HYBE’s Plan to “Throw Away NewJeans” Exposed?

The South Korean Ministry of Culture, Sports, and Tourism has just made public internal audit documents from HYBE Corporation.

One excerpt regarding the plans for the group’s girl groups reveals that the HYBE staff has contemplated removing NewJeans from their roster.

With the debut of ILLIT, joining the ranks of HYBE’s girl groups that include NewJeans and LE SSERAFIM, many media outlets have referred to this trio as “New-I-LE,” celebrating them as the new generation of HYBE idols.

The report includes plans to remove “New” (NewJeans) from this acronym and create a category of girl groups that achieve million-seller status in their first week to promote LE SSERAFIM.

The document states: “With NewJeans, ILLIT, and LE SSERAFIM, the term ‘New-I-LE’ from HYBE has begun to appear on community pages, and there has been a slight increase in mentions of ILLIT…

Now, we can categorize Blackpink, LE SSERAFIM, aespa, and IVE as a group of million-selling girl groups in their first week, rather than dividing them by the fourth generation. We’ve been obsessed with the term ‘New-I-LE’ for long enough; now we just need to remove ‘New’ and create a new term.”

Earlier, on October 21, a topic titled “HYBE IM’s 4 Billion Internal Transaction with Ador Amid Dispute (NewJeans Settlement Issue)” was published on the Korean forum theqoo. 

The topic quoted a news article, which mentioned a suspicious internal transaction of money from ADOR to HYBE IM – the conglomerate’s game subsidiary. 

In particular, the article started by saying that according to industry sources, it was reported in late September that 4.2 billion KRW (approx 3 million USD) of internal transactions took place between ADOR and HYBE IM during the third quarter of this year. 

Among those, HYBE IM took 4.1 billion KRW (approx 2.9 million USD) in revenue from ADOR, while ADOR only recognized 90 million KRW (approx 65,000 USD) from HYBE IM.

The only explanation provided by both companies for the transaction was related to game royalties. However, there are suspicions that HYBE might be inflating new business revenue by leveraging ADOR, which has seen a surge in sales due to NewJeans.

In typical cases where an artist under a HYBE label appears in a game, the label should recognize revenue from royalties or copyrights. However, in this case, the roles are reversed, with ADOR basically paying HYBE IM for its game services.

Last August, HYBE IM updated its game “Rhythm Hive” to include NewJeans. Since NewJeans is managed by Ador and HYBE IM used their intellectual property (IP), ADOR should have been the one to recognize the revenue.

An industry insider pointed out, “HYBE is already trying to take tens of billions of won in quarterly revenue from Ador, and HYBE IM, which hasn’t yet stabilized, is recognizing revenue under unclear circumstances. If this structure continues, it could reduce the settlement amounts that artists are entitled to, leading to further issues.”

Responding to this, a HYBE representative stated, “It is difficult to confirm specific details regarding internal transaction disclosures.”

As a result, many netizens are suspecting HYBE of stealing money from NewJeans’ company to inflate its game subsidiary.

Source: theqoo