The unfortunate story behind Mnet and SM Entertainment

[wrongbyright.livejournal.com]

Last night's MAMA, hosted by Mnet, was certainly a feast for numerous Kpop fans out there. However, as enjoyable as it was, the event was (and still is) swamped with layers of controversy, with SM Entertainment's boycott being the eye of the storm. Mnet and SME appear to be mortal enemies, but many still remember the fact that they used to be very friendly with each other. Exactly what made them become such bitter adversaries? Let's examine the dispute between Mnet and SME.

What exactly is Mnet?

Mnet is a media company owned by CJ Media which focuses on music, media, entertainment and web content business. CJ Media is a part of CJ, a South Korean conglomerate that is one of the top five largest companies in the country. Mnet is involved in pretty much every aspect of the entertainment industry, ranging from album production, distribution, sales, management, television broadcasting, online media and many other businesses. With these expansion, Mnet has become a giant in music industry, with market share of 44% in album sales and over 20% in online music sales.

Mnet and CJ are also shareholders in major entertainment companies DSP Entertainment and YG Entertainment. Although they own no more than 20% of shares from each company, the fact that CJ is a conglomerate means the aforementioned companies are now affiliates of CJ. Smaller entertainment companies with famous names such as Shinwha, Kim Dong Ryul and Wheesung are "affiliates" of CJ as well. Similarly, 30% of JYP Entertainment is held by SK, another conglomerate that is one of top 5 largest companies in Korea, making JYP a faction with as much support as Mnet has.

How has SME and Mnet's relationship developed over the years?

Before 2008, SME and Mnet were quite friendly. MKMF, now known as MAMA, featured numerous artists from SME which were given many awards. However, during 2008, Mnet proposed to SME that they would like to be the distributor of music produced by SME; in return, Mnet would receive certain percentage of profit from the sales. Mnet had already been distributing music of JYP, DSP and YG, and with the right to distribute SME's music they would become undisputed leader in the industry. SME refused the offer as they had the ability to distribute their own music and did not feel the need to pay Mnet for a job that they could do themselves. Mnet undoubtedly held a grudge against SME for obstructing their dominance of the industry, and the friendship ended there.

CJ has also attempted hostile takeover of SME but failed. If they had been successful, CJ would have acquired control of Korean entertainment industry. These facts have not been well-publicized, until recent controversy involving SME and MAMA have brought the public's attention to the relationship between the two parties. With SNSD's Gee and MAMA, we have now witnessed the nature of their relationship.

How does MAMA play into this tense relationship between SME and Mnet?

One of the biggest controversies brought on by MAMA was the fact that the three members of TVXQ, Jaejoong, Yoochun and Junsu, made their appearance for acceptance of Best Representative of Asia Award. Although some may argue that SME's outrage was uncalled for, and that the trio is free to do whatever they want, the choice to make an appearance at an Mnet event was deliberate and could not have been a spontaneous, wanton decision.

So what's the significance behind TVXQ's appearance?

Many have suspected that the three members were able to act in such bold manner against SME in recent months because they were being supported by an organization more powerful than SME. With their unabashed appearance at MAMA, it now appears that Mnet and CJ might be the ones that have the three members' back. It is very possible that CJ and Mnet are backing the three members in order to win their fight against SME for dominance in the industry. If that is so, then TVXQ members have become mere pawns in a battle between two corporations.

SME, a company now known for its oppressive, big-corporate attitude towards its artists, is ironically under attack from one of the largest corporations in Korea. Both companies are profit-motivated organizations that are pursuing whatever action that generates more profit, so there is no good or bad in a situation like this. What is unfortunate, however, is that the artists have become the victims in this corporate power struggle. TVXQ, SNSD, and SHINee are all victims in this dispute between SME and CJ/Mnet; MAMA could merely have been the beginning of penance for these artists.

source: allkpop

This is actually a pretty good article.

Comments

[aikyo16.livejournal.com]

hmm insightful.

[caro1az.livejournal.com]

Ohno finds this intriguing...

Haha.

[xcherryblossomx.livejournal.com]

Glad someone is backing up TVXQ because I doubt that they can keep working with SME after all of this

[freed-misery.livejournal.com]

Me too, I guess an upside is that transferring to another company may not be as hard as I at least, previously thought, not that'd it'd be easy.

Also, icon <3 T__T

[ellystage.livejournal.com]

Both companies are profit-motivated organizations that are pursuing whatever action that generates more profit, so there is no good or bad in a situation like this. What is unfortunate, however, is that the artists have become the victims in this corporate power struggle.

THIS.

It just makes me more sad that all the artists are in the crossfire of this shit.

[onerainysunday.livejournal.com]

"CJ has also attempted hostile takeover of SME but failed."

well damn.

[chromakey-dream.livejournal.com]

LOL at this I imagined like some guerrilla attack...

[pottertastic.livejournal.com]

lol i want to be like "so MNET is the villain and SME is the hero" but i realize they're both villains. it's sad that this is all about power and greed but not a surprise. tbh some of them shouldn't have won...i'm looking at you Kara.

[lotsoflov-e.livejournal.com]

the honey dance is extremely cool you know.

/not

[ricey11.livejournal.com]

Just finished reading this, pretty decent article.
Why ALLKPOP can't have regular decent articles like this for all their printed news is beyond me.

[legens-legentis.livejournal.com]

This! I read it and though it was from the Korean Herald or some other more reputable new source. Imagine my surprise when it said Allkpop at the bottom.

[wrongbyright.livejournal.com]

Not anything that hasn't been revealed before, but the writer summed it up without being too biased to anyone.

I'm kind of glad someone's not taking SME's bullying, but it sucks that the artists are the ones really hurt. :| soshi ;___;

[iiluminate.livejournal.com]

actually, they're both bullies fighting for, in a sense, territory.

Mnet actually seems to be the scarier bully in this case.

[https://users.livejournal.com/--slasher/]

IRIIIIIIIIIIS SOMEBODY HELP ME


bangbangbangbang


sorry, mandatory insertion of relevant song.

[super-jennie.livejournal.com]

TVXQ, SNSD, and SHINee are all victims in this dispute between SME and CJ/Mnet

What about SUJU? D:

[malyo.livejournal.com]

The writer must forgot. Either way, all of SM's artists are victims.

[iiluminate.livejournal.com]

Mnet's grip on the entertainment industry is extremely powerful. I mean, JYP and YG kiss Mnet ass all the time, that's pretty obvious.

If they are really pulling the strings behind the DBSK lawsuit, then SM has every reason to fight back as hard as they can.

But this is a pretty far fetched theory to me. If it's true, then the DBSK lawsuit is just going to get uglier and uglier, and the last thing i want is for JaeChunSu to be used by Mnet like that.

[caughtmedead.livejournal.com]

Hope that the theory isn't true too. I don't want them to be sacrificial lambs for this power struggle though it looks like it. ):

[spread.livejournal.com]

/enlighten

Well that pretty much answered all of my questions that I had towards this subject.
Very unfortunate indeed.

[inheritable.livejournal.com]

I wouldn't be surprised if the lawsuit was motivated by this too :/

Oh well, no conspiracy theories today from me. I'm more curious to see what is going to happen soon.

[hoyah.livejournal.com]

lol i thought of you

[chibi-rei.livejournal.com]

Huh interesting stuff. A couple theories in here raise an eyebrow or two, but they're fairly logical I guess.

[tokidokilolita.livejournal.com]

True.
Now I'm just going to hope that JaeChunSu aren't going to be used D:

[shikinluv.livejournal.com]

Now I'm just going to hope that JaeChunSu aren't going to be used D:

I think they already have been. They accepted Mnet's invitation and that made things ten times worse.

[drumstick220.livejournal.com]

I remember reading about how Mnet/CJ media was mostly owned by Japanese CEOs that also have huge profits in Japan. The plan is to do the same in Korea. I think it was written soon after JYP joined. His company had had a strong battle against joining but ended up having to. Anyone else remember this at all?
Looks like SM is going through the same thing and they will have to join or loose grps/money.

[miduhyo.livejournal.com]

mnet has always creeped the hell out of me. when the sm/mnet feud cropped up, i was actually kind of thrilled, because i'm hardcore about sm artists and it meant i wouldn't have to deal with mnet at all. and yeah, i remember the feud starting over distribution; at the time, i was really "team sm" about the whole thing because ia, there's no reason for mnet to get in on something that sme does by themselves -- and it staved off mnet's monopoly on the entire industry, which was a relief. obviously, things are a bit more muddled now, so idk.

bottom line is that i don't feel comfortable for dbsk either way. neither sme nor cj/mnet has their best interests at heart, and that's upsetting.

[honeydice.livejournal.com]

Whatever it is. Mnet's not really interesting anyway, M!Countdown is boring.

[ellystage.livejournal.com]

Mnet is really shitty too (stage wise - crappy sound systems and cameras).

[hoyah.livejournal.com]

aisssh :/ this mess keeps getting more and more complicated

can't say i would be surprised by this, though - i already figured jcs at mama was just another vicious battle between mnet and sme taking place

jay was right..

[sequinstilettos.livejournal.com]

(http://tinypic.com)

the whole of kpop is.

Re: jay was right..

[ellystage.livejournal.com]

HAHA.

THIS.

[glasstonepearls.livejournal.com]

SOMEBODY'S GOTTA TAKE CAREUH MY BABIES.

[freed-misery.livejournal.com]

And here I was thinking up scenarios. Latest one was that Mnet's CEO slept with the wife of SM's CEO. Then SM's CEO got pissed and launched DBSK to seduce Mnet's CEO's mum but JaeChunSu had moral issues while HoMin were happy for a getting-laid chance.

Seriously though, that was a really interesting article, shed some light. Props to the writer.
*thoughtful*

[dream-a-dreamer.livejournal.com]

Lol that would be the biggest scandal to hit K-pop yet

[faithgrowsold.livejournal.com]

mnet/cj's control of the entertainment industry is scary. someone on omona gave me a download of a pdf file of their assets a little while back, and even if it was old, i O.O the entire time. This is the kind of stuff I'm learning about in my Journalism class and it freaks me the hell out ):

but ugh. team sm. way to cockblock them :)

[inheritable.livejournal.com]

I'd love to see these types of files D:

[thewokstar.livejournal.com]

This is hella juicy shit up in here.

[glasstonepearls.livejournal.com]

yea basically.

[akaich0u.livejournal.com]

Ok I just finished watching all the performances and I just gotta say....MNet likes 2NE1 too much. Like, it's not even YG, it's just 2NE1. I really like 2NE1 but I think a 10 minute stage for rookies is a bit ridic and unnecessary. WG only got 6 minutes last year and Hyori and Big Bang COMBINED got 12...and they are both iconic. =\ As iffy as I feel about SM, I have to admit that MNet definitely does have biases.

[stelf.livejournal.com]

...

How did you get that from the article above?