Business
Page: 355
Primary Wave has purchased a stake in the publishing catalog of Kool & The Gang founding band member and drummer George Brown, the company announced Wednesday (June 28). The sale also includes a stake in the Grammy winner’s writer’s share of his music publishing and the writer’s share of his public performance income.
The deal — which includes classics like “Ladies Night,” “Celebration,” “Get Down on It,” “Cherish,” “Jungle Boogie,” “Summer Madness” and more — is in the multi-million dollar range, according to Primary Wave.
In addition to Brown, Kool & The Gang is comprised of Robert “Kool” Bell, Ronald Bell, Dennis “Dee Tee” Thomas, Robert “Spike” Mickens, Charles Smith, Woodrow “Woody” Sparrow and Ricky West. The Jersey City troupe first got its start on indie label De-Lite Records, which released the band’s debut album, Kool and the Gang, in 1969. The group broke through in 1973 with its fourth album, Wild and Peaceful, which contained hits like “Jungle Boogie” and “Hollywood Swinging.” Pulling from funk, soul, R&B, disco and jazz influences, Kool & The Gang’s work also played a defining role in the soundtracks for Rocky (1976) and Saturday Night Fever (1977).
For its impressive body of work, Kool & the Gang has received two Grammy awards, seven American Music Awards and was inducted into the New Jersey Hall of Fame. The group also received a star on the Hollywood Walk of Fame, while Brown — along with bandmates Taylor and Robert and Ronald Bell — was inducted into the Songwriters Hall of Fame in 2018.
“I am very pleased to call Primary Wave my music partner and to join with dozens of other iconic artists and creatives in an incredible business family,” said Brown of the deal. “I look forward to collaborating with Larry Mestel and the entire Primary Wave team to further enhance my catalog and the Kool & The Gang brand.”
Kendall A. Minter, Brown’s legal counsel, added, “As counsel to George Brown and Astana Music, it was my pleasure to initiate, negotiate and close this deal with Primary Wave. The alignment of a globally iconic artist and creative talent with an iconic, global independent music publisher and brand enhancer is a win-win for the entire music community and fans.”
“Kool and the Gang’s influence on generations of musicians and fans around the globe cannot be denied,” said Primary Wave senior vp of business and legal affairs Samantha Rhulen. “A few of us from Primary Wave were excited to have been in the audience when they were inducted into the Songwriters Hall of Fame in 2018, and we are so thrilled to now be partnering with George Brown in 2023.”
South by Southwest has increased the rates paid to domestic artists performing at the annual festival in Austin by 40-50%, following a petition and rally demanding higher pay.
The 2024 event artist application, which opened Tuesday, outlines that solo artists performing at SXSW will receive $150 — a $50 rate increase from previous years. Bands will now be paid $350 rather than the previous rate of $250. As in years prior, international artists will not receive financial compensation.
Also consistent with previous years, domestic artists playing SXSW must choose to take a monetary payment, or receive an artist credential that includes primary access to all music-related events, artist-only amenities including special rates on hotels, meals and drinks and artist networking space, and secondary access to film and television related programming.
SXSW charges an all acts an application fee, which is $35 until Aug. 25 and then $55 until applications close on Oct. 27.
“Our purpose at SXSW is to help creative people achieve their goals,” said SXSW’s vp of music festival James Minor in a statement. “As an industry event, showcasing at SXSW provides indispensable networking, mentoring, and career development opportunities that are not a part of standard consumer-focused festivals.
“Artists continue to make connections at SXSW that further their careers, and it is essential for us to provide opportunities that make the most impact in supporting the thousands of artists who come to Austin every March.”
In April 2021, Penske Media Corporation, which owns Billboard, became an investor in SXSW by taking a 50% stake in the conference and festival.
The rate increase comes follows an artist-led petition from earlier this year that urged SXSW to increase compensation for musicians playing the festival. Published by the Union of Musicians and Allied Workers (UMAW), the petition was signed by more than 400 artists including Amber Coffman of Dirty Projectors, DIIV, Eve 6, Mountain Goats, Jeremy Messersmith, Speedy Ortiz, Zola Jesus, Pedro the Lion, YACHT and Emperor X, along with the Songwriters of North America (SoNA). On May 31, the organization led a rally outside Penske Media Corporation’s New York offices.
As reported by Texas Public Radio, during a Parks and Recreation Board meeting in Austin on Monday, Pat Buchta, the head of nonprofit Austin Texas Musicians, remarked on the rate increase, saying “Respectfully, is that enough? Our musicians do not think so, and musician input is the one thing that everybody seems to be missing in this conversation.”
The rapper Casanova has been sentenced to more than 15 years in prison on federal racketeering conspiracy and drug charges related to his involvement in what prosecutors called “a vicious street gang.”
A New York federal judge on Tuesday (June 27) sentenced the artist (real name Caswell Senior) to 188 months in prison after he pleaded guilty last year to one charge under the Racketeer Influenced and Corrupt Organizations Act (RICO), as well as a charge of conspiracy to distribute over 100 kilograms of marijuana.
Casanova, a Brooklyn rapper once signed to Jay-Z’s Roc Nation, was one of 18 men charged in 2020 for their alleged roles in the Untouchable Gorilla Stone Nation gang, which prosecutors said “committed terrible acts of violence” across the New York City region.
“Caswell Senior is not just a notorious recording artist, but he is also a high-profile leader of a vicious street gang and a magnet for gang violence,” U.S. Attorney Damian Williams said in a statement after the sentencing, adding that Casanova’s stature had helped the gang recruit and expand nationwide. “Gang life is not worth it and will lead to many years in prison.”
Prior to the criminal charges, Casanova had been an up-and-coming artist, peaking at No. 3 on Billboard’s Next Big Sound chart in 2019 after the release of his album Behind These Scars. Chatting with Billboard at the time, Casanova said he was hopeful for the future, but knew that his past could return to haunt him: “People will always blame you for your past. I’m ok with that; I just have to fight harder. I have to do more to get recognized.”
In December 2020, he was one of 18 defendants named in the sweeping RICO case over Untouchable Gorilla Stone Nation, which prosecutors said operated a violent narcotics operation across the NYC metro area, including the murder of a teenage boy in Poughkeepsie. The allegations even included “brazen fraud” for exploiting benefits programs providing assistance in response to the COVID-19 pandemic.
In May 2022, Casanova pleaded guilty to the RICO conspiracy charge and the drug charge. Among other things, he admitted to participating in a July 2020 shootout at a crowded Miami house party in which he personally shot a man, leaving the victim seriously injured.
Ahead of Tuesday’s sentencing, federal prosecutors requested a prison term ranging from 188 to 235 months, calling Casanova “a high-profile gang leader” who had “amplified the message of the gang” through his music, helping to recruit “a generation of new members.”
“He did not simply pretend to be violent in his music or on social media,” the government wrote. “Unfortunately, he walked the walk. Senior’s offense conduct is not about a few song lyrics or how he marketed his music. Rather, he carried out an array of violent activity and significant narcotics trafficking that benefited some of the gang’s most violent and impactful members.”
Casanova’s attorneys argued that he should receive a sentence well below those guidelines. They said he was “not involved in the gang’s daily activities” and had begun “to distance himself” from the group as his music career took off, including having “denounced gang life” in some public statements.
“The fact is that Mr. Senior stayed in this gang as it furthered his rap career,” Casanova’s lawyers wrote. “As he gained moderate success and then a recording contract with Roc Nation, he increasingly separated himself from the gang’s activities despite remaining a member.”
In a statement to Billboard on Wednesday, Casanova’s lawyer, James Kousouros, said he and his client were “gratified that the court acknowledged the productive messages that Mr. Senior had been giving against gang life over the past several years and sentenced him to the lowest end of the guidelines.”
The pace that global music industry revenues have been growing is expected to slow this year, as the industry is “on the cusp of another major structural change” stemming from the changing price of streaming subscriptions, artificial intelligence and new payment models, according to a closely watched report from Goldman Sachs.
In its latest Music in the Air report, published Wednesday, Goldman’s research analysts say they expect global music industry revenues in 2023 to grow by 7.1%, down from an 8% growth projection last year, as live music and publishing growth rates return to more normal ranges of 6% and 8% growth this year respectively. The compound annual growth rate for revenues from 2023 to 2030 ticked up slightly to 7.3%, from 7.1% last year, and streaming revenue is expected to hold steady at an 11%-growth rate, according to the report.
That indicates steady and even more broadbased growth, researchers say, but the industry is about to face a fresh wave of massive changes.
“We believe the music industry is on the cusp of another major structural change given the persistent under-monetisation of music content, outdated streaming royalty payout structures and the deployment of Generative AI,” Goldman researchers wrote in the new report. “In the wake of these developments, we believe a more coordinated and collaborative response from the main stakeholders will be key to ensure that the industry not only continues on its path of sustainable growth but also captures new business opportunities.”
Echoing a frequent refrain of music industry executives, Goldman’s researchers say monetization of music content is way behind the rate of consumption. They estimate that the revenue earned per audio stream has fallen 20% over the past five years, and that the revenue companies earn per hour of music streamed on Spotify is four times lower than for Netflix.
They estimate that up to $4.2 billion in potential revenue could be gained over time by charging different audience segments, such as super fans, more for subscriptions.
Goldman analysts also wrote that the current method of treating all streams lasting less than 30 seconds the same and paying content owners a pro-rata share of streams “needs to evolve…to cope with dilution of market share.” This weakening, they say, is coming from the fast-growing number of songs uploaded to digital service provider (DSP) platforms, fraudulent and artificial streams and “the propensity of algorithms to push lower royalty content.”
Researchers also sounded a positive note on the potential for generative AI to lower barriers for artists, boost music creation capabilities and improve industry productivity overall, with the major music companies best positioned to benefit.
“We believe the quality of the input to large language models is critical and the largest owners of proprietary (intellectual property) are best positioned to leverage the technology,” researchers wrote, noting the industry will need to be aligned in controlling the deployment of that tech.
The report also notes that, despite fears of market dillution from the rush of new content, Universal Music Group and Sony Music Entertainment both maintained their recorded music market share in 2022, with only Warner Music Group losing market share — about half a percentage point — to independents.
“We continue to expect modest dilution of market share over time, mostly driven by the revenue mix shift towards EM, although we believe that the major record labels will continue to expand their presence in EMs through partnerships, investments and bolt-on M&A,” researchers wrote.
Spotify maintains its clear lead among the DSPs with 34.8% of total global market share in 2022, although it edged 60 basis points lower. YouTube Music was the “major gainer,” gaining about 3 percentage points of market share over the past three years to hold market share in 2022.
Runner Music, the publishing and music company formed by Ryan Tedder, artist manager Ron Laffitte and publishing executive Andrew Sparkler, has hired former Sony Music Publishing executive Amanda Hill as president of A&R/and co-chief creative officer.
Hill is the company’s first major hire since launching in January. In her Los Angeles-based role, Hill will be responsible for leading Runner’s global creative strategy, including writer and artist signings, company development and building out the Runner team.
“I am so excited to be starting this new chapter with Runner Music and to partner with Ryan, Ron, and Andrew, each of whom I’ve respected and admired for many years,” she said in a statement to Billboard. “I’m thrilled to be building this company from the ground up alongside them, and together with our songwriters we will create the future of music publishing.”
More recently, Hill served as senior VP of A&R at Sony Music Publishing, where she worked with major songwriters and artists including Tedder, Greg Kurstin, Miley Cyrus and Johnny McDaid. She consulted for Columbia Records from 2013 to 2019 and has managed Sarah Aarons since 2016.
“In almost 20 years of working with publishing A&Rs across all the major and indie companies, I’ve never had a more effective dialog and workflow with anyone than Amanda,” said Tedder, who serves as co-chief creative officer with Hill. “Her genuine passion for songs, writers and the creative process is as good as it gets and her 17-plus years of experience in all facets of music publishing are invaluable to myself and the Runner team. Speaking on behalf of our writers, artists and myself, we are beyond ecstatic to have her join the Runner family.”
Earlier this month, Runner and Sony Music Nashville partnered to sign 19-year old multi-instrumentalist David J. “David is a true unicorn talent and I’m thrilled that Runner can partner with Sony to help bring his music to the world,” said Tedder at the time of the announcement. “I’m also pleased to announce that Brandon Silverstein is working with Runner as a strategic and creative partner for this project.” David J has earned 75 million career on-demand streams through his independent releases, including “Lost My Heartbreak,” “Before You,” and “Stay,” according to Sony.
Blackstone Group’s Melody Holdings is an equity partner in Runner Music.
SoundCloud has promoted two staff members — Tracy Chan to chief content officer and Ama Walton to senior vp of music licensing/deputy general counsel — and hired Devi Mahadevia, who joins the company as senior vp of strategy following a stint at Meta, the company tells Billboard. “Tracy is one of the foremost innovators at […]
A third music-focused electronic-traded fund — or ETF — is set to debut on the New York Stock Exchange on Friday (June 30). The aptly named MUSQ Global Music Industry ETF, trading under the ticker MUSQIX, has 48 stocks representative of the modern music business, including Universal Music Group, Spotify and Live Nation.
To MUSQ’s founder, David Schulhof, the fast-growing ETF market is primed for an index that allows investors to easily buy into the global music business’s growth story. “It’s been hard to invest in music for the last 25 years,” he says. “You had to be a [limited partner] at KKR or Blackstone or Apollo. And it was really hard to get liquidity.”
Schulhof, most recently the president of music publishing at LiveOne, invested in music assets as the co-founder and CEO of Evergreen Copyrights, which was acquired by BMG Rights Management in 2010, but everyday investors weren’t able to participate in music’s growing popularity as an asset class. “There were a lot of other private equity-backed companies, but it was hard for investors to get exposure” to music, he says.
With MUSQ, Schulhof says he’s giving “the Robinhood investor” a liquid investment to participate in the music business. MUSQ has 48 companies spanning the music content and distribution (including Warner Music Group, Believe), digital music (Spotify, Tencent Music Entertainment), live music and ticketing (Live Nation, Madison Square Garden, Vivid Seats), satellite and broadcast radio (iHeartMedia, SiriusXM, Townsquare Media) and music equipment and technology (Dolby, Sonos). U.S.-based stocks account for 45% of the index’s value; the remaining 55% coming primarily from South Korea, Japan and China.
MUSQ avoids video streaming and other digital entertainment stocks that may rise and fall with music but aren’t dedicated to music. Still, not all of the fund’s companies generate most or all of their value from music. MUSQ’s three largest companies are Apple, Amazon and Alphabet. The next-largest company by weight, Sony Group Corp., owns film, gaming and electronics divisions in addition to Sony Music Entertainment. According to the index’s criteria, a company can be considered for inclusion if it derives at least 50% of its annual revenues from the global music business, is a top five company, or have at least 10% of the global market share in one of the five segments of the music business the index covers.
“I had to include them,” says Schulman, “and I couldn’t ignore them. But I created, I think, a fair, balanced approach, which was to cap their market share on the index at 7%.”
To be eligible for the index, a company must have a minimum market capitalization or assets under management $100 million and a minimum average daily trading volume of $200,000 over the previous six months. Some small companies, such as music streamers Deezer and Anghami, and the newly public Alliance Entertainment, didn’t make the cut. But many other small, unheralded companies are among the index’s 48 stocks, including Stingray, a Canadian streaming company that services cable television networks, and Cliq Digital, a German provider of streaming services that bundle music, movies, audiobooks and other content.
MUSQ is part of a trend of music-focused funds attempting to tap into the booming ETF business. KPOP, which focuses on South Korean companies that create music and video content, launched in 2022. TUNE, another music-focused ETF, launched on June 22. Investors increasingly favor the simplicity of ETFs built around themes such as music, battery technology and sustainability. ETF’s asset under management ballooned from $3.4 trillion in 2016 to $10 trillion in 2021, according to EPFR. PwC believes ETFs will grow to $20 trillion by 2026.
“I have to believe that some amount of that money is going to be interested in music,” says Schulhof.
Super producer Benny Blanco sold a package of publishing and performance copyrights to Litmus Music, the private equity-backed music rights company run by industry veterans Hank Forsyth and Dan McCarroll, both groups said on Wednesday (June 28).
Litmus said the acquisition includes Billboard Hot 100 No. 1’s like “Diamonds,” recorded by Rihanna, “Moves Like Jagger” recorded by Maroon 5, “Love Yourself” recorded by Justin Bieber, and “Señorita,” recorded by Shawn Mendes & Camila Cabello, plus “Eastside,” recorded by Blanco, Halsey & Khalid, “Roses,” recorded by Blanco and the late Juice WRLD featuring Brendon Urie, and others.
Terms of the deal were not disclosed.
Investor interest in music copyrights remains at an all-time high, and while career-spanning catalogs from artists like Bruce Springsteen and Bob Dylan have fetched among the highest reported sums, Blanco, 35, is among a growing cadre of younger producers, artists and songwriters who are electing to sell some of their copyrights while they are still actively making music.
This is the second rights sale Blanco, whose full name is Benjamin Joseph Levin, has done in recent years. In 2019, he sold Hipgnosis partial rights to some 90 songs, including his writer’s share in “Castle on the Hill,” which Blanco co-wrote and co-produced with Ed Sheeran.
A 2013 winner of the Hal David Starlight Award by the Songwriters Hall of Fame and multi-time recipient of BMI‘s songwriter of the year award, Blanco said his longstanding relationship with Litmus’s Dan McCarroll was the reason he chose them to handle these rights.
McCarroll, Litmus co-founder and chief creative officer, and Blanco met when the creative was 17 and McCarroll was running East Coast creative for EMI Publishing. The pair have since worked together on projects involving Keith Urban, Gym Class Heroes and Katy Perry, among others.
“I first crossed paths with Dan as a young teenager,” Blanco said in a statement. “I feel like we’ve had so many dinners and conversations that have gone beyond music and they really helped guide and shape me into the person I am today. There’s no better home I could imagine for such a meaningful part of my catalog.”
McCarroll speaks of the pride of watching him become the “incredible writer and producer he is today. We at Litmus are honored to work with him now to support part of his incredible catalog.”
Launched in August 2022, Litmus has $500 million in backing from Carlyle Global Credit, and aims to buy the publishing and recording rights of artists from a range of genres. In December, Litmus announced it bought Keith Urban‘s master recordings for an undisclosed sum. Forsyth previously held positions as executive vp at Warner Chappell and GM of Blue Note, while McCarroll served as president of both Warner Brothers Records and Capitol Records.
Jarred Arfa has been named executive vp/head of global music for the newly-rebranded agency Independent Artist Group (IAG), the company’s newly installed CEO Jim Osborne announced on Tuesday (June 27).
The launch of IAG was formally announced last week with Osborne at the helm. The company was formed via a merger of two agencies: Agency For the Performing Arts (APA) and Artist Group International (AGI), where Arfa served as COO.
At IAG, Arfa will oversee the day-to-day operations of the combined AGI and APA music departments, reporting to Osborne. As announced last week, Arfa’s father, AGI founder/CEO Dennis Arfa, will serve as chairman of IAG’s music division while Marsha Vlasic will serve as vice-chair.
The deal was made possible thanks to a 2020 investment in APA by billionaire Ron Burkle, whose Yaicapa Companies has long been an investor in AGI.
“Jarred has been instrumental in getting this partnership to the finish line,” says Osborne. “We have tremendous confidence in him to not only lead the day-to-day operations of our music department but to help us grow it from here,”
At AGI, Jarred’s responsibilities included business development, legal, financial and corporate reporting; overseeing artists’ tour contracts; VIP ticketing; and sponsorship and brand partnerships. He will continue to do the same at IAG, with the added help of the infrastructure inherited from the full-service APA, which in addition to music and comedy touring also includes legal, tour marketing, branding and sponsorships departments.
“We have relied on Jarred on so many levels over the years to not only oversee the operations of AGI but to also assist us in furthering our investments in the music business,” said Burkle in a statement.
Jarred will continue to work closely with Billy Joel’s team, assisting on the singer-songwriter’s record-breaking residency at Madison Square Garden along with his other tour dates.
“Jarred has been an invaluable asset to us on so many levels,” added Vlasic. “We have tremendous confidence in him to lead our efforts to integrate and grow our combined music assets enabling our artists and agents to thrive.”
While at AGI, Jarred was an instrumental advisor in the company’s sale to The Yucaipa Companies in 2012 and later served as a conduit for Yucaipa’s investments in K2 and Danny Wimmer Presents.
“I am excited to work with the outstanding young team of APA agents who have been thriving, particularly in urban, as we combine into one cohesive unit,” Jarred said. “I look forward to further offering crossover opportunities for our artists that Jim Osborne and his team have done such an amazing job at. Our plan is to grow the department with a quality over quantity ethos.”
Jarred began his career at Robert Silverman’s CKX Inc., where he acted as director of Muhammad Ali Enterprises and director of operations for Elvis Presley Enterprises.
Lawyers for alcohol giant Diageo are demanding that a judge toss out a lawsuit from Sean “Diddy” Combs that accuses the company of racism, calling it “false and reckless” and driven by an effort to “extract additional billions” from the company.
Explore
Explore
See latest videos, charts and news
See latest videos, charts and news
Combs sued in May, claiming Diageo breached his partnership deal for DeLeon Tequila by failing to properly support the brand. But he went a lot further than that, also leveling accusations of racism and claiming Diageo had treated his product line “worse than others because he is Black.”
In the company’s first response to the lawsuit on Tuesday (June 27), Diageo’s lawyers didn’t exactly hold back, either. They called the Diddy’s lawsuit a “bad faith, sham action” filed by a star who had “amassed nearly one billion dollars” from their partnership but now wanted to “extract” billions more.
“These allegations are nothing more than opportunistic attempts to garner press attention and distract the court from the fact that plaintiff’s breach-of-contract claim is entirely without merit,” the company’s attorneys wrote. “Diageo categorically denies these accusations.”
In a statement on Tuesday, a spokeswoman for Diageo echoed the message of the company’s legal filing — and said Diageo had permanently cut ties with the rapper.
“Mr. Combs’ bad-faith actions have clearly breached his contracts and left us no choice but to move to dismiss his baseless complaint and end our business relationship,” the company wrote. “Mr. Combs has repeatedly undermined our partnerships and threatened to publicly defame Diageo if we did not meet his unreasonable financial demands.”
In his lawsuit, filed on May 31, attorneys for Diddy’s Combs Wines and Spirits claimed that Diageo had “typecast” his DeLeon as a “Black brand” that could only be sold to “urban” consumers, harming its sales and leaving it lagging behind competing Diageo brands like Casamigos and Don Julio.
“Cloaking itself in the language of diversity and equality is good for Diageo’s business, but it is a lie,” Combs’ lawyers wrote. “While Diageo may conspicuously include images of its Black partners in advertising materials and press releases, its words only provide the illusion of inclusion.”
But in Tuesday’s response, Diageo said those bombastic allegations were just a distraction from a run-of-the-mill business dispute that should have been handled under a binding arbitration agreement that both sides signed. They asked the judge to either dismiss the case or order that it be resolved through that private arbitration process.
“Without its inflammatory rhetoric and false accusations, the complaint is nothing but a garden-variety, and eminently arbitrable, suit alleging breach of contract,” Diageo wrote.
And when it comes to that “garden variety” business dispute, Diageo says it was Combs who was clearly in the wrong. The company claims he was “an unreliable and untrustworthy business partner” who failed to provide sufficient support to help DeLeon thrive, while Diageo supplied over $100 million for the project.
“Unwilling or unable to provide funding for the mutual benefit of the parties and the DeLeón brand, in mid-2020 Combs began to issue threats to damage the brand and defame Diageo and its executives and employees by publicly claiming that DeLeón’s failure to thrive was due to a racial animus against him,” Diageo’s lawyers wrote.
In a statement to Billboard on Tuesday, Combs’ attorney John C. Hueston sharply criticized Diageo’s claims that it was terminating its partnership with the star, saying it was akin to “firing a whistleblower who calls out racism.”
“Over the years, he has repeatedly raised concerns as senior executives uttered racially insensitive comments and made biased decisions based on that point of view,” Hueston said. “Diageo even acknowledged the problem by agreeing in his contract to treat DeLeon the same way it treated their other tequila brands. He brought the lawsuit to force them to live up to that contract, and instead they respond by trying to get rid of him. This lawsuit and Mr. Combs are not going away.”