Idol Stars Have Changed the Entertainment Industry
SM’s 22.7 Billion Won in Profits Due to Power of SNSD

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Idol stars are active in all areas, such as TV, movie screens, and musicals, and there has been a lot of interest in the stars’ management companies lately.

The companies that represent Korea’s entertainment world is SM Entertainment run by Lee Sooman, YG Entertainment centered around Yang Hyunsuk, and JYP Entertainment led by Park Jinyoung. These three companies are known as the “Big 3” in the entertainment world for producing top singers.

The largest stockholder of these is Lee Sooman.
SM Entertainment (or just SM for short) was the first company to start the star management system in Korea, and calling themselves “SM Entertainment – Star Agency”, they are known as the “eldest hyung” [or senior] of all star agencies.

In the mid-1990’s, SM put out an idol group called H.O.T. out on the market, and succeeded in capturing a lot of attention from the public. If they were different than the singers before them, it was that they were “created” under the thorough training system by their company.

Like the ‘eldest brother’ that they are, it’s not enough to say that all of SM’s idol stars are glamorous. Nowadays, SNSD, Suju, DBSK, Shinee, and other idol stars are at their peak and are all under the name of SM Entertainment. Even BoA, “Asia’s star”, who is a top celebrity in both Korea and Japan is a part of SMe.


On May 13th, SM officially announced that for the first quarter of this year, they made 22.7 billion won (+$18.1 million USD) in sales and 10.4 billion won (~$8.29 million USD)in business profits. That means that from the same time last year, their sales went up 58% and their business profits increased a whopping 471%.

Last year, SM set a record with 9.3 billion won in business profits. (~$7.4 million USD). However, the profits from the first quarter of this year alone made is MUCH higher than what they made all of last year.

A stock analyst made a positive assessment on this. Stock researcher Kim Changwon said, “SM’s first quarter record is just for that quarter of the year, not the whole year. It’s a perfect and surprising earning.

He also continued, “During the second quarter of the year, Super Junior and f(x) were active. During the 3rd quarter, SNSD will have their Japan activities and Boa will be coming out with her 10th year anniversary album. So their result will improve and be even greater.”

The assessment made that SM’s “success” is because of SNSD is very dominant. Many experts say that SM’s “SNSD-daebak” has almost launched a new market on its own.

Entertainment companies usually rely on their “army of oppas” on their buying power. However, after SNSD entered the market, they are now able to sell with buying power from the “army of samchons” and “army of dads”.

One person working in the music business says, “Unlike teenager fans, the dad and samchon fans’ buying powers are very strong. Although they branched out into a new market, it looks very promising.”

The “Power of SNSD” is even reflected in SM’s stock values. When SNSD debuted in August 2007, SM’s stocks were worth around 3000won (~$2~$3 USD) and because of a crisis, it plunged to 865won (~$0.69 USD) on October 27th, 2008.

However, after “Tell Me Your Wish” and “Gee” made big hits, SM’s stocks also started soaring. Currently, as of May 28th, SM’s stocks are worth 10,800won (~$8.63 USD). SM has succeeded in raising their stocks to about 10 times as much as its lowest record.

In relation, Shinyoung Stock Company has recently stated that the digital music market will lead SM’s future development. Last year, they allowed their music to be streamed through Apple iphone’s music streaming application. Through this, the music consumption system is expected to drastically change from being able to “save” music to being able to “access” music because the demand for the digital music market is to expand a great deal.


*Parts unrelated to SNSD or SM has been omitted


Source: Economy Korea