Welcome to Music Business Worldwide’s weekly digest. Here are the five biggest stories that made headlines over the past seven days. Rounding in MBW is supported in: cent tripHelping over 500 of the world’s best-selling artists maximize their earnings and reduce travel costs.
After more than a year of rumors and reports that Queen’s catalog sales would top $1 billion, this week we received news that the recording and publishing rights to Freddie Mercury’s legendary band have been sold to Sony Music for a much higher price. I heard. Price better than expected: $1.27 billion.
Aside from the huge deal (which has yet to be officially confirmed), much of the music industry news this week has focused on TikTok, a company that is “adjacent to the music industry.”
This week, MBW broke the news that the ByteDance-owned social media company is assembling an investment team to purchase music rights and companies. This means you can be an actual music company rather than just “music-adjacent.”
We also learned this week that Kobalt subsidiary Amra, which calls itself “the first and only global digital collecting association,” has invested more than $50 million in technology to date.
Meanwhile, ByteDance plans to invest $2.1 billion to build an AI hub in Malaysia, making the China-based company the latest tech giant to invest heavily in the country’s burgeoning AI industry.
Finally, this week we asked the following questions: What if Spotify took Sony Music Group Chairman Rob Stringer’s advice and started charging for free, ad-supported subscription tiers? The short answer is “it depends.” But maybe Spotify will make a lot of money.
Here’s what happened this week…
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1) SONY MUSIC plans to acquire the QUEEN catalog for $1.27 billion (reported)
Sony Music Entertainment is set to acquire the catalog of legendary rock band Queen in a landmark deal worth GBP £1 billion (USD 1.27 billion at current exchange rates).
Sony Music has emerged as the ultimate buyer for Queen’s recording and publishing rights, as well as royalties from previous deals with Disney Music Group and Universal Music Group, Hits reported on Wednesday, June 19, citing sources. .
Queen’s catalog includes megahits such as Bohemian Rhapsody, Another One Bites the Dust, We Will Rock You, and more.
Disney’s distributor UMG will reportedly hold North American distribution rights, but Sony will receive royalties. UMG’s worldwide distribution rights will transfer to Sony in 2026 or 2027, making Sony Music the sole distributor and owner of all Queen content globally.
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2) TIKTOK is forming an investment team to acquire music content and companies.
Two years ago, we asked whether TikTok was slowly turning into a record label.
The ByteDance-owned platform recently entered the music distribution market with its SoundOn service and was hiring A&R executives with record label experience.
On June 18, MBW revealed that TikTok was taking this development to the next level with plans to acquire and invest in music rights.
We’ve learned that TikTok is building an in-house music content investment team based in Los Angeles, New York, and San Jose, and is focused on “partnership or acquisition opportunities in the music content space on a global level.”
In other words, TikTok is heading into the highly competitive music M&A market…
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3) TIKTOK parent company BYTEDANCE invests $2.1 billion to develop AI hub in Malaysia
Malaysia has become a hub for AI-related investments by global technology giants.
ByteDance, the parent company of China-based social video app TikTok, is the latest in a string of technology companies to invest in Malaysia with major investments centered on its fast-growing AI business.
According to a Reuters report posted on social media by Investment, Trade and Industry Minister Tengku Zafrul Aziz last week, ByteDance said it plans to “invest in AI and make Malaysia an AI hub in the region with an investment offer of approximately RM10.” “$1 billion” translates to about $2.1 billion…
4) Amra has invested over $50 million in technology to date, most of which has been spent in the last three years.
Amra has grown into a substantial company since being acquired/launched by Kobalt in 2015. For the year to June 2022, the most recent financial year for which public financial figures are available, Amra recorded revenue of US$117.3 million.
It’s no wonder that Francisco Partners, the company that acquired a majority stake in Kobalt in 2022, has highlighted Amra as a growth priority. (FP’s Matt Spezler reiterated Amra’s status as “the only global digital licensing platform” at the time.)
Today (June 20th) Amra released statistics that themselves show just how seriously Kobalt/FP views the opportunities ahead. Amra has confirmed that its total technology investments to date have exceeded $50 million. This is the amount spent over the past three years.
Credit: Nicolas Ospina Soriano/Shutterstock
5) What happens if SPOTIFY starts charging a ‘reasonable fee’ for its ad-funded tier or stops altogether?
The current ‘free’, ad-supported music streaming model is about to be overhauled.
Last month, Sony Music Group Chairman Rob Stringer targeted premium services offered by Spotify and others in a presentation to Sony Group investors on May 30.
Sony executives have suggested that DSPs should close the growing “price gap” between paid and free users, especially in mature streaming markets.
Stringer’s solution: Charge currently free users a “reasonable fee” to listen to music and other content through an ad-supported service.
So what happens if, as Stringer suggests, Spotify now starts charging a modest additional fee for access to its ad-supported tier?
