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The Ledger is a weekly newsletter about the economics of the music business sent to Billboard Pro subscribers. An abbreviated version of the newsletter is published online.
The 2004 documentary Super Size Me took a humorous look at the health consequences of fast-food restaurants’ practice of up-selling customers to higher-priced, larger-portioned items – a super-sized cup of Coca-Cola rather than a large, for example. To the customer, up-selling looked like a good deal: the additional soda or food cost only a few cents more. For restaurants, the tactic padded margins because the difference in price dwarfed the cost of goods.
Super Size Me comes to mind when looking at music subscription services and their quest to improve their margins. Those services have the equivalent of a super-sized option: the family plan, which generally costs 50% more than an individual subscription and includes up to six subscribers on a single plan. But unlike up-selling in the fast-food business, super-sizing a music subscription service doesn’t pay off in the short term. The family plan may help retention, which can improve subscribers’ lifetime value – that, not average revenue per user, is the key metric in the subscription business – but it does nothing to boost margins.
For years, high-fidelity audio was presumed to be music’s version of super-sized food portions: an up-sell product that carried a higher price without a commensurate increase in costs to the platform. But high-fidelity audio now appears to be a standard option for most streaming platforms, another carrot to entice people to sign up rather than a means to segment consumers based on willingness to pay. That means music licensed from record labels and distributors doesn’t provide a path to better margins. In fact, there’s only a small amount of upside left to wring out of licensors: Spotify expects it can get its music margins to 30% and eventually to 35%, up from the 28.1% margin it reported for 2021.
The future of the music streaming business looks more like gas stations than fast food. Gas stations have turned into convenience stores that sell junk food, beverages and household staples. Gas itself is almost a loss leader. Stations make their margins on everything else – a $3 bottle of Coca-Cola, a $2 candy bar or a $6 package of Ibuprofen pills. According to an examination of the economics of gas stations at The Hustle, stations earn a 1.4% profit margin on fuel compared to 200% on soda machines and 100% on lottery tickets.
We’re seeing more examples of streaming services looking for margin relief outside of their core products. On Sept. 20, Spotify, which acquired audiobook distributor Findaway in June, launched a la carte audiobook sales, putting it directly in competition with Amazon-owned Audible. Audiobook downloads provide better margins than Spotify can get from music. As the retailer, Spotify keeps 50% of the audiobook purchase sale proceeds. Findaway’s distributor fee is 20% of the author’s royalties – which works out to 10% of sale proceeds after Spotify takes its 50% cut. In aggregate, Spotify gets a 60% margin in audiobook sales on its platform – double the typical margin in both music streaming and music downloads and more than double Spotify’s gross margin on music last year.
One notable hiccup to Spotify’s foray into audiobooks is the buying process. Spotify sells audiobooks only at its website, not within the Spotify app. That allows it to keep its cushy margins without giving a significant portion to either Apple or Google for in-app purchase fees. Not offering audiobook sales within the app creates an extra step in the buying process, and even a small amount of friction can become a drag on purchase activity. But Spotify could also be a boost to the format, says Tony van Veen, CEO of DIY Media Group, which owns BookBaby, a distributor for independent book authors. “If Spotify offers it and lowers the barrier, will there be more adoption? Yeah, I think so,” he says. Spotify CEO Daniel Ek believes audibooks could eventually achieve 50% of book sales in mature markets compared to their current 6-7% share.
Spotify has already made a big push into podcasts in a search for better margins. Podcasts have been a money-loser with a –57% gross margin but have potential at scale. At a June 8 investor presentation, Spotify CFO Paul Vogel said podcast margins could reach 40% to 50% in the future. Tightening the belt could help get there: news broke on Oct. 7 that Spotify laid off “at least” 38 employees and will shutter 11 podcasts created by Gimlet and Parcast, two content studios Spotify acquired in 2019 for a combined $286 million.
Also searching for better margins, French music streamer Deezer is planning a new product called Zen by Deezer. Expected to debut in France in the first quarter of 2023, the product offers “exclusive music relaxation, sounds, expert tips and guided exercises,” according to the company’s Oct. 4 investor presentation. It’s a sensible product extension given the explosion of apps for meditation, yoga, sleeping and mental health. In the wake of COVID-19, McKinsey put the size of the global wellness industry at a staggering $1.5 trillion.
When Zen by Deezer is running at scale, Deezer believes, its content costs will run about 10% of revenue. That’s compared to roughly 70% for a standard on-demand streaming service that licenses music from record labels, music publishers and performance rights organizations. The difference, the presentation explains, is “one-off content production,” rather than music licensed at standard rates. Whether created in-house or acquired on a one-time, royalty-free basis, Zen by Deezer won’t pay most of its subscription fees to license music.
Elsewhere, music is increasingly a means to hook customers before giving them another product. Abu Dhabi-based Anghami is looking to diversify through podcasts, branded content and live concerts. In June, it purchased Spotlight Events, a concerts company based in the Middle East-North Africa region. Tencent Music Entertainment, China’s largest music streamer, also made a concerted push into spoken-word audio when it acquired audiobook distributor Lazy Audio in 2021. TME also has a growing podcast business.
Using a gas station metaphor for Spotify only goes so far – or does it? Consumers’ reliance on their automobiles makes them dependent on gas stations for transportation. Until electric cars see widespread adoption, most people will be regular customers at gas stations’ convenience stores. Music isn’t quite as entrenched as the automobile, but there’s a growing belief that a music subscription is a basic utility – like internet, gas or water – that most people will carry continuously. That gives streaming services on ongoing billing relationship with hundreds of millions of customers and an opportunity to make better margins on something other than music.
iHeartMedia Atlanta president Drew Lauter has departed the radio giant after video surfaced of the executive using racial and misogynistic slurs. The national radio conglomerate confirmed to Billboard on Friday (Oct. 14) that Lauter was no longer with the company, stating, “allegations of this nature go against our company values and our policies and we take them very seriously.”
The videos – provided to the local news station WSB-TV Atlanta, which first reported the news – shows Lauter repeatedly telling the driver, a fellow iHeartMedia executive, to “run over n—os” and using other racist language in front of two other iHeart employees, one of whom filmed the incident. According to attorneys Jason Castle and Roosevelt Jean, who are representing the client who filmed the incidents, the videos were recorded in August 2021 after a charity event.
In two videos, Lauter can be heard repeatedly using racial and sexist slurs and groping a male coworker while stating, “you better give me that t-tty.” Castle and Jean’s client – who is a top-ranking Black iHeart executive in the Atlanta region – claims to have reported the incident to his immediate supervisor at the time. He informed his attorneys that this was not the first instance of Lauter using racially insensitive language in front of employees.
In a statement provided to Billboard, an iHeart spokesperson said, “As soon as [the videos] were brought to our attention we acted quickly, retaining an outside investigator to conduct a thorough review, and when we received the outside investigator’s findings we immediately took decisive action.”
“From our client’s perspective, this isn’t about our client,” Castle tells Billboard. “It’s that this particular video is a representation of the hostile work environment and the discriminatory and racially insensitive, as well as sexually harassing environment that existed in the iHeart Atlanta offices.”
iHeart employees were reportedly informed of Lauter’s departure on Thursday, the same day the WSB-TV investigative report aired.
Castle says his client has not filed any legal action against iHeart or Lauter.
Ed Sheeran’s lawyers want a federal judge to rethink a recent decision that said the star must face a trial over whether “Thinking Out Loud” infringes Marvin Gaye‘s “Let’s Get It On,” warning that such rulings threaten to “strangle creation” by future songwriters.
Two weeks after Judge Louis Stanton refused to toss the case out, Sheeran’s attorneys respectfully told the judge Thursday (Oct. 13) that he was wrong – and that the only overlap between the two songs were simple musical elements that have “been used in music for centuries.”
“Affording copyright protection to a combination of only two unprotectable basic musical building blocks, such as the ones at issue here, would undermine a central purpose of copyright law – which is to encourage the creation of new works – and would instead strangle creation,” wrote Sheeran’s lead counsel Don Zakarin, an attorney at the firm Pryor Cashman.
In technical terms, Sheeran’s lawyers are asking the judge to reconsider his own ruling. If he does, it would be a rare step, typically only taken when it’s clear a judge has gotten something wrong. In the alternative, they’re asking for permission to file a fast-track appeal; if granted, it could delay any trial by at least a year.
Sheeran has long been dogged by questions of whether “Thinking Out Loud” (which spent 51 weeks on the Billboard Hot 100 after it was released in 2014) borrowed too much from “Let’s Get It On.” He did himself no favors in late 2014, when he was filmed on stage at a concert toggling between the two songs.
The singer was hit with the current lawsuit in 2018 – filed not by Gaye’s heirs but by an entity owned by industry executive David Pullman called Structured Asset Sales. That group owns a one-third stake in the copyrights of Ed Townsend, who co-wrote “Let’s Get It On” with Gaye.
Faced with the accusations, Sheeran’s lawyers argued that the elements he allegedly took from the Gaye’s song – a chord progression and the harmonic rhythm – were too commonplace to be the exclusive property of any one songwriter. They cited a number of other songs, including “Since I Lost My Baby” by The Temptations, that featured similar aspects.
For their part, Sheeran’s accusers admit that those elements, by themselves, are “commonplace and unprotectable.” But they say that when they were combined together in Gaye’s famous song, they became something more original and worthy of copyright protection.
In late September, Judge Stanton refused to side with either argument. He said there was “no bright-line rule” for deciding such questions, and that the pop star would need to make his arguments before a jury of his peers. The decision set the stage for a blockbuster trial at a Manhattan federal courthouse at some point in the future, though a date has not yet been set.
Thursday’s new motion, if granted, would avoid that trial entirely, or push it back if the judge approves the fast-track (“interlocutory”) appeal. In it, Sheeran’s attorneys argued that the court was correct about the lack of a “bright line,” but that the case against Sheeran still fell well short of the mark.
“No one can or should be able to claim the exclusive right to a chord progression and the unremarkable and unprotectable manner in which it is performed,” Sheeran’s lawyers wrote. “Defendants respectfully submit that the order overlooked these critically important legal considerations.”
The arguments from Sheeran’s lawyers sound quite a bit like comments the star himself has made about copyright litigation in the music industry. In April, after he defeated a similar case over “Shape of You,” Sheeran said “baseless” cases were taking a personal toll on him, and that he now films all of his recording sessions to disprove potential claims of infringement.
“It’s really damaging to the songwriting industry,” Sheeran said at the time. “There’s only so many notes and very few chords used in pop music. Coincidence is bound to happen if 60,000 songs are being released every day on Spotify.”
The music industry has completely transformed since Gary Kurfirst’s epic four-decade run as a rock promoter, label head and artist manager to acts including the Talking Heads, The Ramones and Jane’s Addiction, but much of the advice he taught his artists remains true today.
Fine tune one’s craft. Build an audience. Create authentic and meaningful art.
“He wanted to keep his artists in the underground, focused on making music and creating art while protecting them from the business side,” says Talking Heads drummer Chris Frantz, recalling the time that Kurfirst turned down a Rolling Stone cover because he felt the band wasn’t ready for such a career milestone.
“I remember him always telling us ‘Don’t smile in promotion photos – they’ll think you’re making a lot of money,’” recalls multi-instrumentalist Jerry Harrison of the Talking Heads, one of the many A-list acts Kurfirst managed and worked alongside including Bob Marley, the Eurythmics, Garbage and dozens of other bands. Kurfist’s career ran parallel to music industry giants like concert promoter Michael Lang, agent Frank Barsalona and Island Records founder Chris Blackwell, and it’s one that belongs in the Rock and Roll Hall of Fame, says his son Josh Kurfirst, a partner at WME and the agency’s global head of festivals.
Felix of Mountain with Young Ozzy on the left Gary on Rt Gary on the Right. Felix Pappalardi of Mountain (center). A young Ozzie Osbourne left center. Gary selected a relatively unknown Black Sabbath to open for Mountain on their US tour 1969.
Courtesy of The Kurfirst Estate
Joshua Kurfirst is actively positioning his father to be considered for the Ahmet Ertegun Lifetime Achievement Award for Industry Professionals at the Rock Hall. While much of the nomination process is veiled in secrecy, the younger Kurfirst has been in touch with the artists and executives his dad collaborated with over the years, archiving thousands of documents and relaunching the website GaryKurfirst.com in hopes of adding his father posthumously to the Hall of Fame (Kurfirst passed away in 2009). Currently, there are four music managers in the Hall of Fame, all winners of the Ahmet Ertegun Lifetime Achievement Award: Eagles and Fleetwood Mac manager Irving Azoff, Bruce Springsteen manager Jon Landau, late Beatles manager Brian Epstein and former Rolling Stones manager Andrew Loog Oldham.
Kurfirst was also a concert promoter, a label chief at his Radioactive Records, and a family man who married an art teacher named Phyllis in the late 1960s. He had countless stories to share and was a tireless advocate for an artist’s career longevity.
“Gary knew it was essential that the fans walked away feeling they got a really good value for their money,” says Harrison. “And he balanced that with how much the band needed to make for the night to go on to the next show. He had been a promoter himself and knew every part of the business. He’d prefer to work with people, but he had no problem saying, “I don’t care if you’re the only guy in town, we will promote the show ourselves if we have to.”
He also stood by his artists when they faced difficult creative decisions, says famed Blondie front woman Debbie Harry, who hired Kurfirst to help with her solo career shortly after the new wave hitmakers called it quits in 1982 (they reunited 15 years later).
Phyllis and Gary at the Capitol Theater in Port Chester.
Courtesy of The Kurfirst Estate
“I’m sure he would have preferred we got back together but he was very smart and came in knowing the dynamic,” said Harry. “He started when he was quite young and knew the industry from all the different angles. That is really the best kind of manager to have – somebody who gets it and loves it regardless of how crazy things get.”
Shirley Manson of Garbage recalls first meeting Kurfirst when her former band, Goodbye Mr. Mackenzie, was opening for Harry on her Debravation tour.
“He took a great interest in me at the time and told me,’ I think you’re a star.’ And I thought it was ludicrous – I was a backing keyboardist and vocalist,” she recalls. Kurfirst ended up buying out Goodbye Mr Mackenzie’s contract to bring them over to his own label Radioactive Records. The band never took off, and Manson performed with Angelfish until auditioning for Garbage, a group being formed by Nirvana producer Butch Vig.
“I needed an opportunity. And Gary gave me that,” Manson tells Billboard. “Above all else, I am so grateful to Gary for the belief he had in me. Even when things got tricky and there was a lot of backlash in the press, Gary told me ‘You’re great at what you do. You are a star. Just hold the line. I believe in you.’”
Kurfirst was born July 8, 1947, in Forest Hills, Queens. He graduated from Forest Hills High School in 1964 — he was classmates with members of The Ramones — and promoted concerts at the Forest Hills Stadium (then called the West Side Tennis Club). In 1968 he promoted the NY Rock Festival at the Singer Bowl in Queens that was headlined by the Doors, The Who and Jimi Hendrix with his then-partner Shelly Finkel.
Kurfirst expanded into Manhattan by striking a deal to book the Village Theater, a former Lower East Side cinema-turned live music venue that hosted The Who, who nearly caused a riot as fans gathered outside to see the legendary rock group. Bill Graham would take the reins of the theater in 1968, rechristening it as the Fillmore East (the sister venue to Graham’s Fillmore in San Francisco).
Jimi Hendrix concert produced by Gary Kurfirst and Shelly Finkel. Phyllis Kurfirst was Gary’s artistic director and designed this poster.
Courtesy Photo
In 1969, Kurfirst began managing former high school classmate Leslie West and his hard rock band Mountain. Ironically, one of Gary’s first big tests as a manager came at the 1969 Woodstock Festival, where Mountain was scheduled to perform in the afternoon.
When he and the band arrived at the festival site in upstate New York, Kurfirst noticed that the show was way off schedule and “more or less being made up as it went along,” his son Josh says. Noticing that instead of following a schedule, organizers were putting acts on stage as soon as they spotted all the members of a band together backstage, Kurfirst told the group to scatter to different parts of the site and meet backstage at 8:30 p.m.
“The plan worked perfectly, and Mountain ended up with a prime set time,” Josh says.
Managing Mountain brought Kurfirst into the orbit of Island founder Chris Blackwell, who eventually convinced Kurfirst to move himself and his family to the west side of Nassau in the Bahamas where Blackwell operated the Compass Point recording studio. Through his relationship with Blackwell, Kurfirst would meet Bob Marley and land a gig as tour manager for the reggae star’s debut US tour. Kurfirst would go on to manage former Wailers legend Peter Tosh and watched incredulously when he first saw Tosh bury a briefcase of cash he had been paid as part of the record deal Kurfirst had negotiated for him. When Kurfirst asked for an explanation, Tosh simply told him, “I made a deposit in the Bank of Jamaica.”
Kurfirst with Toots Hibbert of Toots and the Maytals in a diner.
Courtesy of The Kurfirst Estate
Upon his eventual return to New York, Kurfirst began to frequent Hilly Kristal’s East Village club CBGB, where he met and signed The Talking Heads as management clients and later signed The Ramones.
Kurfirst would go on to produce several concert films for the Heads, including 1984’s Stop Making Sense, which would be added to the Library of Congress’ National Film Registry in 2021. Four years after launching Radioactive Records, an imprint for MCA Records, the label scored its first No. 1 album with Live’s Throwing Copper, which went on to sell eight million copies.
In total, Kurfirst managed more than 40 artists and groups during his career, including Steve Winwood, Robert Palmer, the B-52’s, Big Audio Dynamite, Deee-Lite, Dig, Los Amigos Invisibles and Skinny Puppy.
“Gary’s taste, ability to identify star talent, and build lasting brands out of those stars was extraordinary,” says Josh, who himself has risen through the top echelons of live music, leading WME’s festival division.
In the final years of his life, Gary began working with his son booking concerts for Spanish language artists. He passed away in 2009 while visiting the Bahamas. He was 61. One of his final management and label projects was with Blackwell, who was Kurfirst’s neighbor and friend for many years when Kurfirst and his family were living in the Caribbean.
The two developed a management company, Kurfirst-Blackwell Entertainment, as well as Rx Records, an imprint for artists that proffered more contractual flexibility and creative latitude than most major labels.
“He had a gift for getting the very best from the artists he worked with without getting in their way or pushing too far,” Blackwell says. “Gary was not just a great manager; he was an excellent marketer and a very creative businessman. He believed in his artists, and they really believed in him. They knew he would do whatever he could to make their music and their careers a success.”
Gary Kurfirst with a young Josh Kurfirst
Live Nation Urban has acquired a significant equity stake in the Washington, D.C.-based Broccoli City Festival, company officials announced Friday (Oct. 14).
Broccoli City has grown every spring since the launch of its first event in 2010; Live Nation Urban notably acquired the stake from festival co-founders and entrepreneurs Marcus Allen and Brandon McEachern.
As part of the acquisition, Live Nation Urban welcomes Allen and McEachern in executive roles. They will work alongside Live Nation Urban president Shawn Gee and his team to scale the Broccoli City brand and “catalyze the creation of new content and culture-centric live experiences and festivals,” according to a press release announcing the deal.
The Broccoli City Festival, described as “a black-owned social enterprise rooted in impact and entertainment that focuses on people and progress,” has notably featured icons such as Lil Wayne, Cardi B, Childish Gambino and the late Nipsey Hussle as well as rising superstars Lil Baby, Lil Durk, Summer Walker, Wizkid and City Girls. Based in D.C., the festival “staunchly supports environmental consciousness in the African-American community and fosters creativity through innovative initiatives at the intersection of technology, music, art, and social impact,” the release continues. “Over the last decade, it has inspired and mobilized 20 million-plus young people through events and online platforms.”
The acquisition highlights a cycle of black entrepreneurship. Beyond the festival, Gee and Live Nation Urban have focused on championing Allen and McEachern and their vision in the long run.
“For us as a company, this investment was an important one,” said Gee, noting that when Live Nation Urban formed in 2018, one of its first deals was a co-promotion agreement with Broccoli City. “I promised the guys that the success of our partnership would lead to greater things, and it was important to me to keep my word. We are not simply investing in a festival; we are investing in these amazing founders. We believe this will be the first of many brands that we will build together with Marcus and Brandon as they have an insatiable entrepreneurial spirit.”
The Broccoli City crew is “super excited about this partnership with LNU/LN, and working closer with Shawn Gee. I really appreciate him encouraging us to be big thinking entrepreneurs and brand builders… not limiting us to event producers,” added McEachern.
To position Broccoli City for further growth, “we are going to focus on curating untapped niche markets, bigger partnerships, and international expansion,” Allen added. “Our big picture goal is to create a 100-million-dollar community at the apex of live entertainment, social impact, and digital media.”
Over the past several years, Burna Boy has grown into a legitimate international star, with each of his last three albums achieving higher and higher slots on the Billboard 200 and his 2021 album, Twice As Tall, winning a Grammy for best global music album. And as his music has grown in popularity in the U.S., he’s been able to reach new milestones like selling out Madison Square Garden, which he did earlier this year. But one aspect of stardom had until recently eluded him: U.S. radio airplay.
That has changed over the past few weeks, as his single “Last Last” from his latest album Love, Damini has begun climbing the Billboard radio charts. And this week, it has finally crowned one of them, having reached No. 1 on Billboard’s Mainstream R&B/Hip-Hop Airplay chart, a testament to the work put in by his label Atlantic Records. And it helps earn Atlantic’s executive vp of black music promotion Kevin Holiday the title of Billboard’s Executive of the Week.
Here, Holiday explains the strategy that brought a song that was originally released in May to the top of the airplay charts in October. “Radio is a long game, and it takes time for records to organically connect with an audience,” he says.
This week, Burna Boy’s “Last Last” hit No. 1 on Billboard’s Mainstream R&B/Hip-Hop Airplay chart. What key decision did you make to help make that happen?
The key decision was to ask urban radio to collectively move in one direction at the same time. Another crucial decision was making sure we highlighted all the latest and greatest information on Burna Boy the week prior to achieving the No. 1. These decisions put us in position to attain our goal.
The song has not just reached the top of that chart, but it’s also climbing the all-format Radio Songs chart, reaching a new peak of No. 24 this week. How are you expanding its airplay audience?
The regions with the highest populations aid the growth in audience airplay. With that said, we are expanding Burna’s airplay audience by targeting the major markets, in hopes they play the record more.
The song has been out for five months now, since first being released in May. Why is it climbing and peaking at radio now?
It takes some time to get folks on the same page and increase airplay. Radio is a long game, and it takes time for records to organically connect with an audience.
Last year, Wizkid‘s “Essence” broke through on U.S. radio, opening up a lane for music by African artists that hadn’t really existed before. How has that changed what’s possible for Burna at radio?
Wizkid helped reshape the sound of traditional U.S. radio from just playing American hip-hop and R&B records. Burna Boy’s music has a grassroots structure of R&B mixed with a “feel good” vibe, which doesn’t completely break the boundaries of the music played within the formats. Ultimately, the possibilities are endless for Burna Boy.
Recently, we’ve seen songs make inroads at pop radio with a pop artist remix. Is that something you guys are exploring? What could that do for a song like “Last Last”?
Although “Last Last” is perfect as is, a pop remix can give a different twist and widen the audience. As of now, I believe there are no plans for such a remix… But never say never!
How can success at radio like this help boost Burna Boy’s career moving forward?
As U.S. radio continues to create global superstars, the sky is the limit for Burna Boy and his future endeavors. We are just getting started!
A day after an Atlanta judge refused to release Gunna from jail, his lawyers made a striking accusation against prosecutors on Friday – claiming an alleged smoking gun text message cited by government lawyers actually had “nothing to do with witness intimidation” and had been used to mislead the court.
At a hearing on Thursday, prosecutors told Judge Ural Glanville that they were in possession of a message in which a co-defendant offered to “whack someone” on Gunna’s behalf. A short while later, the judge denied the rapper bond for a third time, meaning he’ll remain in jail until his January trial.
But in Friday’s filing, Gunna’s lawyers said they’d finally gotten their hands on the message in question – and that it was from June 2020 and “has nothing to do with witness intimidation or obstruction.”
According to the new filing, the actual message reads: “Tell gunna happy c day it’s all love [100 and heart emojis] I’ll still a whack some Bout him.”
“For the state to [argue] that this text is an offer to commit murder (or to threaten or injure a witness in a case that was still two years in the future) aptly illustrates the problem of a hearing by ambush and proffer,” wrote attorney Steve Sadow and Gunna’s other lawyers.
“Respectfully, at each of the bond hearings before the Court, the State has relied on proffers of evidence— never disclosed to Kitchens prior to a hearing — and none of the proffers has panned out,” Sadow wrote.
A spokesman at the Fulton County District Attorney’s Office did not immediately return a request for comment.
Both Gunna (real name Sergio Kitchens) and Young Thug (Jeffery Williams) were indicted in May, along with dozens of others, on accusations that their group YSL was not really a record label called “Young Stoner Life,” but a violent Atlanta street gang called “Young Slime Life.” The charges included allegations of murder, carjacking, armed robbery, drug dealing and illegal firearm possession over the past decade.
The two stars, who strongly deny the charges, have both repeatedly sought to be released on bond ahead of their trials, which are currently scheduled for January. But both have been refused, largely because prosecutors have warned that they might threaten witnesses or otherwise obstruct the case.
Ahead of Thursday’s hearing, Gunna’s lawyers said those warnings had largely been premised on unreliable “proffers” from the government, none of which had later proved to be based on hard proof. They said there was not “a shred of evidence” to support keeping him locked up before he has been proven guilty.
But at the hearing, prosecutor Adriane Love repeatedly cited the supposed “whack” statement by the co-defendant, arguing that it suggested people were willing to murder witnesses for Gunna. She said she was uncertain about whether the message in question had yet been uploaded into court records, but said it would be available by the end of the day if not. Minutes later, Judge Glanville denied bond.
On Friday morning, having seen the text in question, Gunna’s lawyers argued that Love “misstated” the evidence and had thus “misled” Judge Glanville. They put particular emphasis on the date, since it allegedly suggested witness tampering the current criminal case: “The text in question, dated June 14, 2020 — almost two years before the indictment was returned in this case — has nothing to do with witness intimidation or obstruction.”
The new filing did not outright ask the judge to reverse his own decision, but asked Judge Glanville to officially note the actual date and content of the text message, rather than rely on the description offered by prosecutors.
The case against YSL is built around Georgia’s Racketeer Influenced and Corrupt Organizations Act, a state law based on the more famous federal RICO statute that’s been used to target the mafia, drug cartels and other forms of organized crime. Such laws make it easier for prosecutors to sweep up many members of an alleged criminal conspiracy based on many smaller acts that aren’t directly related.
Beyond indicting two of rap’s biggest stars, the case also made waves because it cited their lyrics as supposed evidence of their crimes — a controversial practice that critics say unfairly sways juries and injects racial bias into the courtroom. California recently banned the tactic in that state, but Fulton County District Attorney Fani Willis has strongly defended using it against Young Thug and Gunna.
Barring delays — a very real possibility — trials are currently scheduled for early January.
Interscope Records has announced a partnership with RB Music, the regional Mexican indie label that’s home to Grupo Marca Registrada.
According to both companies, the alliance is an effort to “power” both the catalog and new music of the norteño-sierreño group that hails from Sinaloa. The first release under the venture is Marca’s new single “Puro Campeón,” a collab with corridos singer-songwriter Luis R. Conríquez that released on Friday (Oct. 14).
“From afar, I’ve admired what Ricardo Bobadilla and the entire RB Music team have done over the past few years,” says Nir Seroussi, executive vp at Interscope Records. “Their impact with Grupo Marca Registrada is game-changing. They catalyzed the group’s evolution from a local favorite to an international contender. Together, we have the collective and combined platform to launch Grupo Marca Registrada into the stratosphere.”
With more than 8 million monthly listeners on Spotify, three entries on Billboard’s Hot Latin Songs chart this year (“Si Fuera Facil,” “Solo Me Dejaste” and “El Rescate” with Junior H), Grupo Marca Registrada has carved a lane for itself in regional Mexican collaborating with artists such as Grupo Firme and Gerardo Ortiz.
RB Music CEO/founder Ricardo Bobadilla added, “Music to me is a family business. When we were introduced to Nir and his team there was an instant family-like connection with their knowledge of our business and focus on quality, artistic creativity, and integrity. At RB Music, we have always done things our own way and on our own terms. But I knew I wanted to partner with Nir, as he approaches music with an independent spirit that we at RB Music identify with. In the end, I believe Interscope understands where we want to go and is willing to invest significant time and resources to get us there.”
The partnership between Interscope and RB is the latest example of major labels teaming up with indie regional Mexican labels companies. Most recently, Sony Music Latin teamed up with Rancho Humilde to support Fuerza Régida. Meanwhile, Warner Music Latina signed DannyLux via a partnership with the indie VPS Music.
Jenna Park Adler was promoted to co-head of CAA‘s global hip-hop/R&B touring group alongside existing head Mark Cheatham. Adler’s clients include Jennifer Lopez, Doja Cat, Charli XCX, Green Day, Chloe x Halle, Yeah Yeah Yeahs, Deftones and Mark Ronson.
Robert Santelli was named executive director at the Bruce Springsteen Archives and Center for American Music at Monmouth University. He will oversee the Springsteen Archives and work to create programs, exhibits and collaborations with music museums and universities in the U.S. Santelli can be reached at bsantell@springsteenarchives.org.
BMG named Brandon Riester vp of A&R, recorded music. In the role, the Los Angeles-based executive will sign and develop artists for the label’s frontline recording team and participate in song development alongside BMG’s songwriters and publishing team. He reports directly to executive vp of recorded music Dan Gill. He was most recently A&R for Nuyorican Records. Riester can be reached at brandon.riester@bmg.com.
Colin Reed, longtime chairman and CEO at Ryman Hospitality Properties, is transitioning to executive chairman of the company after more than 21 years as CEO. Succeeding him in the CEO role is Mark Fioravanti, who will also hold the title of president, effective Jan. 1. Reed’s new role will include his responsibilities as executive chairman of Ryman’s board of directors and as chairman of the Opry Entertainment Group (OEG) board of directors. He will also focus on working with OEG strategic investor Atairos as well as NBCUniversal to exploit opportunities for value creation, advance the company’s ESG and DEI goals and handle community and government affairs. He will also continue his role with artist and shareholder relations alongside Fioravanti.
ASM Global named Liam Thornton as executive vp of strategy and development. In the role, he will be responsible for strategic planning, market research, site selection, lease and partnership negotiations, development feasibility, site planning, project advisory and investment analysis. Thornton can be reached at lthornton@asmglobal.com.
Also at ASM Global, Kimberly Weedmark was named general manager for the Los Angeles Convention Center; she joins the company from Universal Studios Hollywood, where she served as vp of special events and group sales. In her new role, she will work with the City of Los Angeles to continue to grow the convention hall.
Warner Chappell Music promoted Petter Walther Walthinsen to head of A&R for Warner Chappell Music Nordics. In the expanded role, Walthinsen will be responsible for the strategy, direction and culture of the company’s A&R department across the Nordics, with all A&R executives in the region reporting to him. Walthinsen, who will report to the region’s managing director Lars Karlsson, was previously senior A&R manager at Warner Chappell Music Norway.
Lily Golightly was hired as senior vp of publicity at Verve Label Group. She will oversee U.S. communications efforts for the company’s imprints, including Verve Records, Impulse!, Verve Forecast, Decca Records U.S., Decca Classics, Deutsche Grammophon and ECM. She previously spent over seven years at 300 Entertainment and operated her own independent publicity company, No Big Deal PR, through January 2020.
Andre Rodriguez was hired as Warner Music Latina’s director of commercial operations. In his new role, he will lead commercial operations for the entire Latin American region, and his team of six employees together will work to bridge the gap between the labels’ marketing and production departments to increase efficiency. He will report directly to senior vp of commercial services Marcela Vaccari. Rodriguez previously served as 10K Project’s senior director of production, and in addition to his new role at Warner, he will continue to manage artists under his self-owned company MUSTDIE.
Russell Hunt was hired as senior creative manager at Reservoir Media. Hunt will be based in the company’s London office, working closely with U.K. head of creative Charlie Pinder to expand Reservoir’s global presence. He will report to executive vp and global creative director Donna Caseine. He joins the company from Tigerspring, where he was head of A&R U.K.
Dan McEvoy and Bertie Gibbon joined the team at ATC Management. McEvoy brings client Black Country, New Road, while Gibbon will oversee the careers of new ATC clients Sorry, The Goa Express and Miss Tiny. McEvoy can be reached at dan@atcmanagement.com and Gibbon can be reached at matthew@atcmanagement.com.
Nashville-based publishing company SoNash launched and announced its executive team: president Travis Chaney, vp Bridgette Tatum, creative director Abigail Wate Ayala and creative consultant Juli Newton-Griffith. Wate Ayala can be reached at Abigail@sonashpublishing.com and Tatum can be reached at bridgette@sonashpublishing.com.
Music technology platform Vydia hired Susan “Sweetness” Ybern and Elena Lanza as label & artist relations managers. Both will play a crucial role in the company’s new business growth, marketing and strategy with artists and labels. They will be responsible for sourcing, negotiating and signing new partnerships deals while working collaboratively across the marketing, legal, client success and product management departments. Ybern can be reached at sweetness@vydia.com and Lanza can be reached at elena.lanza@vydia.com.
Alison Hemmings joined Audible as associate director of public relations. Most recently she worked on the communications team at iHeartMedia, leading publicity and media strategy for the iHeartPodcast Network.
SMACKTok, which offers influencer marketing services under the SMACK umbrella, hired Aleks Samul as coordinator. She will report directly to SMACK founder Marissa Turk and assist in day-to-day operations for the company. Samul can be reached at aleks@smacksongs.com.
Nashville-based marketing agency Thinkswell — which helps artists establish themselves as brands and assists brands in reaching new audiences — hired James Crowley as head of strategy, Jenni Hand as head of operations, Katie Sulzner as digital marketing manager and Nicole Marchesi as digital marketing manager. Michael Adcock was also promoted to art director. Crowley will use data analytics to build a comprehensive digital advertising and social media strategy for clients; Hand will manage campaigns, organizational structure and lead all efforts for artists and organizations; Sulzner will create high level strategic campaigns; Marchesi will execute marketing camapaigns and create video and graphic design content for clients; and Adcock will oversees all creative direction and brand development at the company. Crowley can be reached at James@thinkswell.com, Hand can be reached at jenni@thinkswell.com, Sulzner can be reached at katie@thinkswell.com, Marchesi can be reached at nicole@thinkswell.com and Adcock can be reached at michael@thinkswell.com.
Japanese record labels historically haven’t felt the need to venture beyond their country’s shores to boost revenue. Japan’s recorded music market, the second largest in the world, has been big enough to sustain companies like Tokyo-based Avex Inc., considered a fourth major label in Japan.
But a rapid market shift in Japan — along with South Korea’s surge onto the global scene with K-pop —have created new impetus for Japanese music companies to try to penetrate the toughest of markets: the United States.
Last year, Japan’s sales of physical CDs and vinyl still made up 68% of the 283.2-billion-yen ($2.46 billion) recorded music market. But digital sales jumped 14% to 89.5 billion yen ($624 million) — the fourth-consecutive year of double-digit growth in the category, which is now 83% streaming, according to the Recording Industry Association of Japan.
Avex, an entertainment conglomerate founded in 1988, has developed legendary J-pop talents like Ayumi Hamasaki and Namie Amuro, and forged a live-music partnership with AEG Presents to co-promote artists in Japan. But it has struggled to create new superstars, or to successfully expand to the U.S. and China.
A 2016 effort to set up a U.S. operation fizzled after about two years. Now Avex is trying again. This time, the brass in Tokyo have turned to Naoki Osada, an 18-year company veteran with an M.B.A. from UCLA, a passion for West Coast hip-hop and several years of familiarity with the U.S. music business.
The new entity, which features a publishing arm, a record label and an investment fund, is based in Los Angeles, where Osada holds sway at the Avex House, a recording studio and artist-producer hangout, which has an infinity pool and a rooftop deck with 360-degree views of West Hollywood. During the pandemic, Osada oversaw extensive renovations to the five-bedroom house, which the company says it is renting.
“One of the reasons why we weren’t successful in our past endeavors to expand into China and the U.S. was that we didn’t have a clear mission, an agenda that we shared across the entire company,” Katsumi Kuroiwa, Avex’s CEO, tells Billboard from Tokyo, adding “we weren’t able to pick the right person to expand the business outside of Japan.”
This time Kuroiwa believes the company has gotten it right — and he has given Osada, who serves as president of Avex USA, a longer runway: five years to make the U.S. entity a success.
Naoki Osada the Japanese exec is leading the project/entity Avex USA.
Caity Krone
Avex started its latest U.S. effort with publishing. The initial focus is on building U.S. intellectual property with U.S. and Canadian songwriters through songs that can be placed with U.S. pop stars like Justin Bieber, and Japanese – and even Korean – artists. Osada created a publishing joint venture with Brandon Silverstein, manager of Normani and Brazilian star Anitta. Silverstein was looking for financial backing for his S10 Publishing and says he bonded with Osada over his vision to make the Avex House into a creative hub. Osada also hired Lucas Thomashow, 29, a Google-trained data and social media marketing specialist, to run Avex USA’s new label, SELENE, which is named after a Japanese spaceprobe that orbited the moon in 2007.
Avex has 13 writers on its U.S. roster, including six signed jointly with S10 Publishing: HARV, who co-wrote Bieber’s hit song “Peaches” (before S10 signed him); Jamaican dancehall artist Shenseea, who shared the stage with Anitta in Las Vegas during the Billboard Music Awards week; Cxdy (Internet Money), who works with The Kid Laroi; Toronto-born David Arkwright, who co-wrote “Build a Bitch” with Bella Poarch; Belizean artist Kosa; and Declan Hoy.
One challenge is working both globally and locally. “There’s that double edged sword where we’re always thinking strategically about how to bridge that gap [between Asia and the U.S.], because there’s a lot of cross over,” Thomashow, Avex USA’s senior vp, tells Billboard, sitting with Osada by the Avex House pool one morning. “And that’s whether it’s our U.S. writers and producers putting together hits for some of the biggest Japanese or Chinese artists, or how do we think strategically about Japanese artists.”
In one of the publishing arm’s biggest overseas successes, Arkwright and J. Que co-wrote a debut single for Japanese-American singer CAELAN (real name: Caelan Moriarty), “Forever With You,” which went viral with CAELAN’s sprawling Asian social-media fanbase, hitting No. 1 in China on the Weibo Asia New Songs Monthly ranking in September of 2021.
SELENE, meanwhile, has signed five artists so far, notably Austin George and 19-year-old singer-songwriter Sadie Jean, who had a TikTok open verse challenge hit with “WYD Now,” which counts over 200 million aggregate world-wide streams across all DSPs (she has more than 88 million on Spotify). The label says Zach Hood’s three singles on SELENE have generated more than 150 million aggregate streams. Sophie Holohan’s “Butterfly Effect” has 120 million hashtag views on TikTok, and the artist has more than 322,000 monthly listeners on Spotify. In finding rapid streaming success for newer artists, the label, says Arkwright, “is doing something that major labels, in my opinion, kind of wish that they could do with that kind of efficacy.”
(Sadie Jean is the only SELENE artist with any Billboard chart history. She spent seven weeks on Billboard’s Emerging Artists chart, peaking at No. 35 on the Dec. 25, 2021-dated chart. “WYD Now” spent a week at No. 91 on the Billboard Canadian Hot 100.)
Lucas Thomashow the American exec leading the new U.S. based Avex label, SELENE.
Caity Krone
Silverstein has built a relationship with Avex founder and chairman Masato “Max” Matsuura back in Japan, but credits Osada for the initial progress out of Los Angeles. “We’ve gotten our successes based on [Osada’s] support from Japan, given the writers that we’ve signed,” he says.
Osada, who was previously in charge of corporate venture capital for Avex back in Tokyo, also oversees Avex USA’s Future of Music Investment Fund, which has $25 million to spend on seed and Series A startups, mostly music-tech companies like WaveXR, a VR music platform that created Bieber’s 2021 avatar concert. (The fund has also attracted investment from Bieber and his manager, Scooter Braun.) He sees his Avex USA role as “half investor, half music executive.”
Trying to Catch The Koreans
While Avex executives say they don’t see the Korean labels as direct competitors, they nevertheless want to emulate their formula for success. With a much smaller domestic market than Japan, the Korean music industry naturally had to look outside for growth, which led acts to work harder to create global fanbases. “The Korean companies are at this stage more superior and advanced in terms of breaking global artists,” says Kuroiwa. “Unfortunately, Japanese artists haven’t been able to gain fans around the world like South Korea…and that’s where we have to learn.”
The Koreans labels have also been making moves in the U.S. over the past few years. JYP Entertainment and HYBE, home to BTS, have set up offices and entities in Los Angeles, and even created joint-venture labels like HYBE’s imprint with Universal Music Group’s Geffen Records, which plans to launch a girl group together.
Back in 2014, Avex surprised the industry when it beat out Sony Music for the largest mid-year share of the recorded music market in Japan at 16.1%, according to the Soundscan Japan. More recently, however, Avex held an 8.6% share of the Japanese market in 2019, placing them in third place behind Sony and Universal Japan. The Japanese company’s total assets have been declining in value for four straight years, according to company filings.
Among its challenges, sales of the company’s biggest J-pop artists, Hamasaki and Koda Kumi, peaked more than a decade ago. “We’re in the middle of trying to create a next generation of artists,” says Kuroiwa.
The pandemic also hit the company hard. Avex recorded a net loss of 1.1 billion yen ($10 million) in fiscal 2020, which led Avex to downsize staff and sell its 18-story Tokyo headquarters. The sale price of more than 70 billion yen (more than $673 million in late 2020) generated a profit of 29 billion yen ($279 million), a company spokesperson says.
Sales rose 20.7% to 98.4 billion yen ($686 million) in fiscal 2022, while net income fell 92.8% to nine billion yen ($62.7 million). The income drop-off followed a surge in net income to 128 billion yen ($892.6 million) in 2021, which related to the sale of the building.
Escaping the Past
Avex’s previous foray into the U.S., in 2016, involved Universal Music Japan executive Kimi Kato, former Warner Chappell Music Chairman and CEO Richard Blackstone and Avex executive Ryuhei Chiba. The trio spent about $30 million buying content, including a worldwide publishing deal for a Bruno Mars album, two people familiar with the matter tell Billboard. Matsuura, upset the group had blown through so much money, rallied the board to fire Chiba and then shut down the U.S. entity, the sources say. (A spokesperson for Avex says the $30 million was not restricted to buying content and noted that “the strategy in the U.S. didn’t change because Matsuura got angry, but Avex did decide to change its approach in the U.S. to [a] lean startup model.”)
Osada says the previous team was “trying to do too much at the same time,” including bringing U.S. artists to Japan and launching local businesses. “At that time the company was more about aiming for support to the headquarters’ [Japanese] artists,” he says. “We had a dream, but we didn’t actually try seriously to be successful as a U.S. company. I was like, ‘Why don’t we try to expand the business here because that eventually supports the global operation of Avex?’”
Osada, who started at the company in 2004 as a newly minted J-pop A&R manager fresh out of college, had a front-row seat on the legendary tussle between Matsuura and Tom Yoda, Avex’s co-founder. Yoda wanted to expand Avex into other entertainment-related ventures, including movie production. He accused Chiba, then the company’s executive director and president, of pursuing personal profit from some of the label’s biggest artists, according to Japanese media reports.
The Avex board backed Yoda’s bid to get Chiba to resign. Matsuura resigned along with Chiba, who denied any fault. Osada recalls a staff meeting with about 300 people where Chiba and Yoda were screaming at each other from across the auditorium. “I saw the battle [play out] in front of me,” he says.
But with the support of the staff and artists, including Hamasaki, who said she would leave the label (a declaration that led Avex’s stock price to dip by 16% in one day) – and the threat of bankruptcy looming – Yoda resigned. Matsuura and Chiba later rejoined the company.
A few years later it was Matsuura who gave Osada his instant blessing to study business administration in Los Angeles, at a time when the physical music industry was still in freefall from piracy site Napster. Not only did he avoid the chaotic company restructuring happening back in Tokyo, Osada says he was able to immerse himself in Los Angeles’ music and startup cultures, and inadvertently train himself for his current assignment.
Harv at Avex House
Courtesy Avex
At the Avex House, Osada holds lunch for writers and producers, and his Friday night dinners have drawn an eclectic group of artists and industry types. Thomashow fondly recalls the night Normani‘s cousin cooked authentic New Orleans food for a small group. Events there have drawn the likes of A$AP Rocky and James Blake. Harv hosted Bieber’s “Peaches” release party at the house. (On one evening, Billboard met DJ Richie Hawtin and Dean Wilson, Deadmau5’ manager, along with music executives from Meta.)
The house has also become a magnet for artists, writers, managers and A&R execs to connect and collaborate. Blake, Normani and Anitta have worked on songs there. Arkwright says he’ll sometimes grab an acoustic from the wall of Gibson guitars hanging in the living room and head up to the roof to jam with artists like Austin George, and then pop down to one of the three studios to lay down a track.
“It’s just like this beautiful hang spot that you don’t get very often,” Arkwright says.
Additional Reporting By Rob Schwartz