One Direction Resign From 1D Media: Disaster Or Sign Of Hope?

The One Direction fandom is buzzing after it was announced that the boys have resigned as directors of 1D media, the company that manages One Direction’s finances. With One Direction currently on hiatus, fans fear that the move could be a prelude to One Direction’s hiatus becoming a permanent one. Harry Styles announced in January that he had dropped One Direction’s management team and their PR company. It must be said that Harry’s move excited a lot of fans, because they hoped that the rest of One Direction would follow suit. To date, that has not happened, but could it be the case that One Direction have just boosted their fans hopes.

Last month, the Sun reported that One Direction’s tax affairs could be under investigation. It seems that the members of One Direction converted their shares into a so-called “alphabet” scheme. Apparently, the U.K. taxman is not keen on such schemes, because it avoids paying National Insurance contributions and can help to avoid tax. As a result, the tax inspector needs to be happy that there is a sound business reason for using such a scheme.

Is there a song title pun? We're not familiar with their oeuvre: 1D resign as directors of 1D Media over tax probe https://t.co/ELCbaHefdd

— Bedrock Tax (@BedrockTax) April 18, 2016

There has been no suggestion that Harry Styles, Niall Horan, Louis Tomlinson, or Liam Payne have done anything illegal, and the scheme set up to manage One Direction’s income is perfectly legal. One Direction would also seem to have a perfectly sound reason for using an alphabet scheme. It can’t have escaped anyone’s notice that Zayn Malik quit One Direction just over a year ago.

One of the key benefits to an alphabet scheme is that it allows dividends to be paid at different rates. It would seem reasonable to assume that the five members of One Direction had equal shares in 1D media. When Malik left, he would have retained a right to royalties for music One Direction created whilst he was a member. Income earned after Malik left would be the property of the four remaining members of One Direction. An alphabet scheme would, therefore, allow Malik to be paid at a different rate to the rest of One Direction.

These points seem to be lost on the Sun who broke the news that the One Direction boys have resigned as directors of 1D media. The implication is that One Direction are distancing themselves from a company involved in dodgy dealings. Outlets like Unreality TV have picked up on the story and claim that this could be the “beginning of the end” for One Direction.

If I didn't have you I'd never see the sun. #Directioners – One Direction #SoFantastic @radiodisney pic.twitter.com/ifBbILXGXV

— Morgan (@likeinfinityx) April 10, 2016

Of course, those claims make a good headline, but the moves by One Direction do not necessarily mean very much at all. For a start, all of the One Direction boys remain shareholders in the company. They are presumably in a situation where 1D media currently does not have a lot to manage. Royalties, merchandise sales, and so on will continue to be paid to the company, but with One Direction on hiatus, income will be much easier to manage.

Given that One Direction have acted perfectly legitimately, could it be the case that something else lies behind their decision to step away from 1D media? Could it be that this is a further step down the road of distancing themselves from One Direction’s management team?

Have you been keeping up with everything happening on the @onedirection hiatus?https://t.co/QDqeBafldf pic.twitter.com/9R7B1xRUja

— Maximum Pop! (@maximumpop) April 18, 2016

Many One Direction fans believe that the boys are unhappy under the current management team. Zayn Malik gave us some hints into just how closely One Direction are controlled by their management. In his interviews with Billboard, Fader, and elsewhere, Malik revealed how One Direction’s management banned him from growing a beard, told him how to dress, and so on. Malik also revealed that any attempt to introduce anything different into One Direction’s music was stamped on by management.

One Direction were young boys when the group was formed. They have grown into fine young men who took the world of pop music by storm. One Direction may have been fairly malleable when they were 16- or 17-years-old. They are now young men with a sizeable fortune in the bank. Put simply, One Direction’s members have grown and matured, and it is perfectly natural for them to want to stretch their wings. Perhaps freeing themselves from One Direction’s management is essential for the various members to allow themselves to continue to grow as people and as musicians. Harry Styles seems to have thought this the case — why should the rest of One Direction be any different?

[Photo by Eduardo Verdugo/AP]