Welcome to Music Business Worldwide’s weekly round-up – where we make sure you caught the five biggest stories to hit our headlines over the past seven days. MBW’s round-up is supported by Centtrip, which helps over 500 of the world’s best-selling artists maximise their income and reduce their touring costs.
Phew! Whadda week.
In the past seven days, MBW revealed that Sony Music Entertainment (SME) has entered into a definitive agreement to acquire two companies from Kobalt Music Group for $430 million: recorded music services firm AWAL and Kobalt Neighbouring Rights.
(Triller has now claimed it doesn’t need a UMG license for its service. UMG has called Triller’s statements “removed from reality”.)
Elsewhere, Spotify‘s paying subscriber base hit 155m in 2020, according to its Q4 financial results, which also revealed that the company lost the equivalent of $2.2m every day last year.
Plus, Sony’s recorded music revenues soared above $4.5bn in 2020 after a huge final quarter of the year, while Neil Jacobson’s new company, The Music Acquisition Corporation, floated on the NYSE on Wednesday (February 3) under the ticker symbol TMAC.U.
Well, this shakes up February.
Sony Music Entertainment (SME) has entered into a definitive agreement to acquire two companies from Kobalt Music Group, MBW can reveal.
Sony Corporation has confirmed that the deal is costing Sony Music USD $430 million.
One of those companies is AWAL, the recorded music services firm that works with independent artists including Lauv, Finneas, AG Club, girl in red, Nick Cave & The Bad Seeds, and Little Simz.
The other is performance rights collection agency Kobalt Neighbouring Rights (KNR), which has distributed more than $250 million to over 2,000 artist and label clients since 2013, including the likes of Cardi B, Ed Sheeran, Ariana Grande, Concord, Secretly Canadian and others.
Universal Music Group has pulled its catalog of music from short-form video platform Triller.
Triller is a fast-growing rival to TikTok worldwide, but has landed in trouble with the music business before over its treatment of copyright.
Last summer, David Israelite, CEO & President of the US-based publishing body NMPA, said: “[Triller] boasts ‘millions of songs at your fingertips,’ however many of those songs have not been properly licensed.
“The pattern of tech platforms asking for forgiveness instead of permission to use songwriter’s work must stop. Triller must legitimize its business by properly licensing all music on its platform.”…
There are a few different ways you can slice Spotify’s performance in 2020, as revealed in its newly-published Q4 results.
Spotify shareholders will be happy to see that the firm’s paying subscriber base closed out last year’s fourth quarter at 155m.
SPOT’s annual gross margin (i.e. the chunk of its yearly turnover left after it pays royalties to the music industry and other Costs of Revenue) was also very slightly up, from 25.5% in FY 2019, to 25.6% in FY 2020.
There was further good news in terms of Spotify’s topline annual revenue growth: up 16.5% year-on-year from €6.76bn in 2019 to €7.88bn in 2020.
Yet the further down Spotify’s 2020 Statement Of Operations you look, the grislier things become.
Sony’s global recorded music operation (Sony Music) saw its annual streaming revenues jump by 19.5%, or nearly half a billion US dollars (+$467m), in calendar 2020.
Those streaming revenues hit $2.87bn in the 12 months, as Sony’s worldwide recorded music revenues – across all formats, licensing etc. – hit $4.51bn, up 8.1% YoY.
After a pandemic-affected wobble in calendar Q2, Sony Music had a much stronger Q3 – the three months to end of September – when its quarterly turnover returned above $1 billion ($1.16bn)…
Last month, Music Business Worldwide revealed that long-time Geffen Records President Neil Jacobson was plotting a major flotation of a new music company in the US.
According to an SPAC S-1 prospectus obtained by MBW for Jacobson’s new company, The Music Acquisition Corporation, the exec was planning to raise $200 million (potentially up to $230 million) via an imminent IPO on the New York Stock Exchange.
So far, everything is going to plan. Jacobson’s company confirmed on Tuesday (February 2) that it had priced its IPO of 20 million units at $10 each.
The Music Acquisition Corporation then floated on the NYSE on Wednesday morning (February 3) under the ticker symbol TMAC.U.
TMAC.U is a Special Purpose Acquisition Company (SPAC) and is on the hunt for acquisitions in the worlds of both music rights and music tech.
MBW’s weekly round-up is exclusively supported by Centtrip, leading provider of smart treasury, foreign exchange and payment solutions for the music industry. Find out more here. Music Business Worldwide