State Champ Radio Business
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There’s some good news for the music business in Washington DC: House Democrats seem to have found their next caucus chair in Rep. Hakeem Jeffries, a champion of music creators who since 2013 has served as the U.S. representative for New York’s 8th congressional district. Jeffries, who represents parts of Brooklyn and Queens, co-sponsored the Music Modernization Act, the most important copyright law passed in decades, as well as the Copyright Alternative in Small-Claims Enforcement Act of 2020, a.k.a. the CASE Act. He’s also known as a big hip-hop fan, who once gave The Notorious B.I.G. a shout-out from the House floor on the 20th anniversary of his death.
A formal vote has not yet been taken. But the party seems to be coalescing around Jeffries, who was endorsed as a successor by outgoing Speaker Nancy Pelosi (D-Calif.). If chosen, Jeffries would become the first Black leader of a Congressional caucus, as well as the presumptive Speaker if the Democrats were to win back the House majority. And although it’s hard to say if serious copyright legislation will come in front of Congress, having a supporter of creators and copyright in such an important role could only help rightsholders.
“Mr. Jeffries has been a steadfast supporter of songwriters, and as an original cosponsor of both the Songwriter Equity Act and the Music Modernization Act, he has fought for fairness for creators throughout his career,” said NMPA president and CEO David Israelite. “His leadership in this powerful role will bode well for the future of songwriters.”
Jeffries was honored by the RIAA in September, along with hip-hop pioneers Grandmaster Flash and MC Lyte. (Billboard sponsored this event.)
“It’s hard to think of two potential leaders with more experience working in the trenches of music policy and shaping bipartisan consensus for the digital streaming era than Kevin McCarthy and Hakeem Jeffries,” said Mitch Glazier, chairman and CEO of the RIAA. “A House led by Speaker Kevin McCarthy and Democratic Leader Hakeem Jeffries would feature a dynamic duo for the music community.”
Before entering politics in 2007, Jeffries worked as a lawyer, first in New York for Paul, Weiss, Rifkind, Wharton & Garrison – where he worked down the hall from NMPA general counsel Danielle Aguirre – then for Viacom. At Paul Weiss, he worked on some copyright cases, and he represented Lauryn Hill in a case brought by some of her collaborators. “He has a deep understanding of copyright law,” Israelite said. “He may know the subject better than anyone else in Congress.”
Jeffries may also be one of the bigger music fans in Congress. Besides giving Biggie a shoutout, he’s written about his favorite female rappers, and hosted an annual “Hip-Hop on the Hill” political fundraiser. “Watching hip-hop develop — with Grandmaster Flash, and then Run-DMC, and then the artists of the ‘80s and ‘90s — has been a fantastic journey,” he told Billboard in a 2018 interview about his history as a fan of the genre. “What’s been most compelling to me is how hip-hop has been a vehicle to tell the story of urban America and black America in such an artistic, poetic, and authentic fashion.”
Jeffries is involved with a number of issues, of course. He advocates police reform, and he co-sponsored the Formerly Incarcerated Reenter Society Transformed Safely Transitioning Every Person Act, a.k.a. the First Step Act, which reformed prison and sentencing laws. He voted to impeach Pres. Donald Trump, but he’s also known for working well with Republicans, including former Rep. Doug Collins (R-Ga.), with whom he co-sponsored the Music Modernization Act, as well as the First Step Act. (The two also put together a summer playlist.) Jeffries has also been a leading Democratic fund-raiser.
Some of this has put Jeffries at odds with some of his more radical colleagues, including Rep. Alexandria Ocasio-Cortez (D-N.Y.). Jeffries is a member of the Congressional Progressive Caucus, but his politics are more centrist, as well as more pragmatic. His ability to compromise could be important, since he will have to work with both the Republican House majority as well as the progressive members of his own party. He recently told CNN that “while we can have some noisy conversations at times about how we can make progress for the American people, what we have seen is that under the leadership of Speaker Pelosi, Steny Hoyer, Jim Clyburn, we have constantly been able to come together.”
Warner Music Group’s double-digit fourth quarter revenue growth served as the capstone in chief executive Stephen Cooper‘s long-term growth strategy, and is a signal more growth to come, Cooper said on Tuesday.
YouTube’s former chief business officer, Robert Kyncl, will replace Cooper as WMG’s new CEO on Jan. 1, though Kyncl will share the top duties with Cooper for his first month.
Cooper’s 12-year-tenure at WMG has been marked by an early embrace of digital streaming, major expansion into markets in Asia, the Middle East and Africa, and taking the company public roughly two-and-a-half years ago, among other things.
“I’m very proud of the progress we’ve made over the past 10 years,” Cooper said on a call with analysts Tuesday. “As I look out on the next 10 years, I believe we’re at the doorstep of a new golden age of music. As the ecosystem becomes more complex and exciting new business models emerge, our role as the connective tissue between artists and fans will only become more prominent and important.”
WMG reported quarterly revenues rose 16% at constant currency to $1.5 billion in the fiscal fourth quarter ended Sept. 30, with solid growth across all business lines, including a 39% and a 48% jump in digital and performance revenues respectively. Investors welcomed the news, pushing Warner’s stock up 15.2% to $31.08 as of 10:30 a.m. in New York.
Cooper said he sees the company’s future momentum coming from continued growth in the number and price of streaming subscriptions, penetrating deeper into new emerging markets and investing more in new digital technologies.
WMG now has partnerships with more than 200 streaming services and operates in 70 countries around the world. While executives decline to put a number on how much WMG may make from recent subscription price hikes by Apple Music and Deezer, they said they expect it to result in other streaming companies raising prices.
“I’ve consistently told you that streaming revenue would continue to have significant runway, that we would have price increases and ongoing subscriber growth, and that emerging platforms would continue to expand,” Cooper said. “We’re now seeing all these come to fruition.”
WMG’s annualized revenue from emerging streaming platforms, include deals like the recent one reached with Meta, topped $370 million this quarter, Cooper said.
The fourth quarter saw big releases Lizzo, whose album Special was her first to hit No. 1 on Billboard’s Top Album Sales chart, as well strong carry-over sucess from some of WMG’s superstars like Ed Sheeran, Dua Lipa and Silk Sonic.
The company’s pipeline remains strong, Cooper said, with first quarter releases expected from Paramore, Aya Nakamura, Cardi B, Roddy Ricch and others.
However, Cooper said he expects the outsized monetary impact of hit singles and albums to continue to decrease in the coming years as the company works with talent in more geographic markets and diversifies its revenue streams.
“As we’ve broadened and deepened our artist roster and prioritized a global approach to domestic music, our revenue composition has evolved,” Cooper said. “A decade ago, our top 5 artists generated over 15% of our recorded music physical and digital revenue. In 2022, they generated just over 5%.”
One new geographic market where Cooper said WMG plans to expand is in Eastern Europe. In recent months, WMG invested in the Polish concert and festival promoter BIG Idea, the Serbian record company Mascom Records, and participated in launching OUT OF ORDER, a new label for Eastern European artists.
Warner Music Group, helped by digital revenue growth across recorded music and publishing, reported quarterly revenues rose 16% at constant currency (9% as reported) to $1.5 billion in the fiscal fourth quarter ended Sept. 30, the company announced Tuesday (Nov. 22). Adjusted earnings before interest, taxes, amortization and depreciation (EBITDA) grew by 16% to $276 million.
In his final quarterly earnings after 12 years as Warner Music’s chief executive, Steve Cooper said, “Against the backdrop of a challenging macro environment, we once again proved music’s resilience, with new commercial opportunities emerging all the time. We’re very well positioned for long-term creative success, and continued top and bottom line growth. We’re excited to have Robert Kyncl joining next year as WMG’s new CEO, as we enter the next dynamic phase of our evolution.”
WMG’s share price edged slightly lower in pre-market trading, down 0.88% to $26.98 on Tuesday at 8:19 a.m. New York time. Warner Music executives will discuss the company’s quarterly and full year results on a call with analysts at 8:30 a.m. ET.
Digital revenue grew 12.3% at constant currency or 6.8% as reported to $989 million, including a $38 million settlement related to certain copyright infringement cases. Total streaming revenue increased by 8.9% at constant currency (3.5% as reported) due primarily to driven by music publishing streaming revenue, which rose by 37.0% at constant currency (or 29.8% as reported).
Recorded music streaming revenue increased by 4.7% at constant currency, but decreased by 0.4% as reported. Digital’s share of total revenue comprised 66.1%, compared to 67.3% in the prior-year quarter, due to the double-digit growth of recorded music artist services and expanded-rights and licensing revenue.
Music publishing revenue improved 32.3% at a constant currency (23.9% as reported) to $254 million on the strength of digital and performance revenue. Digital revenues jumped 39.5% at constant currency (32.5% as reported) to $159 million. Streaming revenue increased 37.0% in constant currency (29.8% as reported) helped by streaming services and new digital deals.
In WMG’s recorded music segment, revenues rose 13.1% at constant currency (6.1% as reported) to $1.25 billion. Expanded rights revenue improved 33% to $204 million at constant currency (21.4% as reported) due to an increase in concert promotion revenue following the disruption of the touring business in 2021.
Physical revenue of $123 million was up 6% at constant currency but down 3.1% as reported, primarily due to volatility in exchange rates that offset higher vinyl sales and strong sales in Japan. Digital revenues of $830 million rose 8.1% in constant currency (up 2.9% as reported), and now represents 66.7% of total recorded music revenue compared to 68.9% in the prior-year quarter.
Music publishing contributed nearly 17% of overall company revenues in the quarter, up slightly from the year-ago quarter when music publishing made up 15% of overall revenues. Recorded music revenue contributed 83% of overall revenues in the quarter, down slightly from the year-ago quarter when recorded music revenues comprised 85% of overall company revenues.
The popular Arab-language music and content streaming service Anghami became the latest music company to cut staff as growing global economic uncertainty forces companies to cut costs in order to maintain profitability.
The Abu Dhabi-based company said in a statement last week (Nov. 15) that it was reducing full-time employee headcount by 22%, or roughly 39 employees.
“Given the impact of challenging macroeconomic conditions, we had to take some cost disciplinary measures to improve our bottom-line performance,” Eddy Maroun, Anghami’s chief executive and co-founder, said in a statement announcing the company’s third quarter earnings.
Several music companies have let go of staff or cut investment budgets in recent months as they prepare for a possible economic downturn. This summer, Spotify said it would cut hiring by 25%, SoundCloud laid off 20% of its staff and BMI said it was cutting just under 10% of its total workforce, through a combination of letting 30 people go and leaving certain jobs unfilled.
Launched in 2012, Anghami is the most popular streaming and content company focused on Arabic-language music, with about 58% of the Middle East’s market share and around 20 million active users, according to company filings.
Since going public on the NASDAQ in February, Anghami’s stock has declined by more than 73% to close at $2.70 on Monday. The company’s low stock price and growing investor interest in music companies based in the Middle East and Africa has fueled market chatter about the company’s future. Earlier this month, the German magazine Frankly reported that Spotify was considering buying Anghami.
In an email to Billboard, Maroun said the cuts were necessary as the company worked to reduce operating expenses and focus on profitability. Maroun declined to answer a question about whether the company was preparing for a possible sale.
In its third quarter earnings, Anghami reported that its revenues grew by 29% to $31.7 million, up from $24.5 million in the year-ago quarter. The company’s gross profit rose 13% in the quarter ending Sept. 30 from the year-ago period, helped by a reduction in cloud computing costs by 19% and a 15% increase in music traffic in the quarter.
Additional reporting by Alexei Barrionuevo
Journey guitarist Neal Schon is suing bandmate Jonathan Cain over allegations that he’s blocking access to “critical” financial records — the latest in a string of legal clashes among members of the iconic ’80s rock band.
In a lawsuit filed last month in California state court, Schon accused Cain — the only other core band member remaining from Journey’s heyday — of refusing to give him access to records from an American Express account, through which he claims that “millions in Journey funds have flowed.”
As fifty-fifty co-owners of the band’s corporate entity, Schon says each of them has a right to inspect all financial records, but claims that Cain has “improperly restricted and blocked” him from seeing the Amex records for months.
“This action is brought to turn the lights on, so to speak, and obtain critical financial information Schon has been trying to obtain but has been denied,” his lawyers wrote in an Oct. 31 complaint. “Schon has tried to avoid legal action, repeatedly requesting that Cain grant him access to the AMEX account [but] Cain has not been forthcoming and cooperative, making this action necessary.”
The case is hardly the first legal battle among Journey members.
Back in 2020, Schon and Cain filed a lawsuit against former drummer Steven Smith and former bassist Ross Valory, accusing them of engaging in an “attempted corporate coup d’état” to improperly use the Journey band name. That case ended last year with an “amicable settlement” that saw Smith and Valory depart the band.
And in September, former lead singer Steve Perry took legal action to stop Schon and Cain from registering federal trademarks on the names of many of the band’s biggest hits, including “Anyway You Want It” and “Wheel In The Sky.” Perry, who left Journey in 1998, says his ex-mates cannot unilaterally use the song names because the trio signed a partnership agreement requiring unanimous consent. The case remains pending.
Unlike the earlier cases, the new lawsuit over the Amex account pits Schon and Cain against one another. Schon says each of them should have “unfettered access” to all financial records, but that Cain “set up the account so that only he is authorized to access the records and information.”
And from the wording of the complaint, it sounds like Schon’s gripes potentially go deeper than a single credit card.
“Cain is interfering with Journey, refusing to respond to booking opportunities, blocking payment to band members, crew, and vendors, refusing to execute necessary operating documents, and in other ways as well,” Schon’s lawyers wrote. “Cain has further refused to deal with critical, time-sensitive touring contracts for Journey’s 2023 tour and ensure payment for band members and crew, who Cain contends are ‘non-essential.’ Schon believes those band and crew who are crucial to the band’s success should be paid. Cain’s conduct is inexplicable.”
A rep for Cain did not immediately return a request for comment on Monday.
Read the entire complaint here:
BERLIN – Subscription streaming services have ushered in a recorded music business boom, but the medium’s focus on hit singles has boosted genres like hip-hop and Latin more than some others. Starting today, Universal Music Group’s Deutsche Grammophon is offering its own service, Stage+, which will offer music from its own archive and that of sibling label Decca Records, plus video programming and a new live performance every week — at a cost of $14.90, or €14.90, a month.
Universal Music has no plans to remove its classical recordings from mainstream music streaming services like Spotify and Apple Music. Rather, the idea is to offer a specialist service that can appeal to classical music fans and create a more favorable business structure for a genre that hasn’t been well-served by mainstream services. Since many artists and orchestras record some of the same compositions, it can be difficult for aficionados to find the recording they’re looking for — and the mainstream streaming services tend to curate music for a general audience.
“There’s the urge of consumers and artists to have everything in one place, with all the right data,” says Deutsche Grammophon president Dr. Clemens Trautmann. “You can punch in a work or a recording or an artist and you’ll see the next livestream, the archive, the albums, and if there’s a documentary, behind-the-scenes footage or interviews.”
So far, no big label has managed to build its own streaming service, and it’s hard to know how many consumers will be interested in one that only offers certain recordings. But Deutsche Grammophon, with its iconic yellow logo, has culturally significant repertoire going back more than a century, as well as significant stars like Lang Lang, Anne-Sophie Mutter and Max Richter. It also has enough brand equity to get streaming rights to major live events, and its first streamed performance will be Víkingur Ólafsson’s presentation of his album From Afar in the Harpa concert hall in Reykjavík, Iceland. (Some of the live performances featured on Stage+ will be time-delayed for various reasons.)
For Universal Music, Stage+ also offers business advantages. The price is higher than the current cost of mainstream services, although it includes high-fidelity audio as well as livestreamed events. The core classical repertoire is in the public domain, which means it will not have to pay publishing royalties on about three-quarters of the music it streams. The service can also operate in a way that makes sense for the genre, and it plans to divide up the royalty pool according to the time consumers spend listening to certain recordings, rather than paying a royalty on each track, which advantages shorter songs in a way that’s arguably unfair to genres with varied or longer track lengths, like jazz and classical music.
Stage+ faces competition — from livestreaming video services like Medici TV and Carnegie Hall+ on one hand and specialist streaming services like Berlin-based classical-focused Idagio on the other. And since so many households in the U.S. and Europe now subscribe to a mainstream streaming service, in many cases Stage+ will need to have enough appeal to succeed as a second service. Apple also seems to have plans that involve a classical music service; last summer it purchased the streaming service Primephonic, whose website says, “We are working on an amazing new classical music experience from Apple for next year.” (Apple did not respond to a request to comment.)
Trautmann says that Stage+ grew out of DG Stage, which was established during the pandemic and offered ticketed livestreams of performances by Deutsche Grammophon artists. A little over a year and a half ago, he started working to develop the service with Deutsche Grammophon vp of consumer business, Robert Zimmermann, under Frank Briegmann, Universal Music chairman and CEO, Central Europe, who also serves as chairman of Deutsche Grammophon.
“DG Stage is simple and very effective, but we realized that the artist community and consumers were looking for a service where everything our artists create can be presented holistically in one place and audiences can follow their journey,” says Trautmann, who is himself a Julliard-trained musician who plays classical clarinet.
It’s hard to imagine that Stage+ will ever have enough subscribers to rival the mainstream players, but its premium price could potentially allow it to make money with a number of subscribers in the low six figures. It also offers an interesting model for genres that don’t fare as well in the streaming world as pop music — especially if they have fans who can afford a premium price.
And although no major label currently runs a streaming service, there’s no reason that Stage+ couldn’t also offer music from other labels or rightsholders — and it could potentially offer them better deal terms as a more appealing cultural and commercial environment than Spotify and Apple Music. “We’d be open to enlarge the content offering, provided it’s the right match for our curated approach,” Trautmann says, although there are no immediate plans to do so. “It might be better coming from potential partners instead of us.”
Looking to grow its share of the fast-developing Middle East music market, Warner Music Group has signed Saudi singer Dalia Mubarak, one of the country’s biggest female stars and a leading voice among a new generation of progressive Arabic artists.
Terms of the deal were not disclosed. The signing — Warner Music’s first Saudi artist signing since it began investing in the Middle East region about four years ago — caps a breakthrough year for 31-year-old Mubarak, who earlier this month won Best Saudi Arabian Artist at the Distinctive International Arab Festivals Awards (DIAFA) in Dubai and was featured this summer on the cover of Vogue Arabia.
Since releasing her debut single, “Turn The Table,” in 2014, the singer’s career has flourished in line with the gradual opening up of Saudi society following the appointment of Saudi Crown Prince Mohammed bin Salman in 2017, making him the de facto ruler of the oil-rich Gulf state. His reforms have helped modernize the country of 35 million people, where, up until a few years ago, concerts were banned and ultraconservative norms prevailed, including the segregation of unmarried men and women in public spaces.
Historically rife with piracy, the Middle East and North Africa (MENA) market nearly doubled between 2019 and 2021, and it was the fastest-growing region in the world last year, with recorded music revenues up 35% to $89.5 million, according to IFPI. More than 95% of MENA revenues came from streaming, helping draw the interest of major record companies, which are increasingly looking to emerging markets to find new talent and, in turn, extend their labels’ global reach. MENA’s potential is vast, with a total population of about 430 million people, of which 55% are under the age of 30, according to the Organisation for Economic Co-operation and Development (OECD).
The Mubarak signing follows a series of investments and acquisitions Warner Music has made recently in the Gulf region. Last year, the company acquired a minority stake — reportedly worth around $200 million — in Rotana Music, the Arab world’s leading independent record label, which is part of Rotana Group, owned by Saudi billionaire Prince Al Waleed Bin Talal.
In March, Warner completed the acquisition of Qanawat Music, a leading distributor across the Middle East and North Africa. WMG put roots down in the region in 2018 when it created Warner Music Middle East and opened an office in Beirut, Lebanon.
Mubarak, who mostly sings in Arabic and has previously released music on Rotana, says she fulfilled a childhood dream by signing with Warner Music because of the opportunities and exposure it provides not just in her home country, but internationally as well.
“Everyone is now looking to what’s going on in Saudi Arabia, how it’s changed, and I want to be part of that change and show the world that we have good artists,” Mubarak tells Billboard. “I want to be the bridge [between Saudi Arabia] and the international world.”
Mubarak’s music mixes contemporary R&B and Western-style pop with traditional Khaleeji music, incorporating Arabic instruments like duff drums and mirwas. She says the music, which promotes positive messages of female empowerment, reflects the progressive changes that have occurred in her home country.
The singer has built a large following in Saudi Arabia and the wider Arab diaspora with total YouTube views surpassing 350 million, according to Billboard’s calculations (subscribers to her official YouTube channel stand at just over 600,000). Her most popular song is 2020’s “Elly Yemshy 3ady,” which was the artist’s first single sung in the Egyptian dialect; it has generated more than 66 million views on YouTube.
The singer has just under 700,000 followers on Anghami, the most popular music streaming service in the Middle East with around 20 million active users, according to company filings. (Warner was unable to provide comprehensive streaming numbers for Mubarak.)
Mubarak has also performed at many of Saudi Arabia’s biggest music festivals, including 2019’s Jeddah World Fest, where she joined DJ Steve Aoki onstage at the event’s close. (The festival also featured performances from Janet Jackson, 50 Cent and Chris Brown, and saw Nicki Minaj make international headlines when she pulled out of a scheduled appearance in protest against the Kingdom’s treatment of women.)
Dalia Mubarak with Max Lousada and Simon Robson, Warner Music UK, Nov 2022.
Warner Music
Max Lousada, CEO of Warner Recorded Music, calls Mubarak a “trailblazer for change,” saying in a press release that she symbolizes “a new generation of female artists from the country who are rewriting the rules and winning fans across the region and beyond.”
The singer, who has an American husband, divides her time between the Saudi capital city Riyadh and Dubai. “Other singers in the past were not as lucky to have this freedom and these opportunities that I’m now grateful for,” she says.
Alfonso Perez-Soto, Warner Recorded Music’s president of emerging markets, tells Billboard that the label intends for Mubarak to be the first of many artists Warner signs from the MENA region as part of its overall long-term strategy. Previously, WMG’s focus has been on establishing itself in the region, “building the access to catalogs and distribution and gaining resources” so it is fully equipped to provide “the best tools” to help break and build lasting careers for Arabic artists like Mubarak.
Perez-Soto says the best of Warner Music’s worldwide resources are being made available to help Mubarak establish an international career. That includes teaming the artist up with English producers and songwriters for a short run of demo recording sessions in London earlier this month.
The plan, says Perez-Soto, is that they will “create product and songs that will be appealing to the Western market,” as well as cater to Mubarak’s existing local fanbase by drawing on the Middle East’s rich cultural heritage. Going forward, releases will vary between English-language songs and Arabic-focused repertoire.
Perez-Soto says he hopes giving Saudi artists like Mubarak a global platform will help bring about further change in a country that, while rapidly developing, still draws widespread condemnation for human rights abuses, including a ban on political protest and discrimination against women and marginalized groups.
“The situation is nowhere near close to perfect, but the country is making a very sincere effort [to change] in the right direction and we have to be part of enabling that effort and help that to happen,” says the Miami-based executive.
“There is no hate in music,” says Mubarak. “Music is something beautiful and it creates peace and hopefully we’re going to be part of that.” She wants to inspire other females in the Arab States, including her two young daughters, to follow in her footsteps. “I hope to be their voice,” she says, “to motivate them and make their dreams happen.”
Iggy Azalea has sold her master recording and publishing catalog to Domain Capital for an eight-figure sum, a source close to the deal told Billboard. The wide reaching deal includes 100% of Azalea’s share of her existing catalog, including No. 1 hit “Fancy” (featuring Charli XCX), “Black Widow” (featuring Rita Ora), and “Problem” (with Ariana Grande), and it includes “an additional trigger” for Azalea to earn future revenue on master recordings.
The rapper’s discography includes The New Classic, Surviving the Summer (EP), and In My Defense and The End of an Era. Though she has previously released music under deals with Virgin EMI and Island Records, Azalea has since founded her own label. Called Bad Dreams, it was formerly distributed by Empire but is now in the midst of closing a new distribution deal with a different firm, the source says.
The independent rapper owns 100% of her Bad Dreams label, and she will be able to fully own her masters and publishing on all forthcoming music, starting Q1 2023. On the publishing side, she has an administration deal with Sony Music Publishing.
These days, the Australia native is living in Miami and working on her next album and raising her son, Onyx, whom she welcomed in 2020. She plans to release a full project sometime next year.
Azalea’s deal was revealed just weeks after Domain Capital announced that it closed more than $700 million in commitments for a commingle entertainment fund. In their press release about the fund on Nov. 1, Domain Capital added that it had already deployed more than $170 million in film, television and music investments to date.
“We are excited to launch our first diversified private entertainment royalty fund,” said Anthony Tittanegro, executive managing director of Domain Capital Group in the release. “At a time of sustained entertainment industry growth supported by an ever-evolving landscape of distribution channels, we are focused on building a diversified asset-base to generate cash yield and help maintain our investors’ capital.” The firm declined Billboard’s request for comment.
Last year, a 17-YEAR-old artist from Houston named d4vd released “Romantic Homicide,” a track he had made using BandLab, the Singapore-based social music creation platform. “He recorded a song in his sister’s closet on his mobile phone with Apple earbuds, using a stock preset,” says CEO Meng Ru Kuok — stock presets being one of many things aspiring musicians can find on BandLab, which wants to make it possible for anyone with an idea, no matter their skill set, to create music.
“Romantic Homicide” became an example of that ideal: The brooding, guitar-hooked track caught fire on TikTok, and d4vd (pronounced “David”) signed to Interscope, with the song peaking at No. 45 on the Billboard Hot 100
“I was cheering him on,” Meng says of d4vd. “We’re so excited and rewarded when people move on to other places, whether they stay independent or get signed by major labels.”
BandLab, which was founded in 2015, doesn’t receive royalties from music made on its platform. Instead, the company makes money on artist services (which include distribution, livestreaming and BandLab Boost) that allow acts to turn their profiles or postings into ads on the platform to better reach the 50 million registered users BandLab has.
Meng, 34, has aggressively expanded BandLab’s assets, which are grouped under the holding company of Caldecott Music Group. Along with instrument manufacturing and sales (including Michigan-based Heritage Guitars and Asia’s largest musical instrument retailer, Swee Lee), Caldecott has editorial properties like Guitar.com, Uncut and NME. (BandLab acquired 49% of Rolling Stone in 2016 before selling it in 2019 to Penske Media, Billboard’s parent company.) In September, Billboard and BandLab launched the Bringing BandLab to Billboard portal to expose emerging artists to a global audience.
“On a day-to-day basis, it is not just geographically split, but also mentally in terms of all those areas,” Meng says.
In November 2021, BandLab announced the acquisition of independent artist platform ReverbNation from its parent company, eMinor. And in April, it announced it had raised $65 million in series B funding, bringing the valuation of the platform upwards of $300 million. BandLab envisions a different sort of future — shorter songs made by anyone, using presets or even artificial intelligence (AI) — with the idea that the more music that exists, the more need there is for its range of offerings, from equipment cases to advertising. Business, says Meng, is “gangbusters, in terms of focusing on product and improving the experiences that we bring out.”
Do you feel that d4vd’s success validated your business model?
Yeah, it’s extremely rewarding. We’ve seen stories like that happening thick and fast. Earlier this year, we had an amazing viral success with an incredibly talented young rapper. He was 13 when he started making music on BandLab. He’s 14 now. His name is Cl4pers. He has 1.2 billion views on his hashtag on TikTok alone. It’s not just the viral success but the incredible talent — like d4vd, like Cl4pers — that, prior to BandLab, wasn’t making music with the capabilities that their creativity would have afforded them. D4vd is now signed to Interscope Records and [its artist development/management joint venture] Darkroom and has changed his personal career and the life of his family. Millions of people around the world have listened to his song and have really connected with it. It’s truly special, and it just reminds us of what we’re doing every day, beyond just creating a great business that we’re excited about.
What are the numbers behind that growth at BandLab?
Our last public figure that we shared, we have over 50 million registered users around the world. More than 16, 17 million songs are being made a month on BandLab. I still feel like we’re a small platform getting started. We have 80 full-time staff, 140 if you include all team members around the world. That has grown relatively quickly, and we have a lot of hiring plans in place to expand even further in the next six to 12 months.
Do the creators get royalties?
Yeah, that goes to the artists. We don’t take a position on artists’ rights. There’s a big movement, obviously, toward independent creators being fully in control of what they own. That’s really important to us. We’re focused on empowering the artists. The music is their content. So they are generating their own royalties if they’re distributed by BandLab or ReverbNation or via TuneCore, CD Baby, DistroKid — that’s one way they can be generating money off their music. The artist gets 100%. That’s what we do.
You don’t take commission?
We don’t. Actually, we have a lot of creator economy features on BandLab. For example, someone can tip users on BandLab in their profiles. We allow users to subscribe to other users, similar to Patreon or OnlyFans. We have features where artists can sell their tracks and albums, similar to the iTunes Store or Bandcamp, for example, and the artist keeps 100%. We don’t take a commission from the artists’ earnings after processing fees; Stripe and PayPal are involved in that transaction. We as a platform don’t take a cut of the creator economy. We believe it’s very important the artists are able to monetize. Especially in the United States, you guys get taxed enough. They don’t need more taxes on top from a platform.
How do you make your cut?
We’re focused on empowering artists in creating, making that accessible and free, and truly democratizing music. What Apple did with GarageBand was obviously an incredible progression in democratizing music creation, but 80% of the world uses Android. To be able to afford an iPhone is already out of reach for many people around the world. We don’t believe that people’s creativity or their ability to make music or to express themselves should be limited by their spending power or their knowledge of how to write a song.
Where we make our money is actually in artist services. If you are spending to distribute your music to Spotify, Apple Music, if you are running a promotional campaign — things to help promote your music or develop your career as an artist — that’s where we charge. We have a subscription service that we’ve just announced. There’s our BandLab Boost membership. We also have ReverbNation services that come through membership and various a la carte services.
Your business also supplies royalty-free music packages?
We do provide royalty-free samples. One of our features is BandLab Sounds: We collaborate with artists, commission our own sample packs for people to use in their music-making. And those are provided royalty-free — loop samples, one shots, which are utilized by musicians all around the world to make music. We also have an AI feature called SongStarter, which helps people generate royalty-free song ideas to start off their songwriting process.
All the music on BandLab is original music and original content. We’re very strict and pro-rights owners because we’re trying to protect the creators and all rights holders. This is something that we take very seriously with regard to licensing. It’s about protecting rights holders both on platform and off platform.
Do you train your AI to mimic popular human artists?
No, we don’t.
In the United States, the presumption, based on the Copyright Office, is that only works by human authors can be copyrighted. Who will own the copyright to AI-created portions of songs?
Ownership of content that is developed further from our AI SongStarter tool is owned by the user.
Do you offer marketing services?
We provide a variety of services through BandLab but also through our ancillary services. We acquired ReverbNation last year, which allows you to run third-party advertising campaigns on sites like Billboard, NME and Rolling Stone. They can buy campaigns and centralize their music for promotion on Instagram, Facebook and to promote videos they release on YouTube, for example. We recently announced the beginning of the rollout of BandLab Boost, which allows users to promote, for a fee, their posts and their profile on the BandLab network.
Do you have relationships with the streaming services?
Absolutely. We’re not a [digital service provider]. We believe there are platforms out there that do their job incredibly well. We’re here to empower the music that has been created that ends up on these platforms. We obviously have commercial relationships, like our distribution relationships, but also where we can funnel exciting talent that blows up on their platform.
Whom do you see as a rival?
I’ve been asked that question a bunch. BandLab is creating a whole new category of platform. There are certain services out there that do similar things, but our whole perspective on the ecosystem is that music is collaborative. By nature, it’s not just about the tools — it’s about collaboration, it’s about different influences when people get together. Services need to collaborate as well. That’s where we work closely with other platforms that people outside may see as competitors. There are lots of ways a platform like BandLab can have relationships as a funnel to other services through affiliate partnerships. There are many businesses that have the full suite of tools that we have as BandLab, and it’s our core objective to work closely with all of them. If the music market grows and the creator market grows, everyone benefits.
How has the democratization of music creation that BandLab and other companies and applications have enabled changed music?
The barrier to making a hit is now fundamentally more accessible to anyone. You don’t have to have had a long education or engineering degree to do so. So much of this is being empowered by short-form video and changes in the music industry where a hit song is no longer three minutes long but 10 to 30 seconds — which is really scary and meaningful at the same time.
As his husband, Elton John, prepares for the U.S. finale of his absolutely-positively-unambiguously-final farewell tour Sunday night (Nov. 20) at Dodger Stadium in Los Angeles, David Furnish wants to clarify one thing: “It’s really important to make a distinction between Elton retiring from touring but Elton not playing his very last public performance for the very last time,” says Furnish, 60, a former advertising executive who has produced numerous films, including John’s 2019 biopic, Rocketman. “Will Elton return as a live performer? I hope so! It’s in his blood.”
In a wide-ranging phone interview from the family’s home, Furnish, also John’s manager, discusses the tour’s COVID-19 challenges, how high gas prices and supply-chain issues have complicated budgets and his entry into the music business. “I love working in this world,” he says. “We have the privilege of working with the very best in the business.”
As of last month, the Farewell Yellow Brick World Tour has grossed $661.3 million and sold 4.5 million tickets, including 30 U.S. stadium shows this year that totaled $133.4 million and 830,000 tickets. When the tour returned in January, Omicron loomed over the concert business, but COVID-19 fears have dissipated. How has your thinking about the tour changed throughout 2022?
From us, nothing has changed. COVID is still out in the world. It is still a risk to the health of our crew and to Elton and the band. We put in place a very strict testing protocol. We went back out on the road last January with a regular cadence of testing, keeping everybody up to date on vaccines and boosters. We’ve kept all of that in place. We have people in the tour in separate bubbles. Elton feels really badly, but he hasn’t been able to mix with his band. His band travels in one bubble. He and his assistants, the people who support him, his hairdresser and people in security — they’re in his bubble. It’s been very challenging for Elton, because he always loves being with his band before he goes on stage. He always sits with them and chats and has a laugh with them. That’s not been possible. While he’s been home, between shows or in hotels, he has to isolate. Everybody that supports him at home is also tested regularly — all staff in the household.
How difficult was it to reschedule the shows in Dallas when Elton himself came down with COVID?
We had to postpone, but it meant we lost two shows in Montreal to allow those Dallas shows to be rescheduled. There’s only so much wiggle-room in a tour schedule. This is a big behemoth of a tour. You suddenly just can’t jump to another side of the country or cross the Atlantic to make up a show.
How did fans’ excitement for the tour evolve as the COVID-19 landscape changed throughout 2022?
Thankfully, COVID hospitalizations have massively decreased and there are more medical treatments than there were at the beginning, so people can make the decision as to what medical risk is appropriate for them and still come to see a show. Lockdown was very hard for most people. It was very isolating, and nothing brings people and the world together like music. It’s emotionally and mentally and spiritually very healthy for people to get back out and see shows again. We just had to go back on the road in the safest way possible, and that’s what we’re trying to do.
How have you adapted to higher gas prices and supply-chain issues? Does Elton eat the extra expenses, or have you cut the budget or production?
We just eat the extra cost, because the tour we started with is the tour we intend on finishing with. We sold tickets in good faith and people bought tickets in good faith and it’s really important that we don’t short-change anybody and we honor our commitments. Elton is really committed to that. It’s the largest traveling-production tour Elton’s ever mounted, and it didn’t even occur to us to try to reconfigure it in any way to make it cheaper.
Please set the record straight: Will Sunday’s concert at Dodger Stadium be the last U.S. show Elton ever plays?
I know for a fact he will not be touring in any capacity. What you’re going to see is the possibility of a special one-off or a small residency in one venue for a limited period of time. I don’t think it will be Las Vegas. Elton feels he’s done the best he can in Las Vegas. He mounted two hugely successful residencies there. When you’re an artist and something’s in your blood, you don’t want to shut the door completely. Having said that, I know Elton, and it wouldn’t surprise me if he didn’t do any more live shows, either. He’s really looking forward to spending time with his family. That’s the No. 1 priority in his life. Any type of return to any type of touring is going to be a very well-considered situation, and definitely not a given, at all.
Given your background in other businesses, I wonder what it was like to transition into the music business as Elton’s manager.
I have a business-advertising-marketing background, but I’ve also worked in musical theater, I’ve worked in film production and I’ve been in Elton’s life for 29 years. So it’s not foreign to me at all. When you launch a tour like this, it’s like going on a dangerous mission, and you say to yourself, “I’m hurtling down rapids, and we’re about to go over the falls — who do you want to steady things in the boat and keep things under control?” I’m very fortunate. When I took over, Elton’s tour infrastructure was very, very healthy.
Am I reaching you at the family home in Los Angeles?
Yeah. The whole family’s here in Los Angeles. Obviously, I’m here for work, but I’m here to support my husband and our sons are here. This is a big, big moment in our family’s life.
