SEOUL (ANN/THE KOREA HERALD) – K-pop giant Hybe’s multilabel structure faces a critical test as internal conflict brews between its sub-label, Ador, and the parent company.
The discord arose after Ador executives, responsible for managing the popular K-pop girl group NewJeans, began sending complaint emails to Hybe on April 3. These complaints emerged about a week after another Hybe sublabel, Belift Lab, launched a new girl group, Illit.
Shin Dong-hoon, vice president of Ador, has raised concerns over potential conflicts of interest related to Illit’s choreography and concept, which he claims closely resemble those of NewJeans.
In his complaint, Shin demanded that Hybe CEO Park Ji-won and Belift Lab CEO Kim Tae-ho address these allegations, seeking to resolve the tensions within the multilabel system and prevent further issues in the competitive K-pop industry.
Min Hee-jin, CEO of Ador and the producer of NewJeans, joined the fracas by sending an email not only to Park and Hybe Chairman Bang Si-hyuk, but also to Hybe America CEO Scooter Braun on April 16, claiming that Hybe is causing “conflicts of interest between subsidiaries” by whitewashing Illit’s plagiarism of NewJeans.
Industry insiders say the conflict between Ador and Hybe stems from Hybe’s multilabel business format that pushes its sublabels to compete against each other.
“Going back to the debut of NewJeans, the group debuted in July 2022. This came just two months after Source Music, one of Hybe’s sublabels, launched girl group Le Sserafim. This meant that Source Music and Ador, which are both under the same banner, had to compete against each other. This situation seems to have built up into what’s happening today, for Min to think she is not receiving enough support from Hybe,” an industry insider explained.
The escalating conflict between Hybe and its sub-label Ador burst into the public eye when Hybe initiated an audit of Ador on Monday, alleging that Min, the CEO of Ador, had attempted to take over the sublabel. The parent company stated that Min would be suspended and ultimately dismissed from her position.
Min strongly refuted these claims, asserting that Hybe’s actions were a retaliatory response to her earlier accusation that Hybe’s K-pop girl group, Illit, was a copycat of Ador’s popular girl group, NewJeans.
In the wake of these allegations, Hybe disclosed that they had discovered a document indicating that an Ador executive had plans to sell the company’s shares to foreign private equity funds. This new revelation has intensified the controversy, prompting fans and industry insiders to scrutinise the evolving power struggle within the K-pop industry.
According to reports, the document is an Ador executive’s memo from three months ago in which the initials of global private equity funds “G” and “P” are written and that Ador planned to attract outside investors.
Hybe suspects “G” to stand for the Government of Singapore Investment Corporation and “P” for Public Investment Fund, Saudi Arabia’s sovereign wealth fund.
The document also included the sentence, “How to make Hybe sell its shares in Ador.”
The Ador executive involved refuted the alleged plan to attract buyers, saying that the document was not a formal document to be shared with other employees but just his personal note.
“What Hybe is calling a ‘document’ is just a memo saved on my laptop. I am deeply sorry to hear that Hybe is exaggerating this note as a document for a huge conspiracy,” the executive told a local media outlet on Tuesday.
Currently, Hybe holds an 80 per cent stake in Ador, while Ador CEO Min and other executives hold the remaining 20 per cent.
The ongoing conflict is seen as illustrating the limits of Hybe’s multilabel system.
“The powerhouse can continue pumping out new releases with artists housed by its sublabels to fill BTS’ void. But when competition is exacerbated, these sub-labels might lose their unique colours and come up with artists that are similar to successful artists from other labels,” said an industry insider.
“Conflict between the parent company and its sub-labels cannot be avoided when one of the sublabels begins to accumulate power with the intellectual property of its hit artist,” commented another industry insider.
Hybe CEO Park said in an email sent to Hybe employees on Tuesday that they will “continue to contemplate what to improve for the development of the multilabel system and what needs to be implemented for the growth and development of NewJeans and Illit.”
