There are big things afoot in the South Korean music industry this week, and for once they have nothing to do with K-Pop stars like BTS or Blackpink. Instead, Kakao Entertainment, already a key music distributor and media owner in South Korea, is merging with the country’s top local streaming service Melon.
The deal is expected to be signed off at the start of September, with the new company called Melon M. “Kakao expects to see some 2 trillion won ($1.75 billion) in annual sales after acquiring the nation’s biggest music platform,” reported the Korea Herald. “The two companies will maximize synergy by eyeing the domestic and international markets, respectively.”
There is a long corporate history here, it should be noted. Although originally launched by telco SK Telecom, Melon was acquired by Kakao Entertainment’s parent company Kakao in 2016, although as the report notes, the spin-off of Kakao M to form Kakao Entertainment left Melon with the parent company… until now. Kakao Entertainment also had a high-profile spat with Spotify earlier this year, temporarily removing its music catalogue from that service in a dispute over licensing terms.
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