Fandoms... and fandoms.
Imagine my surprise today, when I decided to check up on facebook and lj, and hear news that "ZOMG, DBSK IS DISBANDING WOES IS US WHY DOES OUR LIVES SUCK BECAUSE THEIR DISBANDING" etc.
Now, I can understand this reaction. When you are a crazy passionate fan, then hearing news about the potential disbandment of your favorite boyband could be a little distressing. However, I would like to lay out a few facts as I see it.
Note: this assumes that the contract signed with SM Entertainment is the same contract that DBSK has today. As I have not discovered any news to the contrary, this is what I am going to assume.
1. DBSK signs an exclusive contract with SM Entertainment, which basically states that all their dealings are with SM Entertainment.
2. Several members of DBSK start a cosmetic line in China.
3. Said several members attempt to renegotiate said contract.
4. News is leaked to the media.
Regarding point 1
Clearly, this exclusive contract was one of the only ways they could get to debut. At the time of their debut, they were young and essentially nothing. It makes complete logical sense that the members of DBSK signed a contract that included this clause, possibly without even realizing it was there.
This is not SM Entertainment's fault. If anything, this fault should be the members' own because they were the ones who decided to sign their contracts. Possibly it was the only way for them to achieve the level of success they have today, but they signed these contracts of their own free will. That likely includes that they are only entitled to 20% of their profits.
--A brief divergence. Is only 20% fair? For a starting artist, I would totally say it's fair for each to only get 4%. Remember, this is assuming that this was their contract when they debuted. At the time of their debut, they were nothing. They willingly made this sacrifice. Additionally, factor in the costs of promotion, the costs of production, and the costs of paying every single one of those people who work in SM Entertainment, right down to the janitors that clean the floors. Take into account the money set aside for recording equipment, maintenance of said recording equipment, etc. Does 80% cover all of it? I would say it covers all of it and more. But remember that when they debuted they had achieved nothing of what they have achieved today. If they had ended up flopping, would 80% have covered everything? Maybe not. Keep such a fact in mind.--
Therefore, is an exclusive contract fair? In my opinion, it's perfectly justified. Maybe it's a little unreasonable, but I highly doubt that many producing companies (from film production to publishing) have lots of non-exclusive contracts. I recently read Shirley Temple's autobiography. She was always signed onto one company, and films produced with other companies were "loan-outs" where she was loaned out to other companies. I think an exclusive contract is perfectly reasonable, and most likely is the norm.
Point 2. Several members start a cosmetics line
From what I've gathered, said members invested money in this company. Now, I highly doubt that personal investments are restricted in exclusive contracts. Real-estate, for example, is a form of investment, and SM entertainment hasn't been raising hell over various members buying houses. Therefore, I conclude that said members were not merely investing money on a personal level, but were actually doing something that went against their contract.
Is this right? NO. They signed a contract, and they broke it. I don't know what specifically, but if it was not in their contract (which they signed willingly, keep all of this in mind) then they broke their contract. This is punishable by law. Said members would have broken the law and would be punishable by court.
Now, assuming that they did not actually break contract, but are (as point 3 says) simply renegotiating their contract for the potential to perhaps sponsor this cosmetic line that they helped start up, etc.
Then that's reasonable. That should be judged, by SM entertainment, and by said members and their legal representation. There is no reason why a contract should not be renegotiated, in fact, (from the autobiography I've read, yes) contracts likely are renegotiated at various times throughout the duration of the contract.
But if they broke their contract? This isn't something small, the way fans are treating it. "Oh, they're overworked, cut them a break, SME" you (assuming you're a fan) say. They broke their contract! They broke the LAW. This isn't something small for you to brush off. There are other ways to make more money without breaking your contract. Negotiating a "loan-out" of some sort. Negotiating a new contract, yes.
--A brief tangent to discuss AVEX. I am assuming that AVEX and SME negotiated a form of loaning-out DBSK to AVEX, which would explain how they can be under AVEX and SME at the same time. Therefore, DBSK would be under SME (and it can be seen by the SME label on all their Japanese CDs [I have no idea about merchandise other than CDs, as I haven't purchased any]) and AVEX at the same time.--
I have no legal experience whatsoever, so I'll refrain from making judgments on what the result would be. My main rant is with how fans automatically assume the worst of SM Entertainment and the best of DBSK. Breaking a contract is against the law. It is unethical (but fans don't care about ethics, we've already established that by the fact that they stalk their idols and harass them in the name of love), and simply put, it's setting a horrid example.
Let me quote my mother on this (mothers are the source of the majority of the wisdom of the world, and everybody would be wise to ask their mother a few questions now and then [not just, "mommy, what's for dinner?"]). "The entertainment industry is a messed up place, and no logical person would step foot there, because it's harsh, it's dirty, and it's not logical. It's just not healthy." (My mother loves logic).
Yes. The entertainment industry, the entertainment world is a horrible messed up world. It is not pretty. People backstab each other, sleep with each other to rise up, do horrible things to each other, and you lose track of who you really are in the quest to rise up. Disagree with me? Think carefully about it before you do. How many child stars are successful when they grow up? (and how many turn to drugs?). Entertainment is a horrible industry to set your foot into. If you succeed, you succeed big. If you fail? You fail big. (Think of all the trainees that don't debut. Do you even know of them? End of story). Again quoting my mother, she was asked to model once (she's quite tall). She refused. She didn't want to get caught up in that type of world.
So is it horrible that there are exclusive contracts and horrible things like sleeping with producers to just succeed? Sure. It's also pretty normal. Don't think otherwise. Really. I'll pull up a quote from Shirley Temple's autobiography, and Shirley Temple's probably the most successful and well-adjusted child-star in the history of child-stars. Paraphrased, Shirley Temple essentially slept with her producer a few days before she got married (to her husband, not the producer). She was warned several years ago by another female actress to be wary when she saw unsocked feet.
And again, almost all singers and actors are underpaid. Simply put, producers make all the money. Yet at the same time, not all the money goes to the coffers of whoever's the head producer. Let's briefly diverge and talk about non-profit organizations (oh yes, charity organizations. Let's think twice before donating money to charity organizations, why don't we?).
Example 1, a non-profit organization. Let's talk about the organization I'm a treasurer of, the ACSSA at UCSD. This is a non-profit organization that doesn't pay it's members, keep that in mind! Plenty of non-profit organizations pay their employees.
Income: Notebook sales held every quarter.
Expenditures: pizza and drinks at meetings (about 25 per year), food [olive garden] at the faculty-student mixers (3), Symposium (1), other events including demonstrations, socials, and plannings(5?)
This is non-profit, and none of the officers are earning any money from this. Yet the money derived from notebook sales (a fairly large sum) goes mainly to buying notebooks to sell next time, and the rest is used up for food and drinks for meetings. Meetings attended by members.
Yes, this non-profit organization uses the bulk of it's money on it's members. I wonder how many also do the same? Plenty, I would assume.
Therefore, organizations that create profit and have workers who are not volunteering. Organizations such as production companies like SM Entertainment. I would imagine that a lot of money goes to pay employees, goes to buying equipment, goes towards promotion (which isn't free, don't ever imagine that), goes towards making up for not as successful artists.
Everybody gets paid. If you're going to complain about DBSK getting underpaid, what about the technicians that record their music? What about the writers of the songs? What about the companies that made the equipment? Do you think the technicians make 4% of each CD sold? Do you think they make more?
Now, assume a CD costs $10 (it makes for easier math). Let's assume that 10% is profit made by the distributing company. $9 goes to the production company. Let's assume that $2 goes to making the CD (and this is a generous estimate, I would put it at %3-4 (30-40%, but I don't know anything about producing music). That means that already 30% is used simply to produce and distribute the CD. Now, let's talk about running costs of the company. Let's say that 20% ($2/CD) goes towards paying for janitors, technicians, etc. Let's also assume that 10% goes to publicity. That makes 60% already used up by simply getting the CD made and getting it out there! 20% goes to the singers, and that only leaves 20% left to invest into other singers/put into the coffers of the CEO of the company.
Keep in mind, I don't know a thing about producing music. But look at this distribution, which is approximate, and maybe it's completely wrong and 50% goes into the coffers of the CEO. But I highly doubt that all 80% goes into LSM's coffers. Especially since he's no longer the CEO, he's simply a shareholder (and DBSK members are also shareholders).
Of course, when you look at how many CDs are sold, that's what makes the money. 4% of 1 million is still 40 thousand. (That, by the way, is why companies are expanding to China. The potential buyer's market is huge).
This rant has gone on quite a few tangents (all related to the entertainment industry, thankfully, or I'd have to delete quite a bit and add dividers), but simply put, let's be reasonable here. Is SM Entertainment at fault? No. No matter how you look at it, they have the legal right. Perhaps it's not quite ethical, perhaps it's downright mean. But it's the norm. And if you choose to get involved in that, then it's your own fault and you should have thought about this.
And a brief discussion about the conclusion. I imagine that this will be settled effectively. Potentially, a non-exclusivity clause would replace the exclusivity clause. Possibly the exclusivity clause would be rearranged to allow for investments and sponsorships of certain companies. But I have no doubt that things will be settled effectively and all parties will be moderately satisfied. I highly doubt that SME would want for DBSK to disband (and said members to leave) because that's a large form of profit that would disappear. Likewise, I highly doubt DBSK would want to leave a production company that has worked for them.
A final conclusion.
Fans are crazy.
End.
Now, I can understand this reaction. When you are a crazy passionate fan, then hearing news about the potential disbandment of your favorite boyband could be a little distressing. However, I would like to lay out a few facts as I see it.
Note: this assumes that the contract signed with SM Entertainment is the same contract that DBSK has today. As I have not discovered any news to the contrary, this is what I am going to assume.
1. DBSK signs an exclusive contract with SM Entertainment, which basically states that all their dealings are with SM Entertainment.
2. Several members of DBSK start a cosmetic line in China.
3. Said several members attempt to renegotiate said contract.
4. News is leaked to the media.
Regarding point 1
Clearly, this exclusive contract was one of the only ways they could get to debut. At the time of their debut, they were young and essentially nothing. It makes complete logical sense that the members of DBSK signed a contract that included this clause, possibly without even realizing it was there.
This is not SM Entertainment's fault. If anything, this fault should be the members' own because they were the ones who decided to sign their contracts. Possibly it was the only way for them to achieve the level of success they have today, but they signed these contracts of their own free will. That likely includes that they are only entitled to 20% of their profits.
--A brief divergence. Is only 20% fair? For a starting artist, I would totally say it's fair for each to only get 4%. Remember, this is assuming that this was their contract when they debuted. At the time of their debut, they were nothing. They willingly made this sacrifice. Additionally, factor in the costs of promotion, the costs of production, and the costs of paying every single one of those people who work in SM Entertainment, right down to the janitors that clean the floors. Take into account the money set aside for recording equipment, maintenance of said recording equipment, etc. Does 80% cover all of it? I would say it covers all of it and more. But remember that when they debuted they had achieved nothing of what they have achieved today. If they had ended up flopping, would 80% have covered everything? Maybe not. Keep such a fact in mind.--
Therefore, is an exclusive contract fair? In my opinion, it's perfectly justified. Maybe it's a little unreasonable, but I highly doubt that many producing companies (from film production to publishing) have lots of non-exclusive contracts. I recently read Shirley Temple's autobiography. She was always signed onto one company, and films produced with other companies were "loan-outs" where she was loaned out to other companies. I think an exclusive contract is perfectly reasonable, and most likely is the norm.
Point 2. Several members start a cosmetics line
From what I've gathered, said members invested money in this company. Now, I highly doubt that personal investments are restricted in exclusive contracts. Real-estate, for example, is a form of investment, and SM entertainment hasn't been raising hell over various members buying houses. Therefore, I conclude that said members were not merely investing money on a personal level, but were actually doing something that went against their contract.
Is this right? NO. They signed a contract, and they broke it. I don't know what specifically, but if it was not in their contract (which they signed willingly, keep all of this in mind) then they broke their contract. This is punishable by law. Said members would have broken the law and would be punishable by court.
Now, assuming that they did not actually break contract, but are (as point 3 says) simply renegotiating their contract for the potential to perhaps sponsor this cosmetic line that they helped start up, etc.
Then that's reasonable. That should be judged, by SM entertainment, and by said members and their legal representation. There is no reason why a contract should not be renegotiated, in fact, (from the autobiography I've read, yes) contracts likely are renegotiated at various times throughout the duration of the contract.
But if they broke their contract? This isn't something small, the way fans are treating it. "Oh, they're overworked, cut them a break, SME" you (assuming you're a fan) say. They broke their contract! They broke the LAW. This isn't something small for you to brush off. There are other ways to make more money without breaking your contract. Negotiating a "loan-out" of some sort. Negotiating a new contract, yes.
--A brief tangent to discuss AVEX. I am assuming that AVEX and SME negotiated a form of loaning-out DBSK to AVEX, which would explain how they can be under AVEX and SME at the same time. Therefore, DBSK would be under SME (and it can be seen by the SME label on all their Japanese CDs [I have no idea about merchandise other than CDs, as I haven't purchased any]) and AVEX at the same time.--
I have no legal experience whatsoever, so I'll refrain from making judgments on what the result would be. My main rant is with how fans automatically assume the worst of SM Entertainment and the best of DBSK. Breaking a contract is against the law. It is unethical (but fans don't care about ethics, we've already established that by the fact that they stalk their idols and harass them in the name of love), and simply put, it's setting a horrid example.
Let me quote my mother on this (mothers are the source of the majority of the wisdom of the world, and everybody would be wise to ask their mother a few questions now and then [not just, "mommy, what's for dinner?"]). "The entertainment industry is a messed up place, and no logical person would step foot there, because it's harsh, it's dirty, and it's not logical. It's just not healthy." (My mother loves logic).
Yes. The entertainment industry, the entertainment world is a horrible messed up world. It is not pretty. People backstab each other, sleep with each other to rise up, do horrible things to each other, and you lose track of who you really are in the quest to rise up. Disagree with me? Think carefully about it before you do. How many child stars are successful when they grow up? (and how many turn to drugs?). Entertainment is a horrible industry to set your foot into. If you succeed, you succeed big. If you fail? You fail big. (Think of all the trainees that don't debut. Do you even know of them? End of story). Again quoting my mother, she was asked to model once (she's quite tall). She refused. She didn't want to get caught up in that type of world.
So is it horrible that there are exclusive contracts and horrible things like sleeping with producers to just succeed? Sure. It's also pretty normal. Don't think otherwise. Really. I'll pull up a quote from Shirley Temple's autobiography, and Shirley Temple's probably the most successful and well-adjusted child-star in the history of child-stars. Paraphrased, Shirley Temple essentially slept with her producer a few days before she got married (to her husband, not the producer). She was warned several years ago by another female actress to be wary when she saw unsocked feet.
And again, almost all singers and actors are underpaid. Simply put, producers make all the money. Yet at the same time, not all the money goes to the coffers of whoever's the head producer. Let's briefly diverge and talk about non-profit organizations (oh yes, charity organizations. Let's think twice before donating money to charity organizations, why don't we?).
Example 1, a non-profit organization. Let's talk about the organization I'm a treasurer of, the ACSSA at UCSD. This is a non-profit organization that doesn't pay it's members, keep that in mind! Plenty of non-profit organizations pay their employees.
Income: Notebook sales held every quarter.
Expenditures: pizza and drinks at meetings (about 25 per year), food [olive garden] at the faculty-student mixers (3), Symposium (1), other events including demonstrations, socials, and plannings(5?)
This is non-profit, and none of the officers are earning any money from this. Yet the money derived from notebook sales (a fairly large sum) goes mainly to buying notebooks to sell next time, and the rest is used up for food and drinks for meetings. Meetings attended by members.
Yes, this non-profit organization uses the bulk of it's money on it's members. I wonder how many also do the same? Plenty, I would assume.
Therefore, organizations that create profit and have workers who are not volunteering. Organizations such as production companies like SM Entertainment. I would imagine that a lot of money goes to pay employees, goes to buying equipment, goes towards promotion (which isn't free, don't ever imagine that), goes towards making up for not as successful artists.
Everybody gets paid. If you're going to complain about DBSK getting underpaid, what about the technicians that record their music? What about the writers of the songs? What about the companies that made the equipment? Do you think the technicians make 4% of each CD sold? Do you think they make more?
Now, assume a CD costs $10 (it makes for easier math). Let's assume that 10% is profit made by the distributing company. $9 goes to the production company. Let's assume that $2 goes to making the CD (and this is a generous estimate, I would put it at %3-4 (30-40%, but I don't know anything about producing music). That means that already 30% is used simply to produce and distribute the CD. Now, let's talk about running costs of the company. Let's say that 20% ($2/CD) goes towards paying for janitors, technicians, etc. Let's also assume that 10% goes to publicity. That makes 60% already used up by simply getting the CD made and getting it out there! 20% goes to the singers, and that only leaves 20% left to invest into other singers/put into the coffers of the CEO of the company.
Keep in mind, I don't know a thing about producing music. But look at this distribution, which is approximate, and maybe it's completely wrong and 50% goes into the coffers of the CEO. But I highly doubt that all 80% goes into LSM's coffers. Especially since he's no longer the CEO, he's simply a shareholder (and DBSK members are also shareholders).
Of course, when you look at how many CDs are sold, that's what makes the money. 4% of 1 million is still 40 thousand. (That, by the way, is why companies are expanding to China. The potential buyer's market is huge).
This rant has gone on quite a few tangents (all related to the entertainment industry, thankfully, or I'd have to delete quite a bit and add dividers), but simply put, let's be reasonable here. Is SM Entertainment at fault? No. No matter how you look at it, they have the legal right. Perhaps it's not quite ethical, perhaps it's downright mean. But it's the norm. And if you choose to get involved in that, then it's your own fault and you should have thought about this.
And a brief discussion about the conclusion. I imagine that this will be settled effectively. Potentially, a non-exclusivity clause would replace the exclusivity clause. Possibly the exclusivity clause would be rearranged to allow for investments and sponsorships of certain companies. But I have no doubt that things will be settled effectively and all parties will be moderately satisfied. I highly doubt that SME would want for DBSK to disband (and said members to leave) because that's a large form of profit that would disappear. Likewise, I highly doubt DBSK would want to leave a production company that has worked for them.
A final conclusion.
Fans are crazy.
End.