SM Entertainment’s IP Crisis at 30-Year Milestone

SM Entertainment, which marks its 30th anniversary this year, finds itself at a critical crossroads. Once a leader in the K-pop industry, SM has now ceded that position to HYBE. Despite possessing three decades’ worth of intellectual property (IP), the company faces the difficult reality that many of its most iconic IPs are currently inactive or inaccessible.

To rejuvenate its artist lineup, SM is pushing its fifth-generation acts—aespa, RIIZE, and the recently launched virtual-human concept group Heart to Heart. However, its cornerstone artists from the second to fourth generations—Girls’ Generation, EXO, and Red Velvet—are no longer active as full groups. Although individual members maintain strong popularity, the company has struggled to mobilize these legacy acts, making their IPs effectively dormant.

This became evident during SM’s 30th anniversary concert, where fans noticed the absence of full-group stages from the company’s most iconic names. This sparked further concerns about SM’s ties with some of its core artists and raised questions about its approach to risk management.

Next year marks the 20th anniversary of Girls’ Generation, but insiders say a full-group reunion appears unlikely. Sunny recently signed with Big Planet Made Entertainment, a company founded by SM’s former executive producer Lee Soo-man, who is also her maternal uncle. Due to Lee’s current estranged status from SM, Sunny’s participation in future Girls’ Generation activities seems improbable.

Meanwhile, Taeyeon, the leader of Girls’ Generation, has openly voiced her frustrations with SM. She has previously mentioned being excluded from family concerts. The situation intensified in April when her scheduled performance at a Japanese event was abruptly canceled due to equipment transport issues. Expressing her disappointment on her fan platform, Taeyeon wrote, “I hate this situation and I’m sorry to my supporters. A performance created with everyone’s effort and anticipation was taken from me in a moment.”

EXO’s case further illustrates SM’s diminishing control over its legacy IPs. Widely credited for accelerating K-pop’s global growth, EXO is now fragmented. Baekhyun, Xiumin, and Chen (often referred to as EXO-CBX) are now under INB100, and their relationship with SM remains tense. Disputes over broadcasting arrangements and scheduling conflicts have divided the fanbase. Although Baekhyun continues to achieve commercial success as a solo artist—with over a million albums sold—his promotional activities under the EXO name have seen little support from SM.

Red Velvet, celebrating their 11th year in 2025, has also seen major changes. Members Wendy and Yeri have officially left SM Entertainment, ending contracts that had lasted since their debut. A day before the news was confirmed, Yeri preemptively informed fans via her personal channel: “There will be an announcement about the company tomorrow. I wanted to tell you first so you wouldn’t be shocked.”

The remaining members—Irene, Seulgi, and Joy—are staying with SM and pursuing their own projects. Irene and Seulgi are slated to release a new mini-album this month as a unit. However, with the group reduced to three members, their overall impact is likely to be smaller than during Red Velvet’s full-group era.

The weakening of SM’s grip on its legacy artists is further complicated by public statements from stars like Taeyeon expressing dissatisfaction with the agency. As more top-tier talents depart or air grievances, SM’s ability to fully utilize its most valuable IPs is being put to the test.