Episode 45: The Big Three

In this episode, I’m joined by David Turner of the excellent music business newsletter Penny Fractions, which you should definitely be subscribed to if you’re interested in the business of music. (Check out his appearance on Money 4 Nothing discussing the Napster narrative.) We get into some of the differences with American and Korean music industries, the lack of meaningful coverage of K-Pop in English, and (spoiler alert) I make David listen to the most divisive song in K-Pop of 2021 and get his opinion.

One thing I realized listening back is we never quite square the circle of “record label” vs “talent agency” so here’s something to keep in mind as you’re listening. When David talks about the “big 3” of American music, he’s referring to Universal Music Group, Sony Music, and Warner Music Group. These are massive multinational corporations responsible for a big chunk of the entire music industry. These companies all have direct deals with the big streaming services for their catalogs and massive sway within the industry. When I talk about the “big 3” of K-Pop, I’m referring to the big three idol talent agencies: SM Entertainment, YG Entertainment, and JYP Entertainment. Unlike the “big 3” of American music, these three companies are not a cartel or anything close to it. For years it was simply media shorthand for the big players on the K-Pop scene and, in fact, now you’ll find references to the “big 4”, to include HYBE, the company behind BTS. The difference to keep in mind here is that K-Pop is not the entire Korean music industry—not even close. And these talent agencies do not have anywhere near the sway of a Warner or Sony or UMG.

So much of this has been mythologized for fan consumption that it can be difficult to untangle the mythos from the reality.

Take singer-songwriter IU, who in many ways is similar to an artist like Taylor Swift (including aesthetically.) IU is seen by many K-Pop fans as “indie” because she is not from “the big 3” and because, like Taylor, part of her brand is writing her own material. But IU wasn’t scouted busking on street corners. She was a trainee with the massive entertainment company LOEN (now owned by Kakao who, as discussed in the episode, made the power play against Spotify) and had a big, industry-supported debut like any other major label artist. If you take a look at who owns the distribution rights for the most popular songs in Korea, the names you see are not the ones you hear about in the English press.

For example here’s the top five songs on the Gaon digital chart (which is a combination of all digital metrics) for the last week of January (the most recent when I checked it).

1. “Drunken Confession” by Kim Min Seok, part of “Project Reborn” remaking classic songs and distributed by Warner Music.

2. “Merry-Go-Round” by Sokodomo (feat. Zion T. and Wonstein), from the rap competition show Show Me The Money season 10, under Stone Music Entertainment, distributed by Genie Music.

3. “ELEVEN” by IVE, who are from Starship Entertainment and distributed by Kakao.

4. “Love Always Runs Away” by Lim Young-Woon, from the Young Lady and Gentleman drama soundtrack, under K-drama soundtrack company Most Contents, distributed by NHN/BUGS

5. “Limousine” by BEO (feat. MINO), from the rap competition show Show Me The Money season 10, under Stone Music Entertainment, distributed by Genie Music.

Kakao (a massive internet company), Genie Music (a subsidiary of KT Telecom), Warner (an American major), and NHN/BUGS (a major internet/gaming company).

Keep going down the chart and you’ll also see Dreamus (an electronics company that was transformed into a vehicle for publishing and now distributes SM and JYP), YG Plus (who distributes YG and HYBE), along with Sony and Universal.

Again, K-Pop and “the big 3” are nowhere near the complete picture of the domestic music scene in Korea and—a point I try to hammer home—has more or less decoupled from mainstream music consumption. To the point that the Korean Music Awards (the “KMAs”) announced a “K-Pop” category for the first time this year. Perhaps Korea, like Japan during the height of the AKB48 boom, has finally fatigued of niche, fan-pushed idol music.

For those curious about BigHit’s first major project—the multimedia web novel Syndrome—pretty much all that remains is the OST from G.Soul, which was uploaded by a fan on YouTube.

I’ll also direct curious listeners to my own translations of some recent Japanese articles on the industry: on IP as the next big business in K-Pop and a two part series on the media strategy behind BTS’s rollout and lessons learned.

I’ve said it before and I’ll say it again: almost everything you can find in English today about K-pop (and especially BTS) is complete fantasy.

One last note, I say in the episode “if” BigBang come back… well, between recording and posting the episode, it was confirmed!! BigBang comeback in April!

The songs played are:

1. “Tell Me” (English) by the Wonder Girls (original MV) (JYP Entertainment)

2. “Next Level” by aespa (SM Entertainment)

3. “Get Up” by Baby V.O.X. (DR Entertainment)

4. “Party Rock” by Boys Republic (Universal Music’s attempt at a boy group. I really liked them but they disbanded in 2018)

5. “Tonight” by BigBang (2011, the album cracked the Billboard charts in America) (YG Entertainment)

6. “Gara Gara Go” by BigBang (2009, one of the songs that popped off in Japan for BigBang before they were “discovered” by American pop fans) (YG Entertainment)

7. “KO OK” by MCND (my favorite of the new generation boy groups!) (TOP Media)

8. “No” by CLC (Cube Entertainment)

9. “Ya Ya Ya” by EXO (co-written by Dem Jointz) (SM Entertainment)

10. “Idea” by Taemin (co-written by Ayo the Producer and Keyz, the team behind WAP) (SM Entertainment)

11. “Make You Happy” by NiziU (JYP Entertainment)

12. “skinz” by OnlyOneOf (RSVP/8D Creative)

13. “Sticker” by NCT 127 (SM Entertainment)