Record Labels
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On Christmas Eve in 2019 — while most music business executives were headed out to holiday parties or completing last-minute shopping — Warner Records quietly finalized a label deal with Jaten Dimsdale, a former member of a hair metal cover band outside of Atlanta who had also tried his hand at hardcore and hip-hop.
Dimsdale had posted a handful of viral YouTube covers: In his version of Michael Jackson’s “Rock With You,” uploaded earlier in 2019 on the 10th anniversary of the artist’s death, his buttery tone contrasted shockingly with his grizzled beard, gauge earrings and the hourglass tattoo stamped on the side of his head. Aaron Bay-Schuck and Tom Corson, Warner Records’ then-recently appointed co-chairmen, had been scavenging for stars to revitalize the faded label — so as the rest of the world hunkered down for the night and wrapped gifts, they inked a deal with Dimsdale, who had started performing under a different name: Teddy Swims.
Fast-forward four Christmases. At the end of 2023, Teddy Swims still lacked a signature hit, but Bay-Schuck spotted some encouraging data surrounding the singer’s single that had been hovering in the middle of the Billboard Hot 100. “I remember over the holiday break, ‘Lose Control’ was taking a positive turn,” he recalls of the singer’s single released in June 2023, “so we knew that was going to be a key song for us going into ’24.”
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During that same holiday downtime, Bay-Schuck also noted some positive numbers on TikTok for another relatively new Warner signing, singer-songwriter Benson Boone: The teasers for his unreleased “Beautiful Things” were gaining traction, so the label posted more snippets before the end of the year to further fuel its growth. “And also,” Corson adds of that particularly busy December, “our A&R team had identified [country singer] Dasha and [folk artist] Michael Marcagi, who were trending [on social media] significantly. We closed those deals, essentially, over Christmas.”
With that hectic holiday season, Warner set the stage for what would become an enormous 2024. In January, “Beautiful Things” rocketed to a startling No. 15 debut on the Hot 100 upon its official release. Dasha’s country clap-along “Austin” started morphing into a viral hit following its late-2023 arrival, and Marcagi’s wistful anthem “Scared To Start” gained immediate traction when unveiled in mid-January. As for “Lose Control,” Teddy Swims’ first Hot 100 hit has become a year-defining smash: It reached the chart’s top 10 during the week of Jan. 20, went to No. 1 the week of March 30 and now, in its 64th week on the Hot 100, remains in its upper reaches — and will likely finish quite high on Billboard’s year-end Hot 100 chart. Boone’s “Beautiful Things,” which eventually peaked at No. 2 on the Hot 100 and logged 27 weeks in the chart’s top 10, likely won’t be far behind “Lose Control” on the year-end list. And as the year drew to a close, Boone and Teddy Swims both notched best new artist Grammy nominations in November.
Going into 2024, Bay-Schuck and Corson had recognized it would be a pivotal year for their regime at Warner Records, even if they might not have predicted the exact way it would unfold. After all, Zach Bryan and Dua Lipa, two of the label’s flagship artists, were expected to release new music — but Teddy Swims’ raspily belted soul-revival pop anthem and Boone’s existential ballad with its out-of-nowhere wailed chorus out-charting any new song by those superstars was less expected.
When reflecting on Warner’s surprising year, Corson offers some wisdom from the Roman philosopher Seneca: “Luck is what happens when preparation meets opportunity.” The startling triumph of relative unknowns like Teddy Swims and Boone, along with strong performances from the label’s A-list roster of talent, has made Warner much healthier than its fallow period in the mid-2010s.
Neither Corson nor Bay-Schuck expected this resurgence would sound like “Lose Control” or “Beautiful Things,” but when the moment arrived, they had already been working overtime to meet it. Unabashed music geeks with complementary talents — Corson the master marketer, Bay-Schuck the A&R whiz — the two label leaders can easily rattle off empirical and emotional takeaways from even their roster’s tiniest artists, and they’re hustling both on and off the clock, studying market inefficiencies and, as Seneca may have wanted, placing the label in a position to scoop up potential wins. “These songs didn’t sound like anything else that you were hearing on top 40 [radio],” Bay-Schuck points out. “That’s a big part of our brand at Warner Records. We aren’t trying to do what everybody else is doing — we’re trying to take risks and stand out.”
From left: Dasha, Dua Lipa, Zach Bryan, Benson Boone, Mike Shinoda and Billy Strings.
Illustration by Israel Vargas
As slow-burning smashes with 10-figure streaming numbers, “Lose Control” and “Beautiful Things” headline a year for Warner that has also included country-rock virtuoso Bryan graduating to stadiums and scoring another hit album with The Great American Bar Scene, which reached No. 2 on the Billboard 200; Lipa earning her highest-charting album and best sales week yet with her third full-length, Radical Optimism; and eclectic acts like Linkin Park, Warren Zeiders, Billy Strings and Rüfüs Du Sol yielding success stories in rock, country, bluegrass and dance, respectively. As a result, Warner Records’ market share soared to third among individual labels (behind Republic and Interscope Geffen A&M) in Billboard’s 2024 midyear report, its highest ranking since Bay-Schuck and Corson were named CEO and COO of Warner, respectively, in 2018.
“Aaron, Tom and the team focus on signing and carefully nurturing original artists, and the result is a diverse roster of established superstars and emerging talent,” says Robert Kyncl, CEO of Warner Music Group. “At the same time, they’ve pioneered new ways of breaking through the clutter and grown their market share in an ultra-competitive environment.”
When Max Lousada, former WMG CEO of recorded music, recruited Corson from RCA Records and Bay-Schuck from Interscope to run Warner Records, both executives understood they had their work cut out for them. Outside of Lipa, who took home the best new artist Grammy Award in 2019, Warner ended the 2010s with an aging, rock-focused roster and a severe lack of new star power. “I’m going to quote Lyor [Cohen], a mentor of mine over the years,” Bay-Schuck says. “When we got this opportunity, he was like, ‘You better make sure they’re giving you five to seven years. That’s how long it takes.’ And I think he was spot-on, when you’re taking on a challenge like we did. We had a really unhealthy company that we inherited, and so the first couple of years were about the culture and getting the right people working here.”
In addition to bringing in deputies like executive vp/head of A&R Karen Kwak, senior vp of digital marketing Dalia Ganz and CFO Michele Nadelman, Corson and Bay-Schuck took a divide-and-conquer rebuilding approach that incorporated their personal expertise. Corson, a former president/COO of RCA Records, was tasked with maximizing the potential of Warner’s existing roster and catalog upon arrival, allowing Bay-Schuck, who previously ran A&R at Interscope, the necessary time to discover and develop new artists.
For Corson, the situation “was a combination of understanding roster catalog and needing to find revenue to buy us enough time.” Fortunately, the Warner catalog was filled with legendary artists — from Prince to Tom Petty to Fleetwood Mac to Madonna — even if, Corson says in disbelief, “there wasn’t anything strategic being done with them by the label.”
Short term, there was plenty of new revenue to uncover. Initiatives included responding to significant album anniversaries with glossy vinyl box sets for classics like Green Day’s Nimrod and Linkin Park’s Hybrid Theory, strengthening relationships with the estates of artists like the Ramones and Mac Miller for special releases and also prioritizing new material from still-viable veterans like Red Hot Chili Peppers and Gorillaz. “Developing a high standard helped create a higher flow of product coming out of the catalog department,” Warner executive vp of promotion and commerce Mike Chester says. “And it really carried us. It allowed us to sign and develop Benson Boone and many others, because you need time to do that.”
With the exception of Lipa — whose 2020 album, Future Nostalgia, yielded hit after hit and also bought the new Warner regime more time to retool its roster — the label’s biggest new names are long-term development projects. Boone, a former American Idol contestant with a strong TikTok following but no original songs, signed with Warner in 2021; Bryan joined the same year, while he was still serving in the Navy and had yet to perform a proper concert. As Teddy Swims puts it nearly a half-decade removed from his own signing, “I speak for more than myself when I say just how thankful we are to [Bay-Schuck and Corson] for having the grace and patience to give artists like me the time and space to develop into what we are meant to be.”
Bay-Schuck points out that “Lose Control” and “Beautiful Things” first became hits outside of the United States, dominating parts of Europe and the United Kingdom before igniting on the Billboard charts this year — but that similarity aside, they required wholly different strategies. “ ‘Beautiful Things’ was viral as f–k — I think that’s an industry term,” Corson says with a laugh, nodding to the dedicated social following and streaming activity that helped unlock radio and tidily set up Boone’s April album, Fireworks & Rollerblades.
On the other hand, Warner had to grind out “Lose Control” with old-school radio promotion, then harness digital marketing to widen its footprint. “It’s one of the most interesting records I’ve ever worked because it’s an eight-format record,” Corson says of the single, which has, in fact, charted on eight different genre-based charts, from Adult Pop Airplay to Rock Airplay to R&B/Hip-Hop Airplay, and has topped three of them in addition to the Hot 100.
As for Bryan, whose singular mix of country and rock has also transcended genre lines, the label’s executives say that his sound, release rate and social media presence all come straight from the singer-songwriter, and they just fill in any of the necessary details. “It is entirely Zach’s vision,” Bay-Schuck says. “And the legacy of this label is exactly that. No one was telling Prince what to do, no one was telling Madonna what to do. You give them advice, you challenge them, you insert your opinions where you can. But ultimately, those artists thrive because the label understood how to let them grow and mature and take swings on their own.”
As they’ve settled into their respective roles, Bay-Schuck and Corson have also clicked personally. They didn’t know each other prior to working together at Warner, but in conversation now, they often finish each other’s thoughts, thank each other for specific achievements and describe developing a friendship “off the field” while sharing a philosophy in the office. “Tom is this masterful operator, and Aaron is serious but in a very nuanced way,” Chester explains. “You have two people working full tilt to keep everything aligned, and the more wins, the greater proof of concept, just doubles down on the relationship.”
The dynamic has impressed the roster’s newer additions. Dasha, whose “Austin” peaked at No. 18 on the Hot 100, remembers meeting with Warner prior to other labels and feeling like her mind was made up before any further conversations. “Tom has been such an angel since day one. He is like my dad — he’s so funny and so kind,” she says. “Aaron, the same thing. He has so much passion for what he does and so much drive that it makes me want to work harder.”
And the label’s veteran artists, too, have met Warner’s efforts to revitalize catalogs and mine new opportunities with open arms. After working with Bay-Schuck and Corson on multiple anniversary reissues, Linkin Park set up its next chapter with new co-vocalist Emily Armstrong under cover of darkness, working with Warner to plan a global livestream, arena tour dates and the Nov. 15 release of its latest album, From Zero. “The Emptiness Machine,” the lead single from the album, debuted at No. 21 on the Hot 100 — Linkin Park’s biggest hit in 15 years and one of fall’s hottest new rock singles. The band’s Mike Shinoda says that Bay-Schuck and Corson were “instrumental” in Linkin Park’s comeback. “They helped us choose ‘The Emptiness Machine’ as a first single before it was completed,” he says.
Next, Bay-Schuck and Corson are focused on building the profiles of Warner’s new stars beyond their breakthrough hits. Teddy Swims’ uptempo follow-up single, “The Door,” has peaked at No. 24 on the Hot 100, and a new album — billed as a “second part” of his debut, I’ve Tried Everything but Therapy — is slated for a January 2025 release. Meanwhile, Boone’s “Slow It Down” reached No. 32, and he spent the year touring the globe (including a few dates opening for Taylor Swift’s The Eras Tour).
The executives also rattle off a dozen rising prospects on their roster — from pop singer CIL to viral country artist Maddox Batson to drum’n’bass revivalist Kenya Grace — and stress a greater focus on hip-hop and R&B in 2025, including with the impending arrival of a new head of its urban A&R division.
Meanwhile, Bay-Schuck and Corson have recently begun overseeing Warner Music Nashville, taking a more hands-on approach with artists like Bailey Zimmerman, Gabby Barrett and Cole Swindell and providing Warner Records’ global resources to help broaden those artists’ international footprints. The move was part of the summertime shake-up at WMG that resulted in Lousada’s departure, as well as the installation of a new regime at Atlantic Music Group, with Julie Greenwald departing as chairman/CEO and 10K Projects founder and CEO Elliot Grainge taking her place.
“We’re getting to know Elliot and [new COO] Zach [Friedman] and [new GM] Tony [Talamo] in real time — so far, great experience,” Bay-Schuck says. “They’re young, they’re energetic, they’re fearless. They’re going to come up with some new ways of doing business that I’m sure will prove to be really great for Warner Music Group.”
Another more subtle change followed the WMG restructuring: Bay-Schuck and Corson now report directly to Kyncl, after previously reporting to Lousada. While both executives say that Lousada’s leadership proved invaluable to their current run of success, they’re happy to be ending a momentous 2024 with a bigger seat at the table.
“We now have visibility into things that we didn’t before,” Bay-Schuck says. “With the greatest respect to those who came before us.”
Corson adds, “We’ve earned this.”
This story appears in the Nov. 16, 2024, issue of Billboard.
Panamanian singer-songwriter Rubén Blades has signed a global partnership with Virgin Music Group, Billboard has learned. The indie artist, who releases music under his own label Rubén Blades Production, was previously with AWAL. This new deal with Virgin sets him up for the “next chapter in his legendary career,” states a press release. One of […]
In calling for Universal Music Group (UMG) to move its stock listing and legal headquarters to the U.S. from Amsterdam by next year, board member and billionaire activist investor William Ackman argued the move could make the company more valuable. But financial sources are split on whether that would be the case.
On Friday (Nov. 8), Ackman said his hedge fund, Pershing Square Capital Holdings, which owns 10.25% of UMG’s stock, will exercise its right to require the company to register with the U.S. Securities and Exchange Commission following violent attacks on Israeli soccer fans on Thursday night (Nov. 7) in Amsterdam, where UMG’s stock is listed on the Euronext exchange. But would the move actually benefit the company, as Ackman seems to believe?
“It could noticeably increase UMG’s value because even though it will make your taxes a little higher and you’re going to spend a whole lot more on expensive securities lawyers, it gives you access to the giant U.S. retail market, and UMG is the perfect kind of company for retail investors,” says Erik Gordon, a professor at University of Michigan’s Ross School of Business.
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In the U.S., more than 62% of individual adults own stocks, a group referred to as retail investors. While big institutional investors, like Pershing, account for about three-quarters of the trading volume on U.S. stock markets, like the Nasdaq or New York Stock Exchange, retail investors are a powerful and growing group. Since the start of the pandemic, when retail investors on Reddit fueled a run-up in the share price of companies like GameStop and AMC, more than 30 million new investors have opened brokerage accounts, according to a University of Missouri study.
Right now, four institutional investors control nearly 60% of UMG’s current pool of stock. In his post last week, Ackman argued that lack of liquidity — in part because only a slim portion of UMG’s stock frequently changes hands — could improve if UMG listed in the U.S.
“UMG trades at a large discount to its intrinsic value with limited liquidity in significant part due to it not having its primary listing on the [New York Stock Exchange] or Nasdaq Exchange and not being eligible for S&P 500 and other index inclusion,” he wrote.
Ackman’s argument is essentially that if UMG lists and starts trading in the U.S., its value will make it an important stock in U.S. financial markets, which in a few years will earn it inclusion in a major index, says Gordon. Getting included in an index, like the S&P 500, creates more demand for a company’s stock because mutual funds and exchange traded funds that track the S&P begin to buy the stock.
Over the weekend, UMG stated that Pershing can request that UMG list in the U.S. if it sells at least $500 million worth of its own UMG shares as part of that listing.
“If I had to guess, Ackman will end up with the right to sell his shares in the U.S. public market and that the company will issue new shares in the U.S. so that Ackman isn’t the only guy selling,” Gordon says.
One equity analyst believes UMG would not become a more valuable company if it moved to a U.S. exchange because its shares already trade at a premium to shares of Warner Music Group (WMG). In a Nov. 1 investor note, J.P Morgan analysts wrote about the premium, arguing that “UMG should trade at a significant premium to WMG…to reflect greater scale, a better track record for growth and consistent margin expansion, best-in-class management and better governance.”
According to Billboard’s calculations, UMG shares were recently trading at a roughly 17 times multiple trailing 12 months adjusted EBITDA, while WMG shares were trading at about 11 times multiple.
UMG moving its stock to an American exchange also comes with another downside: the operational expense that U.S.-listed public companies face from shareholder lawsuits.
“One area U.S. issuers have to manage, unlike non-U.S. issuers, is the volume of shareholder litigation that gets brought in the U.S.,” says Michael Poster, a music industry lawyer at Michelman & Robinson. “It’s expensive to deal with litigation, there are a lot of fees associated with managing, settling and litigating the claims, and it’s frankly a distraction for management. Those things contribute to making trading in the U.S. more expensive from an operational point of view.”
Peering over U.S. borders at the rest of the world, the recorded music business looks like the land of opportunity. The U.S. is certainly lucrative, but it’s also hyper-competitive. While the three major labels have locked up most of the States’ recorded music revenues — they distribute many indies, too — they command a far lower share internationally.
A new estimate of independent labels’ market share shows why major labels’ investments and acquisitions in foreign territories are so common. On an ownership basis, independent artists and labels had a 46.7% share of the global recorded music business in 2023, according to a new MIDiA Research report, with independent labels taking a 40.8% share while artist-direct distributors such as Ditto Music and TuneCore having a 5.9% share. (The data, collected through an online survey of independent labels, accounts for 93% of all global revenues.) That leaves 53.3% for the major labels.
The U.S. is considerably more concentrated. Independent labels and distributors had a 35.7% share of the U.S. market in 2023, according to Billboard’s analysis of Luminate data — 11 percentage points less than their global share — with the major labels owning the remaining 64.3%. That means that while independent artists and labels were behind the majority of the well over 100,000 new tracks that were being uploaded to digital service providers daily as of early 2023, they only accounted for a bit more than a third of revenue.
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The U.S. market gets even more concentrated when distribution, not just ownership, is measured. In the U.S., the major labels have an 84.3% distribution share through their ownership of music distributors Ingrooves (Universal Music Group), The Orchard (Sony Music), AWAL (Sony Music) and ADA (Warner Music Group), leaving independent labels and distributors with a 15.7% share. But MIDiA puts the independents’ global distribution share at 34.2% — 18.5 percentage points higher than their U.S. share.
Besides the availability of market share, companies are also investing outside of more familiar, Western countries because they’re chasing high growth rates. The U.S. is slowing and has settled into solid, high-single-digit annual improvements: 7.2% in 2023 and 5% in 2022 after a pandemic-related 41% surge in 2021, according to the IFPI’s data on global trade revenue.
Emerging music markets, on the other hand, are growing like weeds. Strong gains in some heavily populated countries led the U.S.’s share of global revenues to dip from 41.2% in 2021 to 38.6% in 2023. Over that time span, China’s share grew from 3.8% to 5.1% and Brazil’s share rose from 1.8% from 2.0%. In 2023 alone, Mexico grew 18% to $490 million, and India grew 15% to $357 million to overtake Spain as the world’s No. 14 market.
For majors and indies alike, the never-ending pursuit of market share is taking them across the globe. This year, Universal Music Group bought a majority stake in Nigerian record label Mavin Global and Outdustry, a record label and artist services provider that focuses on China, India and other emerging markets. Warner Music Group took a majority stake in Indian digital media and music company Divo. Believe acquired Turkish record label DMC and purchased Indian record label White Hill Music’s catalog and YouTube channel. In 2022, Sony Music acquired Brazilian independent music company Som Livre. A year earlier, Warner Music Group invested in Saudi Arabian independent label Rotana, building a presence in the Middle East-North Africa region where Reservoir Media has a partnership with Abu Dhabi-based PopArabia.
Streaming and social media have allowed independents to blossom around the world, creating a market “more diverse, fragmented, international, and regional than it has ever been,” wrote MIDiA’s Mark Mulligan. “It has resulted in a market that is characterized by both fragmentation and consolidation,” wrote Mulligan. “These opposing forces are shaping today’s market and will do so in the coming years.”
In recent years, the Grammys have served up several decisive sweeps (and head scratching omissions) that have dominated the conversation and led to some record labels celebrating huge wins in the Big Four categories of record of the year, song of the year, album of the year and best new artist. Within the past decade, Interscope Records emerged victorious in all four categories when Billie Eilish swept the top honors in 2020, while Atlantic’s Bruno Mars took three of the four in 2018, Columbia’s Adele did the same in 2017 and Capitol, through Beck (AOTY) and Sam Smith (BNA, ROTY and SOTY), swept them all in 2015.
What makes the full Big Four sweep particularly difficult is the best new artist aspect, in that rarely does an artist make such an impact with their initial breakthrough that they can win, or even get nominated in, the record, song and album of the year categories. It’s not unheard of — Eilish, Smith, Lizzo, Olivia Rodrigo, Amy Winehouse and Norah Jones have all been nominated in the Big Four categories in a single year this century, with Eilish and Jones sweeping the wins — but it’s not exactly common, either.
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Which makes this year particularly notable: Both Sabrina Carpenter and Chappell Roan received nominations in each of the Big Four categories for the 2025 Grammy Awards, marking just the second time that two artists have achieved that in the same year. (Eilish and Lizzo both received them in 2020.) Even more, they’re both signed to Island Records, a historic achievement for a historic label.
With those eight nods — for Roan’s “Good Luck, Babe!” (record and song); Roan’s The Rise & Fall of a Midwest Princess (album); Carpenter’s Short N Sweet (album); Carpenter’s “Please Please Please” (song); Carpenter’s “Espresso” (record); and BNA for both — Island leads all labels in Big Four nominations, a huge moment for a label that had not been at that table at all in years.
Following Island is Interscope, which racked up seven Big Four nominations through a combination of Kendrick Lamar (record and song for “Not Like Us”), Billie Eilish (record and song for “Birds of a Feather,” album for Hit Me Hard And Soft), Jacob Collier (Interscope distributes his Hajanga label, which put out his album of the year-nominated Djesse Vol. 4), and Bruno Mars and Lady Gaga’s “Die With a Smile” (song), which came out on Interscope (Mars’ label Atlantic did play a role, but Interscope is the credited label).
Beyond Island and Interscope, many of the rest of the nominations were spread out among several labels. Receiving three nods apiece were Republic (album, record and song for Taylor Swift’s The Tortured Poets Department and “Fortnite”) and Columbia (album, record and song for Beyoncé’s COWBOY CARTER and “TEXAS HOLD ‘EM”). Elsewhere, EMPIRE (best new artist for Shaboozey and song for Shaboozey’s “A Bar Song (Tipsy)”) received two, as did Warner (best new artist for both Benson Boone and Teddy Swims), Atlantic (album for Charli XCX’s BRAT and record for Charli’s “360”) and Capitol (best new artist for Doechii and record of the year for the Beatles’ AI-assisted “Now and Then”). Lastly, Epic (album for Andre 3000’s New Blue Sun), dead oceans (best new artist for Khruangbin) and Human Re Sources (best new artist for RAYE) all received one nomination each.
Among the label groups, that means that the Universal Music Group — home to Island, Interscope, Republic and Capitol — racked up 20 of those Big Four nominations, far and away leading the sector. (Given UMG’s recent reorganization, the REPUBLIC Corps Collective claimed 11 nominations, while the Interscope Capitol Labels Group had nine.) Finally, Sony Music had five, Warner Music landed four, while the indie sector claimed three.
WK Records has appointed Azucena “Azu” Olvera as GM, the company tells Billboard. According to the label, which was founded in 2020 by executive Walter Kolm, Olvera will leverage her “extensive expertise in talent relations, A&R, global marketing and strategic partnerships to further WK Records’ mission of cultivating groundbreaking music and elevating Latin artists on […]
Alana Dolgin has joined Atlantic Music Group as the label’s first president of digital marketing, a position created to drive digital strategies across the labels within the company, including Atlantic Records, 300 Entertainment and 10K Projects. Dolgin, who is based in AMG’s Los Angeles office, reports to chief operating officer Zach Friedman and general manager […]
Spinnin’ Records president Roger de Graaf is retiring, a representative for the label has confirmed to Billboard. De Graaf co-founded the Dutch label in 1999 alongside Eelko van Kooten, maneuvering it through several eras of electronic music and quickly evolving consumption models, from CDs to DSPs. “In the beginning, we wanted to become the No. […]
The music business is getting back to basics.
In a few short years, the major labels have gone from investing in and partnering with speculative tech startups to pouring money into regionally focused music companies across Asia, Africa and Latin America. After a brief flirtation with NFTs and live-streaming businesses, anything resembling a faddish technology seems to be out of favor, judging from the deals and partnerships they’ve been making lately. Instead, the majors are targeting old-school music companies that own catalogs and develop artists — and can benefit from the majors’ global network of distribution and other services.
In 2024 alone, the three majors — Universal Music Group, Sony Music Entertainment and Warner Music Group — have acquired or invested in 11 record labels, music catalogs and service providers in small or developing markets. The flurry of deals — there were even more in 2023 and preceding years — provides the majors with more content for their ever-increasing distribution pipeline and more international artists to take to Western markets.
Take UMG’s run of acquisitions and investments in 2024: the remaining stake of European indie label group [PIAS], the remaining stake in the catalog of Thai music company RS Group, a majority stake in Nigerian record label Mavin Global and the outright acquisition of Outdustry, a multi-faceted company with an artist- and label-services arm that focuses on China, India and other high-growth emerging markets. Outdustry will be a division of Virgin Music Group, UMG’s fast-growing distribution and artist services company that includes distributor Ingrooves Music Group and Integral, formerly the artist services division of [PIAS].
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UMG, in particular, is letting the world know about its intentions. On Thursday (Oct. 31), UMG CEO Lucian Grainge dedicated much of his earnings call opening statements to the company’s efforts to expand into potentially lucrative markets that merited little attention before legal streaming services replaced digital piracy. UMG plans to make “several other investments” before the end of the year, CFO Boyd Muir said during the earnings call. In total, he said, investment spending in the second half of the year will be 350 million to 400 million euros ($380 million to $434 million).
The focus on emerging markets and artist services is a noticeable change from a few years ago. When NFT prices soared and fans were stuck at home during the pandemic, the majors invested in blockchain, virtual reality and live-streaming startups. Today, as the majors face slowing streaming growth in mature markets and the needs of an increasing number of independent artists, they’re focused on building a global network of service providers with an eye on up-and-coming markets.
The focus on emerging markets goes beyond acquisitions. In September, UMG launched a new company, Universal Music Group Greater Bay Area, that will be based in Shenzhen, making “the first time a major music company has established a division in China’s Greater Bay Area, the world’s most populous urban area,” the company said.
Another development mentioned on UMG’s earnings call was GTS, a global talent services business in Latin America. In October, GTS became a standalone company separate from UMG’s record labels. “By separating from our local labels,” Grainge explained, “GTS will now be able to also offer its services to artists outside of the UMG family.”
Grainge and Muir painted a picture of a global business determined to expand outside of the mature markets they know best and build a presence in high-growth ones. UMG’s competitors — including independent Believe — are doing the same.
WMG has also had a busy year investing in traditional music companies. In March, WMG purchased a stake in India’s Global Music Junction (India’s The Economic Times reported it was a 26% stake) and launched Warner Music South Asia in April. Last year, the company took a majority stake in Divo, an Indian digital media and music company. Earlier this week, CEO Robert Kyncl told The Economic Times that China and India are the company’s top markets for expansion. “We’re already doing great in India, but it can be a much bigger part of our story,” Kyncl told the paper.
The majors continue to buy catalogs, of course. This year, Sony Music purchased Pink Floyd’s recorded music catalog (in addition to merchandising and name and likeness rights) and UMG bought a minority stake in Chord Music Partners, which holds the rights to over 60,000 songs. Expensive song catalogs give the majors rights to assets with long, productive lives. But given the enormous size of these companies, artist catalog acquisitions barely move the revenue needle. A legendary artist’s catalog might cost $200 million but generate a steady $10 million a year — a healthy sum but a pittance to a company with annual sales exceeding $12 billion.
Rather than pour money into just catalogs, the majors are buying entire companies and building new businesses with growth potential. As Morgan Stanley analysts wrote in an investor note about UMG on Thursday (Oct. 31), earlier acquisitions have had “a negligible effect on revenue and a small impact on profit growth.” But in the future, they are likely to be a more important driver of revenue growth, and Morgan Stanley expects UMG’s financial reports will break out their impact (e.g. reported revenue vs. organic revenue).
In buying regional music companies and building artist-services business, the majors are also taking a defensive measure. Independents such as Believe have been investing in local markets for years. In 2024 alone, Believe purchased the remaining stake in Turkish record label DMC and acquired Indian label White Hill Music’s music catalog and YouTube channel. Independent distributors such as UnitedMasters, Stem, Symphonic Distribution and Create Music Group have given artists a viable alternative to major label-owned systems. The majors are simply changing along with the market.
In 2012, UMG acquired the recorded music assets of EMI Music and later sold some pieces to WMG to satisfy antitrust regulators. Opposition to greater consolidation in the U.S. and Europe means it was probably the last acquisition of its size in those regions. (WMG’s brief flirtation with buying Believe in April and May quickly drew opposition from French indie labels.) There’s less opposition to more gradual growth taking place elsewhere in the world, though. The majors are continuing to expand, but they’re taking many small steps, not single EMI-sized leaps — and they’re doing it through old-fashioned music businesses.
This week, one of hip-hop’s rising stars hit a new milestone in his career: With the release of his latest album, LYFESTYLE, Yeat landed his first-ever No. 1 on the Billboard 200 with 89,000 equivalent album units, following up on the No. 2 debut of his last album, 2093, back in February.
It’s a big achievement for Yeat, who has seen his career steadily project upward, reaching the top 10 of the Billboard 200 with each of the five albums he’s released since he began working with Field Trip Recordings in 2022. This one also came with another big milestone: In its first week, LYFESTYLE, released in conjunction with Capitol, sold 60,000 units, outstripping the entire sales volume of his prior catalog to date so far (35,000) due to a combination of vinyl albums, his first-ever CD release and exclusive songs on various digital variants. And the success of the album earns Field Trip founder/CEO Zack Bia the title of Billboard’s Executive of the Week.
Here, Bia — who has also served as Drake’s tour DJ for the past two years — discusses Yeat’s commercial glow-up since they began working together, what sets this project apart and why they leaned into a sales strategy for the first time with this new album. “Ultimately, it will actually just be the next stepping stone of an achievement that allows us to jump into even bigger live show experiences and wide-reaching ventures outside of just the music,” Bia says.
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This week, Yeat scored his first career No. 1 album on the Billboard 200 with LYFESTYLE. What key decisions did you make to help make that happen?
My main role is always just to help bring his vision to life. Making sure that all the elements between the music, the visuals, the live show and the world-building as a whole are synergetic. Creating unique eras for each project that his fans can bask in.
Over the course of his career, each of his albums has debuted higher than the previous one, with February’s release 2093 coming in at No. 2 prior to this new chart-topper. How have you worked to build his career steadily through the years?
The goal is always to elevate with every album. Learn from previous rollouts and apply and adjust to the next one. He’s so prolific and puts out music at such a high velocity it’s just about continuing to go bigger with every release but in a way that stays true to the core audience. Our goal has always been to just add to the burning core fan base and with every release this group just gets bigger and stronger.
What sets this project apart from the rest of Yeat’s catalog, and how does it help you build from here?
This project I think comes at a time where after a meteoric rise he finally decided to lean back into the “lifestyle.” Reaping the rewards of his hard work, and I think the fun he’s having translates into the music. This project is braggadocious and polished and sets him apart and into a next category after reaching No. 1. Ultimately, it will actually just be the next stepping stone of an achievement that allows us to jump into even bigger live show experiences and wide-reaching ventures outside of just the music.
With 60,000 units, this week was Yeat’s biggest sales week of his career and outsold the entirety of the rest of his catalog to date. What was your approach to the sales aspect of this? And why go down the CD road for the first time?
I think the demand was always there, we just didn’t always cater to it. We are so precious with the music oftentimes we didn’t even have the time to make physical product on such short timelines. After putting out a massive project top of the year, there wasn’t a rush necessarily to force this one out. We could finally take our time to build product around it and lean into giving people actual things to collect: large-format vinyl to listen to and hang in their collection, or collaborative merch with designers he’s admired. Also rewarding people for buying into it, exclusive songs and different offerings that only were available to people who really paid attention and wanted to collect them.
What is your approach to digital marketing? And how have you been able to leverage TikTok for Yeat’s singles?
Yeat is so prolific in music making but is reclusive as a human in general. The rest of the internet can do the documenting and interacting for him. We never try to spark anything on TikTok out of the blue; all we can do is let the people pick. It’s very democratic in that sense, whatever song they champion then we can go lean into [it] and try to spread it wider.
How has the music industry evolved over the course of your career?
To echo the answer from the previous question, I believe that every era of social media has been intrinsically tied to the popular music of that era. Whether the music blew up on the platform of that time or it was big culturally and then translated back to that platform. I think in my time we’ve seen the most digitally-native fandoms yet, so learning to balance both living online but then translating it to live experiences and vice versa, real-life moments that then live online. I think in a time of virality we’ve swam the opposite way and tried to just stay true to chipping away piece by piece at growing something. But granted, this is the time of the quickest evolution in music history. When else has it been possible to make a song on your phone, upload it that night, and go viral the next day?
I would like to thank everyone on our team that works tirelessly and selflessly towards this common goal of uplifting a truly amazing artist. I know this is just a little small recognition that I received but I appreciate it and want to share my gratitude to everyone on our internal team and to [Capitol chairman/CEO] Tom March and the entire Capitol Records family. Also, new BNYX music soon.