Monday, January 3, 2011

Lies about the contract II

There was a reply on my post that quoted another news article/report floating around the blogs/fansites. I decided to explain that article in detail as well. I've seen this one many times so I think it's a good idea to go over it.

* Original article is in black, my explanation is in blue

Prior to late 2008, DBSK’s contract states that no member will earn any profit off of any album that sells less than 500,000 copies. Despite their success and consumption throughout Asia at the time of release, none of DBSK’s albums have hit that 500,000 mark. Therefore, prior to July of 2008, DBSK members have earned nothing off of sales from their first album in 2004 to their most recent Korean album in 2008, as well as the numerous albums and singles in between

Yes it is true, and this was explained in this post. Unless you sell millions of copies, you just don't make meaningful amount of money from albums sales, and prior to 2008, TVXQ's album sales wasn't that high. Purple Line single sold less than 50K, and T(best selling Japanese album) sold around 160K in Japan. There's not much profit to take from that number, and most of the singles/albums sold probably lost money.

On July 1st, 2008, DBSK’s contract was modified so that each member would receive 1% of profit for every album that sold over 200,000 copies. Anything below that would earn them 0%-0.6%. Despite this modification, however, SM has failed to follow through with this policy, therefore leaving the members with a 0% profit, regardless.

Not true. This is a great example of twisting the info to make the contract look bad. First of all, the contract was modified in Feb of 2009 with the new rates, not on July 1st 2008. The contract states that the new rate was set on the 5th modification, and the court ruling shows that the 5th and final modification to the contract was done on Feb 2009. Why does that article show July 2008? The contract specifies that the new rate was RETROACTIVELY applied from July 1, 2008. Why do you think the retroactive date was set to that date? That was to apply the new rate for the Mirotic album, which sold about 500K. Either TVXQ requested it or SM voluntarily decided to apply the better rate retroactively to reward TVXQ, and either way, it shows that SM is not greedy, and is open to changes.

The article also states that each member receives 1% of PROFIT which is a total LIE. They receive 1% from the SALES. There's a huge difference between profit and sales.

The article also fails to explain why the profit with the new rate wasn't paid, same way the other article I debunked omitted the info. According to the court testimony, SM requested JYJ to come in to the office, so the documents and receipts can be checked and the accounting verified for the 2009 activities. I don't think anyone can blame SM for that request since JYJ sued the company for the distribution of the profit, but JYJ didn't do that yet. JYJ lawyer's excuse was because they didn't want to incur the cost of hiring an accountant (really?), and that's also from the court testimony. Now you know why JYJ didn't get paid for the 2009 activities. Since the new rate amended in 2009 is retroactively applied to the Mirotic album, one can easily see that wasn't accounted for either.

In sum, DBSK members have earned 0% of any revenue earned off of the sale of all of their albums and singles prior to 2008, and SM has therefore kept 95%+ of all DBSK album-generated profit since their debut."

Another Lie. SM didn't keep 95%+. Again, that percentage is from the SALES, so SM still needs to deduct all the costs to related to album sales (manufacture, promote, distribute etc), and it's not cheap. This is also explained in this post.


Because there are so many articles like the one above (and the one in this post), SME is needlessly bashed around by the fans who doesn't have access to the real information.

Why are there so many negative news articles/report towards SM floating around the net? Those articles look like they were written on purpose to make the contract look bad, don't they? I can post about that too, but it's going to be covered in distant future because there are other subjects that are more urgent.

I just realized the article uses DBSK, and I used TVXQ in my explanation...just saying.


  1. hey!!! i already read this blog and thank you again. i just have a quesion though. sorry to bother coz i dont know anyone else who to ask. i heard that all 6 of dbsk's major fanclubs are changing heir stans and dropping homin and are in full support of jyj only. i dont know if its true tho. is it? please do tell. im so worried!!! homin are gonna be so disappointed.

  2. You know, it pains me a great deal to know that people don't want to support Homin but then again, it's not really their fault b/c THEY ARE BEING LIED TO! *sighs* God knows how I love JYJ but...I'm pretty sure all this ordeal is b/c of damn cosmetic argument with SM. They don't want to be with SM anymore, that's fine, hell! they are welcome to make their own company if they want to BUT if it implies ruining Homins career and future, I personally WILL NEVER FORGIVE THEM! I'm not the person to bash others but I will simply ignore them. I really hope that they (JYJ) know what they're doing...and that one day they can reunite with Homin :-)

  3. @cinderellaboy10

    You don't need to worry. I am not aware of 6 major fanclubs. If any fansites/clubs are dropping support for HoMin, then they were biased towards JYJ all along anyways.

    There are many clubs/sites all around Korea. The fansite that's known as the biggest, dnbn, is controlled by administrators who only suppport JYJ, but they claim to support all 5 on the surface to avoid alienating HoMin fans so they can still carry the TVXQ fansite moniker.

    As matter of fact, most TVXQ fans actually prefer those sites/clubs to reveal themselves and drop HoMin and just support JYJ instead of claiming to support all 5.

    I only know of one small club that officially dropped support for HoMin. Every TVXQ/HoMin fans actually cheered that announcement. LOL

    There are new TVXQ fansites popping up, and existing HoMin/TVXQ sites are gearing up for the comeback, so you really don't need to worry because in the end, it's the music and the performance that will matter. Fans will just follow the good music.

  4. @ Jennystar19

    I feel your pain. There are many JYJ supporters who turned their back against them after finding out what really happened. It took them months to let go of JYJ...really sad...

  5. So this is a HoMin biased blog? Because there was an article last year that said JYJ had nothing to do with the cosmetic company.

  6. @bebe2pink

    I know about that article too. It's about the lawsuit in China, correct? Post about that article is coming too. :)

  7. You do know that this is a translation? There are many words that are translated wrongly so unless you can who that the lawer said profit but not sales this is moot point.

    Secondly, I think most agree that SM and JYJ have before renegoiated the terms of the contract.

    Thirdly the modification happened in Feb 2009 isn't that like worse but you say that it was retroactively applied so the basic messige in this report was right.

    about the the court testimony, I need a link (to the website, not copy and paste) to comment as I said in another post here.

    I've already commented on the profit/sales poart and what is wrong with that statement SM kept 95% of SALES (humor me until we find a link)

  8. Thank you so much for taking your time writing and translating from the korean sites for us the international fans. I'm actually a Sone but I have start to know KPOP from these 5 boys. the moment I heard about the lawsuit and all it really break my heart. TVXQ is a great KPOP male group EVER! They are legend. My fave member would be Jaejoong and Changmin but when things got split apart, I don't want to bother anymore. I just don't want to pick side. Seeing when HoMin are coming back right now, things are getting messy again in the fandom made me want to know the whole lawsuit things. Thanks to you, your blog really help me a lot in understanding the situation. It does come to my mind, when JYJ decided to leave and why HoMin decide to stay? There must be something why they decide to stay despite the whole slave contract things... that's how I came across to your blog. The way I see it, it just 2 party that have different point of views. JYJ want to out from SM and HoMin want to stay. the sequences from their action both have pros and cons. For HoMin, they probably still okay with what SM offered them. Just like what SUJU Siwon said on his twitter, they chose this path to be a pop icon and they are not a slave or SM puppet (like some would said). It just sad that the 5 Rising Gods from the East and the fanclub that made to world record ended up like this. It just make me sad... and it happened, after 7 years they together... :(

    -sorry for my long rant. thanks again for your great efforts. >_<

  9. @ Sakura

    I'm not gonna start debating with you through comments. Everything you mentioned will be covered on my future posts. I don't even get what you are saying on some of your comments.

  10. I think that you are twisting words and nitpicking for your advantage in order to play the same game you think JYJ and their Korean biased fan are doing. Some things that you point out are true, I will give you that, but some are up to interpretation at best. That is what I think, and that is why I reply to your post. You are free to disagree with me but so far I haven't seen anything that shows the opposite.

    There are points that I agree with you and I too think it is ridiculous the idea that SME is a true evil like some hardcore fans think. However, I think you are loosing the forest for the trees.

  11. @ Sakura

    Well, this is a personal blog, and I'm presenting my point of view. Whether you agree with me or not is up to you.

    I'm not sure where I intentionally misled anything in my post. If you agree that some of my points are true, then at least you are agreeing that the article above is not 100% true.

    It really doesn't matter what the original article say before translation. International fans mostly depend on the translations like the article above, and if the translation is incorrect, then the fans are misled, period. I don't even know why you are bringing that up.

    Because there so many articles like above that present the lies, many fans think SM is an evil company.

    As for the contract modification, that was not the only time they re-negotiated the contract, that was just the final one. I think you need to read all my posts because it was explained already.

  12. @miraliyana

    Thanks for the kind words. Yes it is tragic that such a promising group is in this kind of situation. They could've been really huge, oh well.

    More posts are coming!!! :)

  13. Did I say I forbade you to post your view? I said "That is what I think, and that is why I reply to your post."

    "I'm not sure where I intentionally misled anything in my post" Noted

    Getting angry over which words are chosen is ridiculous in the international fandom. They are everywhere and rarely intentional. Not to mention often news from Korea are translated to one language like Chinese and from there into English. I recommend you to go to allkpop, omgkpop and all the other big websites and compare the articles there to the original versions. The disparity in translations between different people using the same source is at times tr**ic.

    The point is news are often use the wrong words but the core of the news is true. More curious fans can receive a few translation and from them some fans (at least me) have noticed that anything should be take with reservation. In the same way, some translation make situation seem better while other make it worse.

    However if you want to take apart words in articles, please use the ones from Tohosomnia, if possible. I believe that they are spread the most among fans in this part of this fandom.

    "many fans think SM is an evil company" Majority thinks SM is greedy but not evil. Those who think so are the hardcore fans and now matter what you say to those, they will not change their opinion.

    I knew already that they modified the contract a few times and I don't think you have read my post clearly.

  14. @ Sakura

    I found out why your posts were disappearing. They were marked as Spam LOL. You should stop posting too many comments. :)

    BTW, you cannot say mistranslating profit & sales keeps the core of the article the same. It makes a huge difference enough to change the contract from reasonable to unfair.

    Go around youtube or allkpop. Fans still use that 2% profit thing to bash SM everywhere, and you claim it's nothing? Not everyone can distinguish truth from lies. Even if one knew the translation may be wrong, they still cannot know what the real meaning of the original document is since they don't know Korean. In my opinion, many international fans think SM is evil from the posts I've seen.

    I do agree that I cannot change everyone, and I don't intend to, but I can change people w/o info but willing to listen.

    You quoted my comment, but still haven't answered where I misled with my post.

    I don't even know where your first question is coming from.

  15. @ Sakura

    Ok, I think I know where your first question came from. I was just saying I'm expressing my view regarding this issue in my blog. I didn't take your comment in negative way.

  16. @ Sakura

    Oops, I think I deleted your post asking me about the 62.5%. Anyways, it will be covered too. The article you read is false, and I will explain that too (u see how much false info you have if I can prove that I'm right? <== don't comment, I said if) Let's leave it at that for now.

  17. Thanks for this! I didn't get into K-Pop until right around the time the group disbanded and really had no idea what was going on. At first I sided with JYJ but when they formed their own trio something about them just rubbed me wrong. I'm really into the new stuff from the other two though and was kind of getting sick of seeing fanwars in every video I tried to watch! Your blog really helped clear things up for me! Thanks!

  18. @OP
    Cookie for you to find the problem. :D

    “You quoted my comment, but still haven't answered where I misled with my post.”
    Twist and nitpick is not the same as mislead but near. Why I thought that. Refer back to my original comment.

    “Fans still use that 2% profit thing to bash SM everywhere”
    “hardcore fans think”

    This point has already been addressed by many fans (that don't blindly believe any report) and those that still hammer at that are "hardcore fans" that wont listen to any reason no matter what you post.

  19. @ Sakura

    I've seen many fans who still use that number to criticize the contract.

    You can't blame me for nitpicking since the little things that was wrong with those articles made huge difference, and I don't think I've twisted any information. Show me where I have twisted the truth.

    If you are going to accuse me of something, you better be able to prove it.

  20. Thank you so much for your hard work here! People like you amaze me ^^

    After reading all the contract terms, it really doesn’t seem like the contract terms were unfair at all. In fact they seem to be in favor of TVXQ.

    However, there have been other cases where artists have complained about SM for similar reasons, right? (Like Hankyung, H.O.T). Of course, since I am an International fan who only became a kpop fan (through DBSK) only 2 years ago, I don’t know SM’s history very well and might be very wrong. But from what I understand, SM has quite a bit of history for not being very fair and has faced quite a bit of problems with artists (in similar issues – Financial, rights etc) in the past as well.

    Additionally, all of the members have spent years training together and wouldn’t have thrown away such success they were receiving, the hard work they put in, the comforts they had for no reason what so ever - moreover leaving the 2 members and other friends they made in SM for no reason what so ever. I still feel JYJ must have had valid reasons for leaving all of this regardless of the surprisingly fair sounding contract terms (which I still can’t believe you translated for us. Seriously, thank you! It must have taken SO much of your time!).

    At the same time, HoMin staying questions JYJ’s decision even more. They have their valid reasons for staying (which are now supported by the just sounding contract terms). When someone takes a decision they only take it because they think it is the most correct decision and have very valid points for making such a decision. It’s a whirlwind. In the end, who knows what went down? It’s just somewhat strange that 5 people, living and breathing the same air, take two very differently drastic steps.

    Anyways, THANK YOU! I usually feel so misguided being an international fan with limited Korean knowledge. The other translations have always felt somewhat lacking and very (JYJ) biased whereas you clearly show the difference from the facts and your opinions. And this translation has shown me things I didn’t know at all before. You are truly precious.

    HoMin and JYJ fighting! ^^

  21. @ Priya

    Thanks. Hankyung filed a lawsuit similar to JYJ and won, but Hankyung's contract was different than TVXQ, and their circumstances are different. There was never a lawsuit by HOT. When JTL's contract expired earlier than the other two, they decided to not re-sign with SM while the other two were still signed with SM. Now all the members of HOT claim their breakup happened because of misunderstanding, but who knows exactly what happened.

  22. @Precious
    you said "As matter of fact, most TVXQ fans actually prefer those sites/clubs to reveal themselves and drop HoMin and just support JYJ instead of claiming to support all 5."
    :-) i found it to. I still visiting them but they only put pic and pic of YunMin than the news it self.
    I have to open korean website and translate it with google translator. Ironic.. xD
    but lucky i found many media in korea still respect to YunMin. Thats why that time Im officially open acc for Twitter to spread YunMin News more detail. not only pic pic and pic. they even not discuss about how great YunMin in solo carrier as a model or as an actor that time.

  23. @ dhanirahman52
    Yup those sites are disguised as TVXQ5 sites, but don't even talk about the 2 members and actually are in forefront spreading rumors about HoMin. So international fans who have no idea think that's what's going on in Korea which is not true. Just terrible.

  24. I could say the same about your blog.

    You're an SM supporter disguised as a TVXQ/HoMin site but you don't talk about the 2 members and are actually in the forefront of spreading rumours about JYJ. So international fans who have no idea think that's what's going on in Korea which is not true. Just terrible.

  25. @ Nikki
    Can you specifically point out which part of my post is not true or a rumor?

    HoMin supports SM too. If what I posted are true, then I am not spreading rumors. I'm spreading facts.

  26. @Precious

    You have your facts, I'll give you that. But you're like a defense attorney who only brings up case points which supports his clients. Or a reporter reporting on a murder case where A murders B and leaving out the detail that it was out of self defense. Would you say that reporter did not report the truth then?

    Again, I reiterate my point that I'm not trying to attack you or be rude or anything. But it is in my opinion that you are spreading lopsided facts, not all the facts, as you have us all believe. I guess when I saw your blog title and your reasons for having this blog, I thought you would give a truly objective, unbiased account of the entire lawsuit proceedings.

    I have read JYJ fans' translated court documents and all they've done is translate the documents or gave a timeline with all the details and left it at that. Whereas I can't help but feel that you're trying to push onto us your pro-SM views. Which is again, why I questioned your agenda. Why go through so much trouble to make sure people get the point that SM is good?

  27. @ Nikki
    Because I found out that SM is not bad. What should I have done? Keep insisting SM is bad regardless of what I've found?

    Now you're confusing me. Are you having trouble because of my defense of SM?

    Also, why are you trying so hard to define what this blog is about? All you need to do is read my posts and make a decision yourself. I have provided the facts, and it should be really easy for you to read jyj side of arguments, and decide on your own what the truth is.

    I really don't think I left out the self defense part. You keep making arguments, but you really haven't pointed on anything to back up your arguments. Am I one sided? Maybe. Could it be because this whole thing IS one sided? I have determined it to be, and that's how I'm presenting my case.

    Defense attorneys are hired by their clients, and I'm not. That's the difference.

    Also, as you stated yourself, it is your opinion that I'm spreading lopsided facts, but what am I supposed to do? All the facts I've found are lopsided.

    I'm not even done with my blog. I can do so much all by myself. The lawsuit will be covered in the future as well.

  28. Thank you so much, your blog helped my friends and me so much to better understand what's going on! I disagree with everyone who talked bad about you. :)

  29. @ sidmaron
    Thanks for your support. Glad it helped. :)

  30. pls visit for most detail and exactly news!

  31. [Transcription] 121031 JYJ, TVXQ and Kara mentioned on KBS News:

    Nowadays, there are so many teenagers who want to be an entertainer.

    However, as the popularity of the entertainers increase, so do the conflicts b/w them and their management companies.

    Fair Trade Commission (FTC) recently released new standards of exemplary trade between the entertainers and their management companies.

    The 5 member group Dong Bang Shin Ki that enjoyed the most popularity in its heyday eventually broke up into 2 groups after 3 members had legal disputes about the periods of contract, profit sharing, and etc., so-called “Slave Contract”.

    Kim Jaejoong: "I wish there will be a fair system that allows all entertainers to work under good conditions."

    Similarly, the group Kara went through a breakup crisis, where the root of the controversy was a conflict with their management company surrounding the unilateral contents of their contract.

    So the key point of the new standards of exemplary trade released by the Fair Trade Commission is to eliminate conflicts over unequal profit sharing.

    From this time onward, management companies must make financial records available to any entertainer who demands it within a week and must pay the money an entertainer earned within 45 days.

    Also, the practice of having an entertainer appear in a TV show/movie free of charge or without his or her consent is now banned.

    Regarding teen and female entertainers, a separate policy of human rights protection must be made and shown (to FTC).

    These new standards will also be used as an autonomous guideline for solution of conflict in the event of conflicts between management company and affiliated entertainer.

    Additionally to prevent would-be entertainers from being swindled information of entertainment management companies such as facilities, personnel, financial position and etc. will be made available online.

    Fair Trade Commission stated that from this time forward if management company is caught committing any offense with relation to the standard of exemplary trade, it will be strictly punished applying the Fair Trade Law.

    * Watch video:

    * CREIDT:
    Translated by Sofia (@126x204) and proofread by Nikki (@jae2thejoong) ^-^

  32. Another reason for the return to growth in South Korea is the rise in popularity of the K-pop (Korean pop) genre. In 2009, the latest year for which repertoire-share figures are available, domestic repertoire accounted for 61% of physical recorded-music sales, up from 49% in 2008.

    The K-pop genre, which has its roots in electronic pop, originated in the mid-1990s and was boosted by the creation in 1995 of music company SM Entertainment, which focused on the genre. Several other music companies followed SM Entertainment’s lead, and the genre quickly became mainstream. In the past decade a number of K-pop artists, such as the Wonder Girls and Taeyang, have sold well internationally.

    The rise of the genre has, however, resulted in local criticism that artists and groups are being manufactured and subsequently exploited. Several K-pop artists are reported locally to go through an apprenticeship period at the beginning of their careers as part of long-term contracts signed with talent agencies. Despite subsequent successful K-pop careers, a number of artists and groups have complained that their arrangements with the talent agencies amount to little more than “slave-like contracts.” Earlier this year three members of the girl band Kara announced that they had taken legal action to terminate their contract with South Korean company DSP Entertainment. The three members have claimed that they received little in return for a high level of success in several Asian countries, as well as South Korea.

    Another recent contract dispute involved the five-member group TVXQ and SM Entertainment, which was credited with forming the group in 2003. Three of the five members filed lawsuits claiming that their contract terms, which tied them to SM Entertainment for 13 years, were unfair. Although the dispute has not been resolved, the three formed a separate band called JYJ and released English-language album The Beginning in October 2010. The album, which included the track Ayyy Girl with US artist Kanye West, has sold about 300,000 copies in South Korea.

    At the end of 2009, SM Entertainment was also on the receiving end of a lawsuit from one of the 13 members of the boy band Super Junior, who claimed that the length of his contract (13 years) was excessive. He won the case. Another case brought by a member of the NH Media-controlled boy band U-Kiss resulted in a ruling by the Korean Supreme Court that no contract between an artist and a talent agency could last for longer than 10 years.

    Because of so many complaints, the Korean Fair Trade Commission (FTC) established new guidelines for contracts between entertainers and agencies, reducing the contract period to seven years. So far no talent agency has challenged the FTC guidelines.