Kakao Entertainment Responds to Unfair Fee Claims: "Not True... Decided Through Consultation with the Other Party"

Kakao Entertainment, which operates Melon, has denied the claim by Big Planet Made Entertainment that there are circumstances where differential distribution fees are being imposed.

On the 4th, Kakao Entertainment stated in a press release, "We signed a 'music and content distribution contract' with Big Planet Made Entertainment in October 2021, and this contract is still valid," adding, "However, Big Planet Made Entertainment is currently unilaterally claiming contract termination based on incorrect facts."

They further explained, "The distribution fee rate is determined through consultation with the other party, considering various conditions such as whether an advance payment investment is provided, contract duration, offset rate, and valuation of the distribution target titles, all based on strict criteria," emphasizing, "Whether the company is affiliated with Kakao is not a consideration at all in calculating the distribution fee rate."

Kakao Entertainment also stated, "Since all contracts are subject to confidentiality obligations, detailed information cannot be known by anyone other than the contracting parties, so Big Planet Made Entertainment does not have accurate knowledge of other companies' contract details," and added, "Kakao Entertainment concludes contracts with partners through strict and objective standards and has never provided any unfair benefits to any specific partner."

Earlier, Big Planet Made Entertainment reported that they had filed a complaint with the Fair Trade Commission, alleging that Kakao Entertainment discriminated in distribution fees.

Big Planet Made Entertainment claimed, "After recently identifying that Kakao Entertainment imposes differential distribution fees between agencies affiliated with its subsidiaries and other agencies, we submitted a complaint to the Fair Trade Commission in January requesting a review of this issue," and added, "We have secured evidence and testimonies indicating that Kakao Entertainment demands around a 20% distribution fee from general companies, while charging related companies such as SM Entertainment about 5 to 6%."

In response, Kakao Entertainment said, "If they continue to make claims that contradict the facts while demanding unilateral contract termination, we plan to consider all possible countermeasures," and added, "If an investigation is necessary, we will do our best to clearly establish the truth and maintain a fair order in the music industry."

This content was produced with the assistance of AI translation services.