universal music group
Pershing Square Holdings chief Bill Ackman won’t get his wish of a Universal Music Group (UMG) de-listing from the Euronext Amsterdam exchange, but the hedge fund king’s push for a UMG listing on a U.S. exchange will nevertheless come to fruition in 2025. UMG announced Wednesday (Jan. 15) that Pershing Square and some of its […]
Universal Music Group (UMG) is firing back at Drake’s lawsuit accusing the music giant of defaming him by promoting Kendrick Lamar’s diss track “Not Like Us,” calling the case “illogical” and accusing Drake of trying to “weaponize the legal process.”
In a strongly-worded statement issued Wednesday afternoon (Jan. 15), UMG flatly denied the allegations in Drake’s lawsuit — filed earlier in the day in New York federal court — and sharply criticized its superstar artist for bringing it.
“Not only are these claims untrue, but the notion that we would seek to harm the reputation of any artist—let alone Drake—is illogical,” the company wrote. “We have invested massively in his music and our employees around the world have worked tirelessly for many years to help him achieve historic commercial and personal financial success.”
Trending on Billboard
The lawsuit claims that UMG knew that “inflammatory and shocking allegations” in Lamar’s scathing diss track were false, but chose to place “corporate greed over the safety and well-being of its artists.”
But in UMG’s response, the music giant said that Drake himself had often engaged in rap beefs featuring bombastic claims about his opponents — the very thing that he now claims is illegal.
“Throughout his career, Drake has intentionally and successfully used UMG to distribute his music and poetry to engage in conventionally outrageous back-and-forth ‘rap battles’ to express his feelings about other artists,” UMG wrote. “He now seeks to weaponize the legal process to silence an artist’s creative expression and to seek damages from UMG for distributing that artist’s music.”
Drake’s case repeatedly makes clear that he is not suing Lamar himself, and that he holds UMG responsible for releasing a song that it allegedly knew was defamatory.
In its statement, UMG denied that claim — and said it would defend Lamar or any other artist if they were hit with such a lawsuit.
“We have not and do not engage in defamation—against any individual,” UMG said in the statement. “At the same time, we will vigorously defend this litigation to protect our people and our reputation, as well as any artist who might directly or indirectly become a frivolous litigation target for having done nothing more than write a song.”
Drake and Lamar exchanged stinging diss tracks last year, culminating in Lamar’s knockout “Not Like Us” — a track that savagely slammed Drake as a “certified pedophile” and reached the top of the charts. In November, the star filed stunning legal petitions suggesting that he planned to sue UMG, claiming that the company had artificially boosted a song that contained defamatory statements about him.
Earlier on Wednesday, Drake made good on those threats — filing a federal lawsuit that claimed UMG had boosted a “false and malicious narrative” that the star rapper was a pedophile, severely harming his reputation and even putting his life in danger.
“UMG intentionally sought to turn Drake into a pariah, a target for harassment, or worse,” the star’s lawyers wrote in their complaint. “UMG did so not because it believes any of these false claims to be true, but instead because it would profit from damaging Drake’s reputation.”
The accusations — and Wednesday’s response statement — represent a remarkable rift between the world’s largest music company and one of its biggest stars. Drake has spent his entire career at UMG, first through signing a deal with Lil Wayne’s Young Money imprint that was distributed by Republic Records, then by signing directly to Republic.
HipHopWired Featured Video
CLOSE
Source: Carmen Mandato / Getty
Drake has officially brought the US Justice system into his “beef” with Kendrick Lamar. The Toronto rapper has filed a lawsuit for defamation against the Universal Music Group (UMG), his own record label.
Drake’s new lawsuit against UMG over Kendrick Lamar’s “Not Like Us”:
“It was just three days after UMG originally published the Recording and Image that Drake was targeted at his Toronto house by armed intruders in the 2024 equivalent of ‘Pizzagate.’”https://t.co/EVhVle8tsx pic.twitter.com/fMwDvoWQLp
— Meghann Cuniff (@meghanncuniff) January 15, 2025
Earlier, it was reported that Drake had dropped his initial legal petition against UMG and Spotify, where he claimed both entities had manipulated the plays of Kendrick Lamar’s scathing “Not Like Us” to his detriment. Per usual, Drizzy was met with scorn due to even the idea of brining the authorities into a rap battle.
But alas, it was only dropped so the 6 God could raise the ante, as reported by Variety, on Wednesday, January 15, he filed a lawsuit in the U.S. District Court for the Southern District of New York accusing UMG of defamation due its promotion of “Not Like Us,” where K. Dot likens him to a pedophile, amongst other derogatory (to the delight of many listeners) accusations. Per Drake, UMG knew that Kendrick Lamar’s claims were all lies, but they promoted the song anyway and “chose corporate greed over the safety and well-being of its artists. UMG saw an opportunity, seized it, and continued to fan the flames.”
The suit contends Drake’s issue is with UMG boosting “Not Like Us” and not with Kendrick Lamar, technically.
Reports Variety:
Although Lamar’s lyrics are at the heart of the lawsuit, it clearly places the blame on Universal for releasing, distributing and promoting the song: “This lawsuit is not about the artist who created ‘Not Like Us,’” it suit reads. “It is, instead, entirely about UMG, the music company that decided to publish, promote, exploit, and monetize allegations that it understood were not only false, but dangerous.” However, Drake seems to have backed down on claims that UMG and Spotify conspired to falsely boost the song’s streaming numbers; those allegations were strenuously denied by both companies. Ironically, Universal distributes both Lamar’s and Drake’s music — both artists own their recent master recordings via their companies — and has for the majority of both artists’ careers. The suit claims that because Drake’s current deal with UMG is nearing the end of its term, the company is attempting to devalue his music and profile in an effort to gain more-favorable terms in a renegotiation.
Now Drake is really getting cooked on the Internets. See for yourself in the gallery.
Kendrick Lamar’s Super Bowl performance just got that much more highly anticipated.
This story is developing.
Drake has filed a lawsuit against Universal Music Group (UMG) over allegations that the music giant defamed him by promoting Kendrick Lamar’s diss track “Not Like Us,” claiming the label boosted a “false and malicious narrative” that the star rapper was a pedophile and put his life in danger.
Hours after his attorneys withdrew an earlier petition, they filed a full-fledged defamation lawsuit Wednesday against his longtime label – claiming UMG knew Lamar’s “inflammatory and shocking allegations” were false but chose to place “corporate greed over the safety and well-being of its artists.”
“UMG intentionally sought to turn Drake into a pariah, a target for harassment, or worse,” the star’s lawyers write in a complaint filed in Manahttan federal court. “UMG did so not because it believes any of these false claims to be true, but instead because it would profit from damaging Drake’s reputation.”
Trending on Billboard
In one of the lawsuit’s most vivid accusations, Drake claims that the release of “Not Like Us” has subjected him to risk of physical violence, including a drive-by shooting on his Toronto area home just days after the song was released.
“UMG’s greed yielded real world consequences,” his lawyers write. “With the palpable physical threat to Drake’s safety and the bombardment of online harassment, Drake fears for the safety and security of himself, his family, and his friends.”
Notably, the case does not target Lamar himself — a point that Drake’s attorneys repeatedly stress in their filings.
“UMG may spin this complaint as a rap beef gone legal, but this lawsuit is not about a war of words between artists,” Drake’s attorneys say.
A spokesman for UMG did not immediately return a request for comment.
Wednesday’s lawsuit is yet another dramatic escalation a high-profile beef that saw Drake and Lamar exchange stinging diss tracks last year, culminating in Lamar’s knockout “Not Like Us” — a track that savagely slammed Drake as a “certified pedophile” and became a hit in its own right.
Drake shocked the music industry in November when he filed petitions suggesting he might sue over the fued — first accusing UMG and Spotify of an illegal “scheme” involving bots, payola and other methods to pump up Lamar’s song, then later claiming that the song had been defamatory. But those cases were not quite full-fledged lawsuits, and Drake withdrew one of them late on Tuesday.
Now it’s clear why: In Wednesday’s lawsuit, he formally sued UMG over the same alleged scheme, claiming the label “unleashed every weapon in its arsenal” to drive the popularity of Lamar’s track even though it knew the lyrics were “not only false, but dangerous.”
“With his own record label having waged a campaign against him, and refusing to address this as a business matter, Drake has been left with no choice but to seek legal redress against UMG,” his lawyers write.
The filing of the case represents a doubling-down for Drake, who has been ridiculed in some corners of the hip-hop world filing legal actions over a rap beef. It also will deepen further his rift with UMG, where the star has spent his entire career — first through signing a deal with Lil Wayne’s Young Money imprint, which was distributed by Republic Records, then by signing directly to Republic.
In his complaint, Drake’s lawyers said the label opted to boost “Not Like Us” despite its “defamatory” lyrics because they saw it as a “gold mine” — partly because UMG owns Lamar’s master recordings outright, but also because it could use the song to hurt Drake’s standing in future contract talks.
“UMG’s contract with Drake was nearing fulfillment … UMG anticipated that extending Drake’s contract would be costly,” his lawyers write. “By devaluing Drake’s music and brand, UMG would gain leverage to force Drake to sign a new deal on terms more favorable to UMG.”
This is a breaking news story and will continue to be updated with additional details as they become available.
Professional basketball player and “Tweaker” rapper LiAngelo Ball has signed a label deal with Def Jam and Universal Music Group (UMG), according to ESPN reporter Shams Charania. On Monday (Jan. 13), Charania, whose main beat is NBA news, tweeted that the recording deal for Ball, who performs under the name G3, was confirmed by “a […]
Billionaire hedge fund investor and Universal Music Group director Bill Ackman is a step closer to de-listing his Pershing Square Holdings from the Euronext Amsterdam exchange, a move that Ackman — whose Pershing Square company has owned around 10% of stock in the Universal Music Group since 2021 — has advocated for UMG to do, too.
The Euronext Amsterdam approved a plan for Pershing Square Holdings to de-list, with the closed-end fund’s last day of trading to be Jan. 30. The investment vehicle will consolidate trading of its shares on the London Stock Exchange, where it was co-listed in 2017 and where the majority of its trading happens.
Ackman and his family own more than 20% of the fund, and in November he advocated for moving the fund and UMG’s listing from the main Netherlands’ stock exchange after fans of an Israeli soccer team were attacked in early November in Amsterdam.
Trending on Billboard
UMG said at the time that it will review and decide what is in the best interests of all shareholders.
In a separate announcement on Thursday, Pershing Square said it distributed around 47 million shares of Universal Music Group stock, or roughly 2.6% of its overall stake, to investors as part of a planned wind-down of one of the funds Pershing Square initially used to purchase UMG shares from Vivendi in September 2021.
Pershing Square, which managed the closed-end fund called PSVII, said it decided to distribute, rather than cash out, the UMG stock “because we believe that UMG stock is substantially undervalued at its current share price, and the tax-free stock distribution enables our limited partners to continue to own UMG shares.”
Pershing Square continues to own around 140 million shares, equal to a 7.6% stake in UMG, through its core funds — Pershing Square Holdings, Ltd., Pershing Square, L.P. and Pershing Square International, Ltd. — Bill Ackman, Pershing Square employees and other affiliates, according to a company statement. UMG is still Pershing Square’s largest single holding.
As of Dec. 31, Pershing Square said UMG has had a total return of “46% including dividends over the approximately three-and-one-quarter-year life of the investment.” The company said that is better than “the S&P 500’s 37% return and the Amsterdam Exchange Index’s return of 21% over the same period.”
In the ‘00s, The Smashing Pumpkins frontman Billy Corgan looked at the disruptive nature of early social media platform MySpace and saw the death of the record label. It didn’t exactly work out that way — not with MySpace, not with Facebook, not with TikTok. In fact, the major music companies became adept at using these platforms to break artists and perpetuate their market power; if there’s a breakout song on TikTok, labels rush into an old-fashioned bidding war. While social media certainly disrupted the music business, it didn’t uproot the traditional record label model.
There have been numerous other game-changers over the years that failed — on their own, at least — to radically alter how major labels do business, including independent distribution. After TuneCore launched in 2006, major labels continued to sign artists and own their intellectual property, albeit to broader “360” deals that incorporated more than recorded music rights. Nor did the advent of streaming by itself reshape the structure of major record labels. The artists with the most streaming success are involved with major labels in one way or another, be it a traditional record contract, a joint venture or, in rare cases like Taylor Swift, a distribution deal.
Trending on Billboard
Corgan may have misjudged social media’s sole impact on record labels, but he wasn’t entirely wrong about its ultimate influence. When combined, social media, independent distribution and streaming form a potent combination that has changed the balance of power and induced major labels to change how they promote music around the world. This dynamic isn’t exactly new, but it was never clearer than in 2024. This year, major labels have increasingly embraced the role of being service providers to those parties who prefer to remain independent and retain ownership of their intellectual property.
A few years ago, Universal Music Group (UMG) was pouring money into superstar acquisitions such as Bob Dylan’s and Sting’s song catalogs. More recently, the company has been focusing on its artist services model. In the last three months alone, UMG acquired indie label group [PIAS] and agreed to acquire Downtown Music Holdings for $775 million, though the proposed deal has encountered opposition from the independent music community and will need to pass regulatory scrutiny before being finalized. The company also purchased Outdustry — which has an artist- and label-services arm that focuses on China, India and other high-growth emerging markets — and bought a stake in Chord Music Partners, giving UMG distribution and publishing administration duties for the more than 60,000 songs in the investment vehicle’s catalog.
In fact, 2024 played out much like UMG CEO Lucian Grainge said it would. His January memo predicted the company would continue to expand globally and offer labels outside of mature markets a “full suite of artist services” while “acquiring local labels, catalogs and artist services businesses.” To be fair, UMG was already on that path: In 2022, it acquired m-theory’s artist services company and installed its founders, JT Myers and Nat Pastor, as co-CEOs of Virgin Music Group to expand Virgin’s independent music division globally.
Warner Music Group (WMG) appears to have sensed the shifting landscape, too, as there has been a noticeable shift in messaging during Robert Kyncl’s tenure as the company’s CEO. In the Stephen Cooper era, WMG was the music community’s leading investor in Web3 startups. In contrast, Kyncl has chosen to focus on expanding WMG’s footprint globally. WMG briefly signaled its interest in acquiring Believe in March and April after the French company announced a CEO-led effort to take the company private. Notably, Believe has a global label services business and a presence in developing markets that take advantage of the “glocalization” of local markets and global streaming platforms’ ability to help music travel across borders. WMG ultimately passed on pursuing Believe, but Kyncl has followed his peers’ interest in emerging markets, purchasing stakes in Indian companies Divo and Global Music Junction.
The service model isn’t an entirely original approach. Grainge wrote that UMG is “creating the blueprint for the labels of the future,” but UMG is doing what major music companies have always done: following trends and buying independent companies that established a particular market. Sony Music already bought into the service model with The Orchard and AWAL, the latter purchased in 2022 for $430 million. Independents such as Believe, OneRPM and Symphonic Distribution have become established players by combining distribution and artist services, while investors have poured money into independents such as Create Music Group — which this year raised $165 million at a $1 billion valuation — and gamma, which is backed by $1 billion.
But the well-established blueprint was never more of a hot commodity than in 2024. In the music business, nothing signifies the relevance of a business model like the major labels’ desire to buy it and integrate it into their systems — especially when the largest music companies feel they have no choice. The holy trinity of social media, independent distribution and global streaming platforms has given artists an alternative to the much-derided major label record contract. Artists who want to own their intellectual property and have more creative control have never had more of the tools necessary to be independent. That includes financing options, such as advances from well-funded independents or royalty advances from a new breed of financial services companies. When there’s no need for radio promotion and shelf space at brick-and-mortar retailers, the independent model looks a lot more attractive — not only for artists but for the major labels that have become increasingly keen on buying into it.
Ironically, the major labels’ acceptance of the independents’ business model means the music business is becoming less independent. Trade groups such as the Association of Independent Music and IMPALA quickly spoke out against UMG’s agreement to purchase Downtown, just as they did with Sony Music’s purchase of AWAL. U.K. regulators ultimately concluded that AWAL was a “relatively small player” and that the deal did not substantially reduce competition. Time will tell if competition watchdogs feel the same about UMG’s much larger purchase of Downtown. In any case, the independents have proved that artist and label services businesses are a good fit for the modern music business. The next step was always going to be consolidation.
Several more players in the independent music community have called on regulators to block the acquisition of Downtown Music Holdings by Universal Music Group (UMG) announced this week, arguing the deal “would seriously distort the global music market” and “reduce competition and the independents’ bargaining power.”
Virgin Music Group, which is owned by UMG, announced Monday (Dec. 16) that it had agreed to buy Downtown Music Holdings for $775 million in a deal that would beef up the music giant’s market share by absorbing Downtown’s stable of indie distributors, publishing and rights administrators including FUGA, CB Baby, AdRev and Songtrust. The deal came just two months after UMG acquired the remaining shares of indie label group [PIAS], including its services division, Integral — an agreement that was similarly criticized by indie trade groups, who have asked regulators to launch an investigation into the pact.
In a joint release Thursday (Dec. 19), several indie music leaders said the deal, if allowed to go through, would result “in fewer options for smaller companies to negotiate fair terms and compete on equal footing, leading to higher costs and less choice.”
Trending on Billboard
“We are the global independent music community,” said Noemí Planas, CEO of Worldwide Independent Network (WIN), in a statement. “UMG trying to present this as an investment in the independent ecosystem is fooling no one. This is wealth extraction from the independents, another step in UMG’s relentless path to dominance and stifling competition. Independent music is the lifeblood of cultural innovation and market consolidation threatens the diversity that makes music so rich and compelling around the world. We call on regulatory bodies to block the deal.”
Also speaking out against the acquisition was A2IM CEO Richard James Burgess, who stated: “Universal Music Group’s acquisition of Downtown Music’s assets continues a troubling trend of consolidating independent music infrastructure, following acquisitions of InGrooves, MTheory, and PIAS. This increasing level of market concentration chips away at the competitive landscape, making it increasingly difficult for truly independent artists and companies to operate freely and equitably. These acquisitions risk silencing the independent voices that drive innovation and creativity in the music industry.”
Added Darius Van Arman, CEO of Secretly Distribution and co-founder of Secretly Group, “When near-monopolist Universal acquires Downtown, one of the largest independent music ecosystems, and does so in the name of independence, it cheapens what the word means. Market consolidation at this scale is not only anti-competitive, it is a fundamental threat to true independence.”
Virgin’s purchase of Downtown is just the latest in a string of similar acquisitions by major labels over the last several years. In 2024 alone, UMG acquired Outdustry, a label services and rights management firm that works across China, India, and other Asian markets; Thailand-based recorded music catalog RS Group; Nigerian record label Mavin Global; and a minority stake in U.S.-based Chord Music Partners, among others. Two years ago, Sony Music made a splash when it acquired AWAL and Kobalt Neighbouring Rights from Kobalt Music Group, followed by the more recent acquisitions of companies like Spanish label and distributor Altafonte and Greek independent label Cobalt Music. And Warner Music Group has snapped up minority stakes in European indie labels of late, including Dancing Bear Music (Croatia), NIKA (Slovenia) and Mascom (Serbia); it also fully acquired the Dutch label Cloud 9 Recordings in October.
“Whilst we are in favour of free enterprise, monopolies dominate market forces and remove the ability to compete,” said Maria Amato, CEO of Australian Independent Record Labels Association (AIR), in a statement on the Downtown deal. “There must be regulation to ensure that Universal who is already the largest music business in the world with a large stake in Spotify does not dictate prices and the ability for artists and labels to negotiate fair and equitable terms.”
“The recent acquisition by large corporations of companies that until recently were independent is a red alert for the entire global independent music community,” added Felippe Llerena, president of Brazilian trade association ABMI. “The Orchard, AWAL, Som Livre, Proper Music, Altafonte and now Downtown Music are examples of how multinational capital is reshaping the sector. ABMI believes that it is our duty to protect and promote an independent ecosystem, where artists, labels and companies can create freely and sustainably. Our fight is for the appreciation of music as art, culture and expression, not as a simple market product.”
In her own statement, Cecilia Crespo, GM of the association of Argentinian record labels ASIAr, said: “Concentration not only has a negative impact in the way platforms distribute royalties to artists and rights holders (based on market share), but also due to the unregulated use of data and intelligence from the analysis of the data and the behavior of all actors involved (artists, audiences, and users).”
On Tuesday (Dec. 17), several other indie music players came out in opposition to the Downtown acquisition, including indie labels trade body IMPALA, the U.K.-based Association of Independent Music (AIM) and global indie music publishers trade body IMPF.
UMG didn’t immediately respond to Billboard‘s request for comment on the latest statements of opposition.
Independent record labels and publishers are urging regulators to block the acquisition of Downtown Music Holdings by Universal Music Group (UMG) over fears that the deal weakens competition, to the “severe detriment” of artists and fans.
UMG-owned Virgin Music Group announced on Monday (Dec. 16) that it had agreed to buy Downtown Music Holdings for $775 million cash. The deal, which is subject to regulatory approval, bolsters UMG’s share of the music market by bringing a number of independent distributors, publishing and rights administration businesses owned by Downtown under its control. Those businesses include distributors CD Baby and FUGA, publishing administrator Songtrust and Los Angeles-based rights management company AdRev.
UMG’s purchase of Downtown comes two months after it acquired full ownership of European indie label group [PIAS] — a deal that also prompted indie trade groups to issue calls for regulators to intervene.
Trending on Billboard
“This is another land grab,” said Helen Smith, executive chair of independent labels trade body IMPALA — which represents more than 6,000 indie labels and music companies in Europe, including Beggars Group, Cooking Vinyl, Domino and Epitaph — in a statement about the Virgin-Downtown deal.
“We expect competition authorities in key jurisdictions to carry out thorough investigations and block these deals,” Smith added. She also pressed the European Union’s executive branch, the European Commission, “to set the standard internationally.”
“The cynical use of the Virgin brand, once synonymous with independent entrepreneurship, should not hide the fact that this is about utter dominance and control,” added Beggars Group founder Martin Mills in a statement. “This is another step on the road of UMG’s pretence to be the independents’ fairy godmother,” he continued. “But there’s a wolf under that cape.”
The acquisition of [PIAS] and Downtown in rapid succession by UMG follows a flurry of dealmaking over the past several years that has seen both traditional music companies and outside investors snap up firms, labels and distributors that cater to the fast-growing global independent sector.
Major label acquisitions in that time include Sony Music’s 2022 purchase of artist services company AWAL and Kobalt Neighbouring Rights from Kobalt Music Group. More recently, Sony acquired Spanish label and distributor Altafonte, followed last month by a deal for Greece indie label Cobalt Music.
Meanwhile, Warner Music Group has been steadily growing its recorded music interests in Central and Eastern Europe, buying minority stakes in Croatia’s Dancing Bear Music, Slovenian independent label NIKA and Serbia’s Mascom; and acquiring Dutch label Cloud 9 Recordings.
UMG’s deals for [PIAS] and Downtown followed a decade-long ban on the music giant acquiring certain music companies or catalogs in Europe that expired in September 2022. Those restrictions, imposed by the European Commission in 2012 following the company’s $1.9 billion takeover of EMI, prevented UMG from re-acquiring any of the assets it had sold or re-sign any artists who had signed with labels from which it had divested, such as Parlophone Label Group or Chrysalis, for 10 years.
Although Downtown Music Holdings was founded and is headquartered in New York, the scale of its multifaceted business, representing over 50 million songs across more than 145 countries and spanning publishing, distribution, artist and label services, and royalty administration, makes it a major player in the global indie sector. As such, the company’s acquisition by UMG would create a “fundamental shift in the competitive dynamics of the music market,” warned IMPALA chair Dario Draštata in a statement on the acquisition.
The Brussels-based trade association said the sale of Downtown and [PIAS] would further squeeze the independents in an already highly concentrated market and help UMG move further into the market for distribution and services for labels and artists.
“This means more market share and gives UMG control over the opposition,” said IMPALA in a press release. It added, “UMG suing Believe is another part of the strategy,” referencing last month’s $500 million lawsuit filed by UMG, ABKCO and Concord Music Group against Believe and its distribution company TuneCore that accused them of “massive ongoing infringements” of their sound recordings.
Other executives and organizations voicing concern over UMG’s latest acquisition include global independent music publishers trade body IMPF, which said the potential sale would “ultimately reduce choice for songwriters and publishers alike,” and the U.K. Association of Independent Music (AIM), whose CEO, Gee Davy, said the deal reduces independent routes to market.
“It is vital to uphold a true choice of partners for artists and labels and ensure that negotiating power does not become unbalanced,” said Davy in a statement.
Representatives for UMG did not respond to requests for comment when contacted by Billboard.
Three years after Downtown Music sold its 145,000-song catalog — including works performed by Aretha Franklin, David Bowie, Bruno Mars and Beyoncé — the president of its publishing division says it makes more money than it did when it owned copyrights.
That reveal comes amid Monday’s announcement that Universal Music Group’s Virgin Music Group is buying Downtown Music Holdings for $775 million in an all-cash deal expected to close by mid-next year.
Emily Stephenson, who since 2023 has been president of Downtown’s suite of publishing companies (Downtown Music Publishing, Songtrust and Sheer), says her division will generate more than $200 million in revenue in 2024, a 40% increase from last year and a higher gross than it had in 2020, the year before Concord bought its catalog.
Trending on Billboard
“We are in the middle of extreme growth mode right now,” says Stephenson, who has overseen client acquisition, business development, A&R, rights management and client services for Downtown since March 2023.
Since Stephenson took the lead, the publishing division has signed deals with indie rockers The National, Spirit Music Group and Peso Pluma’s Double P Records. According to the company, it now serves some 2 million songwriters and clients in over 60 countries — more than 40% of them outside the United States — manages over 1.5 million copyrights and has distributed over $100 million in royalties through Songtrust.
Access to additional funds has helped. In May, Downtown announced it secured another $500 million in credit from Bank of America — on top of its previous $200 million credit facility — to finance advances.
“We have been earnestly and aggressively putting that money to work,” Stephenson says, by offering competitive advances without forcing independent creators to give up any rights. As a result, “We think we’re growing at nearly twice the rate of the rest of the industry,” she says.
That growth is one of Downtown’s draws. The combined market share held by independent distribution and music companies — i.e. non-major labels and self-releasing artists — rose to 36.7% in 2023, up from 28.6% in 2015, according to MIDiA Research. As a result, the majors have made acquisitions and investments to defend their market share. Downtown’s scale and position of dominance in this segment made it an attractive way for UMG to grow.
However, Downtown’s growth has also led to customer complaints of long wait times at Songtrust and concerns that the platform is becoming more exclusive. Stephenson says there are no plans to restrict who can sign up for Songtrust, adding that over the past year, Songtrust has cut the average response time to customer complaints from 33 days to 17 hours.
Stephenson, 35, has spent more than a decade at Downtown and previously served as Downtown Music vp of business operations, and she says roughly 70% of the managers in her division have similarly long tenures.
That experience has helped with client retention and led to facilitating opportunities. This past summer, “Parade” by French composer Victor le Masne, a Downtown client, became the official theme song for the Paris Olympic and Paralympic Games. This holiday season, the team landed Griff’s cover of the Willy Wonka & The Chocolate Factory classic “Pure Imagination” in Target’s Christmas campaign.
“We are the only player doing this at scale for indie songwriters globally,” Stephenson says. “I think our future is bright.”
A version of this story appears in the Dec. 14, 2024, issue of Billboard.