K-pop concerts’ return boosts SM profits by 70%
K-pop powerhouse SM Entertainment has seen its profits soar 70% thanks to the return of concerts and live events, as controversy grows over its “hostile takeover” by rival HYBE.
Bloomberg reports that Seoul-based SM posted an operating profit of 25.2 billion won (€18.3 million) in Q4 2022, with sales rising 18.2% to 256.4bn won. Its number of concerts in the three-month period was up 35 times on the same quarter in the Covid-hit 2021.
SM, which is home to acts such as BoA, TVXQ, Girls Generation, Shinee, EXO and Super Junior, says it expects profits from concerts and music operations will continue to grow in the first half of 2023, with boy band NCT Dream and pop duo TVXQ! holding more than 50 concerts.
NCT Dream recently completed a Japanese tour, including their first dome shows at Kyocera Dome Osaka, which pulled in 120,000 people over three days. The final show was transmitted through WOWOW, Japan’s largest satellite channel broadcaster, as well as live viewing, which broadcasts live performances at 140 movie theatres nationwide, and was also broadcast live on the global platform Beyond LIVE.
The band will tour Asia, Europe and the Americas from March, while girl group Aespa are also planning another 10 concerts in Japan in the first six months of the year.
“As soon as SM’s new vision ‘SM 3.0’ was announced, the largest shareholder sold his stake, and a hostile takeover attempt by a competitor started”
Earlier this month, HYBE became the largest shareholder in SM Entertainment with the purchase of KRW 422.8 billion shares — a 14.8% stake.
The move was led by HYBE’s global team and involved acquiring former chief producer Lee Soo-Man’s shares in SM days after the announcement of the SM 3.0 business strategy and development plan.
HYBE, which has pledged in a separate notice to buy another 25% stake, is home to acts including BTS, Tomorrow X Together, NewJeans, LE SSERAFIM and Seventeen through its subsidiary labels, such as Big Hit Music, Pledis Entertainment, Source Music and ADOR.
However, over the weekend, SM Entertainment CFO Cheol Hyuk Jang released a video denouncing HYBE’s “hostile takeover”.
“As soon as SM’s new vision ‘SM 3.0’ was announced, the largest shareholder sold his stake, and a hostile takeover attempt by a competitor started,” he says, as per Koreaboo. “This is an attempt that ignores not only the fierce deliberation and efforts of the 600 SM employees who have dreamed of becoming the No.1 entertainment company in the world, but also the values and pride of SM that it has pursued together with the fans and artists.”
“HYBE is raising not only its own concert ticket prices but also those of the labels it has acquired, which illustrates the impact monopoly will have on the industry”
Jang also raised competition concerns over the acquisition, adding that it will lead to higher ticket prices for concerts.
“If HYBE takes the majority of the market share by acquiring SM’s managerial rights, K-pop would lose opportunities for a greater advancement forward,” he said. “Ultimately, K-pop fans will be the ones that will be most affected by the monopoly.
“SM puts reasonable prices to concert tickets to allow broader scope of fans to enjoy cultural performances. Meanwhile, HYBE has taken advantage of its position in the K-pop market to almost double the concert ticket prices as reported in the news several times recently. HYBE is raising not only its own concert ticket prices but also those of the labels it has acquired, which illustrates the impact monopoly will have on the industry.
“The consolidation of SM and HYBE will accelerate ticket price increase, adding burden to fans who love and support K-pop and K-pop artists. The concert ticket price hike is just one example. The monopoly created as a result of HYBE’s hostile acquisition of SM will cause more diverse and direct problems, including decreased diversity of artists, music and concerts.”
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1.5m K-pop fans attempt to buy NCT Dream tickets
A reported 1.5 million people tried to buy tickets for an upcoming show by South Korean boy band NCT Dream.
The seven-piece group will perform their first solo concerts in almost three years, The Dream Show 2: In a Dream, at the 20,000-cap Gocheok Sky Dome in Seoul from 29-31 July.
According to Allkpop, Korean ticketing platform Yes24 crashed during the presale due to the overwhelming demand. One fan uploaded a screenshot of the her position on the waiting list, which showed 600,544 other people ahead of her in the online queue.
NCT Dream’s only previous concert featuring their full line-up was held in 2019
The 31 July concert will be livestreamed on streaming platform Beyond LIVE.
The Dream Show, NCT Dream’s only previous concert featuring their full line-up, was held in 2019 at Seoul’s Jangchung Arena.
Launched in 2016 by SM Entertainment, NCT Dream are one of four spin-offs of K-pop juggernaut NCT, which consists of 23 members.
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