SM Accused of Using Media Play Against HYBE — But Korean Netizens’ Responses Are Surprising

Despite being accused of manipulating public opinion against HYBE through media play, SM Entertainment’s recent report did not receive the expected reaction from K-Netz.

Ten Asia, a K-media platform, released an article on July 23 revealing SM Entertainment’s use of media tactics to discredit HYBE during a management conflict that occurred in 2023.

As reported by the article, SM and members of a viral marketing agency utilized a Telegram chatroom to convene a meeting and strategize on how to generate positive public sentiment amidst their dispute with HYBE over management rights.

In the chatroom, dated February 27, 2023, there were a total of six members, including two employees from SM, a director from HQ named Mr. A, and three representatives from the viral marketing company.

TenAsia allegedly digs out texts between SM’s PR agent requesting news outlet to spread negative press about HYBE while mentioning GFriend, Nu’est, etc.https://t.co/E4fkt0zmEt pic.twitter.com/ztHLyEltBO

— pannchoa (@pannchoa) July 23, 2024

The contract for the facade, worth 1.4 billion KRW ($1M), was announced as a means to promote businesses associated with their transition to “SM 3.0″operations.

Instead of simply using banner advertising, the viral marketing company proposed implementing a media mix strategy by promoting content that supports SM and criticizes HYBE.

In March 1, 2023, discussions between SM and the viral marketing agency began regarding the direct manipulation of public opinion. One of the disclosed plans by SM was to publish an article expressing concerns that if HYBE acquires the label, “SM artists could potentially disappear.”

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“So far, the groups that HYBE has acquired and disappeared are GFriend, NU’EST, and PRISTIN. HYBE is doing public acquisition because they can do whatever they want after gaining control.

However, in the end, we thought that it would be better for the current SM Entertainment management to hold a board of directors meeting than for HYBE to hold a board of directors meeting, so we did not sell stocks to HYBE.”

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When Korean online communities became aware of this information, internet users were surprised. However, instead of criticizing SM, they acknowledged that it was a smart decision not to be acquired by HYBE. Netizens described SM as “not the top choice,”but handing it over to the multi-corporation would be considered “unethical,”especially for the artists under SM.

“But it is true, though.”

“I don’t know which artist is leaving and such, but in a multi-label system, singers can suffer, so the management, employees, and fans are all against it. Even HYBE fans are against it. It’s true that there was public opinion like this.”

“The content is true though. You’d think that they wanted to create negative virality, but you seem to not know what negative virality is. Anyways, isn’t it clear that they just didn’t want to be acquired by HYBE?”

Conversely, fans of HYBE expressed their displeasure with the claim that the “groups HYBE acquired have vanished”.

NUEST — (Photo : Instagram: @nuest_official)

https://n.news.naver.com/article/469/0000798491?sid=103 — (Photo : GFriend (News1))

In May 2019, PRISTIN announced their disbandment, and a year later, in May 2020, HYBE acquired Pledis Entertainment, the agency representing the group.

Offering their perspective, SM Entertainment also clarified:

“This was done for the purpose of conveying the company’s position to shareholders and stakeholders as part of legitimate communication to defend management rights.”