Korean boy band TVXQ's recent announcement that they will be ceasing their musical activities as a group in Japan is expected to take a hefty financial toll on their local management agency, according to Japanese entertainment site Zakzak (www.zakzak.co.jp). Zakzak quoted noted Japanese music critic Tomisawa Issei, who said "TVXQ's break from their musical activities will result in sales losses for Japanese management agency AVEX worth from as little as 3 billion yen (31.9 million dollars) to as much as 5 billion yen (53.2 million dollars)." The Japanese talent agency, known for discovering new talents and venturing into the movie business, is said to have been taking various measures to overcome their recent business difficulties which included downsizing their board of directors from thirteen to seven earlier this month. AVEX announced on their official website last Saturday that the boy band, currently involved in a legal dispute with their Korean talent agency SM Entertainment, will be halting their activities as a group but the members will continue to pursue their individual activities. Matsuura Katsuhito, president of the agency's mother company AVEX Group Holdings Inc., had revealed his shock at the news on social networking service Twitter, saying "You have no idea how big a hit AVEX has taken. It is hard for me to talk about this because I have to consider the standpoint of Korean agency SM Entertainment, but I will try to make [TVXQ] remain for [the group's] Japanese fan club 'bigeast'".

Just over a week ago newspapers were lit up with news of the impending breakup of one of Asia's most popular boy bands, TVXQ. With the group’s Japanese management agency Avex officially halting the band’s activities in Japan, the five Hallyu stars inched closer and closer to the end of their decade-long career. On Tuesday, soon after the band’s announcement of ceased activities in Japan, TVXQ’s Korean reps SM Entertainment said it would file a lawsuit. The entertainment management house has so far withheld from engaging in a legal battle with three members of the group. However, it recently issued an official announcement saying they will now get in the mix against beleaguered trio: Xiah, Micky and Hero. According to an official statement from SM, the change had mostly to do with the recent announcement that it is severing all ties and obligations with its Japanese agency. By cutting loose from both agencies, the move would quickly stop the immense cash flow from revenue generated by the band in Japan to Korea’s biggest entertainment management agency. The band has enjoyed huge success in Japan, where they have topped the charts with singles such as “Toki Wo Tomete” which landed on the top spot of the weekly Oricon chart after selling 195,000 copies in the first week of its release. Even their latest release, a remix album, “TVXQ Nonstop Remix Vol. 2” entered the weekly album chart at No. 3, selling 38,000 copies. SM has recently given more slack to members after a court injunction forced the company to provide more freedom for individual members to pursue other opportunities. All five members have not appeared together in Korea since Xiah, Micky and Hero took legal action against SM Entertainment last July over a contract they felt disadvantaged them. Despite the ongoing legal mud slinging, the group, until Tuesday, had continued performing as TVXQ in Japan.