universal music group
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Kids’ audio platform Yoto, which is behind the screen-free Yoto Player and Yoto Mini, signed an industry-first agreement with Universal Music Group (UMG) to bring music titles and artists from its labels and catalogs to the platform for the first time. Founded by Ben Drury and Filip Denker, Yoto allows children to access music without being exposed to advertising or unsuitable content. The UMG partnership kicked off this month with the launch of Queen’s Greatest Hits: Volume 1 as a “Yoto Card.” That will be followed in the coming months by releases from artists like Bob Marley & the Wailers and labels including Motown Records and Disney Music Group. The Queen cards will be available on Yoto webstores in the United States, United Kingdom, Canada and the European Union; Yoto Amazon stores in the United States, United Kingdom and Canada; and the Queen online store.
Round Hill Music acquired Linus Entertainment, the Canadian independent music company that includes the recording and publishing catalogs of Borealis Records, Mummy Dust Music, Solid Gold Records, Stony Plain Records, The Children’s Group and True North Records, as well as the distribution company Independent Digital Licensing Agency Inc (IDLA). The acquisition encompasses over 3,000 songs and more than 20,000 master recordings. It includes recordings from Buffy Sainte-Marie, Gordon Lightfoot and Taj Mahal, among many others.
Reservoir Media and PopArabia jointly acquired the catalog of Cairo-based content production and distribution company RE Media, encompassing sub-labels Moseeqa and Moseeqa TV and several of RE Media’s owned and operated YouTube channels. The acquisition includes more than 6,000 recordings and compositions from artists such as Amr Diab, George Wassouf, Dalida and Mohamed Mounir. Reservoir and PopArabia additionally acquired the master and publishing rights for the catalog of Egyptian rap duo El Sawareekh.
Timbaland acquired a stake in lifestyle and vinyl brand 12on12, where he will serve as a strategic partner and curator. According to a press release, 12on12 allows “cultural icons” to curate soundtracks of 12 songs “that have inspired, affected and influenced them,” which are then pressed on 12″ vinyl. Timbaland is currently working on his own 12on12 release that will drop at the beginning of next year. His Verzuz partner Swizz Beatz previously acquired a stake in the company in February 2022; since then, 12on12 has expanded into releasing limited edition fine art prints and lifestyle pieces featuring co-curators’ artwork. The company has already collaborated with Run DMC, Swizz Beatz and Travis Scott x Saint Laurent, among others.
Apple Podcasts added several new hosting providers that will support Delegated Delivery, which allows creators to publish subscriber episodes directly from their participating hosting provider dashboard. The new partners are Audiomeans, Captivate, Podbean, Podspace and Transistor, all of which will support Delegated Delivery by the end of 2023. Elsewhere, the company revealed an exclusive integration with Linkfire, which is expanding into podcasting this fall with a toolkit built specifically for podcasters. Using that toolkit, podcasters on Apple Podcasts will have the ability to generate an unlimited number of smart links with landing pages for their podcasts and measure how listeners engage with them using the Linkfire Insights dashboard.
The Salzburg Festival is making its operas, orchestral concerts, lieder recitals and chamber music exclusively available on the recently launched Apple Music Classical streaming platform. More than 100 such recordings are already available at launch.
Matthew Berry‘s fantasy sports and sports betting media company FantasyLife closed a $2 million dollar friends and family round from investors including John Legend, YouTube co-founder/former CEO Chad Hurley and Wasserman Media Group chairman/CEO Casey Wasserman, among many others. Hurley, Wasserman and The SpringHill Company co-founder/CEO Maverick Carter (also an investor, with LeBron James’ LRMR Ventures) will also join the FantasyLife advisory board. Fantasy Life additionally announced new partnerships with brands including Epic Seats, Webex by Cisco and Buffalo Wild Wings.
Believe‘s global dance and electronic imprint b:electronic signed Berlin-based house and techno label mobilee records and Feathers & Bones, the new label from electronic artist Rodriguez Jr.
The Bruce Springsteen Archives and Center for American Music at Monmouth University and E Street Band guitarist Steve Van Zandt’s TeachRock education program announced they would team up to help teachers bring American popular music into the curriculums of classrooms across the United States. Future collaborations will include teacher workshops, student internships, seminars and conferences, curriculum development and joint research activities. The efforts between the two organizations will begin at Asbury Park Middle School and High Schools in New Jersey with the Harmony Student Wellness Program, which uses “popular music as a springboard” for lessons around self-awareness, self-management, relationship skills, responsible decision-making and social awareness, according to the TeachRock website.
Absolute Label Services partnered with Prestige Management for the release of Busted’s forthcoming Greatest Hits 2.0 compilation. Absolute will provide a range of services for the release, including distribution, marketing and project management. The album compiles newly-recorded versions of all of Busted’s biggest hits, fan favorites and live staples, with deluxe formats featuring a number of previously unreleased collaborations with artists including McFly, James Arthur, You Me At Six, The Vamps, Bowling For Soup, Dashboard Confessional, Deaf Havana, Wheatus and Charlotte Sands.
Universal Music Group announced on Monday (Aug. 21) a partnership with YouTube to create a set of principles and best practices around the use of artificial intelligence within the music community, as well as a Music AI Incubator bringing together several UMG artists and producers to help study the effect of the technology, including Anitta, Juanes, Yo Gotti, Louis Bell, ABBA’s Björn Ulvaeus, Ryan Tedder and the estate of Frank Sinatra, among others.
In announcing the new incubator and the three principles — which boil down to embracing the new technological possibilities while protecting creators and establishing content and safety policies — UMG chairman/CEO Lucian Grainge penned an op-ed for YouTube’s blog, in which he acknowledged both the possibilities and the potential dangers of AI.
“Given this tension, our challenge and opportunity as an industry is to establish effective tools, incentives and rewards – as well as rules of the road – that enable us to limit AI’s potential downside while promoting its promising upside,” Grainge writes. “If we strike the right balance, I believe AI will amplify human imagination and enrich musical creativity in extraordinary new ways.”
In reference to the collaboration with YouTube, Grainge points to the video streamer’s development of its ContentID system, which helps screen user-generated content uploaded to the service for copyrighted works, and helps get creators (and copyright owners, such as UMG) paid for their use on the platform. That type of collaboration between DSP and music companies is foundational to the work YouTube and UMG are beginning with respect to AI, Grainge says.
“The truth is, great entertainment doesn’t just reach audiences on its own,” he writes. “It also requires the global infrastructure, new business models, scaled distribution, innovative partnerships and effective safeguards that enable talented artists to create with freedom and receive fair compensation. … Today, our partnership is building on that foundation with a shared commitment to lead responsibly, as outlined in YouTube’s AI principles, where Artificial Intelligence is built to empower human creativity, and not the other way around. AI will never replace human creativity because it will always lack the essential spark that drives the most talented artists to do their best work, which is intention. From Mozart to The Beatles to Taylor Swift, genius is never random.”
Read his full op-ed here.
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 has elevated Manusha Sarawan to oversee its efforts and market-leading label roster across southern and eastern Africa. In her new Johannesburg-based role as managing director, Southern and East Africa, Sarawan will continue to work closely with Adam Granite, UMG’s evp of market development, who said she was “ideally suited” for the role. Sarawan was […]
Republic Records jumped out to a huge lead early on in the market share rankings this year among current releases (those released within the past 18 months), and maintained a 12.46% current share across the first half of the year — more than four points higher than the next-closest label, Interscope Geffen A&M (8.08%). But […]
Universal Music Group plans to raise 750 million euros ($801 million) from the sale of 4.000% senior unsecured notes due 2031, the company announced on Tuesday (June 6). The notes will be issued from UMG’s Euro Medium Term Note program and listed on Euronext Amsterdam. The proceeds will be used to refinance existing debt and […]
Universal Music Group chairman/CEO Lucian Grainge took aim at artificial intelligence again on Wednesday (April 26), this time blaming AI for the “oversupply” of “bad” content on streaming platforms and pointing to user-centric payment models as the answer.
AI tools have exploded in popularity in recent months, and Grainge has been an outspoken critic of generative AI being used to mimic copyrighted works, as with the song “Heart on My Sleeve,” which used AI to generate vocals from UMG artists Drake and The Weeknd.
In fervent comments Grainge made during a call discussing UMG’s earnings Wednesday, the executive said AI significantly contributes to a glut of “poor-quality” content on streaming platforms, muddies search experiences for fans looking for their favorite artists and generally has “virtually no consumer appeal.”
“Any way you look at it, this oversupply, whether or not AI-created is, simply, bad. Bad for artists. Bad for fans. And bad for the platforms themselves,” Grainge said.
The head of the world’s largest music company specifically called out the role of generative AI platforms, which are “trained” to produce new creations after being fed vast quantities of existing works known as “inputs.” In the case of AI music platforms, that process involves huge numbers of songs, which many across the music industry argue infringes on artists’ and labels’ copyrights.
Grainge argued that “the flood of unwanted content” generated by AI could be reduced by adopting new payment models from streaming platforms. UMG is currently exploring “artist-centric” models with Tidal and Deezer, while SoundCloud and Warner Music Group also announced a partnership on so-called user-centric royalties last year.
“With the right incentive structures in place, platforms can focus on rewarding and enhancing the artist-fan relationship and, at the same time, elevate the user experience on their platforms, by reducing the sea of ‘noise’ … eliminating unauthorized, unwanted, and infringing content entirely,” Grainge said on Wednesday.
While UMG continues exploring alternative streaming payment models with partners Tidal, Deezer and others on what form alternative streaming payment models should take, an analyst on Wednesday’s call asked Grainge if, in the meantime, the company would ever consider licensing songs to an AI platform.
“We are open to licensing … but we have to respect our artist and the integrity of their work,” Grainge said. “We should be the hostess with the mostest. We’re open for business with businesses that are legitimate and (interested in) partnership for growth.”
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)
Billboard‘s Global Music Index rose 4.2% this week to 1,263.70, its high level in six weeks, as 14 of the 20 stocks in the index were in positive territory. The index’s most valuable companies were among the gainers: Universal Music Group was up 2.1%, Spotify improved 4.1%, and Live Nation climbed 6.1%.
With additional help from Warner Music Group (+5.9%) and Tencent Music Entertainment (+8.1%), the Billboard Global Music Index outperformed the major indexes. The S&P 500 rose 3.5% to 4,109.31 and the Nasdaq composite improved 3.4% to 12,221.91. In the U.K., the FTSE 100 rose 3.1%.
In the first quarter, the Billboard Global Music Index was up 8.2% overall.
Radio company Audacy was the greatest gainer of the week, improving 18.2% to $0.13. In a proxy statement filed March 24, Audacy said it will propose a reverse stock split at the company’s May 24 shareholder meeting. The New York Stock Exchange will initiate a delisting process for stocks that close below $1.00 for 30 consecutive trading days; Audacy’s share price has not exceeded $1.00 since July 5, 2022. A reverse stock split will reduce the number of outstanding shares. Since the value of the company is unaffected by the event, the reverse split will increase the share price.
Elsewhere, Madison Square Garden Entertainment (MSGE) improved 9.6% to $59.07. On Thursday (March 30), MSGE revealed its final plan to separate its live entertainment company from the rest of its businesses. On April 20, the current parent company will be renamed Sphere Entertainment Co. and be comprised of the state-of-the-art Sphere venue, MSG Networks and Tao Group Hospitality. That will leave a pure-play live entertainment company, MSG Entertainment, which includes such venues as Madison Square Garden and Radio City Music Hall.
Competing interests drove SM Entertainment shares higher in February and early March, but the stock has fallen 36.9% in the last three weeks after dropping another 13.1% this week. The K-pop company’s share price started the year at 76,700 won ($58.71) and surged to 114,700 won ($87.79) on Feb. 10 after HYBE acquired a 14.8% stake from SM’s founder, Lee Soo-man. By March 10, when HYBE and Kakao Entertainment were locked in a battle to become SM’s largest shareholder and lead the company’s expansion following its break from Lee, SM shares hit 147,800 ($113.13). Once Kakao Corp. and Kakao Entertainment’s tender offer expired on March 26, the share price plummeted. Still, SM Entertainment shares are up 21.5% year to date.
The board of directors at Universal Music Group (UMG) has extended the contract of chairman and CEO Sir Lucian Grainge until May 1, 2028, the company announced Thursday (March 30).
The updated agreement transitions Grainge from an all-cash compensation package to one that combines cash and equity; the latter of these includes performance-based objectives that align with the interest of shareholders and correlate with the company’s long-term growth strategy. The majority of the compensation package’s value will be paid in UMG equity and performance-based stock options. As a result, Grainge’s annual salary will be reduced by more than two-thirds from his current salary, down to $5 million. He will be eligible for an annual bonus with a target of $10 million. The EBITA bonus from his previous contract has been eliminated, and he will only be entitled to the contingent bonus under his prior agreement on a pro rata basis until Friday (March 31).
The equity components of the compensation program include annual grants of $20 million, comprised of as much as 50% performance share units (PSUs), with annual PSU goals set by the board of directors; the remainder will be comprised of restricted share units (RSUs). Grainge will also receive a one-time transition equity award of $100 million, comprised of 50% RSUs and 50% performance stock options (PSOs). The PSOs will be paid out only if the company surpasses stock price hurdles — 1/3rd at 26.50 euros ($28.90), another 1/3rd at 30.00 euros ($32.71) and 1/3rd at 38.00 euros ($41.44) — within the term of the agreement.
UMG went public in September 2021 with a listing on the Euronext Amsterdam Stock Exchange.
“UMG is the world´s most successful music company and there are incredible opportunities ahead for a company with the right leadership and vision,” said UMG chairman of the board Sherry Lansing in a statement. “The UMG Board is resolutely committed to converting those opportunities and maximizing shareholder value for the long term. Only the right kind of chief executive can help achieve that goal and Lucian is just the one to do it. Through his clear vision and strong execution in building UMG into the industry leader, Lucian has also essentially created a new category of music company. This agreement is designed to drive both the sustainable success of UMG and long-term shareholder value.”
To align Grainge’s term as executive director and chairman/CEO with the term of the extended contract, the board will put forth a proposal to reappoint him as executive director for a term ending on May 1, 2028, at UMG’s 2023 general meeting on May 11; it will also seek approval for a supplement to UMG’s existing executive directors remuneration policy with respect to his new compensation.
Grainge got his start in the music publishing business in 1979 at age 18. He joined Universal Music in 1986 when he launched PolyGram Music Publishing in the U.K. and steadily climbed the ladder from there, rising to chairman/CEO of UMG’s international division in 2005 and chairman/CEO of UMG in 2011, succeeding Doug Morris. He placed atop this year’s Billboard‘s Power 100, marking his seventh appearance at No. 1 on the list; in 2020, he was named Billboard‘s executive of the decade.
In 2022, UMG’s overall revenues increased 21.6% to 10.34 billion euros ($10.96 billion), boosted by solid returns from recorded music subscriptions and streaming. It remains far and away the largest recorded music company by market share.