HYBE’s Next Plan? To “Cut Reliance On BTS” By Pursuing Game Development, According To Korean Industry Insiders
According to recent exclusive coverage by Korean media Hankyung, HYBE is aggressively pushing forward with its plan to spin off its game development business.
South Korean investment banking industry sources have reported, on April 12, 2022, that HYBE has launched a unit—a new corporate—in the United States in an effort to “diversify its portfolio into new sectors including games, the metaverse, and non-fungible tokens.” Going forward, this newly-established corporate, likely to be called “HYBE IM” after the current in-house game-related business team, will handle all game development and publishing.
The company is seeking partnerships with major game developers such as Krafton, Netmarble, and NCSoft. HYBE may consider joint ventures with them in the US. The decision to base its key future businesses in the US indicated HYBE is establishing key strategies for future content businesses in global markets, industry sources said.
— Journalist Jun Ho Cha via Hankyung
Previously, in 2019, HYBE acquired Superb Corporation—a South Korean video game developer behind the rhythm game “Pianista: The Legendary Virtuoso.” Since the acquisition, HYBE has released a number of games including “BTS World” and “Rhythm Hive.” While none has become a “hit game” to the gaming audience, the successful launches of these HYBE-made games marked the humble beginnings of the company’s emergence as a developer-publisher in the gaming industry.
Experts from both business and investment banking backgrounds see the pursuit of “a new business model” as “expected.” From October 2020, ever since being listed on the Korean Stock Exchange, HYBE has been referring to itself as “the world’s best entertainment lifestyle platform company based on music.” And as a “platform operator,” HYBE is pushing beyond the simple “artist management.”
The decision to base its key future businesses in the US indicated HYBE is establishing key strategies for future content businesses in global markets, industry sources said.
— Journalist Jun Ho Cha via Hankyung
Additionally, according to Hankyung and other Korean media, this push—or the launching of HYBE IM as an American corporation—is not only to “go global,” but also to “stop relying on BTS” for revenue.
To HYBE’s total revenue of ₩127 billion KRW (about $103 million USD) in 2021, BIGHIT MUSIC contributed a large chunk of 66% at ₩190 billion KRW (about $155 million USD). Investment banking experts believe HYBE “aims to create sustainable profit sources” that isn’t entirely dependent on BIGHIT MUSIC’s managed artists.
[HYBE] aims to create sustainable profit sources with the establishment of a platform to constantly communicate with fans rather than just developing artists and selling their albums.
— Journalist Jun Ho Cha via Hankyung
While business and investment banking experts are optimistic about HYBE IM, having the potential to “be an incomparable cash cow” especially if the games make full use of the IPs like music and characters belonging to BIGHIT MUSIC artists, Koreans are skeptical about the shift in focus to game development. Some have pointed out the “conflict of interest” in “wanting to be less dependent on the artists” but “needing to make full use of [the artists’] names, characters, and songs to make selling games.”
Meanwhile, HYBE announced “BTS Island: In the SEOM” with its teaser first released at BTS PERMISSION TO DANCE ON STAGE – LAS VEGAS. BTS members had “the chance to work directly” on the game, by “[developing] the characters, [providing] creative input on the story and art, and even [adding] some of their personal tastes to the game’s puzzles.”
What's Happening In Korea
Share This Post
