For months, lawmakers in South Korea have been frantically trying to figure out how to fix the forced split of BTS, the most successful cultural export the country has ever had.
Big Hit Music, a division of HYBE, announced on Monday (October 17) that all seven members of BTS will report for their required military service as planned. Given that Jin will be 30 in December, the group will no longer have its original seven-member makeup until 2025.
Depending on their ages, Jin, RM, J-Hope, Suga, Jimin, V, and Jungkook will eventually leave the Seoul-based group HYBE to enlist to military service, providing a new difficulty. Since becoming public on the South Korean Stock Exchange in October 2020, the firm has been attempting to broaden its roster and disprove the claims of financial experts that the company is dependent on its one-hit wonder, BTS, which has achieved six No. 1 songs on the Billboard Hot 100.
With the act’s June statement that it would take an indefinite vacation from group activities to pursue solo projects, HYBE was already under pressure. Political pressure and HYBE’s efforts to get the band out of military duty have failed.
All South Korean males aged 18 to 28 are required to serve in the military for at least 18 months. At the proposal of the culture minister, the South Korean National Assembly enacted the so-called “BTS law” in December 2020, allowing K-pop performers to delay mandatory military service until the age of 30.
The market appears to have already factored in the likelihood that the current lineup of BTS will not be able to remain intact for much longer due to factors such as military duty or the members’ desire to pursue solo ventures.
On Monday, shares of HYBE, a South Korean company, dropped 2.54 percent, ending at 115,000 won ($80.40), while shares of other K-pop businesses remained within 1 percent of their Friday closing prices.
As the popularity of K-pop has increased throughout the world in recent years, the topic of mandatory military service has become a contentious one in South Korea. While many, including some MPs, believe the singers should be excused because of their role in boosting the country’s international profile, others, including the military ministry, disagree.
Many South Koreans see mandatory military service as a way to level the playing field in a country with powerful neighbors like China and Russia and a saber-rattling North Korea. Many famous people have had their careers put on hold or halted altogether because they tried to evade military duty.
After members enlisted in the military, boy bands like 2 PM and Bigbang drastically reduced their public appearances and temporarily stopped performing together.
The group’s eldest member, 29-year-old Jin, has stated that he plans to begin military duty by the end of the year once he has finished recording his solo album, barring any last-minute changes to the country’s mandatory draft legislation. Jungkook is the youngest of the BTS members at 25 years old.
To what extent HYBE has diversified its artist portfolio to offset the possible reduction in profits from a less active BTS is still an open issue. One analyst estimates that 85% of HYBE’s 2020 revenue that was accounted for by BTS decreased to around 60% in 2021 as a result of the company’s acquisition of Scooter Braun’s Ithaca Holdings in April 2021.
“[HYBE] has silenced naysayers by rolling out a deep K-pop artists roster that goes beyond BTS,” says Bernie Cho, owner of Seoul-based DFSB Kollective artists and label services agency. According to HYBE’s 2021 SEC filings, more than half of all K-pop album sales worldwide were made up of albums by three boy bands: Seventeen, TXT, and ENHYPEN, all of which debuted between 2015 and 2020. In addition to their male labelmates, Cho calls the two female bands, Le Sserafim and NewJeans, “some of the best-selling artists of the year.”
The largest securities company in South Korea, NH Investment & Securities, has decreased its target stock price for HYBE by 19% to 250,000 won ($177) due to a “delay in growth even after acquiring Ithaca Holdings.”
BTS is effectively the flagship act for a booming worldwide K-pop business, fueling massive retail and physical CD sales in Korea. According to the Hyundai Research Institute, the worldwide popularity of BTS is responsible for an estimated $3.54 billion in tourism revenue and the export of consumer items, including clothing, cosmetics, and food. Sung-Il-jong, a legislator from the ruling People Power Party in Korea, claims that a song reaching No. 1 on the Billboard charts may have a multiplier impact of an additional $1.38 billion for the South Korean economy.
Income from HYBE America, which houses artist management, and Big Machine Label Group, which handles prominent international performers like Justin Bieber and Ariana Grande, is projected to considerably bolster HYBE’s income statement after 12 full months of operations.
As an additional strategy, the corporation will attempt to replicate BTS’s success with sales and streams from BTS’s individual ventures. In July, singles “MORE” and “Arson” were released from J-debut Hope’s solo album Jack in the Box.
As a group, the members of BTS appear committed to maintaining their identity. With 55,000 in attendance at a free concert on Saturday in Busan, South Korea, Jin hinted at a solo project, while the rest of the group committed to continuing to perform together for the foreseeable future. Jimin has said that the group plans to play for another 30 years, even if it means they are in their 70s.
But it was J-Hope, the group’s first open member, who seemed to hint at impending military duty and a potentially difficult time for the group. The team is “at a point where your trust is essential,” he said.
