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The Lyric Capital Group says it raised over $800 million in new financing, closing its second fund that will be deployed in music asset investments through its publishing arm, the Spirit Music Group. The company further said that the new funding breaks out about 50/50 between equity and debt, with $410 million in equity commitments coming from existing and new institutional investors.
Overall, the company said the funding exceeded its target.
“I couldn’t be more excited about completing our latest fundraise with the participation of existing and new investors which validates our unique and collaborative approach to acquiring high-quality assets from recording artists and songwriters,” Lyric Capital co-founder/managing partner and Spirit Music Group chairman Jon Singer said in a statement. “Thanks to our relationships and proven reputation as good stewards of legendary song catalogs and recordings, we have a robust pipeline of proprietary opportunities and the capital to pursue them.”
Lyric Capital Group was formed in late 2018/early 2019 when Singer and then-Spirit vp of acquisitions and business development Ross Cameron led a buyout and recapitalization of Spirit Music.
“Since inception, Lyric Capital has transacted on over $800 million to develop outstanding catalogs of music, in partnership with artists and songwriters,” said Cameron, a Lyric Capital partner and co-founder. “Our disciplined investment approach is informed by our ownership of Spirit Music Group and supported by 25 years of proprietary music royalty data providing us with an unmatched insight when acquiring and managing copyrights. We are very pleased to close our second fund and thank our investors for their continued support of our unique platform.”
The company said it now owns and manages over 100,000 copyrights with both publishing and master recordings a part of the mix. Its catalog includes hits by The Who, Ed Sheeran, John Legend, Chicago, the Go-Go’s, Faith Hill, Tim McGraw, Camilla Cabello, Jay-Z, Ricky Martin, Brad Paisley, Toto, Madonna, Jason Aldean, Graham Nash, T.Rex, Charles Mingus, Carrie Underwood, Taylor Swift, Billy Squier, Chaka Khan, Whitney Houston, Eminem, Elvis, Frank Sinatra, Eminem, Salt-N-Pepa, Electric Light Orchestra, Tom Petty, The Traveling Wilburys and Lou Christie.
Eaton Partners served as the exclusive placement agent on the equity while Truist and Pinnacle led the debt consortium; and Ropes & Gray LLP served as legal counsel.
BERLIN, Germany — The German music market is doing wunderbar. It grew 6.1% in 2022 over the previous year, to 2.07 billion Euros ($2.19 billion), according to the BVMI, the country’s recorded music trade organization. That’s the fourth consecutive year of growth for the market, as well as the first time in 20 years that the business – valued on retail revenue, including VAT – exceeded two billion Euros.
Although Germany came late to streaming, which didn’t overtake the country’s physical sales until 2018, digital accounted for a full 80.3% of retail revenue in 2022, and streaming came in at 73.3%. Total physical sales accounted for 19.7% of revenue.
The CD is still much healthier here than in most other markets, accounting for a full 12.9% of revenue, which makes it the industry’s second most important product after streaming.
Downloads, which never took off in Germany to the extent that they did in most other European markets, accounted for just 2.2%. Other digital revenue, including video streaming, added up to 4.8% of revenue.
Streaming is gaining fast, too: it grew by 14% compared to 2021, while CD sales declined 17.1%.
Within the physical market, vinyl still lags behind CDs, at an even 6%. That’s a significant difference from the U.S., where vinyl sales revenue long since surpassed that of CDs. (Music DVDs and Blu-ray videos accounted for half a percent of revenue, while other physical products accounted for 0.3%.) As in the U.S., vinyl sales are still growing — they were up 6% by revenue — but not as much as in 2021, when they grew 20.1%.
“The fact that the German music industry has taken the 2 billion Euro mark for the first time in two decades is good news of far more than symbolic value,” said BVMI chairman and CEO Florian Drücke. “Looking at streaming, it will be exciting to see how the price increases we have seen recently from the first providers will now play out in the wider market and also how short form videos will be able to monetize even more.”
Spotify is putting emerging U.S. songwriters under the RADAR.
The streaming giant this week launches RADAR Songwriter in the United States, its development program which promises a leg-up for its songwriter participants.
Grammy Award-winning songwriting and production team Beach Noise is the first U.S. act to join the program, which is activated following a soft launch last year in several international territories.
Hailing from Stockton and Los Angeles, Beach Noise is the trio of Matt Schaeffer, Johnny Kosich, and Jake Kosich. The creative team has worked with the likes of Kendrick Lamar, Bakar and Baby Keem, and is credited with producing and writing six of the tracks on Lamar’s Mr. Morale & The Big Steppers, which bowed at No. 1 on the Billboard 200 chart in 2022. One of those numbers was “The Heart Part 5,” which collected a brace of rap categories at the 2023 Grammy Awards.
Beach Noise and other songwriters selected for RADAR Songwriters should benefit from a raft of spotlights and promotional pushes across Spotify’s considerable network.
Those selected will appear on a bespoke cover of the RADAR Songwriters playlist (and their recent releases are added to the playlist); they’re featured in both local and global Spotify creative marketing campaigns; participants will receive promotion on Notable, Spotify’s home for songwriters and producers, by way of a dedicated blog post or interview and social support to amplify the news; and their recent releases will be included on the Noteable Releases Playlist.
Also, explains a rep for Spotify, songwriters tapped for the campaign will receive a dedicated “Written By” playlist that will should earn prominent placement in global spots featuring emerging talent such as RADAR and the Songwriters Hub.
Previous international rising talents celebrated by the program include Natali Noor (Sweden), Alessandro La Cava (Italy), Nathan Galante (Mexico), and Chiiild (Canada).
Spotify unveiled RADAR in March 2020, its global emerging artist program that unites the streaming service’s various domestic and international programs under a single name.
Through the pandemic, Spotify’s numbers continued to grow. According to its earning report published earlier this year, the Sweden-based business ended 2022 with 205 million paid subscribers, up 5% from 195 million in Q3. At the same time, Spotify’s total monthly active users (MAUs) reached 489 million, up 7% from 456 million in Q3.
Noise Pop, the long-running San Francisco showcase for independent bands and music launched in 1993 by Kevin Arnold and later Jordan Kurland, officially turns 30 years this year. What began as a $5 show at the city’s Kennel Club (now called the Independent), rapidly grew into a citywide celebration of the city’s lesser known venues including the Bottom of the Hill, the Great American Music Hall and rooms across the Bay in Oakland and Berkeley.
What has followed are thousands of bands, decades of nurturing the Noise and an enduring legacy that embraces San Francisco’s unique past as one of the best live cities in the world.
This year’s festival features more than 100 independent bands and artists, an accompanying independent film festival and the grand opening of the Noise Pop Gallery at the new Noise Pop offices in the Mission District.
With the festivities now wrapped up, Billboard sat down with Arnold and Kurland to discuss the history of the citywide festival and what challenges lay ahead as Noise Pop enters its third decade.
Billboard: Congratulations on 30 years of Noise Pop. What are you doing to celebrate the big anniversary?
Arnold: We really made an effort to dig up some old favorites and pay tribute to some of our influences and heroes. For the last five years we’ve tried to double-down on emerging talent to push boundaries for our audience at large. We’ve got a film festival and a new office that’s right in the heart of the Mission District and we’re hosting a gallery there that shows the history of Noise Pop through design, topography and posters. And we’re reopening the Kilowatt, which is a San Francisco venue that was legendary. We had so many shows there in the nineties and it’s been gone to the live music world for quite a while. It just reopened with Noise Pop promoting some of its first shows.
What were your expectations for Noise Pop in Year 1?
Arnold: Certainly not anything close to what it’s become. It all happened very last-minute and it was very serendipitous and magical. I got a call in December from the booker at the Kennel Club. I’d been promoting shows on campus at UC Berkeley and had been tour managing Overwhelming Colorfast and the booker asked me to put together a show for January, which is usually a slow time for venues. There’s nobody on tour then and so you look to create new stuff or create stuff locally and pull together what you can.
In San Francisco, indie rock wasn’t a scene yet, it was just weird underground rock and punk rock offshoots and stuff like that. So with all these bands in town who often play, but not necessarily together, we decided to bring five of them all together at once, charge $5 and shine a light on what the city had been up to. And that was really it.
As far as aspirations go, I can say I certainly never thought I’m gonna start an annual thing. But at the same time, I didn’t just call it a show, I called it a festival, which has some implications that it might go again.
Jordan, when did you get involved?
Kurland: I came in Year 5, working with Noise Pop in the fall of 1997 for the festival in 1998. And it was already a multi-venue event prior to that. We added a lot more shows that first year, for the first few years I worked on it, we avoided any competing shows.
If there was a show at the great American Music Hall on a Wednesday night, there wasn’t another show at the Bottom of The Hill at the same time. It was basically one or two shows a day, you know, but they didn’t compete.
What brought you out to San Francisco?
Kurland: I was working for David Lefkowitz at the time. Primus was his big client. They’re a platinum-selling act that just headlined Lollapalooza. He had the Melvins and Charlie Hunter and some other stuff. I was doing some freelance journalism and I wrote an article for the San Francisco Examiner on Noise Pop and I interviewed Kevin for that. And then a few months later, a band named Creeper Lagoon hired me to manage them. And Kevin and the guitarist of that band had been former roommates, we started to get to know each other and then I offered to help out. And Kevin graciously just brought me in as a full partner from the onset.
In 2000 you expanded it to Chicago. Why didn’t it work outside of San Francisco?
Kurland: I grew up outside Chicago and saw an opportunity for a small festival. I wish that we had stuck with because it was a pretty great couple of years there. We didn’t do it to try and copy someone else. We never wanted to be South by Southwest or CMJ. We were the music festival without all the pesky music industry folks. I think we just launched at the wrong time, right as the dotcom bubble was bursting.
How did Noise Pop change with the growth of both Live Nation and AEG, especially in the Bay Area which was the epicenter of the consolidation and concert competition when Another Planet Entertainment came on the scene?
Kurland: Obviously competition’s a good thing and with those three companies, everyone’s bringing something to the table. We never really set out to be that type of promoter and when we kind of stuck our toe in the water to try to expand, it was a bit late. We just weren’t ready to make that move. But in all honestly, I look at us as cultural curators, not so much the typical music venue promoter. Goldenvoice, Live Nation and Gregg and Sherry at Another Planet do a great job. We can coexist doing what we do, and we’re not trying to steal anyone’s business or compete with anyone on that level.
In a way it can be more liberating.
Arnold: It’s interesting to me, and I’ve thought a lot about this over the months and years as we approached the 30 year mark. It went from a tight community of bands and labels and venues to what it is today. Part of that is just the history of music in concerts – first with Bill Graham coming to define what it is concert promoters do in their market to some of the early consolidation in the market that created SFX and what we think of today as the modern concert market.
We’re immune from some of those things because it’s not the game we play day-to-day. We’ve always kind of positioned ourselves from the very beginning to move slowly over time and react to how the market is changing and continue to cooperate with everyone involved in venues and music. We’ve always found a way to be collaborative. And we’ve gotten pretty good at diversifying our business in ways that most promoters don’t.
Give us a snapshot of what the Noise Pop Industries business footprint looks like.
We really became a business in 2006. We’ve been doing the side hustle for more than a decade and asked ourselves ‘what are we gonna do next?’ Ultimately, we formed Noise Pop Industries, took on an investment partner and hired staff and for that first time really ran it in a hands-on way. And we also tried to expand and operate year round and keep the staff on board. You know, the goal really for us at that point was to avoid having to rehire help every year and have some continuity.
We launched the Treasure Island Music Festival the following year and quickly realized that we needed more consistency with the business to sort of counter the ups and downs and seasonality of the festival world.. So DoTheBay.com, a website covering Bay Area music and liveshows, helped a lot.
We also started doing a lot of consulting work and third party production paid. Today, Noise Pop Industries is the total company, and includes the white label offerings we have and then there is Noise Pop Events, which produces Noise Pop and other businesses we promote and take the risk ourselves.
Our newest venture on the presents side is the Rock Quarry Amphitheater at U.C. Santa Cruz which we started exclusively promoting last year.
The White House is giving all federal agencies 30 days to wipe TikTok off all government devices, as the Chinese-owned social media app comes under increasing scrutiny in Washington over security concerns.
The Office of Management and Budget calls the guidance, issued Monday, a “critical step forward in addressing the risks presented by the app to sensitive government data.” Some agencies, including the Departments of Defense, Homeland Security and State, already have restrictions in place; the guidance calls on the rest of the federal government to follow suit within 30 days.
The White House already does not allow TikTok on its devices.
“The Biden-Harris Administration has invested heavily in defending our nation’s digital infrastructure and curbing foreign adversaries’ access to Americans’ data,” said Chris DeRusha, the federal chief information security officer. “This guidance is part of the Administration’s ongoing commitment to securing our digital infrastructure and protecting the American people’s security and privacy.”
The guidance was first reported by Reuters.
Congress passed the “No TikTok on Government Devices Act” in December as part of a sweeping government funding package. The legislation does allow for TikTok use in certain cases, including for national security, law enforcement and research purposes.
TikTok spokesperson Brooke Oberwetter said Monday: “The ban of TikTok on federal devices passed in December without any deliberation, and unfortunately that approach has served as a blueprint for other world governments. These bans are little more than political theater.”
House Republicans are expected to move forward Tuesday with a bill that would give Biden the power to ban TikTok nationwide. The legislation, proposed by Rep. Mike McCaul, looks to circumvent the challenges the administration would face in court if it moved forward with sanctions against the social media company.
If passed, the proposal would allow the administration to ban not only TikTok but any software applications that threaten national security. McCaul, the chairman of the House Foreign Relations Committee, has been a vocal critic of the app, saying it is being used by the Chinese Communist Party to “manipulate and monitor its users while it gobbles up Americans’ data to be used for their malign activities.”
“Anyone with TikTok downloaded on their device has given the CCP a backdoor to all their personal information. It’s a spy balloon into your phone,” the Texas Republican said in a statement Monday.
Sen. Bob Menendez, D-N.J., his counterpart in the Senate, did not shut down the idea of the chamber taking up a proposal that would empower Biden to take action against TikTok, saying it was “certainly something to consider.”
Oberwetter said: “We hope that when it comes to addressing national security concerns about TikTok beyond government devices, Congress will explore solutions that won’t have the effect of censoring the voices of millions of Americans.”
TikTok, owned by ByteDance Ltd., remains extremely popular and is used by two-thirds of teens in the U.S. But there is increasing concern that Beijing could obtain control of American user data that the app has obtained.
The company has been dismissive of the ban for federal devices and has noted that it is developing security and data privacy plans as part of the Biden administration’s ongoing national security review.
Canada also announced Monday that it is banning TikTok from all government-issued mobile devices. The European Union’s executive branch said last week it has temporarily banned TikTok from phones used by employees as a cybersecurity measure.
CMT/Paramount senior executive Leslie Fram will reunite with Steve Barnes as co-host of the relaunched 99X Atlanta morning show, now known as The Morning X With Barnes and Leslie. The radio broadcast had its original success via Atlanta’s alternative rock station from 1994 until 2003, and will now air from 6-10 a.m. ET each weekday.
Fram will also retain her role at CMT/Paramount.
In 1994, Brian Philips, now chief content officer at parent company Cumulus Media, paired Barnes and Leslie on the original Morning X With Barnes, Leslie and Jimmy (Baron). The show earned acclaim in the Atlanta market and beyond, while the team was named Billboard‘s national major market morning show in 1996, and Radio and Records’ national major market morning show in 1999.
In October 2022, the launch of the 99X “museum” website to commemorate the 30th anniversary of the station’s founding led to an outpouring of fan interest and passion. Cumulus Media acquired the station’s classic call letters and relaunched 99X WNNX in Atlanta in December. The station’s ratings doubled in its first month on the air. Barnes has hosted the revamped program since January.
The popular podcast The Pop Culture Show, which the duo founded at the onset of the pandemic, is now rebranded as The Morning X With Barnes & Leslie and joins the Cumulus Podcast Network. Episodes will release each weekday, featuring both new programming and classic material from the legendary radio show.
“This ‘new original 99X’ was destined to be — it is a passion project, a labor of love. None of us has ever stopped being friends, loving the same music, or laughing at the same jokes,” Philips said via a statement. “The audience demanded the return of the station via a social explosion of affection and nostalgia. Only in Atlanta could the will of the loyal 99X audience make the impossible happen. It’s unprecedented to be able to entirely rebuild a classic station with members of its original cast.”
“99X was my home for 17 years and will forever be in my DNA. Those years prepared me for my current role at CMT – understanding a loyal fanbase of music lovers who truly lead the way,” Fram added via a statement. “You only have to glance at the comments from 99X listeners reminiscing about their favorite music and memories to appreciate the role this radio station played in their lives. The Foo Fighters sang, ‘If everything could ever be this real forever, if anything could ever be this good again’ … and it turns out it can. I am psyched to be working with some of my lifelong friends and colleagues on 99X again and thankful to my Paramount/CMT family for letting me continue to put my rock hat on with Cumulus during my off hours.”
“It’s a thrill to come back ‘home’ to The Morning X and 99X,” added Barnes. “It’s mind blowing that the fans asked for our return to the Atlanta airwaves and Cumulus gave us the chance to put our team back together to rebuild this franchise.”
Canada announced Monday it is banning TikTok from all government-issued mobile devices, reflecting widening worries from Western officials over the Chinese-owned video sharing app.
Prime Minister Justin Trudeau said it might be a first step to further action.
“I suspect that as government takes the significant step of telling all federal employees that they can no longer use TikTok on their work phones many Canadians from business to private individuals will reflect on the security of their own data and perhaps make choices,” Trudeau said.
The European Union’s executive branch said last week it has temporarily banned TikTok from phones used by employees as a cybersecurity measure.
The EU’s action follows similar moves in the U.S., where more than half of the states and Congress have banned TikTok from official government devices.
Last week, Canada’s federal privacy watchdog and its provincial counterparts in British Columbia, Alberta and Quebec announced an investigation to delve into whether the app complies with Canadian privacy legislation.
TikTok is wildly popular with young people, but its Chinese ownership has raised fears that Beijing could use it to collect data on Western users or push pro-China narratives and misinformation. TikTok is owned by ByteDance, a Chinese company that moved its headquarters to Singapore in 2020.
TikTok faces intensifying scrutiny from Europe and America over security and data privacy amid worries that the app could be used to promote pro-Beijing views or sweep up users’ information. It comes as China and the West are locked in a wider tug of war over technology ranging from spy balloons to computer chips.
Canadian Treasury Board President Mona Fortier said the federal government will also block the app from being downloaded on official devices in the future.
Fortier said in statement the Chief Information Officer of Canada determined that it “presents an unacceptable level of risk to privacy and security.”
The app will be removed from Canadian government issued phones on Tuesday.
“On a mobile device, TikTok’s data collection methods provide considerable access to the contents of the phone,” Fortier said.
“While the risks of using this application are clear, we have no evidence at this point that government information has been compromised.”
Recent media reports have also raised concerns about potential Chinese interference in recent Canadian elections, prompting opposition parties to call for a public inquiry into alleged foreign election interference.
“It’s curious that the Government of Canada has moved to block TikTok on government-issued devices—without citing any specific security concern or contacting us with questions—only after similar bans were introduced in the EU and the US,” a TikTok spokesperson said in a email.
The company is always available to discuss the privacy and security of Canadians, the statement said. “Singling out TikTok in this way does nothing to achieve that shared goal,” the email said. “All it does is prevent officials from reaching the public on a platform loved by millions of Canadians.”
A woman criminally charged over the theft of Lady Gaga’s French bulldogs is now suing the superstar, demanding that Gaga pay her a $500,000 “no questions asked” reward that the singer allegedly offered for the return of the dogs.
The lawsuit was filed by Jennifer McBride, who pleaded no contest in December to receiving stolen property in connection with the violent incident, in which Gaga’s dog walker Ryan Fischer was shot and nearly killed.
In a complaint filed Friday (Feb. 24) in Los Angeles court, McBride’s attorney argued that Gaga made a binding “unilateral” offer to pay the reward in return for the safe return of the dogs — and that McBride had taken her up on the proposal.
“Plaintiff accepted defendants’ unilateral offer by contacting defendants, and delivering Lady Gaga’s bulldogs to defendants at the Los Angeles Police Department,” McBride’s lawyer K.T. Tran wrote in the lawsuit. “Plaintiff has fully performed her obligation under the unilateral contract.”
A rep for Lady Gaga, whose real name is Stefani Germanotta, did not immediately return a request for comment on Monday.
McBride is one of five people charged over the Feb. 24, 2021 gunpoint dognapping of Gaga’s bulldogs, Koji and Gustav. Prosecutors say the singer was not specifically targeted, and that the group was merely trying to steal French bulldogs, which can be worth thousands of dollars.
McBride returned the dogs to police days later, claiming she’d found the animals tied to a pole and asking about the reward. While police initially told the media that McBride appeared to be “uninvolved and unassociated” with the crime, she was later connected to the thieves and charged with one count of receiving stolen property and one count of being an accessory after the fact. In December, she pleaded no contest to the property charge and was sentenced to two years of probation.
James Howard Jackson, the man who shot Fischer during the robbery, took a plea deal in December and was sentenced to 21 years in prison.
In her lawsuit on Friday, McBride accused Gaga not only of breaching an agreement but also of defrauding her with the claim of a “no questions asked” reward.
“The truth was that defendants intended to have its agents and/or law enforcement to ask questions of Plaintiff regarding the circumstances surrounding Plaintiff’s return of Lady Gaga’s French bulldogs,” her lawyer wrote. “The truth was that Defendants never intended to pay the reward money to Plaintiff.
McBride is seeking the $500,000 reward and another $1.5 million in damages.
LONDON — In early February, Universal Music Group chairman/CEO Lucian Grainge drew a line in the sand between the traditional record business and financial companies entering the fray to tap into the global growth of streaming. “Our industry is entering a new chapter where we’re going to have to pick sides,” Grainge said at the Billboard Power 100 launch event in Hollywood. “Are we on the side of fintech [financial technology] and functional music, functional content? Or are we on the side of artistry and artists?”
Though Grainge didn’t name names, he could well have been talking about Utopia Music, a Zug, Switzerland-based tech company that delivers financial services for labels, publishers and distributors. Over the past two years, Utopia, whose motto is “Fair pay for every play,” has embarked on a frenetic buying spree of 15 companies, including music tech company Musimap; Lyric Financial, a Nashville-based provider of royalty-backed cash advances; and Proper Music Group, the United Kingdom’s leading independent physical music distributor, which provides distribution services for 1,000-plus indie labels and service companies.
Industry executives don’t quite know what to make of Utopia’s rapid growth, its direction or where exactly the company fits in today’s multifaceted global music business. It’s one of several fintech companies, many backed by venture capitalists, that have penetrated the music business to varying degrees amid the streaming boom. “At its core, Utopia is a royalty tech company,” co-founder and executive chairman Mattias Hjelmstedt tells Billboard in a rare interview. “It’s about fixing the many data gaps in the industry.”
Hjelmstedt says he understands and even agrees with Grainge’s opposition to “pure fintech” companies that “go in and try to optimize [their] revenue versus the rest of the industry.” But that, he insists, is not what Utopia is about. His company uses technology — leveraging what has been described as “a database of more than 213 billion global data points” — to better capture royalties and process them accurately, faster and with greater transparency. That, in turn, will “help all facets of the industry earn more money,” not just Utopia’s slice of it, he says.
“We’re on the side of anyone who owns the copyright, which is a creator, which is an artist, which is also a Universal [Music Group] or a copyright fund or a publisher,” he says. “I don’t think there is a mismatch there [between fintech and artists]. It is actually fully aligned for me to have a clear path from usage to creator.”
Utopia is hardly alone in pitching ways to use tech to give artists more control over their music royalties than they’ve traditionally had with label deals. Hifi, a fintech with backers that include industry executives like Quincy Jones and Capitol Records chair/CEO Michelle Jubelirer — as well as artists Diplo and G-Eazy — is launching an “enhanced royalties acceleration service” that promises to pay artists advances based on predicted streaming royalties. Los Angeles-based beatBread offers funding for existing music catalogs and employs artificial intelligence to help artists secure advances of up to $1 million for unreleased music. And Brazilian fintech company Hurst Capital says it has set up a “hyper-specialized team” to manage the royalties of catalogs it has acquired from sertanejo (Brazilian pop-country) stars like Gusttavo Lima and the late Marília Mendonça.
Hjelmstedt is a Swedish serial entrepreneur known for founding gaming platform Electronic Sports Network, which Electronic Arts acquired in 2012, and co-founding video-on-demand platform Voddler, which filed for bankruptcy in 2018. He co-founded Utopia in 2016 with Thomas Gullberg, basing it in the town of Zug, where around 60 of the company’s staff of 1,000 are based.
Details about Utopia’s finances and funding remain opaque. The company’s only publicly listed investors are Switzerland-based investment firms CV VC and FiveT Fintech (formerly Avaloq Ventures). Hjelmstedt says the firms “are by far not among the largest investors” but declined to reveal any others. Utopia, which he says generates over 100 million euros ($107 million) in revenue a year, recently completed an investment round, but Hjelmstedt declined to discuss figures or what the capital will be used for.
Lately, the company has been characterized by change. In November, Utopia cut its workforce by around 20%, or about 230 jobs, according to a company representative. Hjelmstedt says the job cuts resulted from the global economic downturn coupled with the company’s goal of achieving sustainable growth. A month later, in December, Utopia restructured its business into two separate divisions: Music Services and Royalty Platform. Then in January, Utopia reshuffled its senior leadership, with former CEO Markku Mäkeläinen exiting the company and Hjelmstedt taking over as interim chief executive. (U.K.-based Roberto Neri is CEO of the Music Services division.)
As part of the reorganization, Utopia announced on Feb. 7 that it had sold U.S.-based music database platform ROSTR — which has a directory of artists, managers, booking agents and record labels — back to ROSTR’s founders for an undisclosed sum. Utopia purchased the company in December 2021 to strengthen its direct ties with the artist community. But Hjelmstedt says Utopia will now primarily focus on delivering financial services. He declined to comment on whether there will be further divestments or acquisitions this year, claiming the company will reveal more about future plans, including new product launches, in the coming months.
Utopia’s music services division is headed by U.K.-based former Downtown executive Roberto Neri and includes the acquired companies Proper, Absolute Label Services, Liverpool-based publisher Sentric Music Group and Cinram Novum, one of the U.K.’s leading physical home entertainment suppliers. (Cinram Novum provides warehouse, fulfillment and distribution services to labels, including UMG, Sony Music Entertainment and [PIAS].)
Utopia’s royalty platform arm, which Hjelmstedt oversees, looks after the company’s financial technology services, data operations, copyright and royalty processing.
Hjelmstedt declines to comment on whether dividing Utopia into two separate divisions signals an intention to make the split between distributor and royalty platform permanent. He rejects speculation that Utopia is a tech scale-up looking to capitalize on the growth of the music industry rather than to build a sustainable business. The company’s myriad acquisitions, he says, were made “to understand different parts of the industry better, so we can serve them better with the data.” Despite acquiring a significant chunk of the U.K. music distribution business, he says, it was “never the idea of Utopia to be a distributor.”
“We will never be a collecting society or a [performing rights organization],” says Hjelmstedt. “We will never sell data and we will not take investments from a large strategic player in the industry, and by doing so, we can safeguard the core of what we stand for.”
While the use of magnetic tape to record and play music dates back to the 1930s, it wasn’t until 1963, at the Berlin Radio Show, that Philips introduced the two-spool cassette. Twenty years later, the finicky format passed vinyl as the most popular music medium in the United States, but it was a short-lived victory: The CD soon spun it into the bargain bin of history. But two decades after most music fans pressed the Eject button, cassettes are following vinyl’s comeback in stores and stereos.Reel Love
Operating under the Norelco brand in the United States, Philips launched an “intensified advertising and promotion drive” to get cassettes into American homes,” according to the Sept. 24, 1966, Billboard. “The Norelco success on TV with shavers will hopefully be duplicated with recorders.” By the Nov. 26 issue, Philips predicted that “the market for equipment that can record and play back cassettes will reach 4 million sets” within a few years, citing one advantage the format had over vinyl: the “capability to play in any position, even upside down.”
Hitting Pause on High-End
Over the next decade, cassette sales were on fast-forward — but the format struggled to attract audiophiles, who stuck with vinyl. “A $19 cassette is a difficult sale to make,” mused an ad executive who worked for a chain store in the May 8, 1982, Billboard, referring to high-end cassettes. But electronics company Maxell tried: In that very issue, a pre-fame Geena Davis, leaning on a shelf full of tapes, appeared in a full-page ad targeting audiophiles.
Tapes and Tapes
Big Brother must have carried a Walkman: In 1984, the March 24 issue reported that “cassettes toppled LPs as the dominant prerecorded audio configuration last year, accounting for almost 53% of all album product shipped to trade.” Cassettes were up 30.1% year over year, while vinyl dropped 14.1%. The “portable lifestyle,” Billboard noted, “continues to propel sales to new peaks.”
Find Cassingles Near You
“Is Cassette-Single Format Winding Down Already?” asked the front page of the Dec. 21, 1991, Billboard. Apparently so: “The dollar value of CD sales surpassed that of cassettes,” according to an article in that issue. “Most distribution executives [agree that] the format has passed its peak,” though one Midwest chain store owner blamed “lousy songs,” insisting that the decline was nothing “a couple of hits couldn’t fix.”
Measuring Tapes
By the end of the ’90s, cassette sales were unspooling. “The decline of today’s cassette mirrors the disappearance of the 8-track tape two decades ago,” Billboard reported in its Dec. 28, 2002, issue. A year later, cassette sales had dropped 40.3% while CD sales had dropped just 3%, due to the rise of online piracy. In a Dec. 19, 2009, year-end “Sales by Album Format” graphic, cassettes had been folded into the “other” category. But reports of the format’s death were greatly exaggerated. From 2015 to 2022, the little tape that could saw a 443% increase in U.S. sales, according to Luminate, as marquee names like Taylor Swift, Megan Thee Stallion and Maren Morris cued up the cassette’s comeback.
This story originally appeared in the Feb. 25, 2023, issue of Billboard.