SM Entertainment in a crisis? A never-ending stream of bad news
For some reasons, SM Entertainment seems to be buried in bad luck after beginning to implement its new business vision.
Recently, SM has been under continuous criticism due to issues with its artists.
On May 10th, SM announced that Lucas, a WayV and NCT member who had suspended activities due to a private life controversy, will be leaving both groups to pursue a solo career.
Previously in 2021, netizen A, who claimed to be Lucas’s ex-girlfriend, appeared. At the time, Ms. A accused Lucas of two-timing her and severely gaslighting during their relationship. She even released voice recordings and photos, allegedly sent to her by Lucas, as evidence.
Afterwards, Lucas published a lengthy apology and ceased all activities. About two years have passed since then, and he has announced plans for solo activities, but the public’s response is critical. Most of the responses are skeptical, with netizens leaving comments such as “Is there a chance his solo activities will go well?”, “SM really has no eye for people”, and “Isn’t he trying to go to China for solo activities?”
Meanwhile, girl group Red Velvet, who are in the midst of a global tour with 13 performances in 10 cities, had to indefinitely postpone their schedule due to sudden health issues of the members.
In particular, Wendy was diagnosed with COVID-19 right before Red Velvet’s performance in Thailand, while Joy previously halted activities due to poor health.
As a result, on May 11th, SM stated through its official Thai account that Red Velvet’s concert in Bangkok has been indefinitely postponed, as quarantine is necessary according to the Korean government’s COVID-19 prevention measures, and additional testing is needed for artists and all other related parties.”
On the other hand, boy group EXO, who have plans for a full group comeback in 2023, faced a hitch with Kai’s sudden military enlistment. The members who had been discharged were preparing for a full group comeback, but with Kai’s enlistment, this has now been pushed to 2025.
Regarding this, SM stated on May 3rd that they did not anticipate Kai’s enlistment, saying, “Kai was preparing for EXO’s scheduled comeback this year, but due to a recent change in the Military Manpower Administration regulations, he was enlisted into the military training center on May 11th to receive basic military training and will serve as a social service agent.”
However, the military responded that there were no changes in the Military Manpower Administration regulations related to Kai’s enlistment, so SM’s announcement drew criticism.
As a result, many people started to condemn the company for not properly managing the military enlistment schedule of the members ahead of EXO’s full group activities. Kai eventually enlisted on May 11th, and is scheduled to be discharged on February 10, 2025.
On top of all these, SM Entertainment has been constantly criticized since the beginning of 2023. The dispute began with a conflict over management rights with founder Lee Soo-man.
In January, former SM Entertainment CEO Lee Sung Soo announced an agreement to improve the governance structure, moving away from the previous single overall producer system. With this, he stated that new shares and convertible bonds would be issued to Kakao through a third-party allotment paid-in increase. Here, HYBE acquired 14.8% of SM Entertainment’s shares that were owned by Lee Soo Man, forming a “confrontation” between SM Entertainment’s management team and Kakao, versus Lee Soo Man and HYBE.
In the end, the dispute was resolved as Kakao, which had teamed up with the management team of SM Entertainment, secured about 39% of the shares. However, waves were made as Lee Soo Man and SM Entertainment continuously released statements and recordings against each other.