ZAKZAK, an online news portal associated with Sanspo, one of the largest newspapers in Japan, recently published an article on February 5th estimating the penalty cost for TVXQ's breach of contract at 10 billion JPY (approximately 121 million USD).
The article made reference to the difference between the Japanese and Korean industry, or more specifically, particular terms and clauses within TVXQ's contract which were considered "shocking." The terms referred to were where "all rights and privileges that the group get from TV programs and stage performances, as well as public activities in and outside of Korea, belong to the production company." It was also stated that the decision meant "all copyrights, including the copyrights for lyrics, music, arrangement, reproducing right, duplicating right, recording right, distributing right, broadcasting right, performing right, karaoke distributing right, and the right to produce secondary products, are all transferred to the company."
An unnamed expert official explained that, "In Japan, artists are paid a part of their singing right, and copyrights of lyrics, music and arrangement. At that time, among the 5 members, each of them were paid 0.4-1% of their profits. Moreover, if they were not able to sell more than 50,000 copies, then there would be no guarantee for their pay."
Perhaps what was most shocking was the amount of the penalty should there be a violation of the contract. ZAKZAK outlined the amount at 3 times the investment made into the group, plus twice the profit expected to be made in the remaining years of the contract duration. The cost to JYJ for breaching the contract was estimated at "more than 10 billion JPY (121 million USD)."
Diplomatic as always, the Japanese article reasoned that this was the way things were done in the Korean entertainment industry: to invest heavily in their idols, and as a result, bind them with long-term contract and to continue training them. "It may be difficult for the Japanese to understand, but this is the way the Korean wave is taking over Asia."
Source: ZAKZAK and onetvxq