Star producers make exodus to YG, SM

By Park Jin-hai

Star producers of major TV network and cable channels are rushing to move to local entertainment companies en masse, signaling a big change in the local broadcasting landscape.

Industry insiders say that it may become the third big wave in the TV industry, after the first major exodus following the launches of four new cable networks in 2011 and the exodus to the Chinese market in 2015, which actively sought Korean talent in the wake of hallyu or the Korean wave in the region.

Recently Mystic Entertainment, a talent agency founded by singer-songwriter Yoon Jong-shin, hired TV producer Yeo Woon-hyuk, known for MBC’s popular talk show “The Knee-Drop Guru” and JTBC’s reality show “Knowing Bros.”

YG Entertainment is painting a bigger picture with producers.

Several local media outlets including Hankook Ilbo, reported on the possibility that the entertainment giant is paying keen attention to recruiting new talent, investing some 10 billion won.

Three MBC producers ― Jo Hee-jin, known for “Radio Star” and “Capable People,” Kim Min-jong of “Real Men,” and Jae Young-jae of “Infinite Challenge”― are speculated to leave the broadcasting station to work for YG Entertainment.

This rumor has unofficially spread in the entertainment industry although the directors’ transfer has yet to be made official. Mnet producer Han Dong-cheol who directed the talent show “Produce 101” and another Mnet producer of “The God of Music” have also been said to be on top of the YG’s recruit list.

“The rumor that YG has put aside 10 billion won to bring in some 10 producers has been circulating in the industry,” said a screenwriter.

Entertainment moguls SM and FNC took several steps ahead of others, hiring the producer of the KBS talk show “Hello Counselor” and that of the SBS drama “Secret Garden” respectively, paying great efforts to create their own content beginning in 2015.

Talent agencies ambitious to create content

Talent agencies’ apparent external expansion shows that they will go beyond their limited sales structure of leaning toward star management, and directly create their own content to make more money.

YG’s largest chunk of revenue comes from K-pop boy band BIGBANG, but the star-dependent revenue structure can also mean more risk. Stars sign up with different agencies when their contracts expire or when they are involved in various scandals.

In comparison, the created content becomes the company’s assets. These days, many Korean television formats are exported to overseas markets. Shows like “Running Man,” “I Am a Singer” and “Dad! Where Are We Going?” have raked in tens of billions in sales each from their format exports to China.

Although the Chinese market is currently closed because of the political standoff between Korea and China, other Asian markets, not as voracious as China, have constantly shown an increased demand for K- content.

Industry insiders say talent agencies can gain the upper hand in bargaining with TV broadcasters if they can own their hallyu stars and create content without the help of TV broadcasters.

The game is changing fast and people already say the balance of power is tipping from TV stations toward talent agencies.

The three major TV stations are currently broadcasting such shows on prime time. KBS variety show “Trick & True” is made by FNC, SBS reality show “Flower Crew,” by YG, and MBC drama “Missing 9,” by SM.

“The producers’ exodus may be an indication that the axis of cultural power is moving from TV stations to entertainment companies,” said culture critic Ji Hye-won.

Online content boom helps exodus

The burgeoning online content market, which started to take off last year, has further helped the change.

The existing national TV networks are perceived as an outdated broadcasting form among the young generation and more young viewers tend to actively look for online content through mobile devices, rather than sitting in front of the TV. This behavior has boosted the producers’ levels of expectations that great quality content can sell on whatever platform it is using.

“Although I’ve worked for a TV station, I’ve never worried that my content may not reach viewers because it is not on TV. How many people nowadays would sit and watch their favorite shows on air?” asks a producer, who recently moved to an entertainment company. “I transferred because I wanted to focus on creating content without getting enormous daily stress from casting the star actors.”

Giant talent agencies that continued the bidding to expand their businesses pose a threat to major existing TV stations. If the producers who have created flagship shows on MBC are to leave the TV network, MBC in particular is in the hot seat, weary of the large scale loss of talent.

If more producers move to talent agencies, the broadcasters, which have already suffered from major talent losses in the past, may lower the quality of their own content and give the portion to outside production companies.

“It is true that the major broadcasting companies have had difficulties in creating new content for a while, after star producers Na Young-seok and Shin Won-ho transferred to cable network tvN. People in the industry are anxious over whether the same thing will happen this time again,” said an official of a national TV network.