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At 50, hip-hop is “as fresh, in demand and modern as ever,” declared Frank Briegmann, chairman and CEO of Universal Music Central Europe and Deutsche Grammophon. He said this to open the Sept. 7 event Universal Inside, the annual label showcase that this year was “Dedicated to hip-hop” in honor of the genre’s 50th anniversary. Example No. 1 was the night’s first performance, from Kontra K, a German rapper who performed “Für die Himmel durch die Hölle” (For Heaven through Hell) and “Summertime,” a No. 1 hit that samples Lana Del Rey’s “Summertime Sadness.”
German-language rap, the very concept of which would have been hard to imagine in the 1970s Bronx, is now the country’s most popular genre.
After the rapper badmómzjay performed, Briegmann spoke about the vitality of hip-hop, as well as the state of the music business in Germany. To mark hip-hop’s anniversary, Briegmann announced that Universal will release the collection Hip-Hop At Fifty (50 Jahre Hip-Hop), plus reissue classic albums like LL Cool J’s Radio and Eazy-E‘s Eazy-Duz-It, and put out vinyl box sets dedicated to Eric B. & Rakim and Public Enemy. At this point, of course, Universal Germany also has its own roster of Deutschrap stars, including Kontra K, badmómzjay, Sido, Luciano, Chapo102 and DJ Desue — all of whom performed later in the evening.
Briegmann also spoke about the more technical parts of the business, including the idea that there are more places than ever where labels can connect artists with fans – including smart automotive audio systems, fitness machines and metaverse platforms.
“We have gone from being labels to architects and builders of these integrated worlds,” he said. “Together with our artists, we create experiences that go far beyond pure audio consumption.”
One will be Universal’s “YOUniverse,” an interactive platform developed by Universal Music Central Europe that does not seem to exist yet in the U.S.
The music industry’s potential could still be limited, Briegmann said. He spoke about how the “value gap,” which labels and industry groups once invoked to point out that user-upload platforms like YouTube paid less than Spotify and Apple Music, still applied to short-form-video platforms. In the case of YouTube, he said, negotiations eventually led to fairer pay-outs – and he was hopeful the same would happen with these newcomers.
Briegmann also spoke about how artificial intelligence would affect the music business, including Universal’s recent deal with YouTube to develop AI technologies and protect artists from their misuse. The new technology is here to stay, and “we are united by the desire to view and develop AI tools from an artist’s perspective,” Briegmann said. “At the heart of our shared vision is the goal to build a safe, responsible and profitable ecosystem for music and video content.”
Universal Music Group is in the early stages of talks with Google about licensing artists’ voices for songs created by artificial intelligence, according to The Financial Times. Warner Music Group has also discussed this possibility, The Financial Times reported.
Advances in artificial-intelligence-driven technology have made it relatively easy for a producer sitting at home to create a song involving a convincing facsimile of a superstar’s voice — without that artist’s permission. Hip-hop super-fans have been using the technology to flesh out unfinished leaks of songs from their favorite rappers.
One track in particular grabbed the industry’s attention in March: “Heart On My Sleeve,” which masqueraded as a new collaboration between Drake and the Weeknd. At the time, a Universal Music spokesperson issued a statement saying that “stakeholders in the music ecosystem” have to choose “which side of history… to be on: the side of artists, fans and human creative expression, or on the side of deep fakes, fraud and denying artists their due compensation.”
“In our conversations with the labels, we heard that the artists are really pissed about this stuff,” Geraldo Ramos, co-founder and CEO of the music technology company Moises, told Billboard recently. (Moises has developed its own AI-driven voice-cloning technology, along with the technology to detect whether a song clones someone else’s voice.) “How do you protect that artist if you’re a label?” added Matt Henninger, Moises’ vp of sales and business development.
The answer is probably licensing: Develop a system in which artists who are fine with having their voices cloned clear those rights — in exchange for some sort of compensation — while those acts who are uncomfortable with being replicated by technology can opt out. Just as there is a legal framework in place that allows producers to sample 1970s soul, for example, by clearing both the master and publishing rights, in theory there could be some sort of framework through which producers obtain permission to clone a superstar’s voice.
AI-driven technology could “enable fans to pay their heroes the ultimate compliment through a new level of user-driven content,” Warner CEO Robert Kyncl told financial analysts this week. (“There are some [artists] that may not like it,” he continued, “and that’s totally fine.”)
On the same investor call, Kyncl also singled out “one of the first official and professionally AI-generated songs featuring a deceased artist, which came through our ADA Latin division:” A new Pedro Capmany track featuring AI-generated vocals from his father Jose, who died in 2001. “After analyzing hundreds of hours of interviews, acappellas, recorded songs, and live performances from Jose’s career, every nuance and pattern of his voice was modeled using AI and machine learning,” Kyncl explained.
After the music industry’s initial wave of alarm about AI, the conversation has shifted, according to Henninger. With widely accessible voice-cloning technology available, labels can’t really stop civilians from making fake songs accurately mimicking their artists’ vocals. But maybe there’s a way they can make money from all the replicants.
Henninger is starting to hearing different questions around the music industry. “How can [AI] be additive?” he asks. “How can it help revenue? How can it build someone’s brand?”
Reps for Universal and Warner did not respond to requests for comment.
Universal Music Group (UMG) is starting to see the fruit of higher prices and new deals with streaming platforms. The company’s recorded music division saw its subscription revenue climb 10.6% year-over-year (up 13% at constant currency) due in part to price increases at “certain platforms,” the company said in its second quarter earnings release on […]
Universal Music Group general counsel/executive vp of business and legal affairs, Jeffery Harleston, spoke as a witness in a Senate Judiciary Committee hearing on AI and copyright on Wednesday (July 12) to represent the music industry. In his remarks, the executive called for a “federal right of publicity” — the state-by-state right that protects artists’ likenesses, names, and voices — as well as for “visibility into AI training data” and for “AI-generated content to be labeled as such.”
Harleston was joined by other witnesses including Karla Ortiz, a conceptual artist and illustrator who is waging a class action lawsuit against Stability AI; Matthew Sag, professor of artificial intelligence at Emory University School of Law; Dana Rao, executive vp/general counsel at Adobe; and Ben Brooks, head of public policy at Stability AI.
“I’d like to make four key points to you today,” Harleston began. “First, copyright, artists, and human creativity must be protected. Art and human creativity are central to our identity.” He clarified that AI is not necessarily always an enemy to artists, and can be used in “service” to them as well. “If I leave you with one message today, it is this: AI in the service of artists and creativity can be a very, very good thing. But AI that uses, or, worse yet, appropriates the work of these artists and creators and their creative expression, their name, their image, their likeness, their voice, without authorization, without consent, simply is not a good thing,” he said.
Second, he noted the challenges that generative AI poses to copyright. In written testimony, he noted the concern of “AI-generated music being used to generate fraudulent plays on streaming services, siphoning income from human creators.” And while testifying at the hearing, he added, “At Universal, we are the stewards of tens of thousands, if not hundreds of thousands, of copyrighted creative works from our songwriters and artists, and they’ve entrusted us to honor, value and protect them. Today, they are being used to train generative AI systems without authorization. This irresponsible AI is violative of copyright law and completely unnecessary.”
Training is one of the most contentious areas of generative AI for the music industry. In order to get an AI model to learn how to generate a human voice, a drum beat or lyrics, the AI model will train itself on up to billions of data points. Often this data contains copyrighted material, like sound recordings, without the owner’s knowledge or compensation. And while many believe this should be considered a form of copyright infringement, the legality of using copyrighted works as training data is still being determined in the United States and other countries.
The topic is also the source of Ortiz’s class action lawsuit against Stability AI. Her complaint, filed in California federal court along with two other visual artists, alleges that the “new” images generated by Stability AI’s Stable Diffusion model used their art “without the consent of the artists and without compensating any of those artists,” which they feel makes any resulting generation from the AI model a “derivative work.”
In his spoken testimony, Harleston pointed to today’s “robust digital marketplace” — including social media sites, apps and more — in which “thousands of responsible companies properly obtained the rights they need to operate. There is no reason that the same rules should not apply equally to AI companies.”
Third, he reiterated that “AI can be used responsibly…just like other technologies before.” Among his examples of positive uses of AI, he pointed to Lee Hyun [aka MIDNATT], a K-pop artist distributed by UMG who used generative AI to simultaneously release the same single in six languages using his voice on the same day. “The generative AI tool extended the artist’s creative intent and expression with his consent to new markets and fans instantly,” Harleston said. “In this case, consent is the key,” he continued, echoing Ortiz’s complaint.
While making his final point, Harleston urged Congress to act in several ways — including by enacting a federal right of publicity. Currently, rights of publicity vary widely state by state, and many states’ versions include limitations, including less protection for some artists after their deaths.
The shortcomings of this state-by-state system were highlighted when an anonymous internet user called Ghostwriter posted a song — apparently using AI to mimic the voices of Drake and The Weeknd –called “Heart On My Sleeve.” The track’s uncanny rendering of the two major stars immediately went viral, urging the music business to confront the new, fast-developing concern of AI voice impersonation.
A month later, sources told Billboard that the three major label groups — UMG, Warner Music Group and Sony Music — have been in talks with the big music streaming services to allow them to cite “right of publicity” violations as a reason to take down songs with AI vocals. Removing songs based on right of publicity violations is not required by law, so the streamers’ reception to the idea appears to be voluntary.
“Deep fakes, and/or unauthorized recordings or visuals of artists generated by AI, can lead to consumer confusion, unfair competition against the artists that actually were the original creator, market dilution and damage to the artists’ reputation or potentially irreparably harming their career. An artist’s voice is often the most valuable part of their livelihood and public persona. And to steal it, no matter the means, is wrong,” said Harleston.
In his written testimony, Harleston went deeper, stating UMG’s position that “AI generated, mimicked vocals trained on vocal recordings from our copyrighted recordings go beyond Right of Publicity violations… copyright law has clearly been violated.” Many AI voice uses circulating the internet involve users mashing up one previously released song topped with a different artist’s voice. These types of uses, Harleston wrote, mean “there are likely multiple infringements occurring.”
Harleston added that “visibility into AI training data is also needed. If the data on AI training is not transparent, the potential for a healthy marketplace will be stymied as information on infringing content will be largely inaccessible to individual creators.”
Another witness at the hearing raised the idea of an “opt-out” system so that artists who do not wish to be part of an AI’s training data set will have the option of removing themselves. Already, Spawning, a music-tech start-up, has launched a website to put this possible remedy into practice for visual art. Called “HaveIBeenTrained.com,’ the service helps creators opt-out of training data sets commonly used by an array of AI companies, including Stability AI, which previously agreed to honor the HaveIBeenTrained.com opt-outs.
Harleston, however, said he did not believe opt-outs are enough. “It will be hard to opt out if you don’t know what’s been opted in,” he said. Spawning co-founder Mat Dryhurst previously told Billboard that HaveIBeenTrained.com is working on an opt-in tool, though this product has yet to be released.
Finally, Harleston urged Congress to label AI-generated content. “Consumers deserve to know exactly what they’re getting,” he said.
Vinyl Me, Please, the ebullient record of the month club (and pressing plant) based in Denver, hired creative veterans Rob Jones and Alan Hynes to add some rocket fuel to VMP’s product line. In their new roles (Jones as executive creative director and Hynes as senior creative director), the duo will help guide VMP’s artistic direction and work alongside existing creatives on custom record packaging designs for releases. They’ll also work with studios and composers to bring movie scores to vinyl as part of its new Soundtracks offering, beginning with a new pressing of Dave Grusin’s score for The Goonies later this summer. Jones joins VMP after a successful couple of decades as co-founder of Mondo, the maker of pop culture collectibles (including vinyl records and posters) that was acquired by Funko last year. Hynes also arrives from Mondo, where he played an integral role in its design department for years — creating original record packaging for films like Fight Club, Eyes Wide Shut and others.
“Bringing joy to people through tangible, transcendent experiences with music is what VMP is about and what we’re always striving to offer our customers,” said Cam Schaefer, CEO of VMP. “The addition of Rob and Alan to the team takes us to the moon creatively and fills out a 1992 Olympic Dream Team of art and design. Their experience, mind-bending creativity, and passion for exploration will allow them to make a deep impact within VMP and help us to elevate and expand our product line for customers. We’re lucky to have them.”
Liliahn Majeed exited her post as Universal Music Group‘s first global chief diversity, inclusion and belonging officer for a similar DEI role at L’Oréal. During her three years at UMG, Majeed led a team focused on boosting the label giant’s inclusion and equity efforts, and she notably co-chaired one of the committees of UMG’s high profile “Task Force for Meaningful Change.” Before Majeed traded the globe’s No. 1 music company for the No. 1 beauty firm, she held senior marketing and diversity roles at the NBA and earlier, at Frito-Lay. Majeed moves into the chief diversity, equity and inclusion officer, North America role at L’Oréal following the retirement of Angela Guy.
Warner Music Latina appointed Andrés Shaq as A&R director. He’ll be based in Miami and report to Hector Ruben Rivera, senior vice president and head of A&R Latin Music. Shaq was previously senior A&R manager at Warner Music Colombia, where he spent three years and played a key role in the careers of artists like Piso 21, Mike Bahía and Blessd. He also signed notable Colombian producers such as ICON, DJ MAFF, and SOG. “Colombia and the Andean region have an abundance of incredible talent waiting to be discovered. I’m fully committed to discovering and fostering future Latin superstars,” said Shaq. –Leila Cobo
Sony Pictures Television tapped Palash Ahmed to lead new efforts to develop more music-connected projects at the studio. As head of music development — a newly created role — Ahmed will work with studio president of international production Wayne Garvie on synergistic pairings with obvious partners (Sony Music’s recorded music and publishing divisions), as well as with non-Sony artists and labels. In announcing Ahmed’s new role, studio chairman Ravi Ahuja said film and TV content with a music tie-in “comes with a built-in, highly engaged fanbase, and we are excited to begin leaning in to opportunities to develop projects with musical artist connections.” Ahmed, who is based in Los Angeles, joined Sony Pictures Entertainment in 2017 and most recently held the title of senior vp of corporate development.
Tim McGraw‘s management and marketing company, EM.Co, appointed Doug Phillips as vp of marketing and digital. Phillips has previously worked at companies including Q Prime South, Universal Music Group and Sony Music Nashville. Concurrently, EM.Co vice president Brian Kaplan joins McGraw’s media venture Down Home as co-founder and chief strategy officer. Down Home launched earlier this year with partners Skydance and social content studio Shareability. –Jessica Nicholson
Faryal Khan-Thompson joined Downtown-owned music distributor CD Baby as senior vice president of marketing and community engagement, responsible for strategy around the disciplines in her job title, as well as branding initiatives, artist education efforts and growing the company internationally. The NYC-based Khan-Thompson was previously vp of international at TuneCore. “I am committed to building on the great work that has been done and positioning CD Baby as the leading provider of music distribution services for independent artists,” she said. CD Baby recently made headlines by sunsetting most of its physical distribution business — namely, that it will no longer warehouse or distribute the CDs that it makes for artists.
ICYMI: Big Machine Music elevated Mike Molinar to president of the publishing company.
Justin Chacona was named vice president of brand & marketing at Stockholm-based production music company Epidemic Sound, where he’ll lead a team of 40-plus staffers working on marketing and PR initiatives, social media strategy and consumer relations as the company eyes expansion into new markets. Launched in 2009, Epidemic offers a catalog of restriction-free music for use in videos, podcasts and other content. Chacona joins from Polar Electro where he’s been group chief marketing officer since 2020. Earlier in his career, Chacona worked at Rovio Entertainment, where he led marketing efforts surrounding the video game developer’s hit movie for Angry Birds. Chacona’s appointment follows the hiring of Rob Bullough as global brand director earlier this year.
Vickie Nauman was appointed to the advisory board of Interstellar Music Services, a specialist digital rights management company. Based in Los Angeles, Nauman is the founder and CEO of music and tech consultancy CrossBorderWorks and before that held executive roles at 7digital and Sonos. Interstellar, which launched in January, works to maximize the collection of royalties via a suite of services that includes digital distribution, brand partnerships, metadata cleaning, neighboring rights, publishing administration and detailed analysis/reporting. “The Company sits right at the intersection of music and innovation,” said Nauman, “so I hope that it will benefit from my experience as it enters its next phase of growth.”
Youth-focused social media platform Zigazoo hired Joe Kelley as director of music partnerships. In his new role, Kelley will lead outreach efforts with the music industry at large as the short video app looks to build on the recent launch of its product for kids 13 and up. Kelley had plenty of experience connecting with music acts during his four years as Billboard‘s head of artist relations — booking talent for a wide swath of events and other branded franchises. After leaving Billboard, Kelley worked as an artist manager and, more recently, as head of artist partnerships at music impact events platform WithOthers.
The Royal College of Music has enlisted James Williams to be only its 11th director since the prestigious school, located in South Kensington, London, was founded in 1882. Williams will join RCM on Sept. 1, 2024, succeeding current director Colin Lawson, who is retiring. Williams is managing director of the Royal Philharmonic Orchestra, a position he has held since June 2016.
Nashville Bites: Universal Music Group Nashville hired Charlene Bryant as senior vp of business development and strategy. For the last five years, she ran her own company, Riveter Management, a multigenre firm whose clients have included hip-hop artist Trippie Redd… Rachel Burleson was promoted to Big Machine Label Group director of streaming from Big Machine Records project manager… SMACKSongs promoted Sam Sarno to creative director from creative manager… Mark Turcotte starts July 18 as Nashville-based Outback Presents senior vp of marketing. He arrives from Cox Media/Atlanta, where he was general sales manager. –Tom Roland
Earlier this year, Oleg Stavitsky, co-founder/CEO of Endel, laid out a vision for how his company’s AI-driven functional soundscapes could help the major labels — even as anxiety around AI was reaching new heights. “We can process the stems [the audio building blocks of a track] from Miles Davis’ Kind of Blue and come back with a functional sleep version of that album,” Stavitsky told Billboard. At the time, he said his company was in talks with all the major labels about this possibility.
A few short months later, Stavitsky will have a chance to do exactly that: Endel announced a new partnership with Universal Music Group on Tuesday (May 23). In a statement, Endel’s CEO said his company will put “AI to work and help UMG build new and exciting offerings to promote wellness and banish the perceived threat around AI.”
“Our goal was always to help people focus, relax, and sleep with the power of sound,” Stavitsky added. “AI is the perfect tool for this. Today, seeing our technology being applied to turn your favorite music into functional soundscapes is a dream come true.” Artists from Republic and Interscope will be the first to participate — though the announcement omitted any names — with their soundscapes arriving “within the next few months.”
Endel focuses on creating “sound that is not designed for conscious listening,” Stavitsky told Billboard earlier this year. “Music is something you consciously listen to when you actually want to listen to a song or an album or a melody,” he explained. “What we produce is something that blends with the background and is scientifically engineered to put you in a certain cognitive state.”
Endel’s technology can spit out these soundscapes effectively at the click of a button. “The model is trained using the stems that are either produced in-house by our team, led by co-founder and chief composer Dmitry Evgrafov (who’s himself an established neo-classical artist), or licensed from artists that we’ve worked with,” Stavitsky said. “The trick is all of the stems” — Endel has used stems from James Blake, Miguel and Grimes —”are created following the scientific framework created by our product team in consultation with neuroscientists.”
Some people in the music industry have taken to calling sounds designed for sleep, study, or soothing frayed nerves “functional music.” And while it maintains a low profile, it’s an increasingly popular and lucrative space. “Science tells us that nature sounds and water sounds have a calming effect on your cognitive state,” Stavitsky noted this winter. “So naturally, people are turning to this type of content more and more.”
Early in 2022, Endel estimated that the size of the functional music market is 10 billions streams a month across all platforms. (The company has since raised its estimate to 15 billion streams a month.) If true, that would mean functional music is several times more popular than the biggest superstars. “Every day, hundreds of millions of people are self-medicating with sound,” Stavitsky wrote in March. “If you look at the top 10 most popular playlists at any major streaming service, you’ll see at least 3-4 ‘functional’ playlists: meditation, studying, reading, relaxation, focus, sleep, and so on.”
But this has caused the music industry some concern. Major labels have not historically focused on making this kind of music. Most streaming services pay rights holders according to their share of total plays; when listeners turn to functional music to read a book or wind down after a long day, that means they’re not playing major label artists, and the companies make less money. In a memo to staff in January, UMG CEO Lucian Grainge complained that “consumers are increasingly being guided by algorithms to lower-quality functional content that in some cases can barely pass for ‘music.’”
But record companies can’t eliminate listener demand for functional music. It makes sense, then, that they would try to take over a chunk of the market. And Stavitsky has been savvy, actively pushing Endel’s technology as a way for the labels to “win back market share.”
Back in 2019, Endel entered into a distribution agreement for 20 albums with Warner Music Group. And the company announced its new partnership with UMG this week. In a statement, Michael Nash, UMG’s evp and chief digital officer, praised Endel’s “impressive ingenuity and scientific innovation.”
“We are excited to work together,” Nash continued, “and utilize their patented AI technology to create new music soundscapes — anchored in our artist-centric philosophy — that are designed to enhance audience wellness, powered by AI that respects artists’ rights in its development.”
The three major label groups have been in talks with the big music streaming services to find a way to get them to remove recordings with AI-generated vocals created to sound like popular artists, Billboard has learned. The idea under discussion with Spotify, Apple Music and Amazon Music would operate much like the one laid out by the Digital Millennium Copyright Act but would cite violations of rights of publicity, rather than copyright, according to sources at all three majors. Unlike the DMCA, however, this arrangement appears to be voluntary.
The 1998 DMCA gives online services that use, store or transmit copyrighted works a “safe harbor” from secondary liability for copyright infringement as long as they abide by a notice-and-takedown system that allows rightsholders to ask them to remove copyrighted content. That law would not apply to most AI-generated soundalike tracks because they do not infringe protected elements of copyrighted recordings or compositions but rather a trademark or a right of publicity, the protection celebrities may be able to receive to protect their names and likenesses from unauthorized commercial exploitation.
Songs that imitate the voices of big-name talent have become a trend over the past month, reaching widespread attention in mid-April when the track “Heart on My Sleeve,” which apparently used AI to mimic the style and tone of vocals by Drake and The Weeknd, was uploaded to streaming services and then swiftly removed. (The song did not credit those artists, although they were referred to in social media posts about it.)
Citing rights of publicity can be more complicated than copyright, because they are matters of state law in the U.S., backed by limited legal precedent. Rights vary by state, protections for deceased artists vary even more widely, and the use of soundalike vocals for creative purposes may in some cases be protected as free speech. Further complicating matters, these rights almost always belong to artists, not labels, which would presumably file notices on their behalf with authorization. Right now, however, this is the most obvious legal argument with which to keep AI-generated soundalikes off major streaming platforms.
In an April 26 earnings call, UMG CEO and chairman Lucian Grainge seemed to signal this approach to investors. “The recent explosive development in generative AI will… create rights issues with respect to existing copyright law, in the US and other countries, as well as laws governing trademark, name and likeness, voice impersonation, and right of publicity,” he said. “Further, we have provisions in our commercial contracts that provide additional protections.” It is not clear if takedowns issued by the majors would rely on these provisions, state law, goodwill, or some combination.
Some executives have raised concerns that AI soundalikes that imitate the voices of popular artists could result in consumer confusion. Still, a few artists like Grimes and Holly Herndon have embraced the technology, training their own AI voice models and making them available to the public.
Meanwhile, companies like Uberduck, Supertone, Lingyin Engine, and Covers.ai are marketing models with which to replicate voices. Covers.ai, which launched last week, has said that it received over 100,000 sign-ups in anticipation. Tencent Music Entertainment executives announced in November that with the company’s Lingyin Engine they had created and released over 1,000 songs containing synthetic AI voices already, one of which amassed 100 million streams.
This stance taken by the leading streaming services counters a recent announcement from the blockchain-based music platform Audius, which announced that artists can now “opt-in” to allow AI-generated works on their artist page. To organize this new music and avoid confusion, Audius would create a separate tab on the artists’ page especially for user-generated content.
Representatives for Universal, Sony, Warner, Spotify, Apple Music and Amazon Music did not respond to requests for comment.
Universal Music Group shareholders approved on Thursday (May 11) the 2022 compensation packages for CEO Lucian Grainge and his deputy, Vincent Vallejo, plus a special $100 million stock option awarded to Grainge to stay on the job for five more years.
The company did not immediately disclose the percentage of votes cast in support of the advisory vote on the pay packages or other voting items at its annual general meeting held in the Amsterdam, and the meeting was live-streamed only to registered shareholders.
Since the global financial crisis, these kinds of annual meetings become a stage for shareholders to express their gripes about a company’s policies or performance. The vote of support for the world’s largest music company’s pay practices comes despite criticism raised by influential shareholder advisory groups, Institutional Shareholder Services and Glass Lewis, who had advised investors to reject Grainge’s pay packages.
Shareholders approved Grainge’s 2022 pay, which totaled more than 47 million euros (roughly $50 million), and re-appointed him as executive director, along with Sherry Lansing and Luc van Os as non-executive directors. Entertainment mogul Haim Saban was also appointed as non-executive director.
Shareholders declined to reappoint Anna Jones as a non-executive director, and her current term will run until the company’s next annual meeting in 2024.
Shareholders also approved a final 2022 dividend payout of 0.27 euros per share, which investors will receive in June. The vote brings UMG’s full year 2022 dividend to 0.51 euros per share.
In an April report, ISS recommended shareholders vote against UMG’s 2022 remuneration policy, saying the pay packages were out of step with industry standards in part due to “excessive” base salaries. That Grainge’s total pay was 12.4 times higher than the median of peers “raises substantial concerns,” ISS wrote.
Grainge’s 2022 pay package included a base salary of about 15.4 million euros and short-term incentives totaling 28.77 million euros, including a portion equivalent to 1% of UMG’s consolidated earnings before interest, taxes and amortization (EBITA) that was part of an agreement reached prior to UMG going public.
In its annual report, the company says that full-time UMG employees receive an average of 142,039 euros annually,up from 131,961 euros in 2021.
The board explained its reasoning for the remuneration for its executive directors saying that Grainge was a one-of-a-kind executive, and that certain incentive payments were due to legacy arrangements agreed to before the company went public.
In the proposed future pay agreement, which was part of an extension of Grainge’s contract through May 2028, the board said it did away with the incentive that paid Grainge 1% of UMG’s consolidated EBITA. In addition, the new agreement transitions Grainge from an all-cash compensation package to a combination cash and equity package “with a broad set of performance-based objectives aligned with shareholders’ interest and corresponding to the company’s long-term growth strategy.”
UMG ended the European trading day up 0.43% at 18.79 euros ($20.52).
Universal Music Group’s revenues rose 11.5% to 2.45 billion euros ($2.71 billion) last quarter, as sales generated by Morgan Wallen, Taylor Swift, TOMORROW X TOGETHER bolstered results in both recorded music and music publishing.
The world’s biggest music company reported revenue from its recorded music division rose 11.7% to 1.92 billion euros ($2.1 billion) in the quarter ending March 31 compared to the same period a year ago. Revenue from subscriptions and streaming rose by nearly 10% to 1.33 billion euros ($1.47 billion) and physical revenue rose a whopping 32% to 313 million euros ($346 million), while revenue from downloads and other digital revenue — the smallest line item in the division — fell by 19.1% to 55 million euros ($60 million).
The publishing division’s overall revenues rose 13.3% to 425 million euros ($469 million), with digital revenue contributing the most, increasing by nearly 21% from a year ago to 231 million euros ($255 million). Synchronization revenue rose around 11% to 69 million euros ($76 million), while performance revenue slipped 1% to 90 million euros ($99 million).
“Our strong start to the year demonstrates our consistency in developing great artists and introducing their music to fans around the world,” UMG chairman and chief executive Lucian Grainge said in a statement. “We look forward to building on this momentum and furthering our track record of transforming disruptive technologies into opportunities to accelerate our business for our artists, fans and shareholders.”
Overall earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter fell by nearly 43% to 261 million euros ($288 million), driven primarily by equity-based compensation expenses UMG began rolling out in the fourth quarter of 2022. Stripping out those compensation expenses, UMG reported adjusted EBITDA rose 14.7% to 522 million euros ($576 million) compared to the year-ago quarter, and adjusted EBITDA margin grew 0.6 percentage points to 21.3%.
UMG’s Earnings Highlights:
Revenue rose 11.5%, or 9.3% in constant currency, to 2.45 billion euros ($2.71 billion) versus the year ago quarter.
EBIDTA fell 42.5% to to 261 million euros ($288 million)
Adjusted EBITDA rose 14.7% to 522 million euros ($576 million)
Adjusted EBITDA margin grew 0.6 percentage points to 21.3%
Recorded Music Division Highlights:
Recorded music revenue overall rose 11.7% to 1.92 billion euros ($2.1 billion)
Subscriptions and streaming revenue rose by nearly 10% to 1.33 billion euros ($1.47 billion)
Physical revenues rose 32% to 313 million euros ($346 million)
License and other revenue rose 9.2% to 226 million euros ($250 million)
Downloads and other digital revenue fell by 19.1% to 55 million euros ($60 million)
Music Publishing Highlights:
Music publishing revenues overall rose 13.3% to 425 million euros ($469 million)
Digital revenues rose by nearly 21% from a year ago to 231 million euros ($255 million)
Performance revenues slipped 1% to 90 million euros ($99 million)
Synchronization revenues rose around 11% to 69 million euros ($76 million)
Maggie Rogers has signed an exclusive worldwide publishing agreement with Universal Music Publishing Group. The deal sees Rogers recorded music and publishing all joining under the Universal Music Group roof, given the singer-songwriter has been a longtime signee of Capitol Records.
Rogers got her start as a NYU student, writing and producing her own material. When Pharrell Williams gave a master class at the university, Rogers showed him a song she had been working on called “Alaska.” His astonishment at Rogers’ prowess as a producer, songwriter and singer was captured in a viral video that catapulted the young singer to instant acclaim. “Alaska” became her first major label release.
Since then, Rogers earned herself a Grammy nomination for Best New Artist and released two albums Heart It In a Past Life — which hit No. 1 on Billboard’s Top Alternative Albums and No. 2 on Billboard 200 — and Surrender (2022) — which landed at No. 2 on Billboard’s Top Alternative Albums chart and No. 3 on Billboard’s Top Rock Albums chart.
News of the publishing deal arrives just as Rogers prepares for her next tour through the U.S. and Europe. In an attempt to combat bots and scalpers, Rogers “went old school” as she put it in a recent Instagram post: she opted for an in-person, box office pre-sale for all tour stops. “F–k bots + f-k fees. come buy a ticket in person. tomorrow only… Come kick it like its 1965,” she wrote.
Rogers was previously signed to Sony Music Publishing.
Rogers said of her new publishing deal: “I’m so proud to call UMPG my home and can’t wait begin this next chapter of my career alongside so many writers and professionals I respect and admire.”
Jennifer Knoepfle, evp and co-head of A&R at UMPG, added, “Maggie is one of my favorite songwriters, and I have been lucky to work alongside her since the early stages of her incredible career. We are so excited for her next chapter in her new home at UMPG, and she will have the best support for her creative journey.”