HYBE ADOR internal transaction controversy has set the K-pop industry abuzz. Recent reports suggest HYBE might be diverting funds from its subsidiary ADOR to boost revenues of another subsidiary, HYBE IM. This revelation has sparked intense debate among fans and industry insiders alike.
The controversy stems from a significant financial transaction between ADOR and HYBE IM. In the third quarter of 2024, HYBE IM received a staggering ₩4.10 billion KRW from ADOR. This amount is equivalent to 3.7% of ADOR’s total sales last year and 13.3% of HYBE IM’s sales.
Suspicious Gaming Royalties
Both companies claim the transaction relates to gaming royalties. However, this explanation has raised eyebrows in the industry. Typically, when artists appear in games, their labels receive fees for IP usage. In this case, ADOR seems to be paying HYBE IM for gaming services, which is unusual.
The HYBE ADOR internal transaction controversy becomes more intriguing when considering HYBE IM’s financial status. The gaming subsidiary has yet to break even and reported an operating loss of ₩19.7 billion KRW last year. This fact has fueled speculation about HYBE’s motives behind the transaction.
NewJeans Revenue Allocation Concerns
NewJeans, ADOR’s successful girl group, is at the center of this dispute. Last August, HYBE IM updated its game Rhythm Hive to include NewJeans. Logically, ADOR should have received payment for the use of their artists’ IP. Instead, the opposite occurred, raising questions about the fair allocation of NewJeans’ revenue.
Industry Reactions and Implications
Market insiders have flagged the lack of transparency in these internal transactions. There are concerns that if this system continues, it could lead to a decrease in artist compensation. When approached for comment, a HYBE official stated it was “difficult to confirm specific details regarding internal transaction disclosures.”
Final Thoughts: HYBE ADOR Internal Transaction Controversy Continues
The HYBE ADOR internal transaction controversy has left many fans and industry observers questioning HYBE’s financial practices. As the situation unfolds, it remains to be seen how this will impact ADOR, NewJeans, and the broader K-pop industry.
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