There is so much we don’t know; or, a small primer on the business end of the arts

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So, the various English-language K-Pop news outlets have covered Block B’s cancellation of promotions for “Jackpot.” AllKPop (I know, I don’t like them either, but I feel an obligation….) did an article that got a lot of comments, and I found the comments really interesting.

(Well, mostly they were interesting. The person who labeled a #1 album a “flop” needs to show their math. Although they weren’t nearly as funny as the people on OneHallyu who respond to every scrap of news about Block B by saying, “They should disband.” Yeah. I’m sure they’ll get right on that. Because when you have three #1 albums in a row, there’s really no mountains left for you to climb, and it’s time to close up shop.)

Many of the comments on AllKPop are by people trying to suss out exactly how this is going to affect Block B’s bottom line. And the thing is, that’s completely impossible to do with Block B.

Why?

1. Block B is not with a label, and was never with a major label. The members of Block B had contracts with Stardom, which was basically a new company when they joined it. Unlike, say, SM, the terms of Stardom’s contracts were not contested by Block B in their legal action against the company–instead the group charged that the contracts were not being honored–and for the most part the terms themselves never became public.

After Block B lost their suit, they negotiated a transfer of their contracts to Seven Seasons, a newly-formed management company. But did they simply transfer the contracts whole, or did they void those contracts and negotiate new ones with Seven Seasons? I tend to assume that they did the latter, but in all honesty, I have no idea.

As a result:

2. Nobody on the outside has any idea what the terms of Block B’s contracts are. This is HUGE. Do the members of Block B make no money from music sales? Or do they make heaps? Hell if I know!

And don’t think that the percentage cut given the artist doesn’t really matter. I’m a writer who currently writes novels. I self-publish for many, many reasons, the primary one being that I keep 70% of the money I make. It’s not uncommon for an author with a traditional publisher to get only 10%.

What does that mean? I sell a dinky $3 e-book and I make the exact same money as an author who sells a beautiful $20 hardback.

I also sell paperbacks, which cost about $14. People sometimes say things to me like, “Oh, I got your e-book and loved it, so I’m going to buy the paper copy in order to support you!” I tell them, “Don’t bother!” I don’t make any more money off that $14 paperback than I do off the $3 e-book. But for many traditionally-published authors, that is a good idea. Why? Because their contracts stipulate that they get a truly puny amount of money from e-book sales–if you don’t buy paper, the writer gets screwed.

Change the terms of the contract, and everything else changes. What works business-wise for one person won’t work for another if their contracts are not the same. (Remember that the next time someone tells you that no one makes any money from digital music.) And Block B is in such a weird position, it’s not like a standard K-Pop contract with a major label is going to be any help at all with figuring out what their contract terms are.

If that weren’t complicated enough, another factor is that:

3. Seven Seasons has no legacy costs. Seven Seasons did not come onto the scene until Block B had a #1 album under their belt. Seven Seasons did not recruit a bunch of unknowns and lovingly mold them into the talented performers we see today. (Snerk. Sorry, but I just don’t buy the whole notion that K-Pop labels have these AMAZING training systems that spin straw into gold. I’ve seen too many shitty performances to believe that.) Seven Seasons did not have to sell the Korean public and media on something they’d never seen before. They’re not trying to push a slew of new groups. There’s a big hunk of the cost ledger at a traditional label that simply doesn’t exist for Seven Seasons, because they came in after the hard part was over.

All this is why I rely on the very simple argument that if Block B really needed the money from this comeback, they wouldn’t have canceled it. As people have remarked (both admiringly and in a “what the hell are you doing!?!” kind of way), theirs is an extreme position–other K-Pop groups are unlikely to up and cancel their comebacks the way Block B did. But Block B is in a very different position than most K-Pop groups.

Exactly how different, we just can’t know.

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11 responses »

  1. As a lawyer, though, I’m really curious how they worked it out with Stardom in the end: contract transfer, or new contracts? Seven Seasons’ actual role: like a regular company with a CEO controlling the shots, or just doing the managerial and physical grunt-work while Block B decides their own work?

    And while I suspect it’s new contracts and grunt-work for SS, as you said, we don’t know.

    • I know–I’d love to know all the gory details! I’ve read that management companies work for the artists (as opposed to labels, where the artist works for the label), but obviously that’s an incredibly vague generalization. (Literary agents are supposed to work for writers, but the way some contracts are, you’d never know.) My fingers are crossed that it is new contracts & gruntwork for SS, because otherwise Block B is just a couple of personnel changes away from basically having to deal with Stardom all over again….

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