Global Music: Long-term Perspective – Super Fan Economy, Why Concerts Are Now BTS Company's Focus

Global Music: The Long View - Super fan economics, why concertsare now BTS company’s center of gravity K-pop has moved from a unit-driven business to a moment economy where fans spend lesson albums and more on live, time-bound experiences with their artists. As the perceived valueof emotional return per hour rises, concerts have become the natural center of gravity forindustry monetization. Hybe demonstrates this shift at scale, using each show as a platformto monetize fandom across tickets, merch, and digital content. Min-Joo Kang+852 2123 2644minjoo.kang@bernsteinsg.com Robin Zhu+852 2123 2659robin.zhu@bernsteinsg.com “Moment” economy: Concerts take the wheel in K-pop.K-pop fandom has shiftedfrom buying albums to buying time with their artists, with spend increasingly flowing to livemoments rather than physical units, built around monetizing real-time interaction betweenfans and artists. In this framework, concert revenue becomes the natural center of gravityfor the industry’s profit pool as the model rotates from unit-based albums to platforms thatcan repeatedly monetize live, time-bound fan engagement at scale. Ian Moore+1 917 344 8434ian.moore@bernsteinsg.com David Dai, CFA+852 2918 5704david.dai@bernsteinsg.com Fans paying for time: Why experiences beat physical goods.The perceived value oftime is rising even as the real value of a dollar is squeezed, pushing consumers towardexperiences that maximize their emotional return per hour. In K-pop, intense fandom, socialsignaling, and constant digital sharing mean a 2-3 hour show throws off months of residualvalue through clips, interactions with the artist, and ongoing community engagement,supporting ticket and bundle pricing that would look excessive for any standalone product. Christophe Cherblanc+41 582 723 540christophe.cherblanc@bernsteinsg.com Charles Gou+852 2123 2618charles.gou@bernsteinsg.com Filling seats, owning screens: How Hybe monetizes every moment.Hybe has turnedBTS fandom into hard crowd-pulling power, filling 50k-capacity venues and selling out 80+shows, so that every night on tour seeds a high-margin online profit pool in streaming, buzz,and digital content. Its 300+ concerts over 50+ cities looks beyond a local label calendar.BTS’s latest comeback crystallises the model: a new album, a physical comeback stage, andinstant dominance on global platforms show how a single IP can move the content valuechain, shift bargaining power to the IP owner, and monetize fan consumption across Spotify,Netflix, and beyond. Hyrum Caesar+81 3 6777 6979hyrum.caesar@bernsteinsg.com Nosher Ali Khan+1 917 344 8578nosher-ali.khan@bernsteinsg.com Jack Lin+852 2123 2683jack.lin@bernsteinsg.com Monetizing the hype: Hybe’s concert-plus-merch profit engine.Concert revenueis usually a low-margin business once you factor in staging costs and promoter revenueshare, but large-fandom IPs flip that script. In Hybe’s case, each show is treated as amonetization node for a full stack of revenue streams: tickets, VIP and soundcheckpackages, tour-exclusive merch, fan club memberships, and digital content layered ontop. Hybe also benefits from structurally higher margins, retaining a greater share of toureconomics as its global scale reduces reliance on local promoters. Christopher Pancur+44 20 7676 7280christopher.pancur@bernsteinsg.com Streaming to Stadiums: Unlocking superfan lifetime value.K-pop superfanmonetization is becoming a powerful flywheel for bothSpotifyandLive Nation, convertinghigh-ARPU digital engagement directly into live revenue. These fans already spend heavily,making them ideal for Spotify’s premium upsell, while tools like Reserved seamlesslychannel them into concerts, where they drive above-average pricing and sell-through.Spotify monetizes the fan online, Live Nation monetizes them offline, and together theymaximize lifetime value. BERNSTEIN TICKER TABLE INVESTMENT IMPLICATIONS We rateHybe (352820.KS) Outperform. We rateSPOT&LYV Outperform. We rateSonyMarket-Performwith PT =¥3,500.00. We rateUMG Outperform. VALUATION COMPS TABLE DETAILS SUPER FAN ECONOMICS, WHY CONCERTS ARE NOW K-POP’S CENTER OF GRAVITY K-pop’s first generation emerged in the 1990s, led by SM Entertainment, with flagship IPs such as H.O.T. and S.E.S. definingthe early idol model. Fan engagement was largely physical - album collecting, cable TV viewership, and intimate fan meetingsand concerts. BoA marked the first true breakout at a regional level, paving the way for broader expansion. By the secondgeneration, the industry had deepened its talent bench, building a pipeline of skilled producers and tiered regional IPs. That said,monetization remained heavily skewed toward physical album sales, which continued to anchor K-pop consumption throughthis period. Over the past two decades, as K-pop evolved from 1st to 3rd to 4th generation, K-pop fandom has shifted from buying albumsto buying time with their artists, with spend now flowing to live “moments” rather than