Like any other able-bodied man in Korea, members of K-pop boy group BTS are forced to serve 18 months in the military, and the one-and-a-half-year hiatus doesn’t bode well for their agency, HYBE.
At the heart of every business in the K-pop industry are the artists themselves, so whenever an artist’s career comes to a halt, their agencies are bound to take a hit.
Community fan services have emerged as a possible solution to such a problem, and entertainment companies are jumping on the bandwagon to establish their own services.
These fan community services are basically a special form of social media for fans of a certain band or artist that allows e-commerce. Even when artists stop performing, agencies may attempt to fill the void by providing fans with artist-related content or goods through these services.
For example, BTS’s J-Hope uploaded a message to HYBE’s fan community service, Weverse, on March 30, a week after testing positive for Covid-19. The post, which read “Feeling better, after lots of rest and sleep during self-quarantine”, immediately received more than 20,000 comments from fans around the world. Weverse automatically translates artist posts for non-Korean speaking fans.
Right below J-Hope’s post was a banner ad promoting a proofreading service for BTS concerts in 2017. Clicking the banner takes the user to the App Store page. to download the Weverse Shop app. The Weverse Shop e-commerce site offers fans a range of products such as a set of BTS sheet music for 20,000 won ($16), a set of BTS-themed purple nails for 16,800 won, and a nail box. butter cookies inspired by the group’s megahit “Butter” (2021) for 20,000 won.
HYBE owns 51% of Weverse Company, which operates Weverse and Weverse Shop, and Naver owns the remaining 49%.
A total of 41 groups and solo groups at HYBE and YG Entertainment are currently active on Weverse. As of Wednesday, BTS alone had over 14.9 million subscribers.
Social media such as Twitter and YouTube have contributed immensely to the rise of K-pop in the global market, and vice versa – K-pop artists have produced content more frequently than any other artist in the world, and all the hits, likes and comments from fans around the world have all translated into profits for social media platforms and artist agencies.
Today, entertainment agencies are trying to create their own channels.
The three main fan community services – Weverse, DearU bubble and Universe – all operate on different business models.
Weverse Company has separated its communication and e-commerce features into Weverse Store and Weverse Shop.
Meanwhile, SM’s DearU bubble chat service takes advantage of the communication itself. Fans can pay a monthly fee of 4,500 won per artist to receive messages from the artist in a private chat room.
Universe, developed by NCSoft, offers game features and exclusive content for fans with a monthly subscription of 3,500 won.
Of the three players, Weverse is ahead of the game as it has both the biggest boy and girl band: BTS and Blackpink. Global pop stars such as Justin Bieber and Ariana Grande are also expected to join the platform following the takeover of Ithaca Holdings by HYBE.
The number of Weverse subscribers topped 38 million at the end of last year, more than double the 18 million the previous year.
Sales have also increased twenty-fold over the past three years to reach 259 billion won last year.
“There has been an increase in subscribers and many products have recently been released as artists return to in-person concerts, leading to more people shopping on Weverse,” HYBE said.
HYBE sent its first annual letter to its shareholders on March 16, promising to upgrade its Weverse platform and “strengthen fan engagement in games, storytelling and the non-fungible token.” [NFT] companies.”
The company plans to integrate its Weverse with Naver’s V Live streaming service app to reveal the new version of Weverse – the Weverse 2.0 – later this year.
The DearU bubble chat room service is operated by DearU, the software subsidiary of SM Entertainment. SM Entertainment holds the largest stake with 33.66% of the company, and JYP Entertainment comes second with 19.5% of the stake.
There were 296 group or solo artists on the DearU bubble in March, and more than 1.2 million fans subscribed to the service in the fourth quarter of last year.
DearU, which debuted on the Kosdaq last November, marked a turnaround last year with annual revenue of 40 billion won and operating profit of 13.2 billion won.
When a new subscriber signs up for the service, the DearU bubble automatically starts counting subscription days and even celebrates users’ milestones for the duration of their subscription. The character limit for writing replies is extended for each step the user completes, meaning the longer you subscribe, the longer your message to an artist can be.
The service has seen a surge in overseas subscriptions, especially after the arrival of JYP’s Japanese girl group NiziU last June. Foreign subscribers made up 71% of the total in August, up 21 percentage points from 2020, according to a report by Hi Investment & Securities.
Game publisher NCSoft’s universe falls somewhere between the Weverse bubble and DearU in terms of business model, but with additional game features. The Universe app was downloaded around 21 million times at the end of last year, with 3.3 million monthly active users on average.
Fans can collect points on the app, to be used for in-app services, and also decorate the avatar version of their favorite artist. Universe has a weaker artist lineup than its rivals, but NCSoft’s technological capability as a games company is seen as its strength.
Weverse seems to be the favorite so far, but SM Entertainment remains a strong contender.
Album sales are still one of the biggest profit drivers in the K-pop scene. However, more and more fans are concerned about the environmental impact of buying CDs that they won’t actually use.
Experts predict that fan community services could provide an alternative to CDs in the future, with NFTs or virtual goods.
“Fans engage in various activities such as posting content, attending events, collecting goods, hanging out with other fans, and sharing fan-made content on community platforms,” said said Lee Ki-hoon, researcher at Hana Financial Investment.
These companies will have even greater growth potential, according to Lee, “when fan community services integrate metaverse technology.”
BY JEON YOUNG-SUN, KIM YEON-JOO [[email protected]]