Digitization has signi cantly changed the process for producing and consuming music: from analogue to digital, albums to songs, possess to access, audio to visual, and end products to promotional products. In this globalized digital era, actively embracing digitization would likely help enhance the competitiveness of the music industry. e rise of K-pop and the decline of J-pop clearly demonstrate the di erent results from whether to embrace or wrestle with digitization. e Korean music industry recognized changes brought on by digitization earlier and was more active in responding with e ective strategies. By contrast, the Japanese music industry did not immediately respond to these changes but stuck to its rent-seeking behavior in order to take advantage of its larger market size and ‘sophisticated’ copyright regime. e implications from this paper is that business activities are the core element for creating and enhancing competitiveness of the music industries.