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Lyor Cohen’s first encounter with Google’s generative artificial intelligence left him gobsmacked. “Demis [Hassabis, CEO of Google Deepmind] and his team presented a research project around genAI and music and my head came off of my shoulders,” Cohen, global head of music for Google and YouTube, told Billboard in November. “I walked around London for two days excited about the possibilities, thinking about all the issues and recognizing that genAI in music is here — it’s not around the corner.”
While some of the major labels are touting YouTube as an important partner in the evolving world of music and AI, not everyone in the music industry has been as enthusiastic about these new efforts. That’s because Google trained its model on a large set of music — including copyrighted major-label recordings — and then went to show it to rights holders, rather than asking permission first, according to four sources with knowledge of the search giant’s push into generative AI and music. That could mean artists “opting out” of such AI training — a key condition for many rights holders — is not an option.
YouTube did make sure to sign one-off licenses with some parties before rolling out a beta version of its new genAI “experiment” in November. Dream Track, the only AI product it has released publicly so far, allows select YouTube creators to soundtrack clips on Shorts with pieces of music, based on text prompts, that can include replicas of famous artists’ voices. (A handful of major-label acts participated, including Demi Lovato and Charli XCX.) “Our superpower was our deep collaboration with the music industry,” Cohen said at the time. But negotiations that many in the business see as precedent-setting for broader, labelwide licensing deals have dragged on for months.
Negotiating with a company as massive as YouTube was made harder because it had already taken what it wanted, according to multiple sources familiar with the company’s label talks. Meanwhile, other AI companies continue to move ahead with their own music products, adding pressure on YouTube to keep progressing its technology.
In a statement, a YouTube representative said, “We remain committed to working collaboratively with our partners across the music industry to develop AI responsibly and in a way that rewards participants with long-term opportunities for monetization, controls and attribution for potential genAI tools and content down the road,” declining to get specific about licenses.
GenAI models require training before they can start generating properly. “AI training is a computational process of deconstructing existing works for the purpose of modeling mathematically how [they] work,” Google explained in comments to the U.S. Copyright Office in October. “By taking existing works apart, the algorithm develops a capacity to infer how new ones should be put together.”
Whether a company needs permission before undertaking this process on copyrighted works is already the subject of several lawsuits, including Getty Images v. Stability AI and the Authors Guild v. OpenAI. In October, Universal Music Group (UMG) was among the companies that sued AI startup Anthropic, alleging that “in the process of building and operating AI models, [the company] unlawfully copies and disseminates vast amounts of copyrighted works.”
As these cases proceed, they are expected to set precedent for AI training — but that could take years. In the meantime, many technology companies seem set on adhering to the Silicon Valley rallying call of “move fast and break things.”
While rights holders decry what they call copyright infringement, tech companies argue their activities fall under “fair use” — the U.S. legal doctrine that allows for the unlicensed use of copyrighted works in certain situations. News reporting and criticism are the most common examples, but recording a TV show to watch later, parody and other uses are also covered.
“A diverse array of cases supports the proposition that copying of a copyrighted work as an intermediate step to create a noninfringing output can constitute fair use,” Anthropic wrote in its own comments to the U.S. Copyright Office. “Innovation in AI fundamentally depends on the ability of [large language models] to learn in the computational sense from the widest possible variety of publicly available material,” Google said in its comments.
“When you think of generative AI, you mostly think of the companies taking that very modern approach — Google, OpenAI — with state-of-the-art models that need a lot of data,” says Ed Newton-Rex, who resigned as Stability AI’s vp of audio in November because the company was training on copyrighted works. “In that community, where you need a huge amount of data, you don’t see many people talking about the concerns of rights holders.”
When Dennis Kooker, president of global digital business and U.S. sales for Sony Music Entertainment, spoke at a Senate forum on AI in November, he rejected the fair use argument. “If a generative AI model is trained on music for the purpose of creating new musical works that compete in the music market, then the training is not a fair use,” Kooker said. “Training in that case, cannot be without consent, credit and compensation to the artists and rights holders.”
UMG and other music companies took a similar stance in their lawsuit against Anthropic, warning that AI firms should not be “excused from complying with copyright law” simply because they claim they’ll “facilitate immense value to society.”
“Undisputedly, Anthropic will be a more valuable company if it can avoid paying for the content on which it admittedly relies,” UMG wrote at the time. “But that should hardly compel the court to provide it a get-out-of-jail-free card for its wholesale theft of copyrighted content.”
In this climate, bringing the major labels on board as Google and YouTube did last year with Dream Track — after training the model, but before releasing it — may well be a step forward from the music industry’s perspective. At least it’s better than nothing: Google infamously started scanning massive numbers of books in 2004 without asking permission from copyright holders to create what is now known as Google Books. The Authors Guild sued, accusing Google of violating copyright, but the suit was eventually dismissed — almost a decade later in 2013.
While AI-related bills supported by the music business have already been proposed in Congress, for now the two sides are shouting past each other. Newton-Rex summarized the different mindsets succinctly: “What we in the AI world think of as ‘training data’ is what the rest of the world has thought of for a long time as creative output.”
Additional reporting by Bill Donahue.
Universal Music Group (UMG) shares almost hit an all-time high on Friday, reaching 27.47 euros ($29.98) before closing at 27.22 euros ($29.21), a 1% increase for the week. That was close to the peak of 27.96 euros ($30.52) reached on Nov. 12, 2021, less than two months after the company was spun off from Vivendi, and marked a new 52-week high. The 1% gain followed a 6.9% improvement last week as investors reacted to news that the company expects to lay off staff in the first quarter.
If French music company Believe is taken private, as has been reported, shareholders would expect a premium over the recent share price. That would explain why the company’s share price rose 13.5% to 10.18 euros ($11.11) this week — more than offsetting the 10.5% decline Believe shares experienced last week after news broke of the potential takeover. According to a Reuters report, Believe co-founder/CEO Denis Ladegaillerie and U.S. investment firm TCV have floated the idea to private equity firms.
The S&P 500 rose 1.2% to close at a record high of 4,839.81 on Friday, surpassing the previous peak set two years ago. The Nasdaq didn’t set a record but fared even better, climbing 2.3% to 15,310.97. Stocks in other countries didn’t match the gains in U.S. markets. In the United Kingdom, the FTSE 100 dropped 2.1% to 7,461.93. South Korea’s KOSPI composite index fell 2.1% to 2,472.74. China’s Shanghai Stock Exchange Composite Index sank 1.7% to 2,832.28.
Music stocks were slightly off last week’s record high despite Believe’s double-digit gain and the majority of music stocks finishing the week in positive territory. The 20-company Billboard Global Music Index fell 0.4% to 1,559.48 this week, down slightly from last week’s all-time high of 1,566.45. Twelve of the 20 stocks had gains this week. Other than Believe’s takeover-related jump, the best-performing music stocks had only low, single-digit gains. MSG Entertainment rose 4.1% to 33.48 and SiriusXM improved 4% to $5.42.
The index’s most valuable companies improved slightly: In addition to UMG’s 1% gain, Spotify improved 0.8% to $204.71 and Live Nation climbed 0.6% to $91.18. Those gains were overshadowed by losses by radio giant iHeartMedia, which fell 1.7% to $2.25, and three Asian companies: HYBE, SM Entertainment and Tencent Music Entertainment.
The index’s biggest losers were K-pop companies HYBE and SM Entertainment, which fell 10.9% and 10.3%, respectively. HYBE has been on a roller coaster in January, jumping 9.6% from Dec. 28 to Jan. 11 before falling 14.1% over the next six trading days. SM Entertainment jumped 20.5% from the end of December to Jan. 11 but has only dropped 3.4% from its high point. Another big mover this week was Chinese music streamer Tencent Music Entertainment, which dropped 9.5% to $8.51.
There was good news for all companies on Friday when the closely watched University of Michigan’s Index of Consumer Sentiment jumped 13% in January, its highest level since July 2021. Over the last two months, consumer sentiment has risen 29% and Americans’ expectations for future inflation dropped to 2.9%. Consumer sentiment is now 60% above the all-time low from June 2022 but remains 7% below the historical average.
Music companies will soon announce earnings results for the quarter ended Dec. 31. The first companies out of the gate are SiriusXM on Feb. 1 and Spotify on Feb. 6.
Lana Del Rey has signed a publishing agreement with Universal Music Publishing Group, sources tell Billboard. The singer-songwriter was previously affiliated with Sony Music Publishing. Explore Explore See latest videos, charts and news See latest videos, charts and news News of the UMPG deal arrives just a day after Del Rey was announced as one […]
As Universal Music Group chairman/CEO Lucian Grainge forecast in an October earnings call, saying that the company would need to “cut to grow,” UMG is expected to begin laying off employees as soon as this quarter.
Bloomberg first reported the news Friday morning (Jan. 12) that in the next few months hundreds of jobs will be cut from the company that has around 10,000 staffers worldwide.
A spokesperson for UMG declined to confirm the number or the timetable, but in a statement said, “We continue to position UMG to accelerate its leadership in music’s most promising growth areas and drive its transformation to capitalize on them. Over the past several years, we have been investing in future growth—building our ecommerce and D2C operations, expanding geographically, and leveraging new technologies. While we maintain our industry-leading investments in A&R and artist development, we are creating efficiencies in other areas of the business so we can remain nimble and responsive to the dynamic market, while realizing the benefits of our scale.”
In his New Year’s memo to the company, Grainge hinted at changes, writing the company will “further evolve our organizational structure.”
Despite the cuts, Grainge has promised further growth. In his same memo, he noted UMG’s global growth in the past year, including the restructuring and expansion of distribution company Virgin Music Group into such areas as the Middle East, Africa, India and China.
That is a plan that Grainge said promises to continue: “We will keep growing our presence around the world by doing just what we do in more established music markets: signing and developing local artists; providing local labels and entrepreneurs with global promotion, distribution, and a full suite of artist services; and acquiring local labels, catalogs and artist services businesses.”
The news comes while the U.S. recorded music industry continues to grow, despite the potential for streaming saturation and growing challenges from artificial intelligence. U.S. music consumption grew 12.6% in 2023 to 1.1 billion units (measured as album sales plus track equivalent albums and streaming equivalent albums), according to a year-end report issued by Luminate on Wednesday. With that double-digit gain, the U.S. market had its biggest one-year gain since consumption grew 15% in 2019.
UMG remains the leader in U.S. market share, bolstered by artists like Taylor Swift, Morgan Wallen, Post Malone and Olivia Rodrigo. For 2023, its record label market share was 35.84%, up 33.57% from 2022.
Warner Music Group already experienced layoffs, cutting roughly 4% of its staff last year.
Universal Music chairman/CEO Lucian Grainge has released his annual New Year’s memo to staff today (Jan. 9), and used the moment to largely congratulate the world’s largest music company on what was, by many metrics, a huge year for the label and publishing conglomerate.
In his 2,500 word note, obtained by Billboard, Grainge went over many of the points that he raised in his New Year’s note in 2023, when he called for an “updated model” for the music industry, calling for streaming royalty reform in the face of increased fraud and a flood of non-artist music on platforms, and a forward-looking policy in confronting the challenges and opportunities brought by AI, including government protections for copyright and creators. And in this year’s letter, he touted UMG’s achievements on those fronts in the past year, citing the “several global platforms, including the world’s largest music platform, have already adopted artist-centric principles that will transform the way artists are compensated for their work,” referencing new royalty models proposed by Deezer, Spotify and others.
And on the AI front, Grainge cited UMG’s Responsible AI initiative, which lobbied the U.S. Congress on behalf of creators in protecting their works, as well as UMG’s partnership with YouTube to allow artists to develop tools to be able to utilize the advances that AI has brought. Grainge also mentioned UMG’s efforts in the spaces of health and wellness, climate change, sustainability and societal change, through its many task forces and foundations that have fought to promote and donate to coalitions that have helped feed the homeless, promote initiatives that use music to contribute to improved mental and physical health and other initiatives, including increased health care opportunities for musicians and their families.
And he also touted the massive success of UMG’s artists, publishing clients and labels, which dominated year-end charts, including Billboard’s. “To put it succinctly: UMG is the most successful company in the history of the music industry and every one of us should be enormously proud of what we have accomplished together, let alone what I know we will accomplish going forward,” Grainge wrote.
In shifting towards the future, Grainge first noted that UMG had continued its global expansion in the past year, particularly through the expansion and restructuring of distribution company Virgin Music Group, in the Middle East/Northa Africa, Thailand, India and China, to name a few. That is a plan that Grainge says promises to continue: “We will keep growing our presence around the world by doing just what we do in more established music markets: signing and developing local artists; providing local labels and entrepreneurs with global promotion, distribution, and a full suite of artist services; and acquiring local labels, catalogs and artist services businesses.”
In terms of other plans for 2024, Grainge notes that “both the pace of change and our industry leadership will increase significantly.”
In his 2023 note, Grainge wrote about the importance of addressing streaming royalty reform and making sure artists get their deserved share of the royalty pie; in 2024, he’s focused more on “grow[ing] the pie for all artists, by strengthening the artist-fan relationship through superfan experiences and products.” Grainge says that will be accomplished both through internal improvements and through partnerships with various platforms. And he promised to continue their already-underway push in protecting and promoting creators’ voices in the AI discussion.
“In short,” Grainge writes, “We are creating the blueprint for the labels of the future.”
What that blueprint may look like is still to come, however; Grainge also notes that the company will “further evolve our organizational structure,” suggesting that changes to how the overall company operates are on the horizon.
“As you know, over the past several years, we have been investing in future growth, not just expanding geographically and leveraging new technologies, but building our e-commerce and D2C operations,” Grainge writes. “In 2024, as we continue our industry-leading investments in A&R and artist development, we will further evolve our organizational structure to create efficiencies in other areas of the business, so we can remain nimble and responsive to opportunities as they arise, while also taking advantage of the benefits of our scale. In the face of so much change and opportunity, standing still is never an option.”
Read Grainge’s full New Year’s note to staff below.
Dear Colleagues,
Happy New Year! I want to express my deepest gratitude to every one of you for all of your hard work and also to take a few moments to review with you some of the highlights of 2023 and preview some of what’s to come in 2024.
Once again, 2023 saw Universal Music lead the industry in all major financial and competitive performance metrics, at the same time our artists broke records and topped the charts around the world. To put it succinctly: UMG is the most successful company in the history of the music industry and every one of us should be enormously proud of what we have accomplished together, let alone what I know we will accomplish going forward.
In fact, even beyond our artists’ extraordinary achievements and our financial results, there was so much more to be proud of this year.
By the beginning of 2023, it had become obvious that if the industry were to continue to thrive and the value of our artists’ work respected, a number of critically important issues would have to be confronted. As the industry leader we had a clear vision of how to address these issues. And then we went out and took bold steps to turn that vision into reality.
Last January, for example, I wrote to you about the streaming royalty model. A new model was needed, one that would properly reward the artist-fan relationship and disincentivize fraud and gaming the system. Because artists are at the center of everything we do, we called it the “Artist-Centric Model.”
I’m proud to say that in just a matter of months, several global platforms, including the world’s largest music platform, have already adopted artist-centric principles that will transform the way artists are compensated for their work. In the coming months, I believe you will see more platforms adopting these principles. Why? Because it is the right thing to do both for artists and for the wider music ecosystem. As this new model becomes widespread, the impact will be profound: a healthier, more equitable and more vibrant music ecosystem that rewards all artists — be they major, indie or DIY — at all stages of their careers.
In the same way, we showed the industry the way forward when it came to confronting the challenges and opportunities of AI.
Early on in 2023, many “experts” viewed AI as a looming threat. Our view? Just as we had done with so many other previous proclamations of doom, we rejected that short-sighted appraisal. On the contrary, we saw AI as presenting opportunities. And then, just as we did with streaming, we went out to turn those opportunities into reality.
We launched our Responsible AI initiative this year with two goals in mind. First, to lobby for “guardrails,” that is public policies setting basic rules for AI. In the U.S., for example we are lobbying for legislation that would establish a federal right of publicity to harmonize the protections of artists’ image, likeness and voice from AI deepfakes. We were the first music company to call upon the U.S. Congress to protect artists against unethical uses of AI.
Our second goal was to forge groundbreaking private-sector partnerships with AI technology companies. In the past, new and often disruptive technology was simply released into the world, leaving the music community to develop the model by which artists would be fairly compensated and their rights protected. In a sharp break with that past, we formed a historic relationship with our longtime partner, YouTube, that gives artists a seat at the table before any product goes to market, including helping to shape AI products’ development and a path to monetization.
Because we fundamentally believe the best way to ensure responsible AI development is through partnership and market-led solutions, in addition to YouTube, we are collaborating with several platforms on numerous opportunities and approaches — always with artists at the forefront of our thinking. In addition, our artists have begun working with some of the latest AI technology to develop tools that will enhance and support the creative process and produce music experiences unlike anything that’s been heard before. And to leverage AI technology that would benefit artists, we continue to strike groundbreaking agreements with, among others, Endel and BandLab.
We also advanced our initiatives in areas from health and wellness to sustainability and the environment.
The intersection of music and health is another exciting area about which I am especially passionate. We’ve all had experiences in which music changed our mood or comforted us in times of emotional crisis, or even helped us physically. In fact, it’s one of the reasons why so many of us have chosen to spend our careers in music. I’ve long wanted the powerful relationship between music and health to be more than a handful of subjective observations and anecdotes so that it could become a key component of our strategy.
Building upon our success in creating a robust commercial category in fitness, we’re now leading the industry in music and health. In September, we produced the first-ever Music + Health Summit where we brought our artists together with health entrepreneurs and leading neuroscientists to advance this new category. This came on the heels of us entering into a series of more than 40 license agreements to amplify the possibilities in this space. For example, we are pioneering a new category that we call “prescription music,” an evidence-based health technique built on scientific and medical research. What excites me is that it’s cost-effective, non-invasive and drives truly beneficial results. While it’s a field still in its infancy, this area will become an increasingly important component of our strategy.
In the same spirit of promoting positive change in society, our employees also accomplished amazing things. Throughout 2023, our All Together Now Foundation, Task Force for Meaningful Change, Green Team, Unhoused Coalition, and Employee Matching Program contributed to more than 500 organizations around the world, and supported over 1.2 million meals for those in need.
Moreover, in the more than three years since we established a groundbreaking relationship with the non-profit Music Health Alliance (MHA), 500 UMG and UMPG recording artists, songwriters and their families in the U.S. have received life-changing medical care. With this year’s dramatic jump in the need for mental health care within the artist and songwriter community, the MHA partnership significantly increased its support in that area.
Our efforts to move the industry on issues concerning sustainability and the environment led UMG and Bravado to host the first music industry sustainability summits in L.A., London, and New York. The series brought together industry leaders and innovators who made commitments to institute sustainable solutions across a range of categories including events, merchandise, touring and more. We co-founded the Music Industry Climate Collective, the new music industry alliance to address global climate change. And we became the first standalone major music company to win the approval of its greenhouse gas emission reduction targets by the Science Based Targets initiative, the gold standard for establishing corporate climate goals.
All of these initiatives are of course ultimately powered by the success of our artists and songwriters and the support that our employees around the world provide them. So let’s turn to the achievements of our artists and songwriters which were nothing short of astounding in 2023. Here are just a few examples.
Globally in 2023, UMG had:
On Spotify: Six of the Top 10 global artists: Taylor Swift (at No. 1), The Weeknd, Drake, Feid, Karol G and Lana Del Rey.
On Apple Music: 13 of the Top 20 most-streamed songs globally, with Morgan Wallen’s “Last Night” at No. 1.
On Deezer: The three most-streamed artists worldwide with The Weeknd, Taylor Swift and Imagine Dragons.
On YouTube: Three of the Top 5 songs, with Toosii’s “Favorite Song” at No. 1.
On Vevo: Karol G was the ‘Most Watched Artist’ for the third consecutive year.
On Amazon: The top two artists (Taylor Swift and Morgan Wallen), three of the Top 5 songs and albums, and the world’s most requested artist on Alexa (Taylor Swift).
And to break it down by region:
On Spotify: The four most-streamed artists in the U.S.: Taylor Swift, Drake, Morgan Wallen and The Weeknd.
On Apple Music: Five of the top seven songs in the U.S., with Morgan Wallen’s “Last Night” (at No.1), and “You Proof”; Drake & 21 Savage, “Rich Flex” and “Spin Bout U”; and Lil Baby “Freestyle”.
On the Billboard 200: Six of the Top 10 albums—Morgan Wallen’s One thing At A Time (No. 1), Taylor Swift’s Midnights (No. 2), Drake, 21 Savage’s Her Loss, Metro Boomin’s Heroes & Villains, Morgan Wallen’s Dangerous: The Double Album and Taylor Swift’a Lover;
Republic Records was named Billboard’s top label for the third consecutive year.
In the UK, according to the Official Charts Company, UMG had seven of the Top 10 artists, including Taylor Swift at No. 1, Drake and The Weeknd in the top five.
Also in the UK, UMG had all of the three nominees for the prestigious 2024 BRITs Rising Star award, with Island’s The Last Dinner Party taking the award, marking the third consecutive year a UMG artist has won.
In Germany, after having ALL of the Top 10 albums for a week in mid-November, a feat never before accomplished by any company; UMG finished the year with six of the Top 10 albums.
In Japan, UMG had five of the Top 10 albums according to Billboard Japan, including King & Prince at No. 1, while Ado’s single “Show” held the top spot on the weekly streaming chart for 14 consecutive weeks to finish the year.
In France, UMG had five of the Top 10 tracks overall, and three of the Top 5 tracks on Apple Music.
In Australia, UMG had the No. 1 album for 34 weeks this year, with albums from Taylor Swift, Sam Smith, Morgan Wallen, Lana Del Rey, Metallica, Peach PRC, Lewis Capaldi, Niall Horan, G Flip, Powderfinger, Olivia Rodrigo, Drake, Troye Sivan and The Rolling Stones.
In Canada, UMG had eight of the Top 10 albums, including albums from Morgan Wallen at No. 1, Taylor Swift, Metro Boomin, and The Weeknd, and held the No. 1 album for 33 weeks this year.
UMG Sweden’s Loreen won the Eurovision Song Contest with her single “Tattoo” and UMG Sweden had five of the Top 10 artists on Spotify.
At the Latin Grammys, Karol G swept three major awards, including Album of the Year, and Juanes won Best Pop/Rock Album, marking his 25th Latin Grammy award.
Feid continued his massive rise in 2023, as the third most-streamed Latin artist on Spotify, while Sebastián Yatra was recognized as “Artist of the Year” at the 2023 RIAA Honors.
In China, Wu Qingfeng’s Mallarme’s Tuesday won “Album of the Year” at the Golden Melody Awards.
In Indonesia, “Tak Segampang Itu” by Anggi Marito was the top song of the year on Spotify.
Juan Karlos became the first artist from the Philippines to enter the Top 100 Global Spotify Charts with his song “Ere,” which was No. 1 in the Philippines for 10 weeks.
Our Universal Music Publishing Group songwriters also performed spectacularly:
On Spotify’s 2023 most-streamed artists globally, we had four out of the Top 5 (Taylor Swift, Bad Bunny, The Weeknd and Drake) and seven out of the Top 10.
On Spotify’s most-streamed albums globally, we had four of the Top 5 (Bad Bunny, Taylor Swift, SZA, The Weeknd) and seven of the Top 10.
On Apple Music: UMPG had an interest in seven of the Top 10 most-streamed songs in the U.S.
On Billboard’s Hot 100 Songwriters in the U.S., UMPG had three of the Top 5 with Taylor Swift, Jack Antonoff and SZA.
In total, a spectacular performance. We should all be so proud of our artists and songwriters and the work we do to bring their music to the world.
In 2023, we also continued our strategy to expand our presence in high growth markets around the world — both through the strength of our companies in those regions as well as the expansion of Virgin Music Group.
We acquired Chabaka Music, a leading MENA-based company, as well as a majority stake in RS Group in Thailand.
In India we strengthened our position domestically with an exclusive partnership with Represent, a leading management company.
In China we signed new long-term agreements with superstar Eason Chan and with 2022’s No. 1 IFPI global album seller Jay Chou, that includes his JVR Music label.
Looking to 2024, both the pace of change and our industry leadership will increase significantly. We’ll be moving quickly and meaningfully on many different fronts.
Our pioneering artist-centric strategy will extend its reach. We first focused on a fairer way to allocate the streaming pie among real artists by addressing fraud and other aspects that deprive artists of their just compensation. The next focus of our strategy will be to grow the pie for all artists, by strengthening the artist-fan relationship through superfan experiences and products. We are already in advanced discussions with our platform partners regarding this phase and will have more to announce in the coming months. In addition, we will be building our in-house capabilities through groundbreaking partnerships that will accelerate our artists’ ability to create experiential, commerce and content offerings for their fans. In short, we are creating the blueprint for the labels of the future.
As for AI, we will continue building opportunity for our artists, while also leading the fight to protect them from unethical uses of this technology. And all around the world, we will continue to prioritize and fight for policies in the service of artistry — not at the expense of it. We also expect to announce more real-world commercial applications for artist-driven, ethical AI.
We will keep growing our presence around the world by doing just what we do in more established music markets: signing and developing local artists; providing local labels and entrepreneurs with global promotion, distribution, and a full suite of artist services; and acquiring local labels, catalogs and artist services businesses.
As you know, over the past several years, we have been investing in future growth, not just expanding geographically and leveraging new technologies, but building our e-commerce and D2C operations. In 2024, as we continue our industry-leading investments in A&R and artist development, we will further evolve our organizational structure to create efficiencies in other areas of the business, so we can remain nimble and responsive to opportunities as they arise, while also taking advantage of the benefits of our scale.
In the face of so much change and opportunity, standing still is never an option.
We must continue to fight for our artists and songwriters and stand up for the creative and commercial value of music.
Our vision of the future is filled with possibilities, and acting on our strategy will make those possibilities real — for our artists, our employees, our shareholders and the entire music ecosystem.
I promise 2024 will be an extremely exciting and transformative year for our company.
Lucian
Did You Get the Memo? Read Last Year’s Note From Lucian Grainge
Universal Music Group (UMG) has acquired the catalog of Oriental Star Agencies (OSA). Founded in 1966 in London by Pakistani immigrants Muhammad Ayyub and his brothers, OSA is known as one of the United Kingdom’s top labels for South Asian talent.
The OSA catalog consists primarily of recorded music, but the new UMG deal encompasses all of its master recording holdings and its publishing. This includes 18,000 songs and video recordings, including from Malkit Singh, a well-known Bhangra artist; Bally Sagoo; and Attaullah Khan. It also includes works from Nusrat Fateh Ali Khan, a prolific, Grammy-nominated artist and film composer who is known for popularizing a form of Sufi devotional music, called “qawwali,” outside of his native Pakistan.
The sounds of OSA artists were able to permeate the United Kingdom’s musical consciousness even further at the turn of the 21st century, when several older OSA tracks were placed on the soundtrack of the hit soccer movie, Bend It Like Beckham, released in 2002. The label continued to operate independently until 2017 when it sold to Hi-Tech Music, another British record label.
According to IFPI’s Global Music Report, the Asian recorded music market grew 15.4% in 2023, marking the third consecutive year the continent has experienced double-digit revenue growth. Now, Asia accounts for just under 23% of the global market and is expected to continue to expand. Japan, South Korea and China account for the majority of Asia’s global music exports, but South Asian countries overall continue to grow year after year.
In recent years, as the music catalog market grew red hot and competition among buyers became greater than ever, some investors showedincreased interest in acquiring music from typically underrepresented genres and nationalities in the catalog market. Reservoir, for example, invested in new relationships and catalogs in Saudi Arabia and Egypt; Wahoo Music Fund One focused solely on Latin music purchases; Singapore-based blackx tried to corner the Asian music market; and Armada Music’s BEAT started buying up dance catalogs.
According to a press release about the OSA deal, the catalog acquisition “complements UMG’s current service offering and will help drive momentum for the South Asian music market, enabling local artists to reach the largest possible audience in the global community.”
“This acquisition of a hugely successful and iconic British-Asian label specializing in South Asian music will further increase Universal Music Group’s exposure to, and participation in, a fast growing and rapidly changing market,” said Adam Granite, executive vp of market development at UMG, in a statement. “I am particularly pleased that Universal Music Group will become the next custodian of Oriental Star Agencies, a label that has played an unparalleled role in bridging the musical identities of the UK and South Asia, taking the unique sounds of its artists to a broad audience. We believe this catalog has huge potential, and look forward to taking it to the next generation of music fans globally.”
“This is a momentous day for OSA and all our artists,” added Mohammed Twassen of OSA. “Becoming part of the UMG family will turbo-charge our South Asian music, helping it to get in front of more music fans across the world. The past decade has seen a true global explosion of music from the region, and now, under UMG’s stewardship, the next decade promises to be even more exciting.”
Universal Music Group and Tencent Music Entertainment have renewed their multi-year licensing agreement, the companies announced on Wednesday (Jan. 3). Under the renewed agreement between TME and UMG — first signed in May 2017 — Tencent will continue to distribute UMG content on its associated streaming platforms QQ Music, Kogou Music and Kuwo Music, as […]
The Billboard Global Music Index — a diverse collection of 20 publicly traded music companies — finished 2023 up 31.3% as Spotify’s share price alone climbed 138% thanks to cost-cutting and focus on margins. Spotify is the single-largest component of the float-adjusted index and has one of the largest market capitalizations of any music company.
The music index was outperformed by the tech-heavy Nasdaq composite, which gained 43.4% with the help of triple-digit gains from chipmaker Nvidia Corp (+239%) and Meta Platforms (+194%). But the Billboard Global Music Index exceeded some other major indexes: the S&P 500 gained 24.2%, South Korea’s KOSPI composite index grew 18.7% and the FTSE 100 improved 3.8%.
Other than Spotify, a handful of major companies had double-digit gains in 2023 that drove the index’s improvement. Universal Music Group finished the year up 14.7%. Concert promoter Live Nation rode a string of record-setting quarters to a 34.2% gain. HYBE, the increasingly diversified K-pop company, rose 34.6%. SM Entertainment, in which HYBE acquired a minority stake in March, gained 20.1%.
A handful of smaller companies also finished the year with big gains. LiveOne gained 117.4%. Reservoir Media improved 19.4%. Chinese music streamer Cloud Music improved 15.8%.
The biggest loser on the Billboard Global Music Index in 2023 was radio broadcaster iHeartMedia, which fell 56.4%. Abu Dhabi-based music streamer Anghami finished 2023 down 34.8%. After a series of large fluctuations in recent months, Anghami ended the year 69% below its high mark for 2023. Hipgnosis Songs Fund, currently undergoing a strategic review after shareholders voted against continuation in October, finished the year down 16.6%.
Sphere Entertainment Co., which split from MSG Entertainment’s live entertainment business back in April, ended 2023 down 24.4%. Most of that decline came before the company opened its flagship venue, Sphere, in Las Vegas on September 29, however. Since U2 opened the venue to widespread acclaim and earned Sphere global media coverage, the stock dropped only 8.5%.
For the week, the index rose 1.1% to 1,534.07. Fourteen of the index’s 20 stocks posted gains this week, four dropped in price and one was unchanged.
LiveOne shares rose 15.7% to $1.40 after the company announced on Friday (Dec. 29) it added 63,000 new paid memberships in December and surpassed 3.5 million total memberships, an increase of 29% year over year. iHeartMedia shares climbed 14.6% to $2.67. Anghami continued its ping-pong trajectory by finishing the week up 16.9%.
12/29/2023
The year saw K-pop companies making mega moves on a global scale, while the catalog market remained hot.
12/29/2023
SiriusXM’s announcement that it planned to merge its stock with Liberty SiriusXM Group, a tracking stock of Liberty Media, helped the SiriusXM share price climb 16.4% to $5.40 this week after it lagged for much of 2023. Friday’s high mark of $5.78 nearly brought the stock back to where it ended 2022, at $5.84 per share.
The deal, which requires regulatory approval and is expected to be completed in the third quarter of 2024, “will create value for all stockholders by eliminating the tracking stock structure, enhancing liquidity and allowing former LSXM stockholders to participate directly in the ongoing performance of SiriusXM,” said Greg Maffei, Liberty Media president/CEO, in a statement released Tuesday (Dec. 12).
Elsewhere, Live Nation climbed 9.2% to $93.00 this week thanks in part to an investor note by Morgan Stanley analysts that raised the price target to $110 from $100. Analysts pointed to a “secular shift” in consumer spending on experiences, the company’s increased disclosure about its Venue Nation business and a “highly unlikely” chance the Department of Justice will break up the company following its antitrust probe. Morgan Stanley’s $110 price target implies the stock, which is up 33.4% year to date, has 18% upside after Friday’s close.
Those big gains from SiriusXM and Live Nation, as well as a 4.1% gain from Universal Music Group, one of the index’s most valuable components, helped the Billboard Global Music Index increase 2.2% this week to a record 1,522.78. Nine of the index’s 20 stocks finished the week in positive territory, 10 stocks lost ground and one was unchanged.
Other indexes soared this week after the U.S. Federal Reserve held interest rates unchanged on Wednesday (Dec. 13) and indicated it would cut interest rates three times in 2024. The tech-heavy Nasdaq composite set a record closing price of 14,813.92 on Friday, marking a 2.8% gain for the week. The S&P 500 is still 2% away from its high mark after finishing the week up 2.5% to 4,719.19. In the United Kingdom, the FTSE 100 rose 0.3% to 7,576.36. South Korea’s KOSPI composite index gained 1.8% to 2,563.56.
The Billboard Global Music Index’s second-largest increase came from Reservoir Media, which gained 15% to $6.82. The stock’s $6.89 closing price on Thursday was its highest since $7.06 on Feb. 16 and is 31.4% above its 52-week low of $5.19 set on Aug. 10. Chinese music streamer Tencent Music Entertainment gained 8.0% to $8.88.
Hipgnosis Songs Fund gained 4.9% to 0.701 pounds ($0.89) after the company announced on Monday (Dec. 11) the sale of 20,000 non-core music assets for $23.1 million. The proceeds will be used to pay down its revolving credit facility. On Friday, the company also announced the appointment of Christopher Mills as an independent non-executive director effective immediately. Mills, who has a reputation as an activist investor, is CEO/investment manager of North Atlantic Smaller Companies Investment Trust and founded Harwood Capital Management in 2011. Following the news, Hipgnosis Songs Fund shares rose 2.3% on Friday.
Music streaming company Anghami dropped 30.4% to $0.94, bringing its three-week decline to 66.5%. Other than Anghami, however, no other stock finished the week with a loss greater than 5%. iHeartMedia fell 4.9% to $2.52 and MSG Entertainment dropped 3.2% to $31.16.