The Economics of Banning K-Pop Idols from Dating: A $50 Million Loss

In the K-pop industry, idols are strictly prohibited from dating. The reason behind this rule is economic. At the beginning of 2024, news of TWICE’s Leader Karina having a romantic relationship caused SM Entertainment’s market capitalization to drop by approximately $50 million within 24 hours.

K-pop agencies commercialize idols through a strategy known as “Economy of Affect.” They sell expensive fan-signing tickets to fans and provide “personal” messaging via dedicated apps such as Bubble. Idols are marketed as “virtual partners,” allowing these agencies to monetize fans’ emotional investments.

For this system to function, idols must theoretically be free—meaning they cannot have real-life partners. Fans believe their support creates the idols’ fame and power, while any actual romantic relationship is seen as a violation of this “contract.”

In reality, it is estimated that 70-80% of veteran idols with over 10 years of experience are in semi-public relationships. However, standards for newcomers remain extremely strict. Some fans even send LED trucks to company headquarters demanding apologies from idols for alleged “betrayal.”

As the K-pop industry gains global attention, international pressure regarding idols’ privacy rights is increasing.

JYP Entertainment is now at a point where strategic changes reflecting these trends are necessary. Although groups like STRAYKIZ and TWICE, which have been active for around 10 years, have driven profits, there is a need for the growth of upcoming groups.

STRAYKIZ has sold over 3 million albums and made it into the U.S. album sales TOP 10 for three consecutive years. Their monthly Spotify listener count also shows a steady upward trend. TWICE has scheduled 47 out of 78 world tours as of June this year, with 30 performances in North America expected to boost revenue further.

However, performance from groups that debuted after TWICE in 2015 and STRAYKIZ in 2018 has been weak. The development of younger artists such as NMIXX, KickFlip, and Girlset (in North America) is JYP Entertainment’s top priority until STRAYKIZ takes a break from activities in 2028.