JYJ, a trio who split from SM’s quintet, TVXQ, have been shunned by broadcasters under what they claim is pressure by the biggest entertainment firm led by their former agent Lee Soo-man. / Korea Times file
By Kwaak Je-yup
A major public embarrassment threatens SM Entertainment, the leading engine behind K-pop’s growth, over unfair business practices behind the scenes.
On Thursday a source inside the Fair Trade Commission (FTC) leaked information that its investigation team had finished the inquiry into SM’s illegal prevention of its former artists’ activities and was weighing different penalty options, including fines in the hundreds of millions of won.
While the amount is unlikely to do lasting monetary damage to the company, now valued at 746.5 billion won, a public disclosure of unseemly backroom deals could tarnish the glowing reputation it has built over the last decade. The wild, almost unexpected success of concerts abroad this year has catapulted the agency to global stardom. Its stock value has made a fourfold leap in the last year.
The investigation began about six months ago, after a fan filed a complaint against SM Entertainment for preventing former members of SM’s male superstar quintet TVXQ from being on TV or the radio. Even after releasing one of the year’s bestselling albums, new trio JYJ, named after its members Jaejoong, Yoochun and Junsu, received no airplay or a single chance to perform on national television.
“Everybody in the industry has heard the rumor that SM is threatening people so they don’t engage JYJ,” said a music industry veteran, “or SM artists would not be available for their programs or shows.” The source requested anonymity due to the sensitive business relationships at risk.
“We respect the rights of broadcasters. Producers can invite whomever they see fit to their respective shows,” said a spokeswoman for JYJ’s management C-JeS. “But we have experienced cancellations without understandable reasons. We just hope that fans will get a chance to see and hear more of JYJ and their activities.”
She claimed ignorance to any of the FTC’s findings and declined to speculate or elaborate on what they may be, as a separate legal case is ongoing between SM and C-JeS.
In a previous case in February, the Seoul Central District Court found proof of interference and ruled that the No. 1 entertainment agency must pay 20 million won per violation. It was uncovered in court that SM had sent a written request to Warner Music Korea to stop distributing JYJ’s music in October last year. JYJ was formed after yet another previous court ruling in 2009 which annulled the three performers’ contracts with SM Entertainment.
It was announced Friday that Jaejoong appeared on a program on public radio station KBS COOL FM, which marked the first time a music program was allowed to feature one of the JYJ members.