From Sir Lucian Grainge on music’s streaming payout mannequin to Kakao Leisure’s $966m funding… it’s MBW’s Weekly Spherical-Up


Welcome to Music Business Worldwide’s weekly round-up – the place we ensure that you caught the 5 greatest tales to hit our headlines over the previous seven days. MBW’s round-up is supported by Centtrip, which helps over 500 of the world’s best-selling artists maximise their earnings and cut back their touring prices.


This week, writing in a New Yr notice to workers, Universal Music Group Chairman and CEO Sir Lucian Grainge stated the way in which music streaming companies pay labels and artists at present has to alter.

Within the notice, obtained by MBW, Grainge stated: “What’s change into clear to us and to so many artists and songwriters—growing and established ones alike—is that the financial mannequin for streaming must evolve”.

He added: “As know-how advances and platforms evolve, it’s not stunning that there’s additionally a necessity for enterprise mannequin innovation to maintain tempo with change.”

Additionally this week, US market monitor Luminate revealed its Yr-Finish report for 2022 revealing that on-demand audio music streams in the USA grew 12.1% final 12 months, to succeed in 1.1 trillion.

MBW’s evaluation of Luminate’s newest figures revealed, nonetheless, that the Prime 10 greatest hits within the US annually have gotten much less widespread.

Elsewhere, South Korea-based Kakao Leisure, a subsidiary of Kakao Corp, secured 1.2 trillion South Korea Received (approx $966m) funding from sovereign wealth funds.

The corporate’s music division operates streaming platform Melon, which Kakao claims has a “dominant market share in music distribution rights within the nation”.  Kakao additionally operates what it calls “a multi-label administration system for globally beloved Okay-pop artists” together with IVE, Monsta X and others.

Plus, Dr. Dre is reportedly near promoting a few of his music belongings in two separate offers price $200m, whereas Sony Music filed a copyright infringement lawsuit in opposition to Trefuego, a rapper behind a TikTok hit known as 90mh.

Right here’s what occurred this week…


The Picture Entry/Alamy

1) SIR LUCIAN GRAINGE: MUSIC NEEDS A NEW STREAMING PAYOUT MODEL… AND WE’RE WORKING ON IT.

Sir Lucian Grainge, Chairman and CEO of Common Music Group, has stated the way in which music streaming companies pay labels and artists at present has to alter.

Writing in a New Yr notice to workers on Wednesday (January 11), obtained by MBW, Grainge stated: “What’s change into clear to us and to so many artists and songwriters—growing and established ones alike—is that the financial mannequin for streaming must evolve. As know-how advances and platforms evolve, it’s not stunning that there’s additionally a necessity for enterprise mannequin innovation to maintain tempo with change.

“There’s a rising disconnect between, on the one hand, the devotion to these artists whom followers worth and search to assist and, on the opposite, the way in which subscription charges are paid by the platforms. Below the present mannequin, the essential contributions of too many artists, in addition to the engagement of too many followers, are undervalued…”

In Grainge’s crosshairs, there: The ‘professional rata’ payout system utilized by companies akin to Spotify, whereby the vast majority of subscription and advert cash generated every month is pooled right into a central ‘pot’, and is then paid out to labels and artists primarily based on their share of the quantity of whole performs.

Additionally in Grainge’s crosshairs: Firms and entrepreneurs who search to use this ‘professional rata’ system for their very own unjust achieve. (In addition to, doubtlessly, streaming companies who strike direct low-royalty offers with music manufacturing companies, after which intentionally push music followers in direction of this music in an try to save cash on total royalty prices.)


Credit score: Press/Lillie Eiger

2) THE TOP 10 HITS IN THE US LAST YEAR ACCOUNTED FOR FEWER THAN 1 IN EVERY 200 STREAMS

As MBW reported yesterday, the whole variety of on-demand audio streams within the US final 12 months grew handsomely – up 12.1% to 1.1 trillion.

In line with figures revealed in Luminate’s end-of-year report, this quantity of streams additionally noticed a year-on-year acceleration in development from 2021 (whole streams have been up by 121.8bn YoY in 2022, larger than the 111.0bn rise we noticed in 2021).

Digging additional into Luminate’s numbers, although, confirms {that a} long-running pattern within the trendy music enterprise turned much more pronounced in 2022: The Prime 10 greatest hits within the US annually have gotten much less widespread…


3) K-POP AND MEDIA GIANT KAKAO ENTERTAINMENT SECURES $966M INVESTMENT FROM SOVEREIGN WEALTH FUNDS

South Korea-based Kakao Leisure, a subsidiary of Kakao Corp, simply secured 1.2 trillion South Korea Received (approx $966m) funding from what it says are “main sovereign wealth funds”.

It plans to make use of the proceeds to speed up its world development throughout its three enterprise divisions. These divisions embrace ‘Story’, which includes webtoons and net novels, after which Media, in addition to Music.

Kakao hasn’t revealed the names of the funds backing the corporate, however TechCrunch studies that the funding has come from Saudi Arabia’s Public Funding Fund (PIF) and Singapore-based PWARP Funding.

The Korea Herald studies that the ‘money injection is the most important quantity ever acquired by a content material firm’ in South Korea.


4) DR. DRE SELLING MUSIC ASSETS TO SHAMROCK AND UNIVERSAL IN $200M+ DEAL (REPORT)

Dr. Dre is reportedly near promoting a few of his music belongings in two separate offers, with Shamrock Holdings and Common Music Group, for upwards of $200 million.

The belongings embrace a bundle of music earnings streams and another catalog belongings that generate virtually $10 million in annual earnings, in accordance with a report from Billboard on Wednesday (January 11).

Citing sources, Billboard studies that Dr. Dre is promoting his artist royalties from two of his solo albums and his artist royalties from hip hop group N.W.A., which he shaped with Ice Dice, Arabian Prince and Eazy-E in 1987.

He’s additionally promoting his producer royalties, his author’s share of his music catalog that he doesn’t personal publishing rights to, akin to his share of songs on his The Persistent (1992) album, revealed by Sony Music Publishing, Billboard added…


5) THE STORY OF TREFUEGO’S TIKTOK HIT 90MH – AND SONY’S BID TO SCRUB IT FROM THE INTERNET

“Does anybody know why this music is banned on Spotify?”

“wHY ISNT 90MH ON SPOTIFY NA:'(((((“

“whyd 90mh get faraway from spotify”

All feedback posted on Twitter and YouTube at numerous factors in late 2022 by followers of a viral TikTok hit.

Mentioned hit, initially launched in September 2019, is 90mh by unbiased Arizona-based rapper, Trefuego.

Every of those three feedback beckons the identical rationalization: As a result of Sony Music issued a strict copyright takedown discover on 90mh to Spotify and different key platforms on August 9, 2022.

That prevalence is revealed in a lawsuit, obtained by MBW, filed by Sony Music Entertainment and Sony Music Publishing in opposition to Trefuego within the District of Arizona in December…


MBW’s Weekly 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.Music Enterprise Worldwide

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