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LONDON — For live music executives, Monday’s (Oct. 24) appointment of Rishi Sunak as Liz Truss’ successor as U.K.’s prime minister brings a sense of urgency as the sector struggles to recover to full health after the devastating impact of the pandemic.
They are calling for Sunak, who served in Boris Johnson’s government as Chancellor of the Exchequer and will become the U.K.’s first British-Asian prime minister, to swiftly cut the sales tax rate charged on U.K. ticket purchases from the current 20% VAT to 5%.
At the height of the pandemic, Sunak lowered VAT rates to 5% to try and help boost advance sales. The tax cut lasted for eight months, before rising to 12.5% last October and then returning to its pre-pandemic level of 20% on April 1.
Live execs say that cutting VAT back to 5% will encourage ticket sales at a time when many people in the U.K. are experiencing a drastic reduction in disposable income due to soaring food and energy prices. Last month, inflation hit a 40-year high of 10.1% in the United Kingdom.
Jon Collins, CEO of U.K. live music industry association LIVE, says he hopes Sunak’s experience in the Treasury office “leaves him well placed to recognize the economic stimulus that would follow” a reduction in VAT on ticket sales. “Safeguarding gigs, festivals and venues while encouraging additional activity will bring benefits to town and city centers across the U.K.,” says Collins.
An immediate priority for the new prime minister — who officially takes up his post on Tuesday, following a meeting with King Charles III — will be restoring confidence in the financial markets, following Truss’ disastrously brief reign.
Last month, the pound fell to a record low against the U.S. dollar in the aftermath of Kwasi Kwarteng’s Sept. 23 mini budget, which spooked investors with its unfunded tax cuts — something Sunak warned about when he unsuccessfully competed in an earlier Conservative Party leadership contest this summer. Truss sacked Kwarteng as Chancellor on Oct. 14, precipitating her downfall. Almost all the tax measures he introduced have since been scrapped.
Sunak, a former hedge fund partner who married the daughter of an Indian billionaire, won the prime minister role after Johnson announced on Sunday he would not be running for the position. On Monday, Sunak’s only other rival, Penny Mordaunt, pulled out of the contest shortly before votes from members of Parliament (MPs) were due to be announced.
The markets calmed Monday with sterling broadly unchanged against the dollar and government borrowing costs falling as the interest rate on bonds dropped to 3.8%. (The rate was 5.17% in late September.)
“There is no doubt we face a profound economic challenge,” Sunak, one of Westminster’s wealthiest politicians, said in a televised address. “We now need stability and unity, and I will make it my utmost priority to bring our party and our country together.”
Michael Kill CEO of The Night Time Industries Association (NTIA), which represents more than 1,400 U.K. nightclubs and venues, says he will judge the incoming prime minister on his “actions not words.”
Kill says he hoped Sunak can “can address the current instability, uncertainty and begin a journey to build back consumer confidence for nighttime economy and hospitality businesses.” He echoed live executives’ demands for a cut to VAT and called for an extension on business rates relief (taxes payable on business premises, such as record shops and music venues). “Independent businesses will not survive without it,” Kill says.
Amid calls to cut ties with Kanye West over his repeated antisemitic comments, CAA stopped representing the artist within the last month, a source tells The Hollywood Reporter.
The Century City-based talent agency had worked with the artist, but his repeated interviews espousing antisemitic rhetoric have proved indefensible to business partners. With CAA ending its run with West, Hollywood’s major talent agencies — including WME and UTA — have supported calls to end working relationship with the rapper and fashion mogul.
On Oct. 23, Jeremy Zimmer, who leads rival agency UTA, sent a companywide email titled “Rise of Anti Semitism and Hate,” writing that West’s comments “embolden others to amplify their vile beliefs.” The UTA CEO added: “we can’t support hate speech, bigotry or anti-Semitism. Please support the boycott of Kanye West.”
Days earlier, Endeavor and WME mogul Ari Emanuel penned a column in the Financial Times saying that “silence” isn’t an option for the business community given West’s antisemitism. “Those who continue to do business with West are giving his misguided hate an audience,” Emanuel wrote.
While West has a lucrative deal with Adidas for his Yeezy shoe and fashion line, other major partners — including French label Balenciaga, as well as production studio MRC, which was working on a documentary with the artist — have publicly distanced themselves and cut ties. “We cannot support any content that amplifies his platform,” wrote MRC’s leaders, while Balenciaga noted that it doesn’t have “any relationship” with West moving forward.
While the rapper still has official accounts on Twitter and Instagram, posts containing antisemitic comments — including a tweet on Oct. 8 that called for “death con 3 On JEWISH PEOPLE” — have been removed from the social media giants’ platforms. In seeming response, West inked a deal to take ownership of the small “free speech” social media app Parler on Oct. 17. That app is run by the CEO George Farmer, the husband of conservative activist Candace Owens, who donned a “White Lives Matter” t-shirt along with West at Paris Fashion Week earlier this month.
The artist — whose net worth is estimated at $2 billion, per Forbes‘ calculations — had his last full length album, 2021’s Donda, distributed by Def Jam Recordings, a division of the publicly traded Universal Music Group. In a tweet on Oct. 17, UMG stated, “There is no place for antisemitism in our society,” but made no reference to West.
West’s media tour this month has included stops with Tucker Carlson on Fox News, rapper N.O.R.E. on the podcast Drink Champs, and Chris Cuomo at NewsNation. “I classify as Jew also, so I actually can’t be an antisemite,” West told Cuomo.
This article was originally published on THR.com.
Apple is increasing the prices of its Apple Music subscription plans in the U.S. starting Monday (Oct. 24), the company confirmed to Billboard.
In a statement, Apple noted that the Apple Music price hike is due to an increase in licensing costs, “and in turn, artists and songwriters will earn more for the streaming of their music. We also continue to add innovative features that make Apple Music the world’s best listening experience.”
The subscription prices of Apple TV+ and Apple One plans are also being raised, the company confirmed.
Prices are increasing $1 per month for Apple Music individual plans (from $9.99 to $10.99), $2 per month for family plans (from $14.99 to $16.99) and $10 per year for annual plans (from $99 to $109). Its bundled Apple One subscriptions are increasing $2 per month for individual plans (from $14.95 to $16.95) and $3 per month for family and premier plans — from $19.95 to $22.95 and $29.95 to $32.95, respectively. Notably, Apple Music subscriptions will continue to include lossless and Spatial Audio at no additional charge.
This marks the first time Apple has raised subscription prices for these services in the U.S. The website 9to5Mac, which first reported on the increases, also reported that Apple would increase its raise prices in international markets, though the company had not confirmed that by press time.
Though Apple does not regularly report subscriber numbers, in June, J.P. Morgan estimated Apple Music could hit 110 million subscribers by 2025. The lat time the company reported subscriber numbers for Apple Music was in 2019, when it reported 60 million subscribers to the service.
The Apple Music price hike comes amid reports that Spotify could be charging $19.99 a month for its forthcoming premium HiFi subscription tier, though the company has not yet confirmed that. Earlier this month, YouTube raised the price of its YouTube Premium Family plan, which includes its music subscription service, from $17.99 to $22.99 per month.
MRC announced on Monday (Oct. 24) that it will not release a finished documentary on Kanye West following his recent spate of antisemitic comments.
“This morning, after discussion with our filmmakers and distribution partners, we made the decision not to proceed with any distribution for our recently completed documentary about Kanye West,” CEO Modi Wiczyk, CEO Asif Satchu, and COO Scott Tenley wrote in a joint statement sent to the media. “We cannot support any content that amplifies his platform.”
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“Kanye is a producer and sampler of music,” MRC’s leaders continued. “Last week he sampled and remixed a classic tune that has charted for over 3,000 years — the lie that Jews are evil and conspire to control the world for their own gain… Kanye has now helped mainstream it in the modern era.”
The decision made by MRC — Billboard‘s former publisher — follows a Financial Times op-ed published by Ari Emanuel, CEO of Endeavor, last week that urged West’s various business partners to halt work with him. “Those who continue to do business with West are giving his misguided hate an audience,” Emanuel wrote. “There should be no tolerance anywhere for West’s anti-Semitism.”
Emanuel went on to note that “West is not just any person — he is a pop culture icon with millions of fans around the world. And among them are young people whose views are still being formed. This is why it is necessary for all of us to speak out. Hatred and anti-Semitism should have no place in our society, no matter how much money is at stake.”
On Sunday, Jeremy Zimmer, CEO of UTA, also sent a memo asking staff to “please support the boycott of Kanye West.” “Regrettably, anti-Semitism, racism and many forms of hate and intolerance are part of the fabric of society,” Zimmer wrote. “… Throughout history some have used their public platform to spew the plague out loud and spread the contagion to dangerous effect. Kanye is the latest to do so, and we’re seeing how his words embolden others to amplify their vile beliefs.”
In addition to announcing their decision to shelve the documentary on West, MRC’s leaders called on others to distance themselves from the star or condemn his statements. “The silence from leaders and corporations when it comes to Kanye or antisemitism in general is dismaying but not surprising,” their statement read. “Why is a group that has historically been brave and unreserved in its fight against antisemitism so quiet on Kanye?”
Read the full MRC memo below:
This morning, after discussion with our filmmakers and distribution partners, we made the decision not to proceed with any distribution for our recently completed documentary about Kanye West. We cannot support any content that amplifies his platform.
Kanye is a producer and sampler of music. Last week he sampled and remixed a classic tune that has charted for over 3000 years – the lie that Jews are evil and conspire to control the world for their own gain. This song was performed acapella in the time of the Pharaohs, Babylon and Rome, went acoustic with The Spanish Inquisition and Russia’s Pale of Settlement, and Hitler took the song electric. Kanye has now helped mainstream it in the modern era.
Lies are an important part of all discrimination, and this one is no different. When well crafted, they create the illusion that the action is just, that the bigot is “punching up” at the victim. It’s critical to antisemites, who must explain why they are attacking a people that comprise less than half of one percent of the world’s population. Not a fair fight, numbers wise. But if the Jews are ultra-powerful because of secret evil plots, well, the argument is, it must be fair and ok.
The silence from leaders and corporations when it comes to Kanye or antisemitism in general is dismaying but not surprising. What is new and sad, is the fear Jews have about speaking out in their own defense.
Why is a group that has historically been brave and unreserved in its fight against antisemitism so quiet on Kanye?
Because of the emergence of a second lie – one that is at the center of what we call Antisemitism 2.0. It is brilliantly crafted, fast becoming part of mainstream thinking, and puts Jews is a terrible philosophical corner. That lie goes as follows:
If you support Israel’s right to exist, you are a racist.If you are a Jew, you support Israel’s right to exist.Therefore, if you are Jewish, you are a racist.
As leaders of this company (a Jew, a Muslim, and a Christian), we feel duty bound to say to all of you this is a pernicious, terrible use of false logic. It marries very well with the first “punching up” lie that all Jews are connected by conspiracy. And it is working, because many Jews are scared to speak up in defense of their religion, or Israel, for fear of being labelled racists. It is no more true than saying that if you support Palestine’s right to exist, you must be an antisemite.
For proof of how quickly a protest of Israel’s policies can jump to antisemitism, look no further than last week’s outrage at Wellesley College. The school is a historical bastion of liberalism and civil rights. But last week its newspaper editorial board saw fit not only to condemn Israel, but actually publish a MAP of Jewish places of worship, organizations and business in the area so that they could be targeted for protest – or worse. This would not be shocking from Neo-Nazis, but Wellesley?
The three of us want to make our position on this very clear.• We support Palestine’s right to exist.• We support Israel’s right to exist.• Both nations represent a dream and an ideal for their peoples – one of safety, freedom, and prosperity.• Both ideals are worthy of protection, even though we have significant objections to the policies of the governments of both nations.• Objections to a nation’s government do not constitute grounds for discrimination against that nation’s citizens or supporters.• We uniformly reject any assertion that we, our colleagues, or anyone else is bigoted or racist based on their support for the sovereignty and existence of any country, all of which have flaws.
If you hear or encounter the perpetuation of these intolerances and falsehoods, please let us know. It is totally unacceptable. And to those who are afraid to use their voice, hopefully this encourages you to do so.
Asif, Modi, Scott
Music and events venue veteran Becky Colwell has been announced as the general manager for the Kia Forum and vp for music and events at the yet-to-open Intuit Dome, both in Inglewood, Calif. She joins the LA Clippers organization, which owns both buildings, and brings to the job 25 years of venue industry experience. Colwell will be responsible for operations and programming of the Kia Forum as well as the programming of Intuit Dome when it opens as the new home of the Clippers in 2024.
Colwell was previously the gm of the Greek Theater, first for SMG and then for ASM Global following AEG Facilities merger with SMG in 2019, and also served as regional director of booking for ASM Global’s western region. While at the Greek, Colwell was named 2017 venue executive of the year by the International Entertainment Buyers Association (IEBA), and the venue was consistently recognized as one of the top five venues in the country.
She starts her new role today, Oct. 24 and will report to LA Clippers president of business operations Gillian Zucker.
“Becky has earned a reputation for creating best-in-class experiences for all who step foot in the venues she leads and will help us continue to achieve new standards at the Kia Forum and Intuit Dome,” said Zucker.
Colwell added “I’m thrilled to join the Kia Forum family and to be a part of the talented team building what will be the best new venue in the world at Intuit Dome.”
Colwell has also worked as an executive at Booth Amphitheatre and Walnut Creek Amphitheatre in North Carolina. She is an alumna of Auburn University and currently serves as IEBA President and incoming chairman.
YoungBoy Never Broke Again is headed to Motown, sources familiar with the situation tell Billboard.
Headed from Warner Music Group’s Atlantic Records — where he released four official studio albums and many more mixtapes — YoungBoy will begin releasing music on the Universal Music Group-owned Motown in 2023.
Youngboy’s already been working with Motown since last year, when he signed a global joint venture deal with the label and his Never Broke Again collective. Together, they have released two compilations — Never Broke Again: The Compilation Volume 1 (2021) and Green Flag Activity (2022) — and Oct. 28 will release their third, Nightmare on 38th Street, led by the single “Searching” featuring Ten last Friday.
The Baton Rouge, Louisiana, native Youngboy broke out in 2015 and signed to Atlantic two years later, going on to become one of music’s top acts. Since, he’s charted 24 albums on the Billboard 200 — 11 that were top 10, four of those No. 1. He’s been incredibly prolific, as those 24 charting titles have all hit the chart in just over five years (since Aug. 2017).
This year alone, Youngboy has debuted six projects on the chart — five solo endeavors and one collaborative set with DaBaby (Better Than You). He’s charted four top 10 albums on the Billboard 200 in 2022 — more top 10s than any other act this year — and has released four albums in about the past two months: The Last Slimeto, Realer 2, 3800 Degrees and Ma I Got a Family.
Youngboy’s catalog of albums, in total, have earned 16.75 million equivalent album units, according to Luminate. His catalog of songs have tallied 29.04 billion on-demand official streams in the U.S.
Warner Music Middle East has a new general manager, with Ahmed Nureni chosen to replace a departing Moe Hamzeh. Nuhreni arrives from music distribution company Qanawat Music, which WMG acquired earlier this year, and will continue to be based in Dubai — though WMME’s headquarters and staff will remain in Beirut.
Nuhreni, who’ll report to Alfonso Perez-Soto, president of emerging markets at Warner Recorded Music, will continue to run Qanawat in tandem with his duties at Warner. In a statement, he said his “dual role will allow me to harness synergies from both businesses and be thoughtful and strategic in the way we grow Warner Music Middle East’s artist roster,” adding, “There’s so much creative potential in our region and we’re only just beginning to tap into it.”
WMME’s mandate is sprawling, covering a total of 17 markets: Algeria, Bahrain, Egypt, Iraq, Iran, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Qatar, Saudi Arabia, Syria, Tunisia, United Arab Emirates and Yemen.
Hamzeh helped launch Warner Music Middle East in 2018; the company now says he is moving on to pursue other projects in music. He had previously been head of content at digital streaming platform m.media and, earlier in his career, worked at Temple Entertainment and Virgin Megastores.
Perez-Soto called Nureni a “brilliant exec who combines an amazing ear for music with a brilliant strategic mind,” adding, “With the support of our amazing team in Beirut, he’ll champion artists from the region and help them connect with a global audience. I’d also like to thank Moe Hamzeh for all his amazing support over the last five years and wish him good luck in his next adventures.”
Simon Robson, president of International at Warner Recorded Music, called the Middle East and North Africa a “priority market for us” as “highlighted by our accelerated activity in MENA in the last 18 months” — in early 2021 WMG invested in the region’s largest indie label, Rotana Music — “but we have further ambitious growth plans, which Ahmed will help us deliver.”
This year, Spotify is making the streamer’s annual year-end Wrapped campaign more artist-friendly.
Called Your Wrapped Soundcheck, the new feature, available via Spotify for Artists, will allow artists to upload videos thanking their biggest fans for a great year on Spotify, list their latest merch and ensure tickets for their upcoming shows are available on the platform. These videos and offers will then be promoted to top fans as a part of their Wrapped experience.
By uploading short, video messages of 30 seconds or less to their Spotify for Artists profiles, artists can let fans know what their support meant to them over the past year, tease what they’re working on next and/or tell a story that defined their year. Artists are encouraged to list merch on Shopify (the e-commerce giant that partnered with Spotify last October), and provide information regarding their upcoming concert dates on one of Spotify’s partner sites, plus set up a Fan Support account to collect end-of-year tips or drive donations to a charitable cause.
Artists are encouraged to prepare their profiles ahead of this year’s Wrapped season. Your Wrapped Soundcheck’s website provides step-by-step instructions to help artists get ready for the big day.
Three of Hollywood’s top agency chiefs are now calling on the entertainment industry to cut ties with Kanye West given the rapper and fashion mogul’s antisemitic rhetoric on multiple platforms and interviews.
On Sunday evening, UTA chief Jeremy Zimmer sent a companywide memo to staff titled “Rise of Anti Semitism and Hate,” writing that West’s comments’ “embolden others to amplify their vile beliefs.”
Zimmer made reference to a widely circulated Oct. 23 photo of a group of seven people who stood on a 405 freeway overpass in Los Angeles with signs that included “Kanye is right about the Jews,” as well as The Mapping Project, an anonymous effort that purported to show links between Jewish businesses in Massachusetts and “support for the colonization of Palestine.”
“Whether it’s signs on the 405 in Los Angeles, flyers on doorsteps, mapping Jewish businesses in Boston, or marching with hoods and crosses, all of these behaviors ignite the embers of bigotry, and they must not be tolerated,” Zimmer wrote.
The Beverly Hills-based agency CEO’s missive follows a similarly themed Oct. 19 column in the Financial Times by Ari Emanuel, who runs the entertainment and sports company Endeavor, which owns talent agency WME. “Those who continue to do business with West are giving his misguided hate an audience,” Emanuel wrote. “There should be no tolerance anywhere for West’s anti-Semitism.”
Emanuel added: “West is not just any person — he is a pop culture icon with millions of fans around the world. And among them are young people whose views are still being formed.”
Meanwhile, Gersh agency president Bob Gersh weighed in on Sunday, telling Variety, “People really need to hammer these companies in business with him to impress upon them how wrong it is to support somebody like this.”
Following an appearance at Paris Fashion Week in which West donned a “White Lives Matter” shirt on Oct. 3, he went to post a since-removed Oct. 8 tweet that called for “death con 3 On JEWISH PEOPLE,” wrote posts on Instagram that were removed for violating content restrictions, made a stop on Fox News that included a controversial interview with Tucker Carlson (that later included unaired portions leaked to Vice News), taped an interview with the podcast Drink Champs (that was later removed from YouTube) and stopped for an interview on NewsNation with Chris Cuomo in which West said “I don’t believe in that term,” in reference to antisemitism.
Companies and partners that have business with West, whose net worth is estimated by Forbes to be at $2 billion, are under increasing pressure to cut ties with the rapper. Adidas, which has a distribution deal for West’s Yeezy shoe and fashion brand, stated earlier this month that it had placed its partnership “under review,” while French label Balenciaga cut ties on Oct. 21 and said it “no longer any relationship” with West.
In seeming response to having his tweets and Instagram posts restricted, West made a deal with the backers of a small social media platform called Parler. On Oct. 17, the company — which calls itself the “premier free speech social media app” — sent out a press release stating that it had agreed to sell itself to the artist. Parler’s CEO is George Farmer, the husband of conservative activist Candace Owens, who also donned the “White Lives Matter” shirt at Paris Fashion Week.
Read Zimmer’s full memo to UTA staff on THR.com
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.
Music companies face a multitude of pressures as 2022 comes to an end: crippling inflation, a tight labor market, a chaotic environment for breaking new artists, interest rates that are dampening catalog valuations, and high costs of touring amidst a crush of artists on the road, among other challenges. The upcoming slate of corporate earnings provides an opportunity to hear about these opportunities and challenges from leaders of publicly traded music companies who rarely go on the record.
Spotify reports third-quarter earnings after the close of trading on Tuesday (Oct. 25). Universal Music Group and Deezer follow on Thursday (Oct. 27) after the close of trading in the Netherlands and France, respectively. Cumulus Media reports Friday morning (Oct. 28). SiriusXM reports earnings on the morning of Nov. 1. Tencent Music Entertainment announces earnings on Nov. 15. The other 14 publicly traded music companies in the Billboard Global Music Index have not yet announced when they will report.
Look for executives to comment about subscription prices and digital platforms’ ability — or reservation — to raise subscription prices. It’s been a recurring theme from digital and label executives throughout the years, in part because it’s been over a decade since streamers last did it in any meaningful way. “Music is a good value” seems like a popular position when streaming video on-demand services are engaged in cut-throat competition and undercutting one another’s prices to attract new customers and prevent current customers from departing. But the industry has arguably moved past that stage, with many now interested in other means to grow revenue. Still, expect music streaming companies to be reticent to hike prices while inflation is running at a 40-year high.
On Tuesday. Spotify could offer a bevy of information and insights about its progress toward its drive to improve margins, as laid out in its June 9 investor presentation: goals for 35% gross margins in music and 30-35% gross margins in podcasting within the next three to five years. Music margins will be helped by improvements in ad monetization in developing markets as well as price increases in mature markets.
More pressing will be Spotify’s opinions on macroeconomic forces that could affect its growth. The company’s advertising business was roiled by an advertising slowdown during the first year of the pandemic, and now many experts are predicting a recession in 2023 that could again dampen online advertising. On Alphabet’s July 26 earnings call, the company repeatedly used the word “uncertain” when talking about the economy, while reporting that YouTube ad sales grew at their slowest pace since the company started disclosing metrics in 2018. Meta’s second-quarter revenue, meanwhile, was 1% lower than a year earlier — its first decline in a decade. If the same market conditions affect Spotify, how will it react? Even though advertising accounted for only 12.6% of the company’s total revenues in the second quarter, it’s critical to the podcasting business that’s expected to deliver margin relief in the coming years.
If social media company Snap’s third-quarter results Thursday are any indication, a weak advertising market will be a recurring theme throughout October and November earnings reports. In a letter to shareholders, Snap warned its “advertising partners across many industries are decreasing their marketing budgets, especially in the face of operating environment headwinds, inflation-driven cost pressures and rising costs of capital.” At the same time, Snap announced a stock repurchase program of up to $500 million “to protect shareholder value from the impact of dilution.” Investors reacted quickly and decisively by sending Snap shares down as far as 32% to $7.33 on Friday — 87.9% below its 52-week high of $60.78.
Also, expect questions about Spotify’s long-awaited HiFi subscription tier. Last week, reports surfaced that Spotify could be prepping a “platinum” subscription plan that bundles high-fidelity audio with other products. The reports were based on an online survey that sought consumers’ opinions on various product bundles, not hard evidence of an upcoming product launch. But the fact that Spotify would sweeten the offer with reduced advertising in podcasts and other items could suggest it realized demand for a standalone HiFi tier is weaker than hoped — especially when Apple Music and Amazon Music are offering it at no additional cost. What CEO Daniel Ek will say is another matter, however, as Spotify is unlikely to discuss details about a product before an official announcement.
High-fidelity audio is pertinent to Spotify investors because it could help improve gross margins. The June 16 acquisition of audiobook distributor Findaway led to the Sept. 20 launch of an audiobook download store. As both retailer and distributor, Spotify can get 60% margin in audiobook purchases, more than double its current gross margin. Of course, the more important question is how many margin dollars audiobooks will ultimately deliver. With only a few weeks of audiobook sales under its belt, and no audiobook sales in the third quarter earnings, Spotify will have few tangible results for a progress report.
Universal Music Group reports earnings on Thursday (Oct. 27) after the end of the trading day in Amsterdam, where UMG shares are listed. UMG’s share of the U.S. recorded music market dropped slightly from 38.3% in the first half of 2022 to 37.1% at the end of the third quarter, which was lower than its 38.4% share in the prior-year period. UMG’s biggest competitor, Sony Music Entertainment, meanwhile, saw its share boosted from 26.3% to 26.7% thanks to the runaway success of Bad Bunny‘s Un Verano Sin Ti, the biggest album of 2022. UMG biggest releases were Kendrick Lamar’s Mr. Morale and the Big Steppers and The Weeknd’s Dawn FM (Republic). A handful of albums released in 2021 were also in the top 10 in total consumption: Morgan Wallen‘s Dangerous (Jan. 8, 2021), The Weeknd’s The Highlights (Feb. 5, 2021) Olivia Rodrigo’s Sour (May 21, 2021) and Drake‘s Certified Lover Boy (Sept. 21, 2021).
During UMG’s last earnings call, on July 27, CEO Lucian Grainge recounted a string of recent releases (Drake’s Honestly, Nevermind got off to a great start), partnerships (HYBE’s first release through its deal with UMG’s Ingrooves/Geffen), how it planned to get a return on investment on some recent acquisitions (Frank Zappa and Neil Diamond) and how the new Mercury Studios (which produced documentary films on The Rolling Stones and Shania Twain) had helped lift catalog streams.
More important to investors and industry professionals are concrete examples of UMG moving its business forward. Last quarter, Grainge announced UMG’s new licensing deal with Meta and revealed the company had become one of its top 10 revenue-generating digital platforms. He also announced the creation of the New Music Media Network, a service that connects brands and partners with proprietary data and exclusive media from UMG. Given the vital role advertising plays in today’s streaming-led music business and the platforms of tomorrow, a progress update on the New Music Media Network would be helpful.
Less important are comments made about Web3, NFTs and metaverse initiatives. Despite initial enthusiasm around NFTs, these businesses are a work-in-progress and represent an immaterial amount of revenue to a major music company. Conversation about these businesses merely shows that a company is looking ahead and taking the proper steps to capitalize — somehow — on them in the future. That requires hiring the right people, making investments, striking partnerships and trying new things to learn and gain experience. But as of now, Web3, NFTs and the metaverse are solidly in the experiment phase.