FTC probes big K-pop agencies over 'photo card' selling

Korea’s antitrust agency is probing whether an inclusion of photo cards in music album violates laws or disrupts the market order in an investigation of the SM, YG and JYP entertainment agencies.

Photo cards of BTS members [JOONGANG PHOTO]

K-pop fans have long blamed major entertainment agencies for being overly exploitative in their selling of music albums by randomly splitting each member’s photo cards, a sales gimmick that leads them to buy multiple albums until they find the one featuring their biases.

Korea’s antitrust agency is probing whether the practice violates laws or disrupts the market order in an investigation of the SM, YG and JYP entertainment agencies, which was reported by Korean media outlets on Thursday.

The Fair Trade Commission (FTC) declined to confirm the reports since it withholds any information about ongoing cases.

A media outlet reported that the FTC launched an on-site inspection into YG Entertainment on Wednesday, following inspections at JYP Entertainment on Tuesday and SM Entertainment on Monday.

Photo cards, often included in albums, refer to photos of K-pop stars that have not been released in other media or platforms, and many avid fans collect them in a show of their affection.

But the problem is that the agencies often arrange the merchandise randomly rather than having buyers choose a specific photo card, pushing avid fans to purchase several or even dozens of copies of the same album. For groups with numerous members, such as NCT from SM Entertainment, over 50 types of photo cards are available.

To dispose of the excess merchandise, fans often sell it on online marketplaces.

In a separate case, the FTC also probed YG Entertainment and HYBE in July 2023 to verify whether they treated their subcontractors, who produce artists' albums and merchandise, unfairly in business transactions.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]