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The power of the major label has been completely decimated.”
That broadside came from Elliot Grainge during an interview with The Los Angeles Times last year. In the profile, Grainge, founder of the independent label 10K Projects and son of Universal Music Group chairman/CEO Lucian Grainge, added that the majors were like “a conveyor belt with 100 other priorities” and “mediocre-at-best product-management departments.” In his view, there was “not one example” of an artist “signed, developed and marketed from scratch to huge fanfare by a major label in the last three years.”
Sixteen months later, one of those conveyor belts will soon belong to Grainge. In a sudden and surprising shakeup, Warner Music Group announced that the 30-year-old will take over as CEO of Atlantic Music Group on Oct. 1, less than a year after WMG entered a joint venture with 10K. In his new position, Grainge will oversee the renowned Atlantic Records, as well as 300 Elektra Entertainment and his own imprint.
This means he will jump from managing a staff of around 30 in 2023, according to The L.A. Times, to commanding hundreds of employees. And as part of the overhaul, at least two well-regarded WMG veterans are headed for the exits: Max Lousada, who served as the company’s CEO of Recorded Music since 2017; and Julie Greenwald, who had led Atlantic as chairman and COO since 2006.
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The upheaval marks an abrupt generational shift for Atlantic, the storied label co-founded by music legend Ahmet Ertegun in 1947. “They’re going from the most traditional, A&R-driven leadership to a very contemporary, digitally-native new administration,” says one executive who has worked with Grainge in the past. “It’s going to be interesting to see what happens.”
“Cutting Away the Bullshit”
Grainge has risen rapidly in a remarkably short time in the business, and several executives who have worked with him cheered his latest promotion. “We’re still operating in an antiquated system, and Elliot’s found his success by cutting away the bullshit,” says Solomon Sobande, who managed XXXTentacion, the SoundCloud rapper-turned-streaming superstar, before his death and teamed up with Grainge to release X’s ? album in 2018. “There’s a certain level of commitment to his artists, making sure they had everything they needed to be successful, that I was always enthralled by.”
Some Warner employees, however, said they were upset at the departures precipitated by Grainge’s promotion. For them, losing Greenwald, who has been at Atlantic for two decades and assured Ertegun she would take care of the company upon being named president back in 2004, symbolizes the end of an era. (Craig Kallman, who served as chairman/CEO of Atlantic alongside Greenwald for many years and focused on A&R, will remain as CEO of Atlantic Records, albeit in a diminished role.) “We did not think Julie’s run was up yet, and we did not think Max’s run was up yet,” says one WMG executive who spoke on the condition of anonymity because they were not authorized to speak publicly.
Both Lousada and Greenwald were known for their close connections to marquee artists on WMG’s rosters; filling the void left by their departures will be no mean feat. Each has spent decades at record labels, developing reputations for their relationships with both artists and staff. Several executives expressed surprise that the new Atlantic boss is relatively inexperienced — even at a time when younger CEOs have taken over Columbia Records, Def Jam, Island Records and Warner Records, Grainge is the youngest major-label chief by a wide margin — rather than someone who has invested the years to learn how the majors operate.
Multiple WMG employees also wondered how 10K’s approach to signing and building artists will translate to Atlantic. While Grainge’s label has helped generate billions of streams, it has not yet nurtured an arena-headlining superstar in the mold of Atlantic’s Bruno Mars or Ed Sheeran, two artists whom Lousada and Greenwald helped shepherd to global success.
“Julie was widely regarded as one of the last real artist advocates who prioritized substantial songwriting over memetic share-ability,” says one manager who has worked closely with Atlantic. “She knows superstars transcend the algorithm. I really haven’t seen 10K develop anything that I think will last a generation or more.”
In addition, some employees said they are struggling to wrap their heads around the fact that the father of their incoming boss runs their biggest competitor. Together, father and son will lead companies that control more than a third of the U.S. recorded music market.
And some executives are worried that additional consolidation might mean more layoffs. Earlier this year, Atlantic laid off roughly two dozen staffers, mostly from radio and video; any new CEO at any company is likely to have new priorities. Grainge will do “some creative marketing that might not be ‘traditional’ for the majors,” predicts a second executive who has worked with him.
“Some labels still send shit to radio as their primary marketing strategy,” adds a third source who knows Grainge. “10K hasn’t done that. They invest heavily in digital — their ways of working with artists are much more modern.”
A rep for WMG declined to comment. On a recent earnings call, WMG CEO Robert Kyncl said he was “excited by the prospect of taking Atlantic’s culture-making capabilities” and “adding Elliot’s digitally native approach into the mix.” That combination, he continued, will “grow the label’s outstanding reputation.”
“Labels Are Trying to Adjust”
All the majors are facing an increasingly tough landscape because their influence over what music becomes popular is diminished — “decimated,” in Grainge’s words. As a result, “Labels are trying to adjust and test different methodologies to figure out what the future of a major will look like,” says a fourth executive who has worked with Grainge in the past.
In the last year, outside of the superstar ecosystems, music industry wins have often come from smaller, more agile outfits like Pulse Records (Tommy Richman) or Artist Partner Group (Odetari, Lay Bankz). 10K’s biggest success since moving to Warner has been Artemas’ “I Like the Way You Kiss Me” — low-slung club-pop — which peaked at No. 12 on the Hot 100, and, to a lesser extent, Rich Amiri‘s “One Call” (No. 60).
These artists typically thrive in niches online, and don’t necessarily release the type of blockbuster albums that linger near the top of the Billboard 200 for weeks on end. But many young executives believe that this “riches in the niches” approach is the future — they argue that hardly any new superstars will be created now that audiences are spread across dozens of online platforms and mass media has lost much of its firepower.
Grainge’s rise, then, is a nod to the success of these streamlined, quick-on-the-draw operations, with their lower overheads and digital expertise. “It says something about the state of the industry as a whole that one big label system made a bet on a more independent, lean music business strategy,” says the first executive who has worked with Grainge.
But there’s no guarantee that the two systems will mesh. “There’s a political element to going into a place like Atlantic which is very different from running an independent company,” the executive continues. “It’s a challenge to be in that position and inherit decades worth of custom and chains of command.”
Elliot Grainge
Logan Mock
“The Red Tape Doesn’t Exist”
Grainge founded 10K Projects in 2016 and connected with many of his biggest acts early on — often rappers with avid online followings. Grainge was quick to dive into the volatile, punk- and emo-inflected hip-hop that erupted on SoundCloud in this era, signing Trippie Redd, 6ix9ine and XXXTentacion, among others. (More recently, 10K signed Ice Spice in partnership with Capitol Music Group; while most artists moved to WMG with 10K in the joint venture last September, Ice Spice remained under 10K/Capitol.)
At the time, the major labels hadn’t yet built the tools they now use to scour the internet’s nooks and crannies looking for viral phenomena, which left an opportunity for executives immersed in these digital scenes to find talent. The majors may also have been wary of the media controversies and legal troubles that dogged artists like 6ix9ine and XXXTentacion. (At the time, Universal Music Group distributed 10K.) Grainge has “never been afraid to jump out the window for something he believed in,” Sobande says.
“The first time I spoke to Elliot, I was really shocked — everybody knows who his dad was, so I was expecting a spoiled rich kid,” Sobande continues. Instead, he found Grainge “was down to get in the trenches. He was with us flying out to Florida, picking singles, coming in the studio, actually doing the work.”
10K developed a reputation for finding online phenomena early and marketing them savvily, especially on youth-friendly platforms like TikTok — an approach that has now been widely adopted by labels. “The guys at 10K are quick and nimble as it relates to digital strategy and taking risks,” says Karl Fowlkes, an entertainment attorney who has signed several clients to the label. “That’s what makes them special. The red tape doesn’t exist.”
Grainge’s “word was as good as a contract,” the first executive who worked with him agrees. “If you spoke to the guy and he agreed to do something, it would get done without having to jump through a million hoops.”
10K was also known for offering flexible — and generous — short-term deals to artists with momentum, and getting those agreements done speedily. (In contrast, multiple lawyers say Atlantic favored much more traditional deals until relatively recently.) XXXTentacion was initially signed to EMPIRE, but “they could only do so much at the time — it wasn’t the huge company it is now,” Sobande says. “Elliot wanted to get in the X business. And I remember calling him one day, like, ‘Listen, I’ve got an opportunity for you to get involved.’”
Grainge’s response: “Tell me how much, and I’ll do it.”
In the music business, financial commitments often come with strings attached, but multiple sources who know Grainge say he is uninterested in meddling in artists’ processes. He’s very much “this is their idea, let’s go with it,” says the third executive who has collaborated with Atlantic’s incoming CEO.
Birdman Zoe manages the producer Taz Taylor, whose Internet Money record label signed a joint venture with 10K in 2019. “We had a lot of label meetings early on,” Birdman Zoe says. “We really liked the fact that Elliot told us, ‘I want to let you guys do your thing. I’m not here to give you my opinion on something I might not know about. I’m going to back you and financially support you.’”
“You’ve Got to Be Able to Move Quickly”
Independent operations like AWAL, 300 and Alamo have all been snapped up, wholly or partially, by major labels in recent years, part of the majors’ never-ending struggle for market share. 10K was also a target: In September 2023, the company ended its longtime association with UMG and announced a joint venture with Warner Music Group. As part of the move, 10K became a standalone frontline label at WMG and Grainge joined the company’s leadership team.
Forging this partnership was one of the first big moves by Kyncl, who held roles at YouTube and Netflix before taking over WMG in January 2023. (His background in tech has been a point of contention with staff — multiple executives worry that he and the former tech employees he has hired understand data but not culture.) Kyncl inherited a challenge: Halfway through 2024, Republic Records’ current market share was greater than all of Warner Music Group’s. Without big releases from marquee stars, Atlantic in particular has slipped; it’s now behind sister label Warner Records in current market share so far in 2024.
Grainge will be partially responsible for reversing that decline. Sobande is confident he can pull it off. “To be successful, you’ve got to be able to move quickly, and a lot of times the corporate structure slows that process down,” Sobande acknowledges. But if anybody can figure out a way to navigate that tension, “it’s going to be Elliot.”
Warner Music Group (WMG) reported strong quarterly profit growth on Wednesday (Aug. 7) thanks to lower costs and solid revenue gains from streaming subscriptions and digital — which helped offset a drop in physical revenue due to release timing and a difficult year-ago comparison, according to the company. All of that led to a boost in the company’s stock, which had risen nearly 2% by the end of trading on Wednesday (though some of those gains were shaved on Thursday).
“Our strong subscription streaming growth in [the third quarter] was driven by the performance of our music and healthy industry trends,” Warner Music Group chief executive Robert Kyncl said in a statement. He added, “Our commitment to long-term artist development, combined with a flatter structure in recorded music, will enable us to super-serve talent and set WMG up for sustained future growth.”
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Here’s what else you should know about the third-largest music company’s latest quarterly earnings call.
A positive note on the company’s strategic reorganization
Kyncl kicked off the call by thanking outgoing leaders Max Lousada and Julie Greenwald and welcoming incoming Atlantic Music Group CEO Elliot Grainge while providing more detail on how WMG’s recently announced global structure will work.
“We’re making changes from a position of strength, and I’m happy to say that we’re firing on all cylinders across new releases, catalog, distribution and publishing,” Kyncl said. Read more about his comments here.
Strong subscription growth across streamers
Overall streaming revenue was up 5% for WMG this quarter, with recorded music streaming revenue up 8.7% — reflecting growth in subscription revenue of 7%. That was welcome news to investors: Warner’s stock spiked around 6% earlier in the trading session on Wednesday before settling at a gain of nearly 2%.
On the call, Kyncl was asked about the sources of WMG’s subscription streaming revenue after other music companies reported less stellar growth on that metric this quarter. That included Universal Music Group (UMG), which saw a 24% drop in its share price after reporting that overall streaming revenue fell 4.2%, leading UMG executive vp of digital strategy Boyd Muir to suggest that streamers like Apple Music and Amazon Music are struggling to add new subscribers.
Kyncl said WMG’s revenue mix has remained largely the same and cautioned the financial community to resist viewing Spotify as a proxy for the music industry. “It’s much more diversified [than Spotify],” Kyncl said.
WMG’s subscription streaming revenue is projected to grow in the fourth quarter, with that growth remaining “consistent across our handful of top DSPs, certainly led by subscriber growth and … price,” said CFO Bryan Castellani.
In a nod to the music industry’s handwringing over Spotify’s bundling practice, Kyncl said in opening remarks that the labels and DSPs are not “adversaries playing a zero-sum game.”
“That’s simply not the case,” Kyncl said. “We’re actively engaged with our partners around ways to drive growth for all of us. Streaming dynamics remain healthy, with plenty of headroom for subscriber growth in both established and emerging markets across multiple partners. Also, price optimization and improvements in the royalty models will provide ongoing opportunities for additional growth.”
Celebrating Brat summer and the Benson boon
From the “pop sensation of the summer” — Kyncl’s description of Charli XCX’s album Brat — to Benson Boone, whom Kyncl called the “breakout star of the year,” the former YouTube exec appeared pleased with Warner’s recent and upcoming slate of music releases.
“So far in 2024, WMG has more new artists debuting on the Spotify Global Top 10 than any other music company,” Kyncl said, highlighting “homegrown successes” like Benson Boone, Teddy Swims and Artemas, the English-Cypriot singer-songwriter signed to 10K Projects.
Streaming’s catalog “halo effect“
When Twenty One Pilots released their latest album, Clancy, the band’s entire body of work benefitted, with streams more than doubling during the first week after the album’s release. That’s “the beauty of streaming,” Kyncl said on the call. “Newly released hits have a halo effect on the rest of an artists’ catalog.”
While loyal fan bases can drive an uptick in an artist’s catalog streams after a new hit’s release, Kyncl added that WMG can amplify and extend that halo effect, transforming hits into “evergreen, deep catalog.”
Warner Music Group’s stock was up around 3% Wednesday (Aug. 7) as investors optimistically received its fiscal third-quarter earnings report, which showed that streaming revenue continues to grow for the third-largest major music company.
On a call discussing the company’s earnings, Warner Music Group (WMG) CEO Robert Kyncl answered questions and shared his perspective on Spotify’s bundling controversy; discussed what WMG is doing to get more mileage out of its catalog; and shared a broad update on the company’s previously-announced $200 million cost savings/reinvestment plan — while remaining mum on the more recent executive restructure that’s been reverberating through the music industry since last week.
See below for three major takeaways from the call.
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Bundling is not inherently bad
Overall streaming revenue was up 5% for Warner this quarter, with recorded music streaming revenue up 8.7% — reflecting growth in subscription revenue of 7%. While that was welcome news to investors, the subject of Spotify’s contentious decision to bundle music and audiobooks — allowing them to qualify for the lower mechanical royalty rate reserved for bundles under the Copyright Royalty Board’s (CRB) Phonorecords IV agreement — did not go unmentioned. But in his opening remarks and later, during a Q&A period with analysts, Kyncl said the company derives its streaming earnings from a diversity of partners and appeared to tamp down talk of the controversy that erupted over the bundling policy.
“I know that investor attention has recently been focused on the dynamics between labels and DSPs, with some speculating that we’re adversaries playing a zero-sum game. That’s simply not the case,” Kyncl said. “We’re actively engaged with our partners around ways to drive growth for all of us. Streaming dynamics remain healthy … with plenty of headroom for subscriber growth in both established and emerging markets … across multiple partners. Also, price optimization and improvements in the royalty models will provide ongoing opportunities for additional growth.”
Kyncl went on to note that bundling, which could result in lower payments to songwriters, has been used in other industries, like TV, for the purpose of market expansion. “The job of wholesalers like the music companies is to ensure that the sanctity of our pricing are in line with each other. You can expect us to pursue that strategy,” Kyncl said. “As it relates to CRB, I don’t see it as something that will persist in the long term.”
Radio silence on executive restructuring
WMG executives did not directly discuss the internal restructuring plans made public last week, which led longtime co-leader of Atlantic Records and Atlantic Music Group chairman/CEO Julie Greenwald to announce she was stepping down on Tuesday (Aug. 6). During his opening remarks, Kyncl did highlight the “commercially and creatively … successful” partnership between WMG and 10K Projects — whose CEO/founder Elliot Grainge has been picked to succeed Greenwald — by noting English-Cypriot singer-songwriter Artemas’ single “I Like The Way You Kiss Me,” which reached No. 1 on Billboard‘s Global Excl. U.S. chart in April.
However, Kyncl did share details about a restructuring plan he mentioned on WMG’s last earnings call, which included selling the entertainment websites Uproxx and HipHopDX — with the overall goal to increase investment in music, technology and new skill sets and deliver $200 million in savings by the end of fiscal 2025.
“The majority of changes have already been implemented,” Kyncl said. “We are laying a strong foundation to accelerate our progress and yield greater value over time. We made improvements to our royalty systems and the tools used to identify unclaimed revenue, we overhauled our global supply chain, unlocking our ability to scale our third-party distribution business, and we’ve transformed our proprietary tools that identify fan trends while building new ways to engage with super fans.”
Catalog optimization is a major priority
One area where Kyncl is investing in technology is through a project he says is aimed at increasing the “performance of catalog…across all of our DSPs.”
Speaking of recent spikes in streaming for artists in Warner’s “deep” catalog — like Joni Mitchell and Tracy Chapman — as well as “shallow” catalog like Ed Sheeran, Kyncl said generating continued digital success stories for those acts is a top priority.
“We have a project on this across our technology and business teams to move down the entire catalog and make sure it’s properly optimized for streaming and on every large DSP,” he said on the call. “All of this augments our marketing campaigns against catalog which we have done in the past and continue to do and we’re applying more and more frontline focus on catalog.”
Warner Music Group reported on Wednesday strong streaming revenue growth and keeping a lid on its costs helped offset declines in merchandise and physical music sales in the company’s third fiscal quarter.
Quarterly net profit rose nearly 14% to $141 million from $124 million in the third quarter last year. Overall revenue fell by 1% to $1.554 billion from $1.564 billion in the year ago quarter due to the roll off of BMG’s distribution deal and a difficult comparison to the year-ago quarter, which included a $7 million benefit from the Copyright Royalty Board in Phonorecords III.
The company’s digital revenue and streaming revenue were up 4.7% and 5.5% respectively, as subscription revenue grew 7%. Recorded Music streaming revenue increased 5.0%, and music publishing streaming revenue increased 7.9%.
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“Our strong subscription streaming growth in [the third quarter] was driven by the performance of our music and healthy industry trends,” Warner Music Group chief executive Robert Kyncl said in a statement. “We’re nurturing the next generation of artists and songwriters, creating fresh impact for our iconic catalog, and working with our partners to increase the value of music. Our commitment to long-term artist development, combined with a flatter structure in recorded music, will enable us to super-serve talent and set WMG up for sustained future growth.”
WMG’s operating income jumped 10% to $207 million in the quarter from $189 million in the third quarter last year. Adjusted operating income before depreciation and amortization (OIBDA), which measures profitability over a specific period of time, rose 6% to $316 million from $297 million in the prior-year quarter.
Revenue from WMG’s recorded music division fell by 2% to $1.251 billion from $1.282 in the year-ago quarter. This was due in part to the exiting of BMG as a client, which resulted in $26 million less revenue, and a “renewal with one of the Company’s digital partners” which created an additional $3 million drage on recorded music streaming revenue, the company said.
BMG began winding down its distribution agreement with WMG’s ADA last September to move control of its 80 billion-stream digital business in-house.
Physical revenue fell by 4.8% because of release timing and a tough year-ago comparison, the company said. Artist services and expanded-rights revenue fell by 27.1% mainly due to lower merchandising revenue.
Revenue from WMG’s music publishing division rose by 8% to $305 million from $283 million in the year-ago quarter.
Topline Results:
Total revenue 1% to $1.554 billion in the third fiscal quarter 2024 from $1.564 billion in the same period last year.
Net income rose 14% to $141 million from $124 million in the third quarter 2023.
Recorded music revenue fell by 2% to $1.251 billion from $1.282 billion in the third quarter 2023.
Music publishing revenue rose 8% to $305 million from $283 million in the third quarter 2023.
Julie Greenwald will step down from her role as co-chair/COO of Atlantic Records and chairman/CEO of Atlantic Music Group, she announced during a company town hall on Tuesday (Aug. 6). She will be succeeded in her role as chairman/CEO of Atlantic Music Group by 10K Projects CEO/founder Elliot Grainge, effective Oct. 1.
The Zoom call was roughly 10-15 minutes long, according to sources at the label. Greenwald’s announcement of her departure was said by staffers who spoke with Billboard to be both “classy,” “inspiring” and “empowering,” with the longtime executive focusing on the success she has seen at Atlantic over the last two decades and clarifying that she will officially exit at the end of January 2025.
Tuesday’s announcement comes just five days after it was reported that Warner Music Group would be undergoing a major executive restructuring that would see CEO of recorded music Max Lousada stepping down at the end of September, Grainge ascending to the role of CEO of Atlantic Music Group effective Oct. 1 and Greenwald transitioning to the role of chairman of Atlantic Music Group, a move described in a press release as a “leadership transition.” The changes are thought to be far-reaching and indicative of a generational shift at Warner Music Group, which has been helmed by CEO Robert Kyncl since Jan. 1, 2023.
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One of the most celebrated executives in the music business, Greenwald has spent the last 20 years of her career at Atlantic and become practically synonymous with the storied label. During her time at the helm of Atlantic Music Group, she shepherded the careers of artists such as Bruno Mars, Ed Sheeran, Cardi B, Twenty One Pilots, Brandi Carlile, Charli XCX, Lil Uzi Vert and dozens more. She was named Billboard’s Women in Music executive of the year in 2017.
Greenwald led Atlantic alongside Craig Kallman, co-chair/CEO of Atlantic Records and the A&R brain behind the operation. Kallman will continue to hold the title of CEO of Atlantic Records.
At the time of the restructuring announcement, Greenwald said in a statement: “My whole career is about developing baby bands into career artists and empowering our amazing people to change culture in unexpected ways. It’s been 20 years since I walked through the door at Atlantic and began the work of rearchitecting this iconic label. I couldn’t have done it without the deep passion and dedication of my incredible team, and our unbelievable artists, who make music that inspires and moves people everywhere. Finally, I want to welcome Elliot; I’m looking forward to working with him as we continue to place our artists and their music at the heart of this company.”
Additional reporting by Melinda Newman.
The Warner Music Group is undergoing a major executive restructuring that will see CEO of Recorded Music Max Lousada step down at the end of September, the company announced today (Aug. 1). Lousada, who has run the recorded music operation of the major label for eight years, will remain an advisor until January 31, the company said; Lousada’s role will cease to exist moving forward, as will the role of president of international.
As part of the transition, longtime co-leader of Atlantic Records and Atlantic Music Group chairman/CEO Julie Greenwald will now take on the role of chairman of Atlantic Music Group, reporting directly to WMG CEO Robert Kyncl. Meanwhile, 10k Projects founder Eliot Grainge will ascend to the role of CEO of Atlantic Music Group effective October 1, also reporting to Kyncl.
The change will see 10K shift under the Atlantic Music Group umbrella, alongside Atlantic Records, Elektra and 300. Meanwhile, Warner Records — led by co-chair/CEO Aaron Bay-Schuck and co-chairCOO Tom Corson — will oversee Warner Music Nashville, in addition to Nonesuch and Reprise.
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“On behalf of everyone at WMG, I’d like to thank Max for his extraordinary achievements over the last 20 years,” Kyncl said in a statement. “Max is a true artists’ champion, who created a culture that puts artistry first, growing our global reach and building a roster of incredible talent and an outstanding team. I’m grateful that he’ll be helping to ensure a smooth transition.”
“Over the past two decades, we created something special together at Warner: a music company built for artists, where original voices are championed, where their creativity is honored and protected, and where superstar careers are ignited,” Lousada said in a statement. “I’m proud to have grown a world-class team who share that vision and whose enterprise and energy have brought in new labels, rebuilt iconic brands, expanded our global network, and pioneered new fan experiences. The music business has always been about evolution, and the time has come for me to build something new. I’ll be helping the team through this transition, and I have no doubt they’ll continue to develop artists who move the world.”
This is a developing story.
Welcome to a steamy edition of Executive Turntable, Billboard’s comprehensive(ish) compendium of promotions, hirings, exits and firings — and all things in between — across music. Check out this year’s Pride List of top LGBTQ+ executives in the industry. We also have a weekly interview series spotlighting a single executive and a regularly updated gallery honoring many of the industry figures we’ve lost throughout the year.
Big Loud Records promoted Stacy Blythe to executive vp of promotion, effective immediately. Much like her fellow recent promotee Patch Culbertson, she reports directly to partners Seth England, Joey Moi and Craig Wiseman at the Nashville-based label. Blythe joined Big Loud in 2015 and most recently held the position of svp of radio promotion. She and her promo team are credited with pushing two dozen No. 1 singles to radio during her nine-year stretch, starting with Chris Lane’s “Fix” and most recently hitting the mark with Post Malone and Morgan Wallen’s “I Had Some Help.” In addition to Wallen, Big Loud’s roster includes ERNEST, HARDY, Lauren Alaina, Lily Rose, Maggie Rose, HIXTAPE and others. Blythe is a fixture in assorted Billboard lists of influential executives, including Women In Music, Indie Power Players and Country Power Players. “Stacy is a day-one believer in Big Loud,” England said. “She is not only a radio expert, but a relationship builder and an investor in people, as well as a trailblazer within the industry at large that helped us build this company from the ground up. Stacy is integral to the success of our organization, and on behalf of all of the partners, we are honored to continue growing with her.”
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After roughly 18 years in the thick of Japan’s music industry, first at MTV, then Universal and Amazon before spending the last two years in the C-suite at Warner Music Japan, veteran executive Kazuhiro Shimada is taking a break. Shimada said earlier this week that Tuesday (July 9) was his last day as WMJ’s chief operating officer, a post he took on in late 2022 following a celebrated two-plus years as director and general manager of Amazon Music Japan. Prior to that he clocked a decade overseeing business affairs at UMG, and in the aughts was a vp of strategy at MTV Networks Japan. “I would like to express my deepest gratitude to all my colleagues whom I have worked with, business partners, artists and artist managers who have supported me throughout the time,” he said. “I plan to take a break for a while to recharge myself and look forward to the next challenge in the near future.”
Guitar Center appointed Adolfo Rodriguez as executive vp and chief technology & information officer, effective immediately. Reporting to CEO Gabe Dalporto, Rodriguez will harness the senior leadership experience he acquired at companies such as Advance Auto Parts, Citrix and IBM to develop and execute innovative technological advancements at the musical instrument retailer. Guitar Center’s biggest competitor in online retail is Sweetwater, but in the brick-and-mortar game — it has 300-plus stores in the U.S. — the company is about to be the only major player following the pending closure of all Sam Ash stores. “I am thrilled to join Guitar Center at such a pivotal time in its history,” said Rodriguez. “As a passionate musician and advocate for leveraging technology to drive business growth, I am eager to blend my professional expertise with my personal experience.”
Sony Music Latin-Iberia promoted Sergi Reitg to vice president of premium content, a role in which he’ll oversee various audiovisual initiatives throughout Spain and Mexico. Based in Spain, Reitg reports to Fernando Cabral, SML-I’s evp of strategic partnerships. Reitg has spent the last six years leading the company’s premium content team in Spain — recent productions include the documentary Sintiéndolo Mucho and the MAX series Acoustic Home — and will now broaden his remit overseas to North America. “Sergi’s vast experience and innovative approach to the film and television space makes him the perfect creative for this role,” said Cabral.
The Bluegrass Music Hall of Fame & Museum said longtime executive director Chris Joslin will step down later this month. Joslin, who joined the Owensboro, Ky.-based organization in 2015, is headed to suburban Nashville to oversee development and fundraising for Mission Lazarus, a faith-based nonprofit with operations in Honduras and Haiti. During his tenure, the Hall moved offices, rebranded, launched a magazine during the pandemic and grew its signature ROMP Festival into a premiere destination event for bluegrass fans. “Chris led our organization through a crucial era, and under his stewardship the Bluegrass Music Hall of Fame & Museum has flourished into a destination point for bluegrass music fans from all over the world,” said Chris Love, board chair of the Bluegrass Music Hall of Fame & Museum.
NASHVILLE NOTES: Red Street Records promoted Cambria Sojka to creative director, serving both country and Christian rosters at the Jay DeMarcus-founded label. Working closely with Sojka is newly hired Gianna Robinson as the label’s digital content coordinator. Both report directly to vp Michael Steele … Former RCA Nashville svp of promotion Dennis Reese joined artist management company Neon Coast. Their marquee artist? RCA Nashville superstar Kane Brown … Business management firm FBMM promoted Nashville-based Beth Tyson and New York-based Brian Gordner to associate business manager from account manager.
There’s been a C-suite shuffle at Muse Group, home to musician-focused digital tools like Ultimate Guitar, MuseScore and Audacity, as well as sheet music publisher Hal Leonard. Joining the company as chief growth officer is Sven Ahrens, who will oversee a team driving acquisition, engagement and retention of Muse’s apps and products. He arrives from Spotify, where he ran the streaming giant’s subscription growth team. Sliding over from Hal Leonard is the publisher’s longtime chief financial officer Debbie Diekelman, who is now CFO of the whole shebang. Finally, Mo Chahdi joined Muse as COO following a 20-year career that has included stops at AI company Aspen and Dell Technologies. “Sven, Mo and Debbie bring deep and diverse experience to our senior leadership team,” said Eugeny Naidenov, CEO of Muse Group. “Their visionary approach, proven success in scaling businesses and passion for our mission will be invaluable as we continue to evolve to best serve our global community of musicians, educators and learners.”
Nielsen hired advertising veteran Akhil Parekh as its chief solutions officer of digital product, responsible for overseeing the audience measurement company’s ads products, as well as forging strategic partnerships. He arrives from French ad conglomerate Publicis Groupe, where he was most recently executive vp and managing director … Nielsen also announced that former Snapchat, Chime, AOL, Spotify and HuffPost executive Jaren Grusd has joined the company as CEO of its metadata unit Gracenote. The data firm was previously led by Sujit Dasmunshi, who now assumes the role of chief operation officer.
Cinq Music promoted Diana Schweinbeck from director of marketing to senior director of artists and label services. In her new role, Schweinbeck and company will focus on optimizing the end-to-end release process for Cinq artists and labels. Prior to joining the Los Angeles-based distributor, label and publisher, Schweinbeck ran Schweinbeck, LLC, where she offered branding and management services to new artists. “Diana is a seasoned operator with artist management experience and a strong network, making her the perfect fit for understanding artist needs and running this department,” said Barry Daffurn, Cinq Music president and co-founder.
Evelyn Ingram joined Austin-based venue booking software company Prism.fm as senior director of strategic partnerships. Ingram is a veteran of the business, most recently at EventBooking and earlier at Ungerboeck and Momentum Technologies, and has carried on a “very friendly rivalry” with Prism.fm CEO Matt Ford for years, he said. “One of my favorite parts of running a company is building out an awesome team and Evelyn certainly adds to that,” Ford added. “Her experience, her love for life, the intelligence in her approach… Very excited for the future!”
Ex-Directors Guild of America general counsel David Korduner joined KM&M as partner in Los Angeles in the firm’s entertainment and labor practice. Most recently, Korduner served as svp and associate general counsel of labor relations at indie studio Fifth Season. “David’s impressive experience in union relations, contract negotiations, and overseeing legal and labor issues in the entertainment industry complements our entertainment labor practice,” said Bill Zuckerman, KM&M’s managing partner and entertainment group leader.
ICYMI:
James Dolan
Universal Music U.K. reorganized operations into what CEO David Joseph called “two new powerhouse frontline label groups” — Island EMI Label Group, headed by Louis Bloom as president, and the newly formed Polydor Label Group, led by Ben Mortimer … James Dolan got a three-year contract extension to continue running Sphere Entertainment … and BMI welcomed Tom Kershaw as chief technology officer and Justin Rohde as chief transformation officer.
Last Week’s Turntable: Bertelsmann Boards Up BMG Boss
Warner Music Group (WMG) sent letters to tech companies this week instructing them not to use the label’s music to train artificial intelligence technology without permission. Sony Music sent out similar letters to over 700 companies in May.
“It is imperative that all uses and implementations of machine learning and AI technologies respect the rights of all those involved in the creation, marketing, promotion, and distribution of music,” Warner’s notice reads.
It continues, “all parties must obtain an express license from WMG to use… any creative works owned or controlled by WMG or to link to or ingest such creative works in connection with the creation of datasets, as inputs for any machine learning or AI technologies, or to train or develop any machine learning or AI technologies.”
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The notices from Sony and Warner come in the wake of the AI Act, legislation that was passed in the European Union in May. “Any use of copyright protected content requires the authorization of the rightsholder concerned unless relevant copyright exceptions and limitations apply,” the act notes. “Rightsholders may choose to reserve their rights over their works or other subject matter to prevent text and data mining, unless this is done for the purposes of scientific research.”
If companies take this action, then “providers of general-purpose AI models need to obtain an authorization from rightsholders if they want to carry out text and data mining over such works.”
The Cold War between the music industry and much of the AI world has been heating up in recent months. Labels are adamant that AI companies should license their music if they want to use those massive catalogs of recordings to develop song generation technology.
Most AI companies, however, aren’t interested in paying. They often argue that their activities fall under “fair use” — the U.S. legal doctrine that allows for the unlicensed use of copyrighted works in certain situations.
In June, the three major labels sued two AI music companies, Suno and Udio, accusing them both of “willful copyright infringement on an almost unimaginable scale.” “These lawsuits are necessary to reinforce the most basic rules of the road for the responsible, ethical, and lawful development of generative AI systems and to bring Suno’s and Udio’s blatant infringement to an end,” RIAA Chief Legal Officer Ken Doroshow said in a statement.
In a response to the suits, Suno CEO Mikey Shulman said his company’s tech is “designed to generate completely new outputs, not to memorize and regurgitate pre-existing content.” Udio said it “stand[s] behind our technology.”
The three major music companies are weighing a lawsuit against AI startups Suno and Udio for allegedly training on copyrighted sound recordings, according to multiple sources.
The potential lawsuit, which would include Universal Music Group, Warner Music Group and Sony Music, would target a pair of companies that have quickly become two of the most important players in the emerging field of generative AI music. While many of its competitors focus on generating either music or lyrics or vocals, Suno and Udio both allow users to generate all three in the click of a button. Two sources said the lawsuit could come as soon as next week. Reps for the three majors, as well as Suno and Udio, did not respond to requests for comment.
Music companies, including UMG, have already filed a lawsuit against Anthropic, another major AI firm, over the use of copyrighted materials to train models. But that case dealt only with lyrics, which in many ways are legally similar to written subject matter. The new suit would deal with music and sound itself.
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Just a few months from its launch, Udio has already produced what could be considered an AI-generated hit song with “BBL Drizzy,” a parody track created by comedian King Willonius and popularized via a remix by super producer Metro Boomin. Later, the song reached new heights when it was sampled in Sexyy Red and Drake‘s song “U My Everything,” becoming the first major example of sampling an AI-generated song.
Suno has also achieved early success since its launch in December 2023. In May, the company announced via a blog post that it had raised a total of $125 million in funding from a group of notable investors, including Lightspeed Venture Partners and Nat Friedman and Daniel Gross.
Both companies, however, have drawn criticism from many members of the music business who believe that the models train on vast swathes of copyrighted material, including hit songs, without consent, compensation or credit to rights holders. Representatives for Suno and Udio have previously declined to comment on whether or not they train on protected copyrights, with Udio’s co-founders telling Billboard they simply train on “good music.”
In a recent Rolling Stone story about Suno, investor Antonio Rodriguez admitted that Suno does not have licenses for whatever music it has trained on, but he said that was not a concern to him, adding that this lack of such licenses is “the risk we had to underwrite when we invested in the company, because we’re the fat wallet that will get sued right behind these guys… Honestly, if we had deals with labels when this company got started, I probably wouldn’t have invested in it. I think that they needed to make this product without the constraints.”
In a series of articles for Music Business Worldwide, founder of AI safety non-profit Fairly Trained, Ed Newton-Rex, found that he was able to generate music from Suno and Udio that “bears a striking resemblance to copyrighted music. This is true across melody, chords, style and lyrics,” he wrote. Both companies, however, bar users from prompting the models to copy artists’ styles by typing out sentiments like “a rock song in the style of Radiohead” or from using specific artists’ voices.
The case, if it is filed, would hinge on whether the use of unlicensed materials to train AI models amounts to copyright infringement — something of an existential question for the booming sector, since depriving AI models of new inputs could limit their abilities. Content owners in many sectors, including book authors, comedians and visual artists, have all filed similar lawsuits over training.
Many AI companies argue that such training is protected by copyright’s fair use doctrine — an important rule that allows people to reuse protected works without breaking the law. Though fair use has historically allowed for things like news reporting and parody, AI firms say it applies equally to the “intermediate” use of millions of works to build a machine that spits out entirely new creations. That argument will likely be the central question in any lawsuit over AI training.
Some AI companies have taken what is often called a more “ethical” approach to AI training by working directly with companies and rights holders to license their copyrights or form official partnerships instead.
So far, the majors have embraced partnering with AI companies in this way. Already, UMG and WMG have worked with YouTube for its AI voice experiment DreamTrack; Sony has partnered with Vermillio on a remix project for The Orb and David Gilmour; WMG has worked with Edith Piaf’s estate to recreate her voice using AI for an upcoming biopic; UMG launched an AI music incubator with YouTube Music; and most recently, UMG has teamed up with SoundLabs to let their artists create their own AI voice models for personal use in the studio.
After taking itself out of the bidding for French music group and distributor Believe in April, Warner Music Group (WMG) is shopping for an alternative distribution company that could help it gain market share in the competitive space that serves independent creators and labels — and it’s hired a top music investment banker from Goldman Sachs to lead the effort.
Since taking over as WMG’s CEO last year, Robert Kyncl has said the company is prepared to build in-house the technology and services he thinks it needs. Now he’s ready to buy them as well.
“As part of our mission to be a destination for artists and songwriters at every stage of development, we are expanding our lower-touch services that many indie artists, labels and songwriters rely on,” Kyncl said on a conference call discussing WMG’s quarterly earnings on May 9. “We have a clear plan to develop this area of our ecosystem, and we’re building solutions in-house while staying vigilant about [merger and acquisition] opportunities, which could accelerate our capabilities.”
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On Thursday (June 6), WMG announced the hire of Goldman Sachs’ global head of music & live entertainment investment banking Michael Ryan-Southern to a newly created executive vp role. Reporting to Kyncl, Ryan-Southern will be responsible for acquiring companies and catalogs that can boost WMG’s growth and revenues. When he officially joins in August, the first item on his shopping list will be an independent distribution company, smaller in size and cost than Believe, that an inside source described as a “bolt-on” acquisition to help grow WMG’s market share in the independent distribution and services business without affecting its overall profit margins.
Among the companies that WMG is eyeing, according to sources, are leading independent distributors DistroKid and CD Baby. WMG is “active in the market” but is still in the exploratory stage, those sources say.
A WMG spokesperson declined to comment for this story. A representative for Downtown, which owns CD Baby, also declined to comment, except to say that Downtown “is singularly focused on continuing to grow our business and support our clients’ success.” Representatives for DistroKid did not immediately respond to a request for comment.
WMG approached Paris-based Believe in February with a nonbinding offer to acquire it at a price of “at least” 17 euros ($18.60) per share. It ultimately decided not to submit a formal offer in April. Asked why the company did not pursue an offer for Believe, Kyncl said on the May 9 call that it backed away “for a variety of reasons,” including the brief amount of time it was given to conduct due diligence.
Ryan-Southern is a former EMI publishing executive who, along with Goldman’s global head of entertainment investment banking, Aaron Siegel, was on some of music’s biggest deals. These included New Mountain Capital’s acquisition of BMI and the spinoff of Sphere Entertainment, which owns the Sphere in Las Vegas, MSG Networks and Tao Group Hospitality, from Madison Square Garden Entertainment, which owns and operates the Garden and Radio City Music Hall among other venues in New York and Chicago. Ryan-Southern and Siegal also advised Believe founder/CEO Denis Ladegaillerie and his consortium with investment funds EQT and TCV on their effort to take Believe private.
Buying or building something that can leverage WMG’s independent distribution and services division, ADA, would help the music company recruit more early-stage artists, something its executives consider core to its success.
WMG launched ADA in 1993, roughly 20 years before Sony bought a stake in The Orchard and Universal Music Group launched Caroline International as an indie-label distributor that was later rebranded as Virgin Music Group. And though WMG was the first major to carve out a presence serving the independent artist market — renting its major-label services to indies, as industry sources have described it — competition in the market has heated up.
UMG and Sony have invested tens of millions in recent years buying rival startups in the space. A minority shareholder since 2006, UMG acquired Ingrooves in 2019. In 2022, UMG acquired Mtheory Artist Partnerships as well as a 49% stake in [PIAS]. Sony closed out its full acquisition of The Orchard in 2015 and then bought AWAL in 2022.
The Orchard now holds a commanding lead in the U.S. market with a 7.27% current market share, according to Luminate. UMG’s Virgin Music Group, which comprises Ingrooves, Mtheory and Virgin Music Label & Artist Services, holds around 3.42% of the current market. ADA has a current market share of 1.68%. Its biggest client, BMG, which contributes 0.94% to ADA’s current share, is winding down its distribution agreement.
WMG now needs to “turbocharge” this part of its business to capitalize on the fast-growing independent sector, says Fred Davis, partner at The Raine Group.
“The world now is divided into three categories of artists: those signed to major labels, those signed to indie labels and indie artists without a label,” Davis says. “Distribution platforms are proving to be a viable source of A&R for the major labels.”
Focusing WMG’s A&R more on capturing opportunities, particularly in genres that are just beginning to experience growth, was one of Kyncl’s top 2024 agenda items highlighted in a New Year’s Day note he sent to all staff. In April, WMG’s publishing division, Warner Chappell Music (WCM), partnered with ReverbNation, BandLab Technologies’ premium artist services platform, to identify and sign emerging songwriters. WCM administers music rights for any users who enroll in a new program through ReverbNation Publishing Administration, and signed songwriters gain access to WCM’s services.
WMG has acquired majority stakes or launched joint ventures with a few distribution-oriented companies in recent years — some before Kyncl joined WMG — primarily in emerging markets in the Middle East and Asia. Among them: a majority stake in Africori, the leading digital music distribution, music rights management and artist development company in Africa, in January 2022. That March, it also acquired Qanawat Music, a leading distributor in the Middle East and North Africa.
Last year, WMG did two deals in India: It acquired a majority stake in Indian digital media company Divo and formed a joint venture with Sky Digital, which aggregates releases from Punjabi and Hindi labels.
While WMG has made acquisitions in other geographical regions, rival majors have bought companies serving the U.S. market for independents. “It would make sense for [WMG] to augment its distribution with an acquisition,” says a source familiar with the company’s strategy.