The Crisis Facing South Korea's Film and K-Pop Industries

South Korea's entertainment sector, once a beacon of cultural dominance, is facing significant challenges, particularly in cinema. Since 2019, admissions for both Korean and international films have plummeted by 45%, dropping from approximately 226 million to 123 million. Correspondingly, box office revenue has decreased from $1.3 billion to $812 million. Industry experts predict that the number of locally produced films will decline from over 40 annually to around 20 in 2025, with further reductions anticipated in 2026 as the backlog from the pandemic diminishes. Kim Han-min, director of the Yi Sun-sin trilogy, has warned that the sector is on the brink of collapse. Jason Bechervaise, a professor of Korean film, attributes this decline to structural weaknesses, including rising costs and tightening margins, which have stifled mid-budget productions that once nurtured new talent.

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K-Pop, another pillar of South Korea's cultural export, is also experiencing a downturn. In 2024, physical album sales fell by 19.5%, marking the first decline in a decade, with projections indicating continued decreases through 2025. Major K-Pop agencies have shifted their focus from album sales to concert revenues, which have surpassed traditional sales figures. Areum Jeong, a professor of Korean studies, notes that agencies are increasingly catering to core fanbases, potentially at the expense of broader public appeal. This shift has raised questions about the industry's ability to replicate the global success of groups like BTS and Blackpink.

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The landscape of K-Pop is further complicated by the emergence of international competitors. Productions like Netflix's animated film *KPop Demon Hunters* showcase Korean aesthetics but are not authentically Korean, indicating a trend where cultural ideas can be reproduced globally without direct involvement from Korean creators. This has led to the rise of similar groups trained in Korean methods in regions like Japan and Southeast Asia, intensifying competition.

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In response to these challenges, the South Korean government has initiated a five-year cultural investment plan worth 51.4 trillion won (£26 billion) aimed at bolstering the country's cultural industries. President Lee Jae Myung has appointed Park Jin-young, founder of JYP Entertainment, to co-chair a new presidential cultural committee focused on promoting Korean pop culture internationally. Major agencies are also expanding into Southeast Asia, India, and China.

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However, critics argue that the emphasis on international expansion may neglect the domestic infrastructure that once fueled South Korea's cultural rise. Jeong warns that while financial success may continue, it does not guarantee the creative renewal necessary to produce groundbreaking works like *KPop Demon Hunters*.

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While the decline in cinema attendance and K-Pop sales is widely reported, there is a lack of consensus on the long-term implications for the industries. Some experts believe that the pivot toward global markets may ultimately benefit South Korea's cultural exports, while others caution that this strategy could undermine the authenticity and creativity that initially attracted international audiences.

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• “almost collapsed” — Kim Han-min, Director

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• “K-pop companies began catering mainly to the core fandom, and kind of forwent the idea of being widely known to the public,” — Areum Jeong, Professor of Korean Studies

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• “but now it’s as though Hollywood’s beating Korea at its own game.” — Jason Bechervaise, Professor of Korean Film

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• “Jeong believes the industries will continue to earn money but warns that financial success alone cannot guarantee creative renewal.” — Areum Jeong, Professor of Korean Studies

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