HYBE, in partnership with Tencent Music, China's largest music platform, is set to enter the Chinese market more aggressively. The industry is closely watching whether HYBE can effectively monetize in China amid the emergence of the "K-pop crisis theory."

On May 16, HYBE signed a music distribution contract with Tencent Music. This agreement enables Chinese audiences to officially access HYBE's current and future music releases on Tencent Music's platforms, including QQ Music, KuGou Music, KuWo Music, and WeSing. The collaboration aims to promote music sources and artists. However, the distribution status and contract details have yet to be confirmed, according to a HYBE official.

Popular K-pop artists under HYBE, such as BTS, SEVENTEEN, and TXT, are highly popular in China. However, the profits generated from their activities have not fully returned to Korea due to the absence of an official distribution contract. As a result, China accounted for only 1% of HYBE's total sales last year. Most of HYBE's sales in Asia (32.7%), excluding Korea, were primarily driven by the Japanese market in the first quarter.

With this new deal, HYBE will actively target the massive Chinese music market. They have already begun recruiting Chinese personnel for content planning, production, and business operations to establish a stronger local presence. HYBE Chairman Bang Si Hyuk noted the clear slowdown in K-pop indicators during the Kwanhun Forum held in March, stating that China's market continues to grow despite Hallyu restrictions

As of December last year, over 700 million people in China were using music streaming platforms, with over 90% of them affiliated with Tencent Music. In the first quarter of this year, Tencent Music's online music revenue reached $510 million, with over 94.4 million paid service users. On top of that, Tencent Music also emphasized its strengthened partnership with HYBE in its Q1 earnings release.