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LiveOne will capitalize on the booming podcast industry by spinning off its PodcastOne business as a standalone entity through a dividend to shareholders as of August 28, the company announced Thursday. PodcastOne shares were approved for listing on the Nasdaq exchange on Monday (Aug. 14) and will begin trading under the “PODC” symbol on Sept. 8.
LiveOne, which also owns the music streaming platform Slacker Radio, will issue a dividend of about 19% of PodcastOne shares to its shareholders and retain the remaining roughly 81% of the outstanding shares. LiveOne CEO Robert Ellin said he expects PodcastOne stock will be priced between $8 — the minimum price for Nasdaq-listed stocks — and $12 per share. A third-party valuation of PodcastOne in February put the company at between $230 million and $274 million.
“We will be very aggressive to continue to grow that and it’s a big part of the reason we’re taking the company public,” Ellin said during a conference call for investors on Thursday (Aug. 17). The company currently has a pipeline “of over 10 additional acquisitions that we’re carefully taking a look at,” he added.
PodcastOne has a number of popular podcasters including Adam Carolla, Dr. Drew Pinsky and Jordan Harbinger. It ranked 10th in Podtrac’s publisher ranking for July 2023. Last week, LiveOne obtained the exclusive network distribution and advertising rights to comedian Brendan Schaub’s portfolio of podcasts including The Schaub Show and The Fighter.
PodcastOne already has two important acquisitions in 2023. LiveOne entered into a letter of intent to acquire Kast Media, a podcast network expected to add up to $10 million in annual revenue and boost earnings for PodcastOne. The company also has a binding letter of intent to acquire Guru Fantasy Reports, owner of fantasy football website Fantasy Guru, that Ellie said he expects will close “in the next few weeks.” The all-stock deal is expected to add annual revenue of $2.5 million and over $600,000 in earnings before interest, taxes, depreciation and amortization.
PodcastOne had revenue of $10.6 million in the quarter ended June 30, accounting for roughly 38% of LiveOne’s total revenue. Last week, LiveOne raised its guidance for PodcastOne’s full fiscal year revenue from $34 million to a range of $42 million to $47 million.
Separately, LiveOne also plans to make Slacker Radio a standalone, publicly traded entity through a merger with Roth CH Acquisition V Co., a special purpose acquisition company. LiveOne and Roth have signed a letter of intent but no merger date has been announced. LiveOne said it expects Slacker to have a pre-money valuation of $160 million.
Publishers should get ready to welcome a royalty windfall now that the Copyright Royalty Board has printed its Phonorecord III final determination in the Federal Register — the last step to make the new rate structure official, concluding a more-than-four-year royalty row between publishers and streaming services.
The question is, how much that bonus will be.
While various industry estimates are all over the place with some even reaching another $400 million, by Billboard estimates, the just announced determined rates — finalized eight months after the 2017-2022 term expired — could yield up to another $250 million in underpaid mechanical royalties flowing from digital services to publishers and songwriters.
Now, digital services like Spotify, Amazon Music, YouTube and Pandora have six months to review and adjust past payments made for U.S. mechanicals to the new rates. Doing that will take a complicated assessment of past payments and applying them under the new finalized structure.
The ruling increases U.S. mechanical royalties each year during the five-year period using a multi-pronged formula based on choosing between either the royalties calculated using a “headline rate” tied to a percentage of the streaming service’s total revenue; or another pool that is calculated by using the lesser of either a percentage of total content cost — i.e. what’s paid to labels — or 80 cents per subscriber. Under the new finalized determination — which for the percentage of service revenue prong, is the same as the initial determination for the 2018-2022 term — the headline rate increased from 11.4% of service revenue in 2018 to 12.3% in 2019 to 13.3% in 2020 to 14.2% in 2021 and to 15.1% in 2022.
From there, performance royalties that are negotiated with and paid out to rights organizations like ASCAP and BMI are subtracted from the all-in pool, leaving just the mechanicals behind. The mechanicals are then measured against a 50-cents-per-subscriber floor, and whichever is bigger becomes the final mechanical royalty pool paid out to publishers and songwriters.
Until an appeal of the initial CRB rate determination initiated by independent songwriter George Johnson and joined by most of the big digital services sent it back to the CRB in July 2020, most of the streamers had been paying royalties under the high escalating rates from the initial Phonorecords III determination. But with the remand, in the fall of 2020, most services reverted to paying music publishing royalties using Phonorecords II rates from 2013-2017 while the appeal was sorted out. As an example, looking at just 2020 rates, that meant digital services abandoned the royalty structure that paid 13.3% of service revenue or 24.1% of total content cost and switched back to using the prior headline rate of 10.5% of service revenue and 21% of total content cost.
(This article uses rates and math associated with what’s known as the stand-alone portable streaming model — i.e., a single paid subscription — because it’s the dominant model that produces the most revenue in the U.S. marketplace. The rate formula has different percentages and parameters for other models like bundled, ad-supported, family or student tiers.)
Under the CRB judges’ final determination published in the Federal Register, the Phonorecords III royalty calculation keeps the escalating rate structures for on-demand streaming for the percentage of revenue prong in the formula but abandons an escalating rate structure for the cost-of-content prong. So, in the case of a single paid subscriber, that prong will apply 21% of total content costs to build an all-in pool to cover both mechanical and performance royalties, instead of the previously used — from the initial 2018-2022 determination announced in 2019 — annual escalating rates that in 2022 would have culminated at 26.1% of total content costs. That means in months where the total content cost became the all-in prong, the streaming service most likely overpaid publishers under the new rate structure.
In addition to eliminating an escalating rate structure for that prong, the CRB judges reapplied a ceiling for the total content bucket limiting what digital services would have to pay publishers. The initial 2018-2022 determination took out the ceiling mechanism, which would have meant that every time labels negotiated a higher rate, the music publishers and songwriters would also automatically benefit by a higher rate. Now, services reviewing their previous payments will need to measure the total cost of content bucket against the 80-cents-per-subscriber ceiling. Whichever of those two buckets is lower is then measured against the headline bucket and, this time, whichever is larger is chosen as the all-in bucket.
Reinstating the ceiling and jettisoning the escalating rate structure for the total content all-in pool could mean publishers were actually overpaid tens of millions of dollars for the 2018-2020 years, Billboard estimates based on Mechanical Licensing Collective and Harry Fox Agency royalty calculations data obtained from publishing sources. That amount, however, will be more than offset by the hundreds of millions of dollars in additional payouts that digital services will have to make for 2021 and 2022.
Billboard doesn’t have all the data necessary to calculate mechanical revenue on a month-by-month basis for each digital service, but looking at overall payments and reports to the Mechanical Licensing Collective can provide a simplified ballpark estimate on how much is owed to publishers and songwriters over the Phonorecords III five-year period.
First, let’s look at the first three years when it’s likely that services overpaid publishers and songwriters because they used the since-abandoned initial determination’s escalating percentages for the total content pool when calculating royalties. With Spotify, for example, according to data obtained by Billboard for the streamer’s Premium Individual tier, the headline rate royalty bucket won out most of the time for two of those years — 2019 and 2020 — to become the all-in bucket. Since the headline bucket rates are the same before and after the remand, it’s likely there were relatively minimal overpayments during that period. In 2018, however, Spotify’s total cost of content bucket appears to have won out all year — and that was at a higher rate of 22%, not the remanded 21%, and without a ceiling. So, in that year alone, Spotify likely overpaid by as much as $10 million on that tier alone, Billboard estimates, and is due to receive that money back from publishers and songwriters.
Based on that, and not knowing what kind of label licensing deals all digital services have, Billboard calculates — and some industry financial sources agree — that as much as $50 million in over-payments might have been paid by the digital services to publishers and songwriters overall during the 2018 through October 2020 period.
For that period, any overpayments will mostly be sorted out directly between the digital services and the publishers because the Mechanical Licensing Collective — created following the Music Modernization Act was signed in 2018 — hadn’t begun operating yet. Though, the organization will need to be involved in in recalibrating royalty payments that came from unmatched and unpaid royalties, which digital services turned over for those years at the MLC’s inception.
For 2021 and 2022, however, once the MLC began operating, the organization will be responsible for managing any royalty adjustments, once the new data and additional funding is received from the digital services.
In 2021, U.S. digital services reported $9.76 billion in estimated service revenue to the MLC, while the all-in publishing revenue totaled $1.31 billion — or 13.38% of service revenue — according to Billboard estimates based on MLC data obtained by Billboard. Taking a simplified across-the-board approach applying that year’s 14.1% headline rate against the total revenue of $9.76 billion would deliver nearly $1.39 billion in mechanical royalties — a $80 million bonus to publishers and songwriters.
For 2022, the payouts will likely be even greater. That year, digital services reported $10.78 billion in service revenue to the MLC and paid out a total of $1.45 billion in mechanical and performance royalties — or 13.5% of total revenue. Applying the 15.1% headline rate for that year produces about $1.63 billion in all-in publishing revenue — making for an extra $175.1 million in mechanical royalties.
Combined, 2021 and 2022 could yield an additional $255 million in mechanical royalties, by Billboard‘s best estimates. Depending on how much services can claw back from overpayments made during 2018 through October 2020, Billboard estimates publishers and songwriters will receive a windfall of $200 million to $250 million.
Once those payments are settled, it will be up to publishers to figure out payments to their songwriters under the new rate structure.
Beyond the windfall expected due to adjustments for over payments in 2018-2020 and the much larger underpayments in 2021-2022, Billboard estimates that the MLC holds an additional $350 million or so in unmatched or unclaimed royalties. In March of this year, the MLC reported to Billboard that it had paid out over $200 million of the $427 million pool in mechanical royalties it was handed from the years prior to when it began operating on Jan. 1, 2021. Sources say that since then, the prior 2021 unclaimed and unmatched pool has been further reduced with a total of almost $300 million now paid out. That leaves around $130 million in unclaimed royalties.
But what about 2021 and 2022? Since the MLC began, it has been matching about 90% of royalties from recordings to songs. In addition to the remaining 10% of songs that are not yet matched to recordings, there are songs building up the unpaid royalties pool because their credit claims do not add up to 100%. If a portion of a song’s credits are not claimed, that portion of the song’s royalties goes into the unclaimed and unmatched pool. Consequently, the overall payout rate the MLC is making nowadays comes out to about 84% of mechanical royalties received from digital services, according to sources, which is a considerable improvement compared to the 68–72% digital services matched and paid prior to the MLC’s launch.
In 2021, digital services paid the MLC about $675 million in mechanical royalties, Billboard estimates, and in 2022, they paid about $740 million. If 16% of the royalties for those two years are unmatched or unclaimed, that would make for another $225 million. And when 2018-2020 is added in, the MLC has a little more than $355 million in unmatched or unclaimed royalties still to be doled out to publishers and songwriters.
In addition to the publishing royalties still held by the MLC, Billboard estimates the finalized CRB rate determination will result in $50 million in overpayments to publishers for the 2018-2020 period and about $250 million in underpayments for 2021-2022. Within those totals, some of those adjustments will impact the $350 million or so unmatched and unclaimed royalties still held by the MLC.
If you give a hoot about feel-good songs on TikTok, there’s a solid chance you’ve heard Paul Russell’s “Lil Boo Thang” by now. A full version of the infectious song, which interpolates “Best of My Love” by The Emotions, has been cleared for landing and is set for release on streaming services at midnight on Friday (Aug. 18). Billboard has also learned that Arista Records has officially signed Russell, a Texas native now based in Los Angeles, ahead of the song drop.
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The proof of “Lil Boo Thang”’s virality is in the stats. Russell teased a 21-second snippet of the track via TikTok on June 28, with the post garnering over 5.3 million views and launching over 55,000 “creations” from new fans who’ve paired it with everything from clips of their dogs to best-friend tributes to fitness milestones. Russell later repurposed the post on Instagram Reels, where he reeled in another 10.4 million views.
In six subsequent TikTok posts that included the song, with lyrics like “Tell ‘em you found a lil’ something too fresh” and the folksy “I don’t give a hoot what your dude say,” Russell has generated another 4 million views and dozens of comments with varying versions of “Dude, drop the full version now!!!“. (He again cloned these follow-ups on Reels, bringing in millions more listens for the song clip.)
The infectiousness of “Lil Boo Thing” owes quite a bit to the legendary bounce of “Best of My Love,” a disco-funk anthem written by Maurice White and Al McKay of Earth, Wind & Fire that spent five weeks atop the Billboard Hot 100 in 1977 and was The Emotions’ biggest hit.
Courtesy Photo
The full version of “Lil Boo Thang” (see the single cover, right) has received 20,000 pre-saves to date.
“First and foremost, ‘Lil Boo Thang’ is meant to be a good time,” said Russell ahead of the full track release. “When I wrote it, I was stressed out on a Thursday afternoon, so I just turned on some of the music that makes me happy and imagined that I was celebrating something. I think what makes the song special is the fact that so many of us are ready to just forget about whatever is happening around us and enjoy the good things in life — not just thinking back to good times in the past but creating new ones in the present day.”
The Cornell graduate has nearly 2 million monthly listeners on Spotify, with 14 million streams for his 2022 single “Ms. Poli Sci” and 7.3 million for 2021’s “Hallelujah.”
Check out the TikTok post that started it all:
The music team at TikTok was hit with layoffs last week in an effort to improve efficiency, multiple sources tell Billboard. The cuts affected seven staff members, including senior product strategy & ops lead Kelly Chen and U.S. music partnerships and operations lead Marisa Jeffries. All affected employees were based in the United States. Sources […]
BMG has partnered with pioneering UK electronic duo The Chemical Brothers and will now administer and represent the band’s entire song catalog, building upon their previous arrangement to represent all of the duo’s works from 2015 onwards. The news comes just weeks before the duo will release their tenth studio album For That Beautiful Feeling.
Primary Wave Music has purchased the publishing rights of Styx member Dennis DeYoung, encompassing the majority of his compositions and master recordings. This includes Styx hits “Come Sail Away,” “Babe,” “Mr. Roboto,” “Lady,” “The Best of Times,” and more.
Concord has purchased a portion of the song catalog of Plain White T’s frontman Tom Higgenson, including his share of “Hey There Delilah.”
BMG has acquired the writer’s share of royalties for Michael Münzing of SNAP!, building on the company’s pre-existing partnership with the 90s Eurodance troupe. The two parties’ relationship began in 2018 when BMG acquired SNAP!’s recorded music catalog.
Simon Cowell and Syco Entertainment have launched Syco Publishing in partnership with UMPG.
Warner Chappell Music and the Warren Brothers have joined together to sign Jet Harvey to a worldwide publishing deal. Most recently, Harvey co-wrote Bailey Zimmerman’s “Rock And A Hard Place,” which ranked at No. 1 on Billboard’s Country Airplay chart for six weeks.
peermusic Australia has signed Ziggy Ramo to a worldwide publishing agreement. This is Ramo’s first-ever publishing deal, encompassing his back catalog and future works.
Sony Music Publishing hosted its first-ever SMP x BeatStars Hitmaker Week in Stockholm, Sweden at the House of Creatives. Bringing together 27 BeatStars Publishing hitmakers from 10 different countries, the camp marked the three-year mark in SMP’s partnership with the beat marketplace.
Position Music has signed producer, writer and instrumentalist Keith Varon (Machine Gun Kelly, Joji, Kenny Hoopla, Travis Barker) to a publishing deal. News of the deal arrives soonafter the talent scored RIAA Gold for “Angels and Demons” by jxdn and Platinum for “Banyan Tree” by Machine Gun Kelly.
Reel Muzik Werks has signed songwriter Jennifer Adan to a publishing administrative deal. This includes the administration of her previously existing catalog, including “She Wouldn’t Be Gone” by Blake Shelton.
After at least five months of deliberations, Paramount Global has decided against selling a majority stake in its BET Media Group, The Hollywood Reporter has confirmed.
The move to take down the “for sale” sign for the unit — which includes the BET channel, streamer BET+ as well as VH1 and BET Studios — follows publicly expressed interest from the likes of moguls Tyler Perry, Byron Allen, Sean “Diddy” Combs and others in acquiring a majority interest. The Wall Street Journal earlier reported Paramount’s decision to end the bidding process for BET.
Perry is already in business with Paramount via a multiyear content partnership struck in 2019, while Allen has been aiming to expand his TV station empire that counts The Weather Channel and Combs has a TV presence with his Revolt network.
During Paramount’s latest earnings call, on Aug. 7, CEO Bob Bakish was asked about the status of the potential sale and didn’t address BET by name, but replied: “We’re always looking for ways to maximize shareholder value. And as we said before, that might involve divesting, acquiring or potentially partnering on assets all of which we’ve done. But other than that, I’m not going to comment on anything specifically.”
The company has owned BET since 2000, when the Sumner Redstone-led firm then named Viacom snapped up Black Entertainment Television for $2.3 billion in stock and $570 million in debt. At the time, the BET channel was carried in 62.4 million households domestically.
For the past several years, Paramount has been looking to slim down its collection of assets in order to scale up in streaming and burnish its core entertainment portfolio (Paramount Pictures as well as CBS, Showtime, Nickelodeon, Comedy Central, MTV, BET and streamers Paramount+ and Pluto TV). That effort has boosted Paramount+ to about 61 million subscribers globally, but the streaming division still isn’t profitable, tallying $424 million in losses in the second quarter.
Earlier this month, the company struck a $1.62 billion deal with private equity giant KKR to sell off major book publisher Simon & Schuster. That sale (a yearslong effort after its first attempt was blocked by a judge over antitrust concerns) followed Paramount selling tech site CNET for $500 million in 2020, CBS’ New York BlackRock headquarters building for $760 million and CBS’ Studio City lot for $1.85 billion in 2021.
Paramount, with its large collection of linear channels, has been subject to headwinds in the industry amid the march of cord-cutting as consumers look beyond pay-TV packages to subscription streaming offerings. In the last quarter alone, more than 1.7 million subscribers were shed by the major pay-TV and cable companies (including Comcast, Charter and DirecTV), per a tally from Leichtman Research.
Affiliate and subscription revenue at Paramount’s TV Media unit was off 2 percent in its most recent quarter, the company disclosed Aug. 7, noting that the decline was “primarily reflecting the impact from subscriber declines, partially offset by pricing increases.”
This article was originally published by The Hollywood Reporter.
Over the past week, Oliver Anthony has summited the music charts, thanks to his viral hit “Rich Men North of Richmond,” which highlights working-class frustrations (and, in some of its most controversial lyrics, the country’s welfare system) and has been met with both intense praise and backlash.
The song first gained national attention late last week, when RadioWV’s YouTube live video for the song began gaining millions of views (that YouTube post now has more than 16 million views). By the end of Aug. 11, “Rich Men North of Richmond” topped the iTunes country chart, and since then, “Rich Men” has soared to the top of the all-genre iTunes chart. According to Luminate, the daily official on-demand U.S. streams for “Rich Men North of Richmond” grew to over 3 million on Tuesday (Aug. 15). The song also resides at No. 1 on the Spotify Top 50-USA chart, as of Wednesday afternoon (Aug. 16).
The song and YouTube video gained traction initially, in part, through various media personalities who shared the video, including John Rich, Joe Rogan and Matt Walsh, as well as Barstool Sports and conservative outlet Breitbart posting it on social media.
The consumption of Anthony’s music extends beyond “Rich Men.” His song “Ain’t Gotta Dollar” is currently No. 1 on Spotify’s Viral 50 chart, with five of his other songs resting in the chart’s top 10 on Wednesday afternoon, as of publishing.
These numbers have swiftly led to an industry feeding frenzy for Anthony, with one label head telling Billboard, “I don’t think I’ve ever seen anything like this before.”
Anthony acknowledged the rush of record labels trying to sign him on Wednesday, when he posted on social media to let his followers know about a show this coming Saturday at Eagle Creek Golf Club and Grill in Moyock, North Carolina.
“We are working on a full line up of shows with bigger accommodations in the near future,” Anthony wrote on his official music Facebook page. He also noted, “Everyone in the ‘industry’ is rushing me into signing something, but we just want to take things slow right now. I appreciate your patience.”
While the Radio Music Licensing Committee awaits an appeals court decision in its so-far unsuccessful attempt to combine rate court proceedings with ASCAP and BMI under a single judge, the trade group has filed federal petitions to begin the processes separately in the Southern District of New York.
Usually, such rate proceedings petitions are initiated after negotiations between the performance rights organizations and the RMLC prove fruitless. Under these petitions, the PROs will each make the case for what rate it thinks their songwriters and publishers are entitled to receive when their songs are played on the radio. This time out, for the period of 2022-2026, the RMLC is seeking to maintain the same rates it had under the prior agreement which covered 2017-2021.
In July 2022, the RMLC tried to get ASCAP and BMI combined into a single rate proceeding, thus showing its hand that it felt rate negotiations had failed. For decades, each PRO had its own separate rate proceeding, but about seven or eight years ago, the RMLC began a new rate court strategy of trying to assign market share to the four U.S. PROs — ASCAP, BMI, SESAC and Global Music Rights — in attempt to keep the rates in parity with market share, irrespective of each PRO’s song catalog. In filing its petition to consolidate the rate proceedings to the Southern District of New York, which oversees both rate proceedings and the ASCAP and BMI consent decrees, the RMLC said the act was justified by the Music Modernization Act of 2018 that changed how the the Southern District assigns the rate court proceeding.
The step to combine the rate proceedings into one was seen by some music industry executives as a further attempt to pursue that rate strategy. Having a single judge, instead of bifurcated rate court proceedings, could benefit the RMLC because it would likely pit BMI and ASCAP against each other, vying for a higher rate than the other with both PROs arguing over market share.
But in May this year, Southern District Court Judge Stanton ruled against the RMLC’s consolidation petition so the radio trade group subsequently appealed that decision. The Second District Appeals Court has yet to issue a ruling on the RMLC motion, but in the meantime, the RMLC is getting the ball rolling with the rate court by filing amended petitions on BMI on Aug. 10 and on ASCAP on Tuesday.
Despite filing petitions for the two rate court proceedings, the RMLC petition for the ASCAP rate court proceeding says that if the Second Circuit Appeals Court ultimately agrees with the RMLC position to combine the two rate court proceedings into one, “it reserves all rights at the appropriate time” to pursue a unitary action against ASCAP and BMI.
The ASCAP rate proceeding covers the current five-year term which began on Jan. 1, 2022. In the prior term (2017-2021), RMLC said it paid a combined 3.51% of net revenue as a royalty pool for the two PROs, with ASCAP getting 1.73% of that based on market share claims it made at the time — which the RMLC now says was “a representation that turned out to be false.” Meanwhile, BMI received 1.78% of radio stations’ net revenue.
Nevertheless, in May 2022, according to the petition, the RMLC asked ASCAP and BMI if they would be willing to roll forward the combined 3.51% of net revenue royalty pool, provided that ASCAP and BMI would agree on a mechanism for assessing each of their market shares.
Although the rate level would be the same, the RMLC implies it is actually an increase because the combined ASCAP and BMI share of total performances on RMLC stations likely has diminished since when the prior agreements began, the RMLC argues in its petition.
Meanwhile, it looks like BMI is requesting a rate increase from 1.78% to 2.95%, according to what the RMLC states in the BMI petition; while the RMLC ASCAP petition doesn’t disclose the rate ASCAP is seeking.
The RMLC didn’t immediately respond to a request for comment.
“The RMLC would rather continue to waste time and money on expensive litigation than simply paying songwriters a fair royalty for the use of their music,” ASCAP CEO Elizabeth Matthews said in a statement. “It’s not that complicated. Simply treat music creators who support your successful and profitable businesses with dignity and respect and everyone wins.”
While the PROs and the RMLC wait for the rate court proceedings to make a determination, all parties have agreed to an interim rate that allows radio to continue to play music without copyright infringement.
Boosted by K-pop’s growing popularity and artists’ return to concert stages, the four publicly traded South Korean music companies — HYBE, SM Entertainment, YG Entertainment and JYP Entertainment — posted average revenue growth of 71% in the second quarter of 2023, according to Billboard’s analysis of their recent earnings reports.
Sky-high growth rates in recent quarters have helped make the K-pop companies a wise investment in 2023: Through Wednesday (Aug. 16), the four share prices increased an average of 63.6% year to date, adding more than $4.7 billion in market capitalization cumulatively to the companies’ stocks. In contrast, stocks of the two largest standalone music companies, Universal Music Group and Warner Music Group, have gained 3.6% and lost 6%, respectively, year-to-date through Tuesday (Aug. 15).
In terms of revenue growth, the leader in the second quarter was JYP Entertainment, home to the groups Stray Kids and Twice. JYP’s revenue grew 124% to 151.7 billion won ($115.2 million), with new albums by Stray Kids, Twice and NMixx driving a 298% increase in physical sales to 74.1 billion won ($56.3 million). Republic Records, JYP’s partner in the United States, accounted for 14.5 billion won ($11 million) of physical sales, or about 20% of the total amount. Elsewhere, JYP’s concert revenue grew 44% year-over-year to a record 14.4 billion won ($10.9 million) while merchandise sales climbed 151% to 21.7 billion won ($16.5 million). Domestic streaming revenue grew 18% to 2.2 billion won ($1.7 million) while overseas streaming revenue jumped 82% to 10.3 billion won ($7.8 million).
YG Entertainment boasts the greatest share price gain among the group at 75.6% year to date. The company behind breakthrough girl group BLACKPINK, YG posted revenue of 158.3 billion won ($120.2 million) in the second quarter, up 108% from the prior-year period.
JYP Entertainment’s operating income grew 88% to 45.6 billion won ($34.6 million) but missed its 51-billion won estimate, causing the company’s share price to fall 8.2% the following day. Although its revenue grew 124% in the quarter, JYP was hurt by what it called a “temporary increase in content product costs.” As a result, its cost of goods sold rose 162% while gross margin percentage — gross profit as a percent of sales — declined 1.6 percentage points to 47.7%.
Expenses also grew faster than revenue at HYBE, where cost of sales grew 25% while sales, general and administrative expenses climbed 32%. HYBE’s operating profit declined 8% as a result, while net income improved 19% despite a 21% growth in revenue. HYBE’s share price declined just 0.9% the day after the results were released; with a 38.9% gain year-to-date, its stock boasts the lowest appreciation of the four K-pop companies.
Carin Leon’s former manager is suing distribution company Oplaai and two of its executives for copyright infringement over allegations of underpaid royalties.
In the lawsuit, Javier “El Tamarindo” González, CEO of Tamarindo Rekordsz, alleges that he has not been properly paid by Oplaai – his indie label’s distributor since 2018 – for revenues from Leon’s music. González owns all copyrights for songs recorded by Leon during the term of their recording deal that started in 2018 through last December.
According to the claim, Oplaai has “infringed, and continues to infringe” upon González’s copyrights in the sound recordings and compositions by “reproducing, distributing, selling, promoting, advertising, performing by means of digital audio transmission, and otherwise commercially exploiting without authority or consent.” Oplaai’s CEOs Marylu Ramos and Victor Zambrano are also named as defendants.
González and Oplaai’s partnership began in 2018 through an oral distribution agreement where he says he “granted” Oplaai a two-year license to distribute new Tamarindo Rekordsz recordings delivered to Oplaai during that period. According to the complaint, the deal would be renewed for subsequent one-year terms if both parties agreed.
Initially, the deal was that Oplaai would collect all revenue derived from Tamarindo Rekordsz’s catalog and retain 30% of the net revenue (as a distribution fee) and pay 70% of the net revenue to Tamarindo Rekordsz (as a royalty). Following Leon’s massive success during 2019 and 2020 – Oplaai “agreed” in 2021 to lower its distribution fee to 14% and to pay Tamarindo royalties in the amount of 86% of the net revenues collected by Oplaai from the catalog.
By the end of 2022, Leon and González announced they had mutually agreed to part ways after the five-year relationship, during which Leon earned his first Latin Grammy win, plus 11 entries on the Hot Latin Songs chart and 10 top-10 songs on the Regional Mexican Airplay chart.
After Leon and González negotiated a release agreement – ratifying González as the owner of all rights (including copyrights) pertaining to Leon’s recordings from February 2018 until the date of the release agreement – González formally notified Oplaai that he was terminating their pact effective April 11, according to the lawsuit. He also requested Oplaai provide him with a simple catalog delivery file so that Tamarindo Rekordsz could “commence alternative distribution.”
After the termination, “neither Oplaai, Ramos, or Zambrano had the right to copy, sell, distribute, license, or publicly perform any of the Sound Recordings. Nor did they have a license or right to exploit the Compositions.” Yet, according to the lawsuit, “even after confirming that the Distribution Agreement was terminated and representing that it had instructed its distributor to take down all Tamarindo-controlled content, Oplaai, at Ramos’ and Zambrano’s direction, has continued to distribute and exploit the Sound Recordings without license or authorization, in violation of Tamarindo’s exclusive rights.”
Furthermore, Oplaai has collected revenue from DSP’s including YouTube, Apple Music, Spotify and Amazon, among others, “as a result of its unauthorized distribution and exploitation of the Sound Recordings,” according to the claim. The lawsuit also states that Oplaai has “improperly” charged the indie label a 30% distribution fee for March and April 2023 and failed to pay Tamarindo royalties for that period. And that Oplaai has failed to provide Tamarindo with the requested migration files, thereby requiring González’s new distributor to “manually upload the data, codes, music, and other necessary information to the DSPs to migrate the catalog.”
González claims that he has suffered damages in a “specific, identifiable amount to be proven at trial” and is seeking “all gains, profits, and advantages derived by Defendants from their infringements of Tamarindo’s and Tons’ copyrights.”
Billboard reached out to Oplaai but did not hear back at press time.