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Joaquina has signed a management deal with Global Talent Services (GTS), Billboard can exclusively announce today (Dec. 11). The new partnership will strengthen the Venezuelan singer-songwriter’s growth and amplify her artistic potential, and she will be overseen by manager Paula Kaminsky and co-manager Camila Canabal.
“I’m very grateful to count on a team that believes in me and my project, but most importantly, for believing in my songs and what I have to say in them,” the 19-year-old newcomer (born Joaquina Blavia Canabal) said in a press statement. “I’m very excited for this next stage of my career.”
Kaminsky added: “We are very happy and grateful that Joaquina, who is a talented singer-songwriter and performer and someone who holistically embodies the feelings of her generation, has placed her trust in GTS to further develop her career, and together, guide her in achieving her dreams of taking her art to the whole world.”
The exclusive news comes on the heels of Joaquina winning the coveted best new artist award at the 2023 Latin Grammys in Seville, Spain, where she was also nominated for best singer-songwriter album for her debut EP, Los Mejores Años.
Joaquina poses with the award for Best New Artist in the media center for The 24th Annual Latin Grammy Awards at FIBES Conference and Exhibition Centre on Nov. 16, 2023 in Seville, Spain.
Niccolo Guasti/Getty Images
Born in Caracas but raised in Miami, the well-rounded rising star—who took music, theater, and ballet lessons—is inspired by artists such as Avril Lavigne, and pens songs about teenage angst as heard in her notable track “Los Mejores Años.”
“Although I am very extroverted and I love to socialize, I am also very private and it’s difficult for me to talk about my fears, my thoughts, and ‘Los Mejores Años’ was a big relief song for me,” she previously told Billboard. “It helped me a lot to understand many things I was feeling in a time of normal transition in everyone’s life. It’s a bit that concept of feeling the fear of growing up for the first time in your life.”
Before winning best new artist, Joaquina formed part of the first class of graduates from producer Julio Reyes Copello’s Art House Academy, signed a record deal with Universal Music Latin, and was the opening act for artists such as Alejandro Sanz and Fonseca. She was also spotlighted as Billboard’s Latin Artist on the Rise in November.
Legislators have provisionally agreed to sweeping new laws that will regulate the use of artificial intelligence (AI) in Europe, including controls around the use of copyrighted music.
The deal between policy makers from the European Union Parliament, Council and European Commission on the EU’s Artificial Intelligence Act was reached late on Friday night in Brussels local time following months of negotiations and amid fierce lobbying from the music and tech industries.
The draft legislation is the world’s first comprehensive set of laws regulating the use of AI and places a number of legal obligations on technology companies and AI developers, including those working in the creative sector and music business.
The precise technical details of those measures are still being finalized by EU policy makers, but earlier versions of the bill decreed that companies using generative or foundation AI models like OpenAI’s ChatGPT or Anthropic’s Claude 2 would be required to provide summaries of any copyrighted works, including music, that they use to train their systems.
The AI Act will also force developers to clearly identify content that is created by AI, as opposed to human works before they are placed in the market. In addition, tech companies will have to ensure that their systems are designed in such a way that prevents them from generating illegal content.
Large tech companies who break the rules – which govern all applications and uses of AI inside the 27 member block of EU countries — will face fines of up to €35 million or 7% of global annual turnover. Start-up businesses or smaller tech operations will receive proportionate financial punishments, said the European Commission.
Governance will be carried out by national authorities, while a new European AI Office will be created to supervise the enforcement of the new rules on general purpose AI models.
President of the European Commission Ursula von der Leyen called the agreement “a historic moment” that “will make a substantial contribution to the development of global rules and principles for human-centric AI.”
Responding to the announcement, Tobias Holzmüller, CEO of German collecting society GEMA, said the deal reached by the European government was a welcome “step in the right direction” but cautioned that its rules and provisions “need to be sharpened further on a technical level.”
“The outcome must be a clearly formulated transparency regime that obliges AI providers to submit detailed evidence on the contents they used to train their systems,” said Holzmüller.
Representatives of the technology industry, which had lobbied to weaken the AI Act’s transparency provisions, criticized the deal and warned that it was likely to put European AI developers at a competitive disadvantage.
Daniel Friedlaender, Senior Vice President of the Computer and Communications Industry Association (CCIA), which counts Alphabet, Apple, Amazon and Meta among its members, said in a statement that “crucial details” of the AI act are still missing “with potentially disastrous consequences for the European economy.”
“The final AI Act lacks the vision and ambition that European tech startups and businesses are displaying right now,” said CCIA Europe’s Policy Manager, Boniface de Champris. He warned that, if passed, the legislation might “end up chasing away the European champions that the EU so desperately wants to empower.”
Now that an political agreement has been reached on the AI Act, legislators will spend the coming weeks finalizing the exact technical details of the regulation and translating its terms for the 27 EU member countries.
The final text then needs to be approved by the European Council and Parliament, with a decisive vote not excepted to take place until early next year, possibly as late as March. If passed, the act will be applicable two years after its entry into force, except for some specific provisions: bans will apply after six months while the rules on generative AI models will begin after 12 months.
In a statement, international recorded music trade organization IFPI said the first-of-its-kind legislation provides “a constructive and encouraging framework” for regulation of the nascent technology.
“AI offers creators both opportunities and risks,” said an IFPI spokesperson, “and we believe there is a path to a mutually successful outcome for both the creative and technology communities.”
Hipgnosis Songs Fund has found a buyer for a batch of “non-core songs” that have been up for sale since earlier this fall. In a filing Monday with the London Stock Exchange, where it is listed, HSF announced the sale of 20,000 tracks for $23.1 million, which it said reflects a 14.2% discount on the songs’ valuation as of late September.
The company said the sale of the songs, acquired in 2020 from Kobalt, is expected to net $22.6 million, which will be used to pay down a revolving credit facility and provide “greater headroom under its future covenant compliance reporting.” The buyer or buyers were not disclosed. The sale price represents a multiple of 9.6x net publisher share, according to a statement, and makes up approximately 1% of HSF’s investment portfolio value.
The specifics of these “non-core” songs have also not been disclosed. When the proposed sale was announced in September, the company’s board said the songs “require ongoing accounting and reporting obligations that take up significant bandwidth which can be better focused on active song management.”
Hipgnosis is comprised of three companies: Hipgnosis Song Management, Hipgnosis Songs Capital and Hipgnosis Songs Fund. The latter of the three has been mired in controversy in recent months after it was announced that the London-listed trust would not pay its investors a dividend because of new, lower projections for revenue.
On Oct. 26, investors of the fund overwhelmingly demanded structural changes to the music rights company, with more than 80% of Hipgnosis investors voting in favor of the board drawing up “proposals for the reconstruction, reorganization or winding-up of the company to shareholders for their approval within six months.”
Last month the company announced that the fund will not declare dividends before the new fiscal year, which begins next April, in order to ensure it has enough on its balance sheet to pay contractually-mandated catalog bonuses.
In its latest filing announcing the sale of unspecified songs, HSF also said it had appointed Singer Capital Markets as sole corporate broker and financial adviser, and Shot Tower Capital as lead adviser of the company’s strategic review.
Physical and digital media archiving service Iron Mountain Entertainment Services has agreed to fund full-ride scholarships for four students at Inglewood, Calif.-based music education institution 1500 Sound Academy, the organizations tell Billboard.
1500 Sound Academy offers instruction in current and emerging business practices in the music industry via a team that includes Grammy-winning singer-songwriter James Fauntleroy, Grammy-winning producer Larrance “Rance” Dopson and entrepreneur and executive Twila True. The scholarships will be available to prospective students who wish to enroll in one of three 1500 Sound Academy programs: music & industry fundamentals, DJ fundamentals and vocal performance & production fundamentals. Those awarded the scholarships will take part in in-person lectures and labs focused on music production, engineering, songwriting, mixing, music business, DJ fundamentals, vocal performance, vocal production and more.
Students who receive the scholarships will also be instructed in the basics of archiving and restoration through Iron Mountain’s “Smart Vault” digital media preservation solution as well as on-the-ground training at Iron Mountain’s digital studio and vaults.
To be eligible for the scholarships, applicants must meet the enrollment requirements and not have previously attended any course or program at 1500 Sound Academy.
“We look forward to our partnership with Iron Mountain Entertainment Services by offering four fortunate students the opportunity to learn the fundamentals in this industry through one of our programs,” said Fauntleroy in a statement. “With IMES’ global resources in the film, music, broadcast, and sports industries, we’re encouraging new talent to emerge in the field and seeking to help a new generation of music professionals obtain a launching pad into the industry.”
“The 1500 Sound Academy is leading the way for the next wave of leaders in the business of music,” added Lance Podell, senior vp/GM of Iron Mountain Entertainment Services. “We are honored to partner with them and fund student scholarships, as well as provide our Smart Vault solution to all of the students and faculty. Too often we hear about lost lyrics, songs or assets. Our support will provide the solution and training to help a new generation of creators in the discipline of archival preservation, which is a critical but often overlooked aspect of building a music career.”
The application process for the scholarships opens on Tuesday (Dec. 12). Winners will be announced on Dec. 29 or Jan. 5. More details on the submission and application process can be found here.
Ariana Grande has a new manager in Brandon Creed. The superstar has signed with his newly-launched Good World Management firm, sources tell Billboard.
Grande made major headlines in August when she split with longtime manager Scooter Braun‘s SB Projects. Grande had been with the company since 2013, the year she released her breakthrough debut album, Yours Truly.
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“[Ariana] likes that he understands her on a different level and between acting and music, she has a lot coming up and is excited to have found a new support system to help her execute her plans,” says a source close to the situation.
“She wants the focus to be her art and he puts her artistry and vision before anything else,” adds another source. “He is the perfect person to help her execute her visions for this next chapter of her life and career.”
In 2017, Creed — a longtime manager whose previous clients have included Bruno Mars and Lizzo — merged his own The Creed Company with Irving and Jeffrey Azoff‘s firm to form Full Stop Management. He split with the Azoffs in July, announcing the launch of Good World Management, bringing his clients Mark Ronson, Troye Sivan and Charli XCX along with him. Grande marks his third major signing since then.
In early August, Creed and Lydia Asrat announced they had signed Normani to a co-management deal through Good World and Asrat’s Q10. Then, in September, he signed Demi Lovato — another former Braun client.
Grande has had eight charting albums on the Billboard 200, six of them hit the top 10, with five topping the list. Her last release, Positions, debuted atop the chart in 2020 and spent two weeks at No. 1.On the Hot 100, she’s logged 73 entries — including 20 top 10s, seven of which hit No. 1. She most recently led the tally with her remix collab on “Die for You” with The Weeknd in March 2023.
Across her catalog of songs, she’s generated 23.5 billion on-demand official streams in the U.S., according to Luminate. Her albums have earned 22.4 million equivalent album units in the U.S, of which traditional album sales equal 3.3 million.
Grande recently teased her forthcoming seventh studio album with a series of photos posted to Instagram back in the studio. Artists including Selena Gomez, Billie Eilish and SZA expressed excitement in the comments for the pop star’s anticipated return.
On Saturday (Dec. 9), Grande performed “Oh Santa!” alongside Mariah Carey in New York. Next year, she will star as Glinda alongside Cynthia Erivo in the long-awaited Wicked film.
When Travis Scott performed a virtual concert inside the battle royale game Fortnite in April 2020, it drew 12.3 million concurrent players at its peak — the largest in-game gathering in Fortnite history. But despite this pull, “music has always been a little bit of a one-off” for us, says Nate Nanzer, vp of partnerships for Epic Games, the company behind Fortnite.
“We’ve done a concert here, and then a year-and-a-half later there’s another one. We haven’t had a persistent space to celebrate music before.”
This changed Saturday (Dec. 8), as the company rolled out Fortnite Festival, a music-focused game made in collaboration with Harmonix, the developer behind titles like Rock Band and Guitar Hero. Players can create a band with friends — or forge ahead solo — and perform hits on a variety of virtual instruments.
“For almost 30 years now, we have been trying to invent new ways for people to experience music through gameplay,” says Alex Rigopolous, co-founder and studio lead of Harmonix. “We never had an opportunity to do that on anything like the insane scale that Fortnite offers.”
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Epic Games previously dabbled in music by purchasing the platform Bandcamp in 2022, but the partnership proved short-lived. In September, Epic announced that it was laying off 16% of its staff and that the licensing company Songtradr was acquiring Bandcamp in September. (Layoffs hit Bandcamp as well.)
“While Fortnite is starting to grow again, the growth is driven primarily by creator content with significant revenue sharing, and this is a lower margin business than we had when Fornite Battle Royale took off,” Epic Games CEO Tim Sweeney wrote in an email to staff.
Fortnite is known for unbridled mayhem: Up to 100 players fight to death on an island, with the goal of being the last one standing. Rigopolous believes the game’s new music component may attract new users who steered clear in the past.
“Not everyone on Earth is interested in a battle royale game,” he says. In contrast, “basically everyone on Earth loves music.”
Fortnite Festival players will initially be able to drum, strum, or sing along with more than 30 songs, including the Weeknd’s “Blinding Lights,” the Killers’ “Mr. Brightside,” and Psy’s “Gangnam Style.” Players form a team, pick their track of choice, and choose an instrument — in addition to the usual suspects like guitar and percussion, they can select vocals, bass, keytar, and more. Once they’re transported to the stage to perform, game play may remind some users of Guitar Hero, with brightly lit notes zipping towards the user indicating what button they’re supposed to press on their keyboard or console.
Epic Games’ goal is eventually to have “hundreds” of songs available to play in Fortnite Festival, according to Nanzer.
“There will be a rotation of songs that anyone can play for free,” he explains. “If there’s a song you really like and want to be able to play whenever you want, you can go buy that song” to retain access to it. Nanzer says “music rights holders will share in the revenue from sales of music in the game.”
We’ve taped the launch setlist to your amp, so you can prepare for the Festival 
These sweet Jam Tracks will be on rotation starting in just three more days, so study up! pic.twitter.com/gYJc8jzfLN— Fortnite Festival (@FNFestival) December 6, 2023
These tracks — “Blinding Lights,” “Mr. Brightside,” Lady Gaga’s “Bad Romance” — are already massive, billion-stream hits. “Most of the music in the game is going to be huge hit music, household names,” Rigopolous acknowledges. But the hope, in time, is to introduce music from “lesser known artists who are cool and people should hear.”
“We have lots of pitches already from our label partners,” Nanzer adds. “We really want this to become a real opportunity for [the music industry] to reach this audience in a way that they’ve never been able to reach them before.”
If YG Entertainment’s re-signing of all four BLACKPINK members is any indication, investors can worry less about K-pop companies’ ability to retain their artists.
YG Entertainment gained 17.2% this week to 59,300 won ($45.00) as investors reacted to news that the four members of BLACKPINK signed to new, exclusive contracts with the agency. (The share price rose 29% the morning the announcement was made.) Uncertainty about contract renewals had caused the company’s share price to decline 16% in the week ended Sept. 22, as news reports out of South Korea said three BLACKPINK members would leave YG and spend just six months out of the year with the group. At the time, the company denied the news and insisted that the deals were still being discussed.
The BLACKPINK renewal appeared to have a positive impact on the stocks of other K-pop companies. Shares of HYBE gained 12.3% to 237,500 won ($180.24), while SM Entertainment shares rose 3.6% to 88,200 won ($66.94). Those improvements far exceeded the 0.5% gain posted by South Korea’s KOSPI composite index.
The Billboard Global Music Index gained 2.2% to a record 1,481.56, surpassing the previous high of 1,426.49 set four weeks earlier. That brought the index’s year-to-date gain to 26.9%. Half of the index’s 20 stocks finished the week in positive territory.
This week’s 2.2% gain outpaced major indexes around the world. In the United States, the Nasdaq improved 0.7% to 14,403.97 while the S&P 500 rose 0.2% to 4,604.37, reaching an all-time high of 4,609.23 on Friday (Dec. 8). In the United Kingdom, the FTSE 100 gained 0.3% to 7,554.47.
Spotify was the biggest contributor to the Billboard Global Music Index’s gain this week. The streaming company — the largest component of the 20-company, float-adjusted index — enjoyed a double-digit increase this week, gaining 9.6% to $198.05 after Monday’s news the company will lay off 17% of its workers. Following Thursday’s news that CFO Paul Vogel will leave the company in March 2024, Spotify shares rose 1.1% on Friday.
Another stock to react to financial news was Sphere Entertainment Co., which announced the sale of $225 million in convertible senior notes that mature in 2028. That sent the company’s shares down 15.5%, but the stock recovered most of its losses and finished the week down only 5.3% to $32.66. Following the debt announcement, Sphere Entertainment was upgraded by Seaport to a “buy” with a $38 price target, representing a 16.4% upside over Friday’s closing price. U2 concerts were doing $500,000 more per show than expected and the $99 average ticket price to the Darren Aronofsky film Postcard From Earth was above analysts’ $84 estimate.
The smallest stock on the index, Abu Dhabi-based music streamer Anghami, dropped 41.3% to $1.35 without any regulatory filings or other news. The stock was trading below $1.00 per share as recently as Nov. 15 but jumped to $3.49 on Nov. 21 on trading volume of 57.7 million shares, or about 50 times the daily average.
The Michael Jackson estate isn’t happy about a recently-announced digital sale of an early Jackson 5 recording, warning that it “violates the Jackson Estate’s rights” and could lead to a lawsuit.
A Swedish company called anotherblock announced Wednesday (Dec. 6) that it would digitally release a 1967 version of the song “Big Boy,” claiming it represented the first time Jackson’s voice had been put on tape. But in a letter sent Thursday, the estate’s attorney, Jonathan Steinsapir, pointedly advised the company about several problems that might “expose you to liability to the Jackson Estate.”
Among other things, the letter (which was obtained by Billboard) warned that the estate owns all rights to Jackson’s name, image and likeness rights, along with his trademarks. “Given this,” Steinsapir wrote, “any use of Michael’s name, image, and likeness in marketing, advertising or in the product itself violates the Jackson Estate’s rights.”
At issue in the budding dispute is a 1967 version of the Jackson 5 song “Big Boy,” a subsequent version of which was commercially released in 1968. The earlier version is called the “One-derful Version” because it was recorded at Chicago’s One-derful Studios. According to Rolling Stone, that version of the song first surfaced in 2009 and was released in 2014 on vinyl.
On Wednesday, anotherblock said it would release the track for the first time in digital format, doing so in partnership with Jackson’s mother, Katherine Jackson, and with a company called Recordpool, which purportedly controls the intellectual property rights to the recording. The sale, which included $25 and $100 packages with various other goodies, is meant to continue through the weekend via the anotherblock site.
But in its letter on Thursday, the estate warned that whatever deals anotherblock had struck to facilitate the “Big Boy” sale could be invalid if they covered rights that were controlled solely by Michael’s estate, like his trademark rights. And the estate’s lawyers strongly questioned the claim that the “One-derful Version” was Jackson’s first studio recording.
“We have no information to confirm that the unreleased recordings you are making available are in fact the first time Michael Jackson’s ‘voice was put on tape’ or even that it was the first time he recorded in a studio at all,” the estate’s attorney wrote. “Indeed, we have good reason to believe that this is not the first time Michael Jackson ever recorded in a studio. Because of that, you are likely misleading the public.”
A 2009 article by the Chicago Reader called the “One-derful” track “the earliest known studio recording of Michael Jackson and his brothers.” A 2014 article from Rolling Stone likewise called the recording the “earliest commercially available Jackson 5 recording.”
In Thursday’s letter, the estate also sharply criticized the decision to publish previously unreleased songs, telling anotherblock that Jackson was “was the consummate perfectionist” and that he had been “very careful about what recordings he released to the public.”
“Because of this, we have serious doubts that Michael would have ever wanted these recordings released and commercialized,” the estate’s attorneys wrote. “As the persons designated by Michael to protect his legacy after his untimely passing, the Estate’s Co-Executors are duty-bound to point this out. What you are doing is the opposite of honoring Michael Jackson.”
As if the message wasn’t clear enough, at the bottom of the letter the estate warned that it reserved “all of the Jackson Estate’s rights and remedies,” including the right to seek monetary damages and an injunction blocking further sales.
A spokeswoman for anotherblock declined to comment.
Spotify’s announcement this week that it was laying off 17% of its global workforce surprised a music business enjoying a renaissance. After all, Spotify ignited the subscription-streaming boom that saved the industry. And while the companies that depend on the online advertising business go through booms and busts — think of Meta cutting 21,000 jobs since 2022 — music business jobs have been relatively safe.
Spotify’s decision to eliminate about 1,500 full-time staffers shouldn’t have come as a surprise, though. As CEO Daniel Ek put it in a letter announcing the layoffs, “Today, we still have too many people dedicated to supporting work and even doing work around the work rather than contributing to opportunities with real impact.”
Over a decade and a half, Spotify pioneered a new model for music subscriptions by prioritizing growth over profit. While on-demand video streaming services such as Netflix frequently raised prices, Spotify left most of its prices unchanged until July. Digital music platforms have a notoriously tricky path to profitability, but Spotify’s share price soared thanks to a pandemic-era boost to streaming companies as well as high expectations for its nascent podcasting business. By February 2021, as Spotify poured money into acquisitions and pricey podcasting content, the stock was trading at $364.59 per share, valuing the company at roughly $71 billion.
By 2022, however, Spotify’s investors had run out of patience. The stock was trading at $110 on June 8 when Ek and CFO Paul Vogel shared their ambitious plan at the company’s Investor Day presentation: $100 billion in annual revenue, 40% gross margins and 20% operating margins. To get there, Spotify would continue to scale its podcasting business and lean on its audio content acquisitions — The Ringer, Parcast, Megaphone and Anchor — to help the format reach larger audiences. Now, Spotify also wants to do for audiobooks what it did with podcasts: piggyback on its massive base of music listeners, develop innovative products and build a bigger market.
Podcasts and audiobooks, as well as services sold to artists and record labels like merchandise listings and Discovery Mode, are important to reaching the targets of 40% gross margin and 20% operating margin. Given the nature of licensing deals with record labels and music publishers, music margins have little room to improve. Whereas video streamers like Netflix pay fixed costs for much of their content, Spotify pays a percentage of revenue to record labels and music publishers. That means as revenue increases, so do its content costs. And that’s not likely to change. “Our strategy is not predicated on trying to extract margin by negotiating better terms with the content partners we have,” Ek said at the 2022 Investor Day.
Over a year later, however, Billboard’s analysis of Spotify’s financial statements shows the company is still nowhere near its target margins. Since the first quarter of 2020, its gross profit margin has fallen between 24.1% and 28.4% while its operating profit margin has ranged from –8.8% to 3% and was below zero in 11 of 15 quarters.
Merely adding subscribers isn’t enough. (The company reported 226 million at the end of Q3 2023.) Reaching its targets requires Spotify to cut costs while investing in new growth opportunities such as podcasts and audiobooks. Ek said as much when explaining Vogel’s upcoming departure on Thursday. “I’ve talked a lot with Paul about the need to balance these two objectives carefully,” he said in a statement. “Over time, we’ve come to the conclusion that Spotify is entering a new phase and needs a CFO with a different mix of experiences.”
Spotify’s cost-cutting started in 2022 with a pause on new hires, layoffs in October and the cancellation of six live audio shows in December. This year, it laid off 6% of its global staff in January and in June merged two podcast production houses, Gimlet and Parcast, and further cut its podcast workforce by 2%. In August, it shut down Spotify Live, a short-lived live streaming app. Then on Monday, Spotify announced it would lay off 17% of its workforce. It also canceled two in-house podcasts, Heavyweight and Stolen.
As the graphs show, recent trends in Spotify’s financials made it clear larger cuts were necessary to meet the company’s ambitious targets. Personnel costs as a percentage of revenue rose from 13.8% in 2021 to 16.2% in 2022. Research and development expenses — which include some salaries — jumped from 9.4% of revenue in 2021 to 11.8% in 2022.
As Ek explained in the memo to employees, Spotify grew in 2021 and 2022 to take advantage of lower-cost capital. Today’s environment is different, however, and Ek believes Spotify’s “cost structure for where we need to be is still too big.” Indeed, Spotify’s head count steadily increased as it acquired companies, developed new formats and created product innovations that both resonated (Spotify Wrapped) and flopped (Spotify Live) with users. The number of full-time employees increased nearly 50% from 2020 to 2022.
This growth came without added efficiency, however. The revenue generated per employee peaked at 1.54 million euros ($1.66 million) in 2019 and declined to 1.4 million euros ($1.51 million) in 2022 — the lowest since 2017. The July price increase will help Spotify bring in more revenue without additional staff or resources, though the effectiveness of those increases won’t be known until Spotify releases full-year results in late January.
What’s more, Spotify’s gross profit per employee fell to a five-year low in 2022. Gross profit is what’s left after cost of sales — primarily royalties to labels and publishers — is deducted from revenue. It goes toward personnel costs, sales and marketing expenses, and general and administrative costs. But as Spotify added employees in recent years, gross profit per employee fell to 350,000 euros ($377,000) in 2022 from 391,600 euros ($421,000) in 2021.
An obvious way for Spotify to reach its target margins was to make larger cuts to its workforce and, as Ek phrased it, “become relentlessly resourceful.” Cutting 17% of its personnel costs would have resulted in savings of 323 million euros ($349 million) in 2022, based on total personnel costs of 1.9 billion euros ($2.05 billion). That savings would have halved Spotify’s 2022 operating loss of 659 million euros ($711 million).
Ultimately, the multi-billion-dollar question is simple: Can Spotify continue adding subscribers as fast as it has in previous years and develop its spoken word products into the higher-margin businesses it needs with far fewer employees? That’s the high-stakes situation the new CFO will walk into in 2024 and that will determine the company’s future from here on out.
Each week we’ll be sharing the most important news from the north with Canada’s top music industry stories, supplied by our colleagues at Billboard Canada.
For more Canadian music coverage visit ca.billboard.com.
Online Streaming Act hearings
For the last few weeks, a who’s who of stakeholders in Canadian music and media have been appearing before the Canadian Radio-television and Telecommunications Commission (CRTC) — from rights manager SOCAN to Spotify, Sirius XM and even UFC. The occasion is Bill C-11, a.k.a. the Online Streaming Act, which will update Canada’s Broadcasting Act for the first time in decades. The hearings will continue until Friday (Dec. 8).
It’s a major deal for the Canadian music business, whose system of CanCon requirements and public funds have built an industry that can compete — or at least not crumble — in a market dominated by American media to the south. This first round of hearings are focused on major streaming platforms like Spotify and YouTube and potential regulations and monetary contributions they may have to make in order to continue operating in Canada.
“We hope that the CRTC will lean into this idea that it’s a once-in-a-generation regulatory process,” says Patrick Rogers, CEO of Music Canada, which represents the major label. “There are a lot of big questions: Who gets regulated? Who pays? How much? Who has access to the money? Now is when we’re going to figure it out.”
A worry among many is that too much financial regulation of big American tech companies could cause them to scale back their investment in Canada. Something similar recently happened with Bill C-18, in which Meta chose to block all Canadian news rather than pay for it. In Spotify’s hearing, company executives — who have an office in Toronto — said that compelled spending could affect their existing Canadian investments.
“The objective here should be: how do we build a stable, viable, resilient, equitable, middle class of artists and thriving Canadian-owned businesses and the music space that can compete globally?” says Andrew Cash, president and CEO of the Canadian Independent Music Association. READ MORE
How Quebec markets its music to the world
M for Montreal festival took place from Nov. 15-18, bringing Canadian and international visibility to Quebec music and artists. That’s an important objective in Quebec, where francophone music is marketed as much to France and globally as to the rest of Canada, which is divided by language.
According to the Société de développement des entreprises culturelles québécoises (SODEC), one of the festival’s main financial partners, M for Montreal is a significant market. “It’s an extraordinary opportunity to check the interest of foreign professionals in very particular artistic proposals whose potential is not yet known internationally,” says Élaine Dumont, general director of international affairs, exportation and marketing of Cinema at SODEC.
For her, events like M for Montreal are a fantastic way to gauge interest in Quebec musicians. “They are at home with their audience, so they can give the best of themselves, and that is precious,” says Élaine Dumont.
Similarly, SODEC supports collective presence, which means making sure Quebec artists and music industry professionals are represented at festivals worldwide. “We collaborate with M for Montreal, Mundial Montreal, FME, POP Montreal, for example, so that they send professionals internationally,” she adds. Thus, M for Montreal participates in events such as South by Southwest in Texas, Reeperbahn Festival in Germany, The New Colossus in New York and The Great Escape Festival in England.
“The festival has a good network in France, Germany, the UK, the US, and the rest of Canada,” notes programmer Mathieu Aubre. And because the French market is not approached like that of Francophone Africa, for example, SODEC, with an annual budget of over $4 million for the export of Quebec music, also offers specific support to territories. “We distribute various aids that allow us to take risks, support artists’ careers and develop audiences outside Quebec and internationally,” says Dumont. READ MORE
Diljit Dosanjh to play the biggest Punjabi concert outside of India
Diljit Dosanjh is set to make history next year with a just-announced performance at Vancouver’s BC Place on April 27, 2024 — the country’s first-ever Punjabi stadium show. With a capacity of 54,500, it’s expected to be the largest ever Punjabi music performance outside of India.
The BC Place announcement caps off a banner year for Dosanjh. This summer, he became the first artist to perform a fully Punjabi set at Coachella and in September, he released his latest album, Ghost, blends smooth R&B, moody trap and laid-back pop. The album spent seven weeks on Billboard’s Canadian Albums chart, peaking at No. 5. His collaboration with Sia, “Hass Hass,” also went to No. 37 on the Canadian Hot 100.
Speaking to Billboard Canada for a cover story about the popularity of Punjabi music in Canada, talent buyer Baldeep Randhawa recalled taking a job at Live Nation with a goal of supporting South Asian music. At the time, he hinted at big things to come with Dosanjh and said he had already shown there’s a major market for Punjabi music in Canada.
“I told them I was gonna prove the concept, book a 500 cap[acity] room and eventually go bigger,” Randhawa said.
When only a couple of months later, Live Nation booked Dosanjh, Randhawa learned he could skip right over the 500 capacity rooms and book arenas. Dosanjh performed at Scotiabank Arena in Toronto, then a sold-out show at Vancouver’s Rogers Arena — which has a capacity of 18,000 — in June 2022.
Dosanjh is a superstar, but he’s not the only Punjabi artist making waves in Canada. Dosanjh collaborator Ikky recently announced a headline tour visiting five Canadian provinces in February 2024. READ MORE