K-pop's 'Big 4' launch joint venture for FANOMENON festival, split trademark with government

South Korea's four major K-pop agencies — Hybe, SM Entertainment, YG Entertainment and JYP Entertainment — have established a joint venture to run FANOMENON, a global K-culture festival scheduled for December next year. The trademark for FANOMENON, which had drawn controversy after being filed solely under JYP Entertainment's name, will be held equally by the Ministry of Culture, Sports and Tourism and the new company, with each owning a 50 percent stake.

According to legal sources, Fanomenon Co. — the joint venture formed by the four agencies — completed its incorporation filing at the Seoul Central District Court registry on Oct. 26. The company's registered office is in Yeongdeungpo-gu, Seoul. Fanomenon Co. will take full charge of planning, producing and operating the festival, and will handle the acquisition and management of related intellectual property, including the trademark.

Park Yoon-seo, who previously worked at both Hybe and JYP Entertainment, will serve as CEO. The four agencies each appointed one non-executive director: Kim Jeong-jip from YG, Won Woo-hyeon from SM, Yoon Han-gil from Hybe and Shin Hyeon-guk from JYP. Kim Mu-hyeon was named auditor. On the ownership structure, Park Jin-young, co-chair of the Popular Culture Exchange Committee, told the National Assembly's Culture, Sports and Tourism Committee during a national audit on Oct. 7 that "the four agencies contribute equal amounts and hold equal voting rights."

The trademark dispute was resolved before the company was incorporated. The Ministry of Culture, Sports and Tourism signed a joint trademark co-ownership agreement with JYP Entertainment on Oct. 22. Under the agreement, the trademarks filed domestically and overseas under JYP Entertainment's name will be held 50-50 by the ministry and Fanomenon Co. The agreement also includes provisions allowing trademark use to be restricted and legal liability imposed in the event of a breach.

The FANOMENON trademark was filed solely by JYP Entertainment shortly after the Popular Culture Exchange Committee launched on Oct. 1 last year and first announced plans for the event. The domestic trademark was converted to joint ownership in April this year when a half-stake was transferred to the ministry, but overseas filings — made in the United States in November last year and in Japan in March this year — remained under JYP Entertainment's name alone. When this came to light in late September, critics argued it was preferential treatment for a company whose founder and largest shareholder serves as co-chair of the committee overseeing a government-backed project.

Park Jin-young appeared as a witness at the national audit and explained that JYP Entertainment, which had a dedicated team in place, filed the trademark first with the intention of transferring it to the government, citing concern that another party might register it first. Park acknowledged the approach was problematic, saying, "In trying to do things right, we ended up using various methods. I do think it was not a normal way to go about it." Park maintained, however, that no profit from the trademark would "remain with our company."

Operating principles for the joint venture were also laid out. Culture, Sports and Tourism Minister Choi Hwi-young said on Oct. 1 that the four agencies had agreed not to pay dividends to shareholders from the company's profits, with all earnings to be reinvested in future events. Artists signed to the four major agencies will be capped at 30 percent of the concert lineup, with the remaining stages open to singers from smaller agencies. The main event will be funded entirely through private sources — ticket sales, sponsorships, global broadcast rights and exhibition booth sales. The 2027 government budget includes about 15 billion won ($11.1 million) in FANOMENON-related project costs, covering tourism promotion and support for small and medium-sized enterprises participating in exhibition booths.

The name FANOMENON combines "fan" and "phenomenon." The festival brings together K-pop concerts, a fandom awards ceremony and exhibition and experience programs by K-culture companies. It will run for 11 days from Dec. 2 to Dec. 12 next year at Seoul Arena in Changdong, Seoul, and KINTEX Hall 2 in Goyang, Gyeonggi Province. Seoul Arena will host headline performances and the fandom awards, while KINTEX will feature festival-style concerts and exhibition and experience events by companies in gaming, webtoons, film, food and beauty. The awards ceremony is designed to honor fandoms rather than artists, with artists accepting on behalf of their fans. When the committee announced its plans in July, it projected more than 520,000 visitors — including 200,000 from overseas — and an economic impact of around 1 trillion won. The economic impact estimate was provided by the Korea Culture and Tourism Institute.

The extent of the government's involvement in running the joint venture is also under discussion. At a comprehensive audit of the National Assembly's culture committee on Oct. 23, Minister Choi said the four companies cannot use the FANOMENON trademark freely, adding, "We will also look into whether it is possible for the ministry to step in and be more directly involved."