The Shadows Behind K-Pop’s Global Growth — Extremely Low Streaming Earnings for Artists and Allegations of Falsified Accounting by HYBE

As K-Pop dominates global charts, structural issues within the industry are coming to light. Despite high ratings from international music media and strong chart performance, Korean artists receive extremely low actual streaming earnings. By Outlook Respawn, the revenue per play on monthly subscription streaming services in Korea is approximately 7 KRW, which is roughly equivalent to 0.005 dollars. Platforms take 2.5 KRW as service fees, leaving only 4.5 KRW for rights holders. Citing data from South Korea’s Ministry of Culture, Sports and Tourism and industry sources, the report explained that under Korea’s “music transmission fee collection regulations,” platforms retain 35% of streaming earnings while rights holders receive 65%. The problem lies in how that 65% is distributed. Performers (singers, musicians) receive about 6.25%, record producers and distributors get 48.25%, and copyright holders (composers, songwriters) receive merely 10.5%. In other words, singers receive around 0.4 KRW per song, while composers and songwriters receive about 0.7 KRW per song. This represents a dramatic difference compared to international standards. An analysis commissioned by the Korea Music Copyright Association (KOMCA) this year showed that only about 10.5% of streaming earnings in Korea go to copyright holders. In contrast, major developed countries such as the United States, the United Kingdom, and Germany allocate between 12% and 16% to copyright holders. This means Korean copyright holders earn at least 30% to 40% less than international standards. Compounding the issue is the “pro-rata” distribution method. Under this system, the most popular songs take the majority of streaming earnings, leaving mid-tier and emerging musicians with far less. Ultimately, when payment fees, in-app fees, and distribution costs are factored in, the actual earnings that reach artists decrease even further. With K-Pop dominating global streaming, such structural imbalances are raising concerns about the industry’s sustainability. International music copyright organizations and composers consistently argue that Korea’s streaming earnings distribution falls short of international standards. An even more serious issue is the lack of transparency in the management of large entertainment companies. Korean critics have noted that international media have even labeled HYBE, the giant company dominating K-Pop, as the “K-Pop mafia.” by New탐사, allegations of falsified accounting related to Ithaca Holdings, acquired by HYBE’s U.S. subsidiary, are under police investigation. Analysis shows that HYBE assigned an intangible asset value of 1.1 trillion KRW to Ithaca Holdings, whose total assets were only 436 billion KRW. The most problematic aspect is that the most valuable intangible asset of Ithaca Holdings—Taylor Swift’s music copyright—was sold five months before the acquisition. Questions arise about whether the acquisition decision was appropriate given that music copyright had become the core asset. At that time, Ithaca Holdings’ operating profit was merely 218 billion KRW. The fact that Scooter Braun, who played a key role in HYBE’s entry into the U.S. market, was the representative of Ithaca Holdings is also at the center of controversy. Scooter Braun is a person whose reputation was severely damaged due to a copyright dispute with Taylor Swift in 2019. Critics argue that HYBE’s management, which has an identity as artists, could not have been unaware of this fact. An even more serious allegation is reverse viral marketing. There are suspicions that TAG PR, a marketing company acquired by HYBE in September 2024, launched viral campaigns targeting its artists. TAG PR shared offices with HYBE’s U.S. subsidiary, and after Scooter Braun stepped down as an executive, HYBE quickly divested its shares in the company. Reverse viral strategy involves deliberately creating negative rumors or incidents against affiliated artists. Unlike noise marketing used by small entertainment companies to increase visibility, analysts believe that large companies that already largely control the media use this tactic for purposes such as strengthening control or managing artists. Fans and industry insiders note that this method is similar to the one Scooter Braun used when managing Justin Bieber. Currently, HYBE Chairman Bang Si-hyuk has been summoned by the police for five investigations but has not been arrested. These allegations—ranging from falsified accounting to attacking artists and manipulating public opinion—represent a level of corporate crime that is unrelated to other investigations currently underway by the police. These issues reveal how vulnerable the industry’s basic management transparency and artist protection systems are, regardless of K-Pop’s achievements on global charts and in terms of musical quality. The fact that K-Pop, highly regarded internationally, faces various problems among its creators and industry structure raises concerns about the sustainability of the K-Pop industry.