K-pop's biggest agencies see rise in profits despite pandemic
Despite the coronavirus pandemic, the “big four” K-pop entertainment companies mostly saw a rise in profits in 2020 according to each company’s operating reports released this month.
While concerts and ticket sales dropped due to Covid-19, a rise in album and online content sales increased the firms’ overall profits.
Big Hit Entertainment, the firm behind K-pop phenomenon BTS, was especially successful last year. Its sales increased by 35.6 percent from 587.22 billion won ($517.82 million) in 2019 to 796.28 billion won in 2020. Profits rose by 47% from 98.74 billion won to 145.51 billion won. Big Hit also made its stock market debut last October.
“Concert sales [in 2020] decreased by 98 percent compared to the previous year, but was replaced with online concerts which increased sales by 71 percent,” said Big Hit Entertainment. Profits from other endeavors, such as the agency’s online fan community platform Weverse and various licensing deals, also rose by 54 percent.
Big Hit’s decision to acquire other entertainment companies such as Pledis Entertainment and Source Music had a positive effect as well, with album sales surging by 196 percent.
YG Entertainment, which manages K-pop powerhouses including girl group Blackpink, also saw a surplus: its sales went from 253.507 billion won in 2019 to 255.26 billion won in 2020, and its profit from 5.35 billion won to 10.74 billion won.
For JYP Entertainment, behind groups Twice, ITZY and Stray Kids, sales slightly dropped last year — from 155.43 billion won to 144.39 billion won — but profits rose from 43.45 billion won to 44.13 billion won thanks to album sales and royalty payments.
Both YG and JYP’s income from concerts decreased by 90 percent due to Covid-19, but profit from music and album sales made up for the loss. YG’s album sales increased by 12.8 percent — largely thanks to girl group Blackpink having a record-breaking 2020 — and JYP’s by 31 percent.
SM Entertainment was an exception among the "big four." Both SM’s sales and profits decreased: Its sales by 11.8 percent from 657.82 billion won to 579.87 billion won and profits by 83.9 percent from 40.39 billion won to 6.49 billion won. Although it was not a deficit, it was the sharpest decline among Korea’s major entertainment agencies.
SM explained that “the lack of offline concerts in Korea and abroad due to Covid-19 was an unfriendly business environment.”
On the bright side, SM’s album and music sales increased by 53 percent largely thanks to its boy band NCT.However, its new girl group aespa being met with lukewarm success, and its top stars U-Know Yunho of TVXQ and Irene of Red Velvet becoming embroiled in scandals may indicate a rocky road ahead for the company.
BY HALEY YANG [email@example.com]