State Champ Radio sony music
Trueno has signed a record deal with Sony Music Latin, Billboard can announce. The Argentine rapper and singer, known for his socially conscious lyrics, is a leading force in the hip-hop scene of Latin America. “Joining Sony Music US Latin is a big step in my career! I am very excited to be able to […]
In January 1999, Universal Music Group laid off hundreds of employees during a wave of consolidation with PolyGram. “The biggest staff cuts were at Geffen and A&M, two Los Angeles-based labels that have been folded into Interscope Records … and at Island Records, which has been merged with Mercury,” Billboard reported at the time, predicting that the cuts would affect label rosters, with “baby bands … expected to suffer the most casualties in the shake-ups.” In an interview with The New York Times, one artist manager described the impact of the merger on his band as if “a car [got] shut off in midgear.”
Roughly 25 years later, UMG is expected to cut hundreds of jobs to create “efficiencies in other areas of the business so we can remain nimble and responsive to the dynamic market,” according to a January statement from the company. Warner Music Group has announced layoffs of more than 800 people in two rounds over the last 12 months; on Monday, WMG label Atlantic Records announced additional cuts of about two dozen employees, primarily in the radio and video departments. (Sony Music is also expected to trim staff, according to sources; a rep for Sony declined to comment.)
Trending on Billboard
These cuts herald a leaner approach to the major-label business, and some talent and their representatives are worried about how this impacts their future.
Artists “are going to be upset,” says Mike Biggane, who was head of curation for Spotify, then worked at UMG as global executive vp of music strategy and tactics until last year. “The teams that artists signed up for and have been going to battle with will all be gone. That is going to impact the managers and the remaining label staff, who are already spread too thin.”
“If you’re not a multi-platinum artist, good luck,” says Allen Kovac, a longtime manager who had several acts in the UMG system during the 1999 consolidation.
A rep for UMG declined to comment. Speaking to financial analysts on Wednesday, UMG CEO Lucian Grainge said that “when it comes to supporting their rosters, [labels] will have access to our highest performing internal teams and resources to bring the new artists to even higher levels of success.”
And some executives were more sanguine about the impact of the upcoming staff cuts. Chris Anokute manages Taela, who was signed by Michelle Jubelirer before she recently left Capitol Music Group. “I’m very grateful to Michelle for signing her,” Anokute says. “Now there’s new management, and I’m excited to work with the new team to keep on developing her. I’m not worried for one second.”
Major labels have been consolidating internally for more than two decades. In 2004, Atlantic Records and Elektra Records merged as part of a Warner Music Group shake-up that included 1,000 layoffs. “Warner began cutting money-losing and under-performing artists from its merged Atlantic-Elektra label’s roster, and is preparing to let go as many as half of the label’s 170 acts,” The Washington Post reported.
Later the same year, BMG and Sony Music merged. “In each market tough decisions will have to be made about the senior executive lineup, overall staffing and artist rosters,” Billboard wrote.
While layoffs were typically followed by roster trimming in the past, history can serve only as a limited guide when assessing the latest round of cuts. “The environment today seems quite different to that of the late 1970s and early 1980s — the first time the industry experienced serious contraction — or the early 2000s,” says Adam White, a former Billboard editor-in-chief who later served as UMG vp of international communications. “During both of those time periods, industry sales slumped significantly and staff cutbacks were widespread. Isn’t that in contrast to the current environment, with revenue admittedly not growing at previous, double-digit rates — but still growing?”
Nonetheless, with leaner staffs, “you either need to spread your remaining staff more thinly or serve a smaller roster,” says Peter Sinclair, who worked at UMG for five years before founding beatBread, an artist-funding platform, in 2020.
Some major-label executives contend the staffing changes their companies are making will let them offer more resources to artists, not less. WMG CEO Robert Kyncl, for example, told staff that the cost savings from recent cuts would free up money that can be put towards “increasing funding behind artists and songwriters,” while Atlantic Music Group chairman/CEO Julie Greenwald said the company would be “bringing on new and additional skill sets in social media [and] content creation” to “help artists tell their stories.” In a memo to staff on Wednesday (Feb. 28), Grainge wrote that “our long-term growth strategy, including this organizational redesign, represents a new paradigm for artist support.”
However, many acts believe major-label staffs are already stretched perilously thin, and that layoffs will only exacerbate artists’ feelings of being underserved. “Way too many of my clients complain about what the labels aren’t doing for them,” says Todd Rubenstein, an entertainment attorney. “Even if there is a whole plan they come in with, it’s still not getting serviced.”
“I’m not anti-label; I think every single artist we have is on a major label,” adds Crush Management founder Jonathan Daniel. But “the reason I set up my company the way I did” — Crush has its own marketing and radio promotion staff — “is because labels always have too many artists for how many people work there.”
Labels are already more willing to trim their rosters than they were in the past, and A&R executives say this may have intensified independent of the recent layoff announcements, after a period of excessive signing driven by pressure to maintain market share and an abundance of viral hits on social media. “Would [layoffs] speed up the process of trimming the roster?” asks entertainment attorney Michael Sukin. “Sure, but labels don’t need an excuse.”
That said, when employees are laid off or leave to take another job, some artists will lose their internal advocates. Executives believe it’s likely that there are acts in the UMG system who won’t have their options picked up after the layoffs because no one inside the buildings will fight to keep them.
“Any artist that’s more singles-based is more of a risk on your balance sheet,” says one A&R executive-turned-manager. “They want artists that have sticky fan bases that will be there and support them when they don’t have a hit.”
This all sounds nerve wracking for artists, who are, after all, the lifeblood of record companies. In reality, though, an artist who was a label’s 40th most important act may not have been getting a ton of help anyway — as a UMG executive told The New York Times around the time of the Polygram merger, “for the [artists] we let go, they’ve probably already been dragged over the coals by a record label that can’t do the best job for them.” Nick Stern, another longtime artist manager, is fond of saying “there’s nothing better than being a top five priority at a major label, and nothing worse than being 20 to 50.”
And while artists who got dropped by a major label in 1999 didn’t have many ways to get their music heard around the world, that’s not the case in today’s digital industry. Song creation, distribution and marketing are now all far more affordable. “As the majors’ gatekeeping role shrinks, artists have more options, more leverage, more control and more creative freedom,” Sinclair says. “If you’re an artist and you get dropped by the majors, I’d recommend you take it for what it is: an opportunity.”
When Biggane left UMG last year, he started Big Effect, a company developing technology designed for smaller artist teams to release products and manage catalog effectively. He predicts an “exodus of talent on both sides — people working in the industry trying to provide services and artists looking for services.”
“They’re all going to come out in the independent market,” Biggane says, “and try to find each other.”
Additional reporting by Kristin Robinson
During Sunday night’s Super Bowl, Beyoncé dropped two new country-flavored songs, the galloping “Texas Hold ‘Em,” and the more reflective “16 Carriages.” But country radio stations have been initially slow to add the Houston-born superstar.
Explore
Explore
See latest videos, charts and news
See latest videos, charts and news
In the two songs’ first 24-plus hours of release (from Sunday night through the end of Monday), eight reporters to Billboard’s Country Airplay chart played “Texas Hold ‘Em,” and only one, KBAY San Francisco, played it more than once (two spins), for a total of nine early plays at the format, according to Mediabase. No stations on the country chart’s panel, which ranges from 145-to-150 stations, played “16 Carriages” in that span. Overall, “Texas Hold ‘Em” received over 200 all-format plays, largely on pop radio, in that stretch, while “16 Carriages” drew just a handful of plays. Neither song registered enough plays through Monday to appear on Billboard’s 60-position Country Airplay chart.
The situation at country radio may change, however. On Tuesday afternoon (Feb. 13), Columbia officially serviced “Texas Hold ‘Em” to country radio, whereas it had previously been sent to other formats, according to a source. Country radio has traditionally been reluctant to play songs that aren’t serviced to them or then actively promoted by the label. The two songs are part of Renaissance Act II coming from Beyoncé on March 29. Beyoncé has flirted with country music before, releasing “Daddy Lessons” on 2016’s Lemonade and playing the track with the Dixie Chicks (now The Chicks) on that year’s CMA Awards. That song was not actively worked to country radio, according to a Billboard story at the time, and did not chart at country radio, though it did reach No. 41 on the Hot 100.
Trending on Billboard
Bo Matthews, programming director of Alpha Media’s KBAY, which played “Texas Hold ‘Em” twice on Monday and continues to play it, says listener reaction has been “split.” He says, “I think it’s different to hear Beyoncé on a country radio station. We’re going to play it more and see if it the audience likes it and let them allow to be the decider as to whether or not it continues to be on the playlist.”
KBAY began playing “Texas Hold ‘Em” before Sony Music serviced to country radio, so Matthews grabbed the edit (which bleeps out the word “b—-”) from one of KBAY’s sister stations playing it, had KBAY’s midday host add it and asked listeners to weigh in. “It’s one of the biggest celebrities in the world doing a country song and I think that’s exciting for the format,” he says.
On Tuesday, the Austin American-Stateman ran a news story based on a social media post claiming country station KYKC in Ada, Oklahoma, flat-out rejected a request to play “Texas Hold ‘Em.” The story included a screenshot of a post from X (formerly Twitter) user @jussatto, who said he had requested the station play the song and received the following response, “Hi, we do not play Beyonce on KYKC as we are a country music station.” Another fan posted another response from the KYKC, saying it will “happily play the song when it gets high enough on the chart.”
These claims immediately sparked a broader online debate over whether country stations would play the song. On Tuesday afternoon, the station, which is not a Mediabase reporter, posted on Facebook that there were “lots of calls coming in” for the song and posted a log showing “Texas Hold ‘Em” played at 2:28 p.m. CT, sandwiched between Zach Bryan’s “Tishomingo” and Carrie Underwood’s “Wasted.”
A source at the station, who spoke on the condition of anonymity, told Billboard that the initial email response posted on X was from the station’s general manager, who did not know that Beyoncé had released two new country songs. KYKC’s sister Top 40 station had already played the song, and while the country station tends not to add songs until they are in the top 30 on Mediabase, “based on the number of calls we got in, we realized we needed to add it to the country station,” the source says. The song is now in the station’s system and it will continue to play it.
CMT immediately added “Texas Hold ‘Em” to its branded streaming stations and anticipates playing a video once one is released. A number of streaming services, including Spotify and Apple Music have also added it to their playlists. The song is currently on Spotify’s Hot Country playlist and it is No. 1 on iTunes’ Top 100 Songs chart, with “16 Carriages” at No. 2. Neither song appears on iTunes Top 100 Country Song chart, which is dominated by songs from Toby Keith’s catalog, following his death Feb. 5.
Beyoncé is just one of several pop artists planning to release country projects, including Post Malone and Lana Del Rey. Ed Sheeran told Billboard that he’d like to make a country album and a country project recorded by Brian Wilson in the ‘70s, is finally coming out next year, according to Rolling Stone.
Audacy and iHeartRadio country executives did not respond to request for comment. Beyoncé’s representative declined to any answer questions about the releases and the plan at radio.
Assistance on this story provided by Gary Trust.
Dennis Kooker, president of global digital business at Sony Music Entertainment, represented the music business at Sen. Chuck Schumer’s (D-NY) seventh artificial intelligence insight forum in Washington, D.C. on Wednesday (Nov. 29). In his statement, Kooker implored the government to act on new legislation to protect copyright holders to ensure the development of “responsible and ethical generative AI.”
The executive revealed that Sony has already sent “close to 10,000 takedowns to a variety of platforms hosting unauthorized deepfakes that SME artists asked us to take down.” He says these platforms, including streamers and social media sites, are “quick to point to the loopholes in the law as an excuse to drag their feet or to not take the deepfakes down when requested.”
Presently, there is no federal law that explicitly requires platforms to takedown songs that impersonate an artists’ voice. Platforms are only obligated to do this when a copyright (a sound recording or a musical work) is infringed, as stipulated by the Digital Millennium Copyright Act (DMCA). Interest in using AI to clone the voices of famous artists has grown rapidly since a song with AI impersonations of Drake and The Weekend went viral earlier this year. The track, called “Heart on My Sleeve” has become one of the most popular use-cases of music-related AI.
A celebrity’s voice and likeness can be protected by “right of publicity” laws that safeguard it from unauthorized exploitation, but this right is limited. Its protections vary state-to-state and are even more limited post-mortem. In May, Billboard reported that the major labels — Sony, Universal Music Group and Warner Music Group — had been in talks with Spotify, Apple Music and Amazon Music to create a voluntary system for takedowns of right of publicity violations, much like the one laid out by the DMCA, according to sources at all three majors. It is unclear from Kooker’s remarks if the platforms that are dragging their feet on voice clone removals include the three streaming services that previously took part in these discussions.
In his statement, Kooker asked the Senate forum to create a federal right of publicity to create a stronger and more uniform protection for artists. “Creators and consumers need a clear unified right that sets a floor across all fifty states,” he said. This echoes what UMG general counsel/ executive vp of business and legal affairs Jeffery Harleston asked the Senate during a July AI hearing.
Kooker expressed his “sincere gratitude” to Sens. Chris Coons, Marsha Blackburn, Amy Klobuchar and Thom Tillis for releasing a draft bill called the No FAKES (“Nurture Originals, Foster Art, and Keep Entertainment Safe”) Act in October, which would create a federal property right for one’s voice or likeness and protect against unauthorized AI impersonations. At its announcement, the No FAKES Act drew resounding praise from music business organizations, including the RIAA and the American Association of Independent Music.
Kooker also stated that in this early stage many available generative AI products today are “not expanding the business model or enhancing human creativity.” He pointed to a “deluge of 100,000 new recordings delivered to [digital service providers] every day” and said that some of these songs are “generated using generative AI content creation tools.” He added, “These works flood the current music ecosystem and compete directly with human artists…. They reduce and diminish the earnings of human artists.”
“We have every reason to believe that various elements of AI will become routine in the creative process… [as well as] other aspects of our business” like marketing and royalty accounting,” Kooker continued. He said Sony Music has already started “active conversations” with “roughly 200” different AI companies about potential partnerships with Sony Music.
Still, he stressed five key issues remain that need to be addressed to “assure a thriving marketplace for AI and music.” Read his five points, as written in his prepared statement, below:
Assure Consent, Compensation, and Credit. New products and businesses built with music must be developed with the consent of the owner and appropriate compensation and credit. It is essential to understand why the training of AI models is being done, what products will be developed as a result, and what the business model is that will monetize the use of the artist’s work. Congress and the agencies should assure that creators’ rights are recognized and respected.
Confirm That Copying Music to Train AI Models is Not Fair Use. Even worse are those that argue that copyrighted content should automatically be considered fair use so that protected works are never compensated for usage and creators have no say in the products or business models that are developed around them and their work. Congress should assure and agencies should presume that reproducing music to train AI models, in itself, is not a fair use.
Prevent the Cloning of Artists’ Voices and Likenesses Without Express Permission. We cannot allow an artist’s voice or likeness to be cloned for use without the express permission of the artist. This is a very personal decision for the artist. Congress should pass into law effective federal protections for name, image, and likeness.
Incentivize Accurate Record-Keeping. Correct attribution will be a critical element to artists being paid fairly and correctly for new works that are created. In addition, rights can only be enforced around the training of AI when there are accurate records about what is being copied. Otherwise, the inability to enforce rights in the AI marketplace equates to a lack of rights at all, producing a dangerous imbalance that prevents a thriving ecosystem. This requires strong and accurate record keeping by the generative AI platforms, a requirement that urgently needs legislative support to ensure incentives are in place so that it happens consistently and correctly.
Assure Transparency for Consumers and Artists. Transparency is necessary to clearly distinguish human-created works from AI-created works. The public should know, when they are listening to music, whether that music was created by a human being or a machine.
Music companies’ third-quarter earnings reports have so far been full of good news and positive trends. Subscription and streaming growth continue to drive revenues for record labels and publishers. Live entertainment continues its post-pandemic expansion. Margins are healthy. Overall, these have been solid report cards for the state of the music business.
Among the companies to report thus far are Universal Music Group, Sony Music, Spotify, Believe, Sphere Entertainment Co., MSG Entertainment, HYBE and SiriusXM. Next week’s earnings reports will come from Warner Music Group (Nov. 16) and Tencent Music Entertainment (Nov. 14). German concert promoter CTS Eventim will report on Nov. 21.
Here are seven items from the earnings releases to date that stood out and deserve more attention.
Universal Music Group struck out against “merchants of garbage.” During Universal Music Group’s Oct. 26 earnings call, chairman and CEO Lucian Grainge got a lot of attention when he bemoaned the “merchants of garbage” — creators of low-value functional music such as generic mood music and nature sounds — that want to be on equal royalty terms at streaming platforms as such UMG artists as Taylor Swift, The Beatles and The Rolling Stones. Grainge’s memorable turn of phrase came in defense of UMG’s artist-centric royalty scheme crafted in partnership with French music streaming service Deezer. “Sorry, I can’t really think of another word for content that no one really actually wants to listen to,” Grainge said.
Spotify’s price increase gave a much-needed uplift to subscription revenues. The price for an individual Spotify subscription in the U.S. was $9.99 from 2011 to July 2023. The price hike to $10.99 in roughly 50 markets may have arrived later than its competitors, but it came just when Spotify needed a boost. Spotify’s premium average revenue per user dropped 6% year over year (1% at constant currency) mainly because the company had a larger share of family plans compared to the prior-year, CFO Paul Vogel said during the July 25 earnings call. Early returns from the price increase in the U.S., U.K. and dozens of other markets helped offset those losses. Because Spotify’s number of subscribers increased 16% year over year to 226 million, subscription revenue grew 10% year over year (16% at constant currency) to 2.9 billion euros ($3.1 billion). With three full months of a price increase in the fourth quarter and considering the price increase covered about 75% of Spotify’s revenue base, the company expects the price increase to provide “a positive, mid-single digit” benefit (excluding foreign exchange) in the fourth quarter, said Vogel.
No company lowered guidance, and some have raised guidance. Sony Music raised guidance for revenue and adjusted operating income before depreciation and amortization by 5% and 4%, respectively. Reservoir Media raised guidance for fiscal 2024 revenue and adjusted EBITDA by 10% each. It’s one thing for a company to meet expectations it had previously laid out to investors. But raising previously released expectations is something else altogether — a sign the future will be better than expected. It’s usually a benefit to the stock price, too. The share price is the present value of future cash flows. When an estimate for future cash flows takes a sudden jump, that changes the financial model used to calculate the share price.
Consumers aren’t slowing their spending on live music. In August, concerns arose that a resumption of student loan payments, paused to help people struggling during the pandemic, would take a bite out of pocketbooks and cause music fans to pull back on the record amounts they were spending on live entertainment. Three months later, there is no indication that consumers are slowing down, according to Live Nation. “We’re seeing no sign of weaknesses,” said president and CFO Joe Berchtold, noting that Ticketmaster’s October sales in North American were up double-digits year over year. “We’re not seeing any pullback in any way from a club to a stadium tour from Milan to Argentina right now,” added president and CEO Michael Rapino.
SM Entertainment has big plans for its new publishing subsidiary, Kreation Music Rights. The K-pop stalwart has been “aggressively recruiting global writers” and plans to have 80 of them under contract this year, CEO Jang Cheol Hyuk said during the Nov. 8 earnings call. SM Entertainment is pursuing collaborations with both domestic and international publishers and plans to recruit foreign writers “who wish to advance into K-pop by establishing overseas subsidiaries,” Jiang said.
Radio advertising continues to struggle — but the clouds may be starting to part. iHeartMedia’s October revenues were down 8% and the company expects its fourth-quarter revenue excluding political revenue to be down in the mid-single digit percent year over year. The fourth quarter will be iHeartMedia’s strongest quarter of the year “but will be weaker than we originally anticipated due to some dampening of advertising demand which coincided with the uncertainty caused by the recent geopolitical events,” CEO Bob Pittman said during Thursday’s earnings call. That said, iHeartMedia’s digital business “is sort of in recovery mode,” said Pittman, and the company is “seeing the pieces falling into place” for radio’s recovery as most advertisers expect to be “back in growth mode…and spending to support that” in 2024.
The market for catalog acquisitions isn’t slowing down. Reservoir Media CEO Golnar Khosrowshahi said catalog prices aren’t contracting despite higher interest rates. “We’re still seeing a lot of demand for assets and continued infusion of new capital within the competitive set,” she said during Tuesday’s earnings call. “And that is certainly fueling the demand. The pipeline is robust. And it ranges in size from large to a lot of smaller deals.” Reservoir Media hasn’t been suffering from sticker shock, though. Acquisitions in the Middle East-North Africa market — such as some catalog of Saudi Arabian label Mashrex in June — provide the company with good value, Khosrowshahi added. “If we’re looking at a market here that is somewhat saturated with a lot of capital in the marketplace, and we’re able to execute [deals in MENA] at these lower multiples, that makes it just that much more attractive to us.”
Sony Music México announced on Thursday (Nov. 9) the launch of M4 Records, a label run by music executive Manuel Cuevas, who has helped propel the careers of artists such as Carlos Rivera, Yuridia, Lila Downs, Filipa Giordano, Gilberto Santa Rosa and, more recently, regional Mexican singer Luis Ángel “El Flaco”. “Manuel is an executive […]
Spotify is planning to implement changes to its streaming royalty model in early 2024 that would affect the lowest-streaming acts, non-music noise tracks and distributors and labels committing fraud, sources tell Billboard.
Conversations have been going on for weeks with the major record labels, Universal Music Group, Sony Music Entertainment and Warner Music Group, as well as independent labels and distributors, sources say. While the new royalty system will keep its existing pro-rata model, it introduces new floors that will grow the pool for more established artists and rights holders.
The changes to Spotify’s royalty model, which were first reported by Music Business Worldwide, include:
A new threshold of minimum annual streams that a track must meet before it starts to generate royalties. The threshold, according to MBW, will de-monetize tracks that had previously received 0.5% of Spotify’s royalty pool.
Financial penalties for music distributors and labels when fraudulent activity on tracks they have uploaded to Spotify has been detected.
A minimum play-time length that non-music noise tracks, such as bird sounds or white noise, must reach to generate royalties.
The specific benchmarks of these changes and how financial penalties will be calculated or implemented are currently unclear.
Spotify will need new agreements to the royalty structure changes with most record labels and distributors to implement the plan, but that doesn’t mean entirely new licensing renewals. Changes can be made specifically for these elements, sources say. And since the major labels — which all negotiate their deal renewals with Spotify on different timelines — are likely to benefit from the new terms, they are all likely to sign onto them.
When reached for comment, a Spotify spokesperson said in a statement, “We’re always evaluating how we can best serve artists, and regularly discuss with partners ways to further platform integrity. We do not have any news to share at this time.”
The standard, existing pro-rata streaming model has been a major topic of consideration this year, ever since Universal Music Group CEO Lucian Grainge called for an “updated model” for the business that will be “an innovative, ‘artist-centric’ model that values all subscribers and rewards the music they love” in his annual New Year’s letter to staff. Following, UMG announced partnerships with Tidal, Deezer and Soundcloud to explore alternative models, and reports surfaced that similar conversations were underway with the other leading streaming platforms.
In July, during UMG’s second quarter earnings call, Grainge announced a “newly expanded agreement” with Spotify, under which he said “they have committed to continue to work to address” what he outlined as key components to the “artist-centric” approach: Fairly rewarding “real artists with real fanbases” for “the platform engagement they drive”; applying “stricter fraud detection and enforcement systems” and “ensuring real artists don’t have their royalties diluted by noise”; and “better aligning the relationship between artists and fans by promoting greater discovery and promotion of real artists.” Two out of three of these priorities are now being pursued by Spotify.
In September, UMG and Deezer outlined a new model for what they called “artist-centric streaming.” That model was similar, albeit more severe, than what Spotify is planning. It included royalty “boosts” for “professional” artists whose music streamed above a threshold, while promising to crack down on fraud and replace “non-artist noise content” with its own functional music that would be excluded from the royalty pool.
Unlike Spotify — which relies heavily on industry-leading algorithm-recommended playlists and auto-play, lean-back listening — Deezer’s plan also demoted passive listening royalties by “boosting” artists who are actively searched for by users. Unlike Deezer, Spotify is planning to roll this out will all major labels and leading independent labels and distributors.
YouTube is planning to roll out a new artificial intelligence tool that will allow creators to make videos using the voices of popular recording artists — but inking deals with record companies to launch the beta version is taking longer than expected, sources tell Billboard.
The new AI tool, which YouTube had hoped to debut at its Made On YouTube event in September, will in beta let a select pool of artists to give permission to a select group of creators to use their voices in videos on the platform. From there, the product could be released broadly to all users with the voices of artists who choose to opt in. YouTube is also looking at those artists to contribute input on that will help steer the company’s AI strategy beyond this, sources say.
The major labels, Universal Music Group, Sony Music Entertainment and Warner Music Group, are still negotiating licensing deals that would cover voice rights for the beta version of the tool, sources say; a wide launch would require separate agreements. As label leaders have made public statements about their commitments to embracing AI in recent months, with UMG CEO Lucian Grainge saying the technology could “amplify human imagination and enrich musical creativity in extraordinary new ways” and WMG CEO Robert Kyncl saying, “You have to embrace the technology, because it’s not like you can put technology in a bottle” — some music executives worry they’ve given up some of their leverage in these initial deals, given that they want to be seen as proponents of progress and not as holding up innovation. Label executives are especially conscious of projecting that image now, having shortsightedly resisted the shift from CDs to downloads two decades ago, which allowed Apple to unbundle the album and sent the music business into years of decline. Some executives say it’s also been challenging to find top artists to participate in the new YouTube tool, with even some of the most forward-thinking acts hesitant to put their voices in the hands of unknown creators who could use them to make statements or sing lyrics they might not like.
The labels, sources say, view the deal as potentially precedent-setting for future AI deals to come — as well as creating a “framework,” as one source put it, for YouTube’s future AI initiatives. The key issues in negotiations are how the AI model is trained and that artists should have the option to opt-in (or out); and how monetization works — are artists paid for the use of their music as an input into the AI model or for the output that’s created using the AI tool? While negotiations are taking time, label sources say YouTube is seen as an important, reliable early partner in this space, based on the platform’s work developing its Content ID system that identifies and monetizes copyrighted materials in user-generated videos.
Publishing, meanwhile, is even more complicated, given that even with a small sampling of artists to launch the tool at beta there could be hundreds of songwriters with credits across their catalogs — which would be sampled by the model. Because of this, a source suggests that YouTube may prefer paying a lump sum licensing fee rather that publishers will need to figure out how to divide among their writers.
As complicated as the deal terms may be, sources say music rights holders are acting in good faith to get a deal done. That’s because there’s a dominant belief this sort of technology is inevitable and if the music business doesn’t come to the table to create licensing deals now, they’ll get left behind. However, one source familiar with the negotiations says this attitude is also putting music companies at a disadvantage because there is less room to drive a hard bargain.
For months, AI-soundalike tools that synthesize vocals to sound like famous artists have been garnering attention and triggering debate. The issue hit the mainstream in April when an anonymous musician calling himself Ghostwriter released a song to streaming services with soundalike versions of Drake and The Weeknd on it that he said were created with artificial intelligence. The song was quickly taken down due to copyright infringement on the recording, not based on the voices’ likenesses, but in the aftermath a month later Billboard reported that the streaming services seemed amenable to requests from the major labels to remove recordings with AI-generated vocals created to sound like popular artists.
In August, YouTube announced a new initiative with UMG artists and producers it called an “AI Music Incubator” that would “explore, experiment and offer feedback on the AI-related musical tools and products,” according to a blog post by Grainge at the time. “Once these tools are launched, the hope is that more artists who want to participate will benefit from and enjoy this creative suite.” That partnership was separate from the licensing negotiations currently taking place and the beta product in development.
On Wednesday, UMG, Concord Music Group, ABKCO and other music publishers filed a lawsuit against AI platform Anthropic PBC for using copyrighted song lyrics to “train” its software. This marked the first major lawsuit in what is expected to be a key legal battle over the future of AI music, and as one source put it a signal that major labels will litigate with AI companies they see as bad players.
Following Hamas’ attacks throughout Israel this past weekend and Israel’s current bombardment of Gaza, the three major labels, along with the Recording Academy, have released statements condemning Hamas. In a statement posted Thursday to X, the platform previously called Twitter, Warner Music Group wrote, “We condemn the terrorist attack on Israel by Hamas and the […]
Every Thursday, labels deliver all their new releases to TikTok. This is typically a mundane process, but an essential one. Just as record companies want their new tracks playable on all the streaming services at midnight, they want them on TikTok — a crucial promotional venue and driver of music discovery, especially for younger listeners.
But on Sept. 22, things began to go wrong with what’s ordinarily a relatively seamless operation. Five executives — all affiliated with Sony Music or managers with artists in the Sony Music ecosystem — told Billboard that they encountered problems getting their music on TikTok. The issues varied, as did their duration: Some songs’ delivery was temporarily delayed; some never made it; some temporarily faced copyright takedowns even though they were legitimate major-label releases that didn’t infringe on the works of others.
Two sources were told by Sony Music that even Bad Bunny‘s new single “Un Preview” — distributed by The Orchard, which Sony owns — was initially available on all streaming services when it came out Sept. 25, but not on TikTok. (A rep for Bad Bunny did not respond to a request for comment.) It does not appear that the other major label groups experienced similar problems.
While TikTok is renowned for its technical abilities, especially its algorithm, no platform is impervious to mistakes; perhaps someone accidentally pressed the wrong button at headquarters. Funny as that sounds, a version of it has happened before: Back in 2019, major labels suddenly encountered problems delivering songs containing swear words to TikTok. When asked about the platform’s unexpected turn towards the puritanical, a representative said that “due to an internal error, we inadvertently restricted explicit tracks from TikTok globally.”
But last week’s hiccups on TikTok arose against a different backdrop. Sony Music was in the process of negotiating a new deal with the ByteDance-owned company, according to multiple sources. And Sony Music executives told at least two people that they believed sudden problems with getting music onto TikTok were linked to the ongoing negotiations.
Reps for both Sony Music and TikTok declined to comment.
This bizarre episode served as a discomfiting reminder of both TikTok’s power and the music industry’s uneasy relationship with the platform. TikTok often seems like it’s the only service capable of jumpstarting a hit — “the biggest game in town,” as one manager told Billboard last year. That means a label’s music has to be on there if it hopes for commercial success.
But TikTok is also notorious for its low payouts to rights holders. And this has created tension, leading some of music’s most powerful figures to demand better rates from the platform in public remarks.
In September 2022, Universal Music Group CEO Lucian Grainge warned of a value gap “forming fast in the new iterations of short-form video.” “We will fight and determine how our artists get paid and when they get paid in the same way that we have done throughout the industry for many, many, many years,” Grainge added during a call with investors the following month.
Sony Music Group Chairman Rob Stringer echoed this sentiment during a call with investors in May. “Some of the short-form video providers are relatively new, but we are clearly monitoring their progress, and it doesn’t take a scientist to realize that we are being underpaid by some of those content providers,” he said. “As [our] negotiations go on, that will be our position until we are satisfied that we have been paid properly.”
Warner Music Group CEO Robert Kyncl has been more measured in his public comments about TikTok. Warner announced a new multi-year licensing deal with TikTok this summer.
Nearly four years ago, when TikTok said it “inadvertently restricted explicit tracks,” the problem took a number of weeks to resolve. Labels first noticed that songs containing swears were having trouble at the end of August. It was October before a TikTok rep said the company was “finally able to notify labels of the full restoration of affected tracks.”
The various issues experienced by Sony Music affiliates in September were fixed far more quickly. No one was TikTok-less for even a full week.
Still, an executive says, the experience was unnerving — a reminder that his artists’ access to a platform with more than a billion monthly active users “can be cut off overnight.”
