Running out of money, many Kpop groups struggle to survive in the competitive industry and end up disbanding

Small and medium-sized companies fell into crisis because of the pandemic. Experts say Kpop is collapsing from the roots.

Some cultural and performing arts sectors have been put on hold because of Covid-19. The impact of the pandemic on the Kpop industry is serious. In particular, small entertainment companies and little-known artists are the biggest victims.

Their situations were already difficult because the fiercely competitive Kpop market became even more precarious after Covid-19 started. When witnessing the crisis of small and medium-sized entertainment companies, an expert told Channel A, “Kpop is collapsing from the roots”.

How do unpopular groups survive? 

In July, the agency MAJOR9 announced the disbandment of girl group Bling Bling, after only about a year and a half since their debut. Other groups namely Lunarsolar, Hot Issue also disbanded in April and May respectively. 

Plenty of Kpop groups ended up disbanding. Most are groups under small or medium companies. They remained completely unknown to the public. Some even had to give up on their dreams of living the celebrity life and go back to being commoners. 

Before the pandemic, one of the most important ways to make money for Kpop groups was to perform at events, especially local festivals. Watching their favorite artists perform live makes fans feel a lot more excited than seeing them through television or social media platforms.

In addition to major music events like KCON or Dream Concert, Kpop groups can perform at local festivals like C-Festival and Gangnam Festival. The appearance of Kpop artists in such events is also important to attract foreign tourists. In particular, the audience to local festivals often gets free admission, so the number of attendees is quite large. This is an effective way for an unpopular group to gain attention.

The 2019 K-Pop Artist Festival in Seoul Land was free to enter. The lineup for the event included many groups from small and medium-sized companies such as Hotshot, TRCNG and JBJ95. Similarly, the 2019 Kpop Together Festival held in Lewisville, Texas had the participation of two girl groups, Chic Angel and Weki Meki.

University festivals also feature unpopular groups in the lineups quite often. May is usually the time when Korean students finish midterm exams and prepare for final exams. To help students relieve stress, schools often organize festivals. 

The lineup of performers at festivals of big universities is impressive. Hanyang University’s music festival brought together Psy, Zico, aespa, and Brave Girls.  Similarly, STAYC, a popular 4th gen group from a smaller company, appeared at the festival of Sungkyunkwan University.

The cost of organizing a music festival can exceed 100 million won. In which, more than 30 million won was spent to invite idols to perform. Less popular groups will be paid less. However, according to JoongAng Ilbo, on average, idol groups receive 20 million won for performing at university festivals. This is still the substantial amount of money that helps many groups maintain their activities even when they are not famous.

Small and medium-sized companies in crisis

For music events or concerts, ticket prices have skyrocketed over the past few decades.  These types of performances always bring great profits to the artists.  Currently, the average ticket price of concerts in North America is around 80-90 USD. Moreover, K-pop is gaining global popularity.  Many groups from small companies do not receive much attention in Korea but are very popular in foreign countries. Organizing a world tour becomes even more important for these groups.

KARD had their first tour in May 2017.  They performed overseas even before their official debut in Korea.  All tickets for the tour sold out shortly.  That proves their popularity abroad.  Since then, the group has continuously held music events abroad despite the fact that in Korea, KARD is not known to many audiences.

Dreamcatcher is a case similar to KARD. Dreamcatcher captures the attention of global K-pop fans with its rock music and horror concept. Their international fan base has grown steadily over the years. They went on three overseas tours before winning their first Korean music show “Show Champion” with the song “Maison.”

However, Dreamcatcher or KARD’s most important source of income had been cut off since the global outbreak of Covid-19.  Most live music events were postponed.  Rookie groups can’t communicate with fans and they struggle to promote themselves.  When music events and festivals were canceled one after another, small and medium-sized companies stood at a crossroads, Channel A reports.

Big companies like SM Entertainment, JYP Entertainment, and Big Hit Music can use their own platforms to organize online concerts for artists.  Meanwhile, groups that do not have a large enough foreign fan base cannot hold online music events.

In that case, the group’s disbandment or the company’s bankruptcy is unavoidable. DR Music CEO Yoon Deung Ryong told Channel A: “99% of small businesses like ours are on the verge of going bankrupt. It was extremely difficult for us to keep the company running. We were nearly wiped out.”

Lea (member of the group Black Swan) told Channel A, “The golden age of idol groups is very short and it is passing meaninglessly because of the epidemic. I feel like I’m on the edge of a cliff. I have worked hard for my debut but the virus suddenly broke out. I’m very frustrated because my entire family is in Brazil and I want to send them money.”

A heavy financial blow was dealt to small entertainment businesses. Just the first six months after the epidemic saw the bankruptcy of more than 30 different businesses. Many groups that debuted in 2020 and 2021 have disbanded.

Even potential groups like Hinapia (including 4 former members of Pristin) cannot continue to work together.  The group debuted at the end of 2019 with the single “Drip” and received a pretty good response.  OSR Entertainment planned to release the second album for Hinapia in March 2020. But this was the time when Covid-19 had a serious impact in Korea.  The group’s activities thus decreased.  By August 2020, just 9 months after its establishment, Hinapia disbanded.

Other groups managed to hold out during the pandemic period.  The group Bvndit took up to two years to release a new product called Venom.  During the group’s hiatus, member Seungeun appeared on Mnet’s survival show Girls Planet 999.  In the program, she mentioned the pressure and negative impact of Covid-19 on Bvndit.

“The crisis has mainly hit small and medium-sized companies.  The Covid-19 shock never ends.  K-pop is collapsing from the roots,” an expert told Channel A.

At the moment, Korea loosens Covid-19-related rules. Festivals and music events are held again. Many artists start to carry out their global tour plans. Although it is still too early to say when the pandemic will stop, the entertainment sector is gradually getting back to business as usual. Small businesses and groups have reason for optimism thanks to the comeback of live events.

Related Articles

Back to top button

Welcome to KBIZoom. Please support our journalism by allowing ads to appear.

With the support of readers like you, KBIZoom can continue to bring you the best in breaking news about K-pop, K-dramas, and worldwide entertainment. You can support us for free by allowing ads to appear.