mutation or/and plastic surgery.

Secondly, the democratization of Korea caused previous bans and

censorship to be lifted, enabling the consumption of both Japanese and Western music. This led to a
more diverse and creative cultural market and opened foreign markets such as Japan, which was not
possible under former dictatorship. Third, technological advancements with computers, the Internet,
and social media have created a form of virtual cosmopolitanism where people around the world can
enjoy Korean cultural products even without knowing the Korean language. The global K-pop
phenomenon would not have been possible without it. Lastly, the global capitalist economy has
opened up new dominant markets such as China, India, Latin America and South East Asia (Oh
2013).

Since K-pop has been so heavily influenced by Western music, one can ask what the “Korean-
ness” in South Korean music is. The mix of global elements due to K-pop collaboration with foreign
stylists, choreographers and music producers, makes the Korean aspect ambiguous (Rånes 2014).
Furthermore, as Gil-Sung Park argues, K-pop does not simply mimic foreign material but is instead a
product of global collaboration through a division of labor. Korean contemporary music’s global
following is widely credited to the development of social media networks and not solely due to a
pan-Asian cultural hybridity. Without services such as YouTube and Facebook, the global
dissemination of K-pop would not have been possible (Park 2013). This will be discussed more in
detail in this paper.

K-pop today signifies the exportation of music, which is made in Korea for global consumers. It
was necessary for K-pop to globalize because of the small local market and a previously large
problem with illegal downloading in South Korea. It was not until the 21st-century that K-pop gained
global attention. Earlier, Europe and the U.S. (which will further on in this paper be referred to as
West) did not pay any interest to Korean musical talents. The music simply was not Western at all.
Local music, ‘trot’, which is considerably different to today's pop music, dominated Korea (Oh
2013). It is notable that up until 2016, an estimated 80 percent of the songs recorded for the K-pop
market is produced or written by musicians based in either the U.S. or Europe, with a majority of the
Europeans hailing from Scandinavia. Many hit songs from Korea’s most famous artists are either
written or produced by Scandinavians (Blume 2016). Between which exact years this is referring to
is not stated. K-pop has only started to actively outsource foreign talent since 1995 and therefore, it
could be speculated that it is within this time frame (1995-2016) that 80 percent of Korea pop music
is either written or produced by the West.

The ones orchestrating the success of K-pop are the Korean music labels. Unique to the Korean
music industry is how their music labels are different from a traditional Western music label. As will

Johan Williams Jolin The South Korean Music Industry 7

be discussed more specifically later, these labels do not only publish music, they are behind every
aspect of it. They discover, sign and train talents, as well as control the production and publication of
their music. They are today more commonly referred to as agencies or entertainment companies.

The Korean music industry is led by three main large agencies: Star Museum (SM) Entertainment,
Yang Goon (YG) Entertainment, and Jin-Young Park (JYP) Entertainment. SM Entertainment is the
largest and has arguably been the most important label for the development of K-pop (Oh 2013).

According to research conducted by Korea Advanced Institute of Science and Technology

(KAIST) University examining individual companies in 2010, SM Entertainment had an income of
$78.55 million, which was the twentieth largest of all enterprises in the world. However, they had the
highest profit ratio out of all the top twenty countries that year beating Sony-Music, Apple-Music
and Universal Music Group to name a few (Lee 2014).

In order to answer how the Korean music industry reached its level of success, I have gathered my
information from six distinct areas. I have utilized articles written by scholars, analyzed the thoughts
from K-pop enthusiasts on blogs, and collected news surrounding Korean idols from various
Hallyu news outlets as well as from newspapers and magazines. This paper also contains information
from a documentary produced in Sweden, which has been uploaded in three parts to YouTube.
Furthermore, Pelle Lidell, a Swedish A&R (Artist and Repertoire, a person who signs
songwriters/producers and place their songs with labels and artists) who currently works at Ekko
Music, allowed me to conduct an interview with him. He is actively working together with SM
Entertainment. This interview was conducted in Swedish at his office. The style of the interview was
free flowing. However, I did bring up some pre-planned questions, all of which will be listed in the
appendix. All other sources besides the interview and documentary are in either English or Korean.
These six unique sources help to provide a broader perspective as previous articles omit either the
perspective of K-pop fans or the viewpoint of K-pop fieldworkers. This thesis will also be the only
extensive paper I have come across which cover several significant fields, such as a background
of Hallyu and soft power, influence of the legislative instances, exportation and differentiation
methods, as well as revenue collection. Furthermore, this project will give a comprehensive overview
on the prosperity of the Korean music industry and how various strategies have been applied along
with the advancements of media technologies since 2005 to further its evolution.
This thesis is, therefore, structured as follows. Firstly, the paper briefly examines the Korean
wave as well as the notion of soft power, which is the foundation K-pop’s success. Secondly, with

Johan Williams Jolin The South Korean Music Industry 8

the background of Hallyu, section three will examine how popular music in Korea managed to
diffuse around the world due to external factors from outside the industry, such as the government
and the development of media technologies. Section four will delve into how Korean music agencies
operates today and their strategies to reach a global market. The last section will be a conclusion that
will reiterate and summarize all the points made in the paper.

Johan Williams Jolin The South Korean Music Industry 9

2. The Korean Wave

K-pop was not the product that first sparked off the Korean Wave. In fact, its global success can
be attributed in part to earlier South Korean cultural products gaining worldwide recognition and
popularity. Some scholars refer to K-pop as “Shin-Hallyu”, the new Korean wave, or the Korean
Wave 2.0.

The term Hallyu was invented to describe the expanding popularity of South Korean popular
culture in China during the late 1990s by the Chinese press. Scholars like Bok-Rae Kim and Steven
Chen both argue that Korean dramas and movies originally fueled the Korean wave. Kim describes
the Korean wave as a developing phenomenon undergoing three generations, Hallyu 1.0, which
lasted from 1995 to 2005, Hallyu 2.0, from 2006 to recent years and Hallyu 3.0, which is what
Hallyu is transitioning into today (Kim 2015).

In order to help understand how Korean music amassed such a huge following of global
consumers, this section will briefly examine the background of the Korean Wave and how South
Korea’s music played a major role in the evolution of Hallyu.

2.1. Korea as a Soft Power

According to Joseph S. Nye, the power to change another’s behavior to one’s liking can be
exercised in three distinct ways: force, payment or attraction. In particular, the method of attraction is
what Nye refers to as “soft power” (Nye 2006). Soft power examines how a country exercises its
power through the calculated management of its perceived image (Martinroll 2017). Generally, there
are three main resources from which a country can harvest soft power: political values, foreign
policies, as well as culture (Nye 2006). A prime example of this can be seen from the way the U.S.
has created a unique and desirable image for itself through the propagation of Hollywood movies,
stars and even the advertisement of products such as iPhones and Levis jeans. This is the trajectory
that Korea intends to take with Hallyu (Martinroll 2017).

Unlike most developed countries, Korea dedicates a significant amount of its reserves to export
pop culture with the goal to establish itself as a leading global soft power.

In addition to hard power resources, most notably a robust military force, the South Korean

Johan Williams Jolin The South Korean Music Industry 10

government utilizes the soft power strategy to enhance its global standing and visibility. This
strategy was first carried out in response to the economic turmoil that Korea underwent during the
1990s.

Through the exertion of soft power, Korea aimed to progress economically through globalization.
The former South Korean president, Myung-Bak Lee (who served as the Korean president between
2008-2013) employed the catchphrase, “Global Korea” in his political agenda. In addition, he
established the Presidential Council on National Competitiveness, which sought to promote the
Korean brand by enhancing the image and prestige of Korea. This ultimately led to Korean products
and services to be more lucrative and highly valued (Kalinowski & Cho 2012).

2.2. The Rise of Hallyu

In the early 1990s, the Korean government stopped enforcing state-owned media co-operations,
and even encouraged private investments into media, entertainment, and other industries. This gave
rise to new channels being aired. To further fill airtime, broadcasting stations produced a plethora of
low budget dramas, which mainly targeted middle-aged woman. In 1991, the government enforced a
quota on television companies, pressuring them to acquire a certain number of dramas from
independent producers. This implementation help lay the foundation for the Korean Wave (Chen
2015, Negus 2015. Rånes 2014) and provided the precedence for the first stage of Hallyu, which was
the popularization of K-dramas in China (namely, the dramas ‘What is Love About’, 1997 and ‘Stars
in My Heart’, 1999) and Japan (‘Winter Sonata’, 2002 and ‘Dae Jang Geum’, 2003) (Chen 2015).

By the same token, it was during this time that the Korean policymakers and media outlets
realized that their cultural product was not only a financially viable export product but also a means
to control the global image of South Korea. This led to the utilization of soft power. In 1994, the
Presidential Advisory Board of Science and Technology of Korea showed that the box office
earnings of the Jurassic Park movie were equivalent to that of 1.5 million exported Hyundai cars. It
is widely agreed upon that this is the point when the government realized the importance and
influence of the cultural industries. It is also the springboard for a paradigm shift where the
government would lay the foundation for Hallyu (Chen 2015).

However, according to several scholars, the economic crisis faced by South Korea during the mid-
1990s provided the impetus for the rise of Hallyu (Negus 2015). Other than causing a huge blow to
the financial sector of Korea, this crisis led to the retraction of many international investors and

Johan Williams Jolin The South Korean Music Industry 11

stakeholders who were wary of the fluctuating market. It thus came as no surprise that the country
“lost foreign direct investments, lacked tourism and faced global skepticism (Martinroll 2017).” As a
response to the crisis, the South Korean government decided to shift their focus from a national
modernization project to a global one (Negus 2015).

The K-drama Winter Sonata in particular played an indispensable role in the first rise of Hallyu. It
became an overnight success in Japan when it was first released in 2002. Many scholars today
believe this to be the start of the Korean wave. Initially, the success of Hallyu was solely attributed to
K-dramas (Lie 2012). Between 1995 and 2007, the total revenue for Korean dramas grew from $5.5
million to an astounding $150.9 million (Jin 2012). I speculate that since the drama is well produced,
it managed to be carried by four factors that are arguably the reasons for the success of Hallyu, the
Korean government, technological developments, the diaspora of the Korean people, and cultural
similarities. These four factors will be further discussed in next chapter but in relation to K-pop.

South Korean music was, however, not completely irrelevant during this era with the Korean boy
band High Five of Teenagers (H.O.T) instigating the craze for K-pop in China and the singer BoA
amassing an immense following in Japan. Along with a few other artists, H.O.T and BoA laid the
foundation for K-pop stars today (Chen 2015, Lee 2014, Kim 2015). This period of the Korean Wave
opened new markets and turned the eyes of consumers in China, Japan, and Taiwan towards Korean
products (Kim 2015).

In contrast to Hallyu 1.0, which appealed to mainly middle-aged women, Hallyu 2.0 attracted
young people from Asia, North America, and Europe through the proliferation of vibrant and
energetic music. (Chen 2015, Oh & Park 2012) Hallyu 2.0 is most widely believed to have begun in
2006 as digital technologies developed, thus, easing the diffusion of Korean cultural content, in
particular, K-pop. The main driving force for the rise of Hallyu 3.0 is the popularization of the K-
brand. With the rising success of K-pop, consumers are eager to try new products from South Korea,
one of which is Korean fashion (Kim 2015).

It is incontrovertible that Hallyu has been an extremely profitable commodity for the Republic of
Korea both financially and culturally. It has also played a crucial role in building South Korea’s
image since 1999. In 2004 the total net revenue of Hallyu was approximately $1.87 billion. This
staggering figure multiplied to an estimated total of $11.6 billion in 2014 (Martinroll 2017). BBC
also notes that K-pop exclusively contributes with $2 billion per year to the Korean economy (q.b.
Seabrook 2012). How these numbers are calculated is not explicitly stated in neither of my sources,
but I speculate that it is the total revenue including sales from merchandise, concerts, movies,

Johan Williams Jolin The South Korean Music Industry 12