Attempts to poach popular K-pop artists nothing new

Fifty Fifty (Attrakt)

Allegations and controversy surrounding Fifty Fifty continue, but the group is not the first K-pop group to face suspicions over a potential buyout after rising to stardom in the competitive music industry.

“Poaching members of a group or attempts to breach their exclusive contracts have been ongoing in the entertainment industry for a long time. These practices have impeded normal business activities, resulting in irreversible consequences for both the company and its artists,” said the Korea Entertainment Producer's Association in a press statement on Wednesday.

Most recently, there was EXO’s Baekhyun, Xiumin and Chen’s dispute with SM Entertainment over attempts to make double contracts with another agency.

As these three members notified their agency that they were terminating their exclusive contracts due to payment transparency issues, SM claimed there were “outside forces” enticing them to join another label.

Years ago, there was also boy group B.A.P, which made its debut back in 2012.

This group was extremely popular not only in Korea but also in Europe during the first three years following its debut.

They won various awards around the world, such as the Best Korean Act Award at the MTV Europe Music Awards in 2013 and 2014, and Germany’s Remarkable Award in 2012. Their performance at the K-pop World Festival in 2012 even featured on the Grammy page for the “Best of 2012.”

However, the group abruptly ceased its activities in November 2014 when it filed a lawsuit against its label, TS Entertainment, to nullify its exclusive contract, claiming unfair profit distribution.

“But the label had provided them with documentation for its payments to the group, to which the parents of the group’s members admitted there was no problem, so there were rumors at that time that a third party had approached one of the members to propose a buyout of 10 billion won ($7.67 million),” said an industry insider, requesting anonymity.

The difference between these previous cases and Fifty Fifty's is that Fifty Fifty is a group with a career of less than a year.

They only have one hit song, “Cupid,” which charted on the Billboard Hot 100 and the Official Singles Chart Top 100. That helped the group set a new record for the longest entry on both charts by a K-pop girl group.

And that’s their sole source of profit so far because they have not yet held any concerts or performances at festivals, nor have they acquired any advertising contracts.

“To understand the K-pop industry, you need to know that there is an investment cost for the label that creates a group because they train candidates before debuting them. It’s different from how a label launches a solo artist or other types of bands since normally for those cases, they look for ready-made, already perfect artists ready to debut and sell music,” said Lee Gyu-tag, a K-pop expert who researches pop music and media studies as an associate professor of cultural studies at George Mason University Korea.

Training K-pop group candidates includes providing them with housing -- as usually they hail from different parts of the country -- and voice, dancing and foreign language lessons, as well as other educational programs such as current events and history-related lectures.

“To reduce payment disputes, it would help to have the label explain thoroughly to its artists how investment costs have been spent, and how profit will be distributed,” Lee added.

Fifty Fifty (Attrakt)

All four members of Fifty Fifty applied for an injunction to suspend their exclusive contract with their agency, Attrakt, on June 19 to the Seoul Central District Court. They claim Attrakt breached the contract by not compensating for their work properly and forcing one member to participate in scheduled activities despite poor health.

Attrakt, on the other hand, is claiming that its subcontracted outsourcing company, the Givers, led by producer Siahn, who took part in producing hit single “Cupid,” approached Warner Music Korea attempting to sell off the girl group, as well as enticing the group to terminate its contract with Attrakt.

The agency also claims that the Givers discretely took over a larger share of the copyright of the song, “Cupid,” by buying the copyright from three Swedish composers who took part in creating the song.

The Korea Entertainment Producer’s Association publicly sided with Attrakt on this issue in its press statement, saying that it “wishes the best for Attrakt, which has created a miracle with Fifty Fifty despite a difficult industrial environment.”

“The poaching of talented artists by impure forces based on the power of capital is an act that breaks the foundation of the growth of producers and artists who have created the basis of K-pop. Labels are no longer superior to artists but rather are partners running towards the same goals. Therefore, we will not sit by, but will instead respond strongly against these acts," said KEPA.

KEPA also addressed the need for the establishment of legal measures related to artist management, the establishment of a Korean popular music council -- similar to the Korean Film Council, a public institution under the Ministry of Culture, Sports and Tourism that supports and promotes the film industry -- and an artist free agent or rent system, to develop the industry in a healthy way.

“An artist rent system would be a good solution. In foreign music markets, small to mid-sized labels survive by discovering talented artists and training them to outsource those artists to big labels. Big labels then distribute these artists and their music to make money, part of which goes to the small and mid-sized labels that have produced these artists. With that money, the small to mid-sized labels again invest in talented artists. If such a system is implemented in Korea, big agencies could 'rent' idol groups from small labels. Such a measure would prevent small labels from seeing economic losses when losing their artists to bigger and powerful agencies,” explained Lee.

It has been over four months since Fifty Fifty shot to fame with “Cupid,” but the group’s legal battle with its agency casts a murky outlook over the group's future.

“The sad thing about Fifty Fifty is that they do not have a fan base yet. People don’t know about the members of the group but only about their songs. Also, because Fifty Fifty already left a bad impression on the public as a group that betrayed a supportive agency, it might be difficult for the group to continue to succeed in the country,” said Lee.

By Hong Yoo(yoohong@heraldcorp.com)