Why the Korean wave is more than BTS or Blackpink | CNBC Explains

Summary

The Korean Wave, or Hallyu, is a cultural phenomenon that has propelled South Korea's entertainment industry to global prominence, from K-pop to movies and beauty products. With BTS leading the charge, South Korea's cultural exports have become a significant economic force, contributing billions to the economy. The government's strategic investment in cultural industries has fueled this growth, while scandals and controversies in the industry highlight its challenges. Despite these setbacks, the Korean Wave continues to shape global trends, showcasing South Korea's growing influence on the world stage.

Takeaways

• 😀 BTS's 2020 IPO was the largest in South Korea in three years, driving global interest in K-pop and South Korean entertainment.
• 😀 Big Hit's market debut saw shares soar by 160%, reaching a valuation of $8.4 billion at its peak, though the price eventually dropped.
• 😀 The Korean Wave, or Hallyu, extends beyond K-pop, encompassing South Korea's cultural exports such as TV dramas, movies, esports, and beauty products.
• 😀 South Korea's cultural exports contributed $12 billion in 2019, even as overall exports declined due to geopolitical tensions and global trade cooling.
• 😀 South Korea's entertainment industry has seen significant growth since the 1990s, fueled by reforms that allowed more foreign influence, including Hollywood films.
• 😀 The abolishment of censorship and the rise of K-pop pioneers in the 1990s laid the foundation for the global success of the K-pop industry.
• 😀 BTS's song 'Dynamite' alone contributed $1.4 billion to South Korea's economy in 2020, demonstrating the economic power of K-pop.
• 😀 Tourism in South Korea has benefited greatly from the Korean Wave, with BTS concerts alone bringing in over 187,000 foreign tourists.
• 😀 The South Korean government has heavily invested in cultural exports, with a $5.5 billion budget in 2020 for the Ministry of Culture, Sports, and Tourism.
• 😀 The Korean Wave has propelled streaming companies like Netflix, with Netflix investing nearly $700 million in Korean content to fuel its global popularity.
• 😀 While the Korean Wave has brought international acclaim, it faces challenges including negative perceptions due to historical tensions with neighboring countries and industry scandals.

Q & A

What is the Korean Wave (Hallyu) and how has it impacted South Korea's economy?

The Korean Wave, or Hallyu, refers to the global popularity of South Korean culture, including music, television, movies, esports, food, and beauty products. It has significantly boosted South Korea's economy, contributing $12 billion in cultural exports in 2019 and playing a key role in driving the country’s $1.6 trillion economy.

How did BTS contribute to the rise of the Korean Wave?

BTS, through its global influence and successful IPO of Big Hit Entertainment, has been a major driving force of the Korean Wave. Their market debut in 2020 saw a massive surge in Big Hit's stock price, and their music has brought substantial economic benefits, including $1.4 billion contributed to Korea's economy in 2020.

What was significant about Big Hit's IPO in 2020?

Big Hit's IPO in 2020 was South Korea's largest in three years. It was oversubscribed by over a thousand times and led to a 160% surge in its stock price, reaching a peak valuation of $8.4 billion. This event highlighted the global influence of South Korea’s entertainment industry.

What role has the South Korean government played in promoting Hallyu?

The South Korean government has actively supported the growth of Hallyu by investing in its Ministry of Culture, Sports, and Tourism. They have created divisions like the Hallyu Support and Cooperation Division, promoting the export of K-pop, K-drama, K-beauty, esports, and other cultural exports. The government has allocated billions to the content industry to ensure its continued growth.

How did the success of the 2019 BTS concert in Seoul contribute to the economy?

The 2019 BTS concert in Seoul attracted 187,000 foreign tourists, generating over $790 million for South Korea’s economy. This event demonstrated the power of K-pop in driving tourism and contributing to South Korea’s economic growth.

What challenges has the Korean Wave faced despite its success?

Despite its success, the Korean Wave faces several challenges, including negative perceptions due to South Korea’s foreign policies, the commercialization of its cultural exports, and controversies within the entertainment industry such as sexism and celebrity scandals. These issues have impacted its global image.

How has the Korean film industry contributed to the global recognition of South Korea?

The Korean film industry, particularly with films like *Parasite*, has contributed to South Korea's global recognition. *Parasite* won four Oscars in 2020, including Best Picture, and earned $257 million globally, showcasing South Korea’s growing influence in the global entertainment market.

What impact did the Korean Wave have on streaming services like Netflix?

The Korean Wave has greatly benefited streaming services, particularly Netflix, which has invested nearly $700 million in partnerships and co-productions to fuel the global popularity of Korean content. The pandemic further accelerated this trend, as more people turned to streaming platforms for entertainment.

How has Hallyu influenced international relations, especially with North Korea?

Hallyu has been used as a tool for cultural diplomacy, such as when 160 K-pop artists performed in North Korea in 2018. This cultural exchange was seen as a means of easing tensions and paving the way for peace talks between North and South Korea, with some experts attributing it to a breakthrough in relations.

What controversies have impacted the image of the Korean Wave, particularly in the K-pop industry?

The K-pop industry has faced several scandals that have tarnished its image, including the prostitution and corruption scandal involving Seungri of Big Bang. Additionally, issues like sexism, the high-pressure nature of the industry, and negative sentiments from neighboring countries like Japan and China have cast a shadow over the Korean Wave.