In news that I haven’t seen covered yet but is absolutely relevant to Korean entertainment nonetheless, Samsung launched a new music app called Milk about a week ago, and the company has already had to issue an apology for the brand.
Basically, Samsung has been putting up ads essentially telling consumers in Korea (where piracy is a huge problem, if you didn’t know already) that paying to download music sucks and that even paying to stream music sucks. Then they go the extra mile and say that while using torrents to pirate music for free is a wonderful idea, it too sucks because you waste time searching and all that. So the message is, essentially: “Forget paying money for music and/or supporting artists. Hell, forget even pirating music, because that’s too much work. Use our app instead to screw over everybody in music but us!”
This tone coming from Samsung of all people went over about as well as expected, with musicians pissed off and fans who don’t believe in screwing over the people who actually make music equally upset. Thus, it swiftly led to a Samsung apology, after which they went right back on to shamelessly trying to plug their service. Either way, Samsung already admitted to being in the wrong and quickly copped to going one step too far to shill their crap.
Unfortunately, that still doesn’t really solve the problem of their intent, which unfortunately reflects the attitude of a lot of consumers and those in the industry to begin with. As a standalone, I guess this isn’t terribly significant (company does asshole thing … again), but coming from a company that basically owns Korea, to try and screw over musicians is pretty gross.
At Asian Junkie, we’ve explained the situation in Korea a bunch before, but basically artists don’t make anything from actual music sales.
But music sales in South Korea alone do not recoup that investment. For all their passion, home-grown fans are not paying enough for K-Pop.
The CD industry is stagnant, and digital music sites are seen as vastly underpriced, with some charging just a few cents a song.
Bernie Cho, head of music distribution label DFSB Kollective, says online music sellers have dropped their prices too low in a bid to compete with pirated music sites.
“But how do you slice a fraction of a penny, and give that to the artist? You can’t do it,” he says.
With downward pressure on music prices at home, “many top artists make more money from one week in Japan than they do in one year in Korea”, Mr Cho says.
Company representatives say concerts and advertising bring in far more than music sales. “Overseas markets have been good to us,” says one spokesman. South Korean musicians need to perform on home turf, but “Japan is where all the money is”.
As acts start to make money overseas, he says this “broken business model” – underpricing – is creeping into their activities abroad.
A former policy director at South Korea’s main artists’ union, Moon Jae-gap, believes the industry will go through a major upheaval. “Because at the moment, it’s not sustainable,” he says.
Until that happens, he says, artists will continue to have difficulty making a living.
As KPOPALYPSE explained here, the lack of opportunities to profit from music sales is not as big a problem for idols, who can use their fame/popularity to sell-out concerts all over the globe and/or to endorse product after product until the point of oversaturation. But even after scoring a hit, idols might not get paid much for years since they have to wait for their popularity to take hold to produce revenue because actually selling music doesn’t make them anything (AOA/EXID as recent examples). But forget the idols even, because though most idols are struggling in the current model, a lot of them do at least have monetary upside. However, musicians who rely primarily on music sales are the ones truly getting shafted by all this as it currently stands, not to mention how grim things might look if and when we get to where Samsung wants to take it.
Remember, as of now, it’s a market where artists get like 3-4 cents for every digital download, and that’s actually up a lot from before 2013 due to price increases, and Samsung (with their $327 billion revenue) are now telling people to use their free service (that may or may not have licensing issues anyway) or to torrent music, because paying for products is lame.
If you’re keeping track at home, that means music in Korea used to cost 73 won for a download, but has now risen to 110 won, or less than one-tenth what iTunes costs – and that’s not factoring in the unlimited streaming.
Typically music distributors in Korea keep 40 percent of revenues, although some take as much as 57.5 percent – all much higher than Apple, which keeps just 30 percent of iTunes sales.
This stuff is an issue in America as well (I don’t fuck with streaming services like Spotify anymore), but artists in America are still a LOT better off than they are in Korea.
“Gangnam Style” only earned 3.6 million won in online royalties in Korea, coming from 2.86 million downloads and 27.32 million streams – that works out to an average of about 10.7 won per download and 0.2 won per stream.
However, in the United States, Nam calculated that Psy received the equivalent of 2.8 billion won for 2.9 million downloads.
That’s … not even close.
Anyway, the point is that things are already terrible for most musicians, especially those who rely on music sales, and that’s even more true in Korea where piracy is essentially an acceptable fact of life. But now with Milk, Samsung has decided to pile on by sending the message that the literal cents musicians get is far too much. The fact that they then ran ads which were literally laughing at the situation is just insult to injury for most.
Dunno about you, but knowing about all that shadiness totally makes me wanna use the app.