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South Korea’s entertainment dominance appears unshakeable. From BTS conquering global charts to Parasite sweeping the Oscars in 2020 and Korean dramas topping Netflix, Korean popular culture has never been more visible. Exports driven by the country’s arts hit a record $15.18bn (£11bn) in 2024, cementing the country’s reputation as a cultural superpower.
But inside South Korea, the two industries that helped build the Korean Wave – cinema and K-pop – are now experiencing fundamental transformations, with their survival strategies potentially undermining the creative foundations of their success.
The decline in cinema is the most dramatic. Admissions – for Korean and international films – have fallen 45% since 2019, from about 226 million to 123 million, while box office revenue has dropped from $1.3bn to $812m.
With investment slowing sharply, Korean distributors that once released more than 40 locally produced films a year are expected to put out about only 20 in 2025, and warn that 2026 could be “even more serious” as the pandemic-era backlog runs out and new productions are not coming fast enough.
Kim Han-min, director of the Yi Sun-sin trilogy, delivered the bluntest warning when he told lawmakers last year that the sector had “almost collapsed”.
Jason Bechervaise, a professor of Korean film at Hanyang University, sees not a short-term slump but a structural weakening. “Years of tightening margins and rising costs have thinned out the mid-budget productions where new directors once developed and established film-makers experimented,” he says. “Much of the talent pipeline is now moving toward streaming platforms, where investment is steadier and production schedules more predictable.”
The theatrical “holdback window” – the period between a cinema release and a film’s arrival on streaming – has also shortened to just a few weeks for many titles, leaving audiences with little reason to buy a ticket. The strain has already triggered historic consolidation, with the operators of the Lotte Cinema and Megabox chains planning to merge their 1,682 screens.
Cinemas are investing heavily in premium formats such as Imax and Dolby, but without a reliable flow of domestic films, industry insiders say such upgrades cannot deliver a sustained recovery.
K-pop’s reckoning
Cinema is not the only pillar under strain. K-pop, long considered one of South Korea’s strongest cultural exports, is also entering a period of uncertainty.
Physical album sales fell 19.5% in 2024 – the first decline in a decade – dropping from 115.2m units to 92.7m, with the drop projected to continue by the end of 2025. This includes international releases, but few make major inroads into the Korean charts.
Yet major agencies have found their salvation elsewhere, with concert revenues now surging past traditional album sales as they pivot to global touring.
Areum Jeong, a professor of Korean studies at Arizona State University, says companies have increasingly prioritised their most dedicated fans. “K-pop companies began catering mainly to the core fandom, and kind of forwent the idea of being widely known to the public,” she says. “When companies cater to the core fandom’s needs, the core fandom will spend and support.”
This narrow focus, she argues, has influenced how idols are recruited, trained and marketed, and the superfan-centred model is now being copied by industries outside Korea. Yet questions remain about whether this approach can produce the kind of breakthrough global phenomena that defined K-pop’s golden era, such as BTS or Blackpink.
Meanwhile, smaller agencies, once vital for experimentation and diversity, have struggled to survive, squeezed by rising production costs and a shrinking share of fan spending.
At the same time, the global success of Korean cultural ideas no longer guarantees that Korean companies will be the ones profiting.
Netflix’s animated hit KPop Demon Hunters became the platform’s most-watched animated film. The film was co-directed by the Korean-Canadian Maggie Kang, and included several Korean/Korean-American voice actors, but was an American production based on Korean aesthetics.
Jeong describes it as a “de-territorialised, hybrid idea of K-pop [rather] than an authentic K-pop product”, suggesting that Korean cultural concepts have become portable enough to be reproduced internationally without Korean participation. Similar groups trained in Korean methods are now emerging in Japan and south-east Asia, creating direct competition.
Yet she says audiences still seek real-world encounters with Korean culture. After the film’s release, museums, food brands and cosmetics companies experienced renewed interest in items featured onscreen.
Bechervaise notes how creative dynamics have shifted. As domestic productions became more formulaic, American studios and Korean-diaspora creators began drawing on Korean cultural elements in works such as Minari, Beef and Demon Hunters. “Korea had beaten Hollywood at its own game,” he says, “but now it’s as though Hollywood’s beating Korea at its own game.”
The government has responded with a sweeping five-year, 51.4tn won (£26bn) cultural investment plan, aimed at expanding South Korea’s global cultural footprint and strengthening broader cultural industries, from content exports to arts training, tourism and sports.
President Lee Jae Myung has also appointed the JYP Entertainment founder and K-pop mogul Park Jin-young to co-chair a new presidential cultural committee to promote the spread of Korean pop culture internationally.
Major agencies such as HYBE and SM Entertainment are opening new subsidiaries in south-east Asia, India and China. But critics say the focus on overseas expansion risks overlooking the infrastructure at home that once powered South Korea’s cultural ascent and eroding the cultural authenticity that originally attracted international audiences.
Jeong believes the industries will continue to earn money but warns that financial success alone cannot guarantee creative renewal. “The Korean entertainment industry will continue to profit this way,” she says, “but I think it will be difficult to create something like KPop Demon Hunters that has won over so many people worldwide.”
