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.
MBW broke the news this week that Kobalt Music Group is currently in advanced talks to sell a majority stake to US-headquartered Francisco Partners.
Senior MBW sources tell us that there’s a possibility a deal could be signed over the next week or two.
With offices in San Francisco, London and New York, Francisco Partners has raised over $24 billion in committed capital since its launch over two decades ago.
Other music-related investments made by Francisco Partners have included Eventbrite, which secured financing from the investment firm of up to $225 million back in 2020.
Another big story reported on our pages this week was that the US music publishing Industry generated $4.7 billion last year, but the record industry grew twice as fast.
Music publishers saw their wholesale US revenues rise by $700 million to USD $4.70 billion in the calendar year of 2021, according to industry (NMPA) data.
Record companies (and distributors), meanwhile, saw their wholesale US revenues rise by more than double this figure. Their revenue grew $1.8 billion, to $9.8 billion for 2021.
Elsewhere this week, South Korea-headquartered K-Pop company SM Entertainment expanded in Saudi Arabia with plans to promote S-Pop (Saudi Pop) via the discovery and production of local artists.
The company also plans to establish “a metaverse platform to share Korean and Saudi culture” as well as a music venue along the Red Sea which it says will be, “capable of holding a music festival all-year-round”.
Here’s what happened this week…
Last year was a big year for Kobalt Music Group. The company celebrated its 20th anniversary in 2021, while selling AWAL to Sony Music – a deal which left Kobalt clear to focus on its core music publishing business, plus digital collection society AMRA.
2022, though, might be an even bigger year in the story of the company.
Senior MBW sources tell us that US-headquartered Francisco Partners is currently in advanced talks to acquire a majority stake in Kobalt Music Group, with the possibility of a deal being signed over the next week or two…
2) THE US MUSIC PUBLISHING INDUSTRY GENERATED $4.7BN LAST YEAR – BUT THE RECORD INDUSTRY GREW TWICE AS FAST
There are financial statistics in the music business that, on the surface of things, don’t tell us too much.
They might be big and impressive, but they give little away about trends affecting the wider business.
Here is one of those numbers: According to the National Music Publishers’ Association, the US music publishing industry generated USD $4.70 billion in the calendar year of 2021.
That figure, revealed by NMPA boss David Israelite at the trade org’s annual meeting in New York in June, was up by just under $700 million versus the equivalent number from 2020 ($4.08bn)…
3) SONY MUSIC JAPAN IS BUILDING ‘THE LARGEST VIRTUAL TALENT DEVELOPMENT AND MANAGEMENT PROJECT IN HISTORY’
Sony Music Entertainment (Japan) recently launched a global talent audition for real-life creators to work as virtual characters via the Tokyo-based ‘PRISM Project’, described in a press release as a “member of the Sony Music Entertainment (Japan) Inc. family of virtual talent brands”.
On PRISM Project’s website, it’s referred to as “a multinational VTuber agency from the future”.
According to SMEJ, PRISM Project is “backed by Sony Music’s industry-leading expertise in talent management, voice acting, music production, event production, and digital technology”, and aims to “push the boundaries of the virtual talent space by providing growth and development opportunities unrivaled in the industry today…”
4) K-pop giant SM Entertainment expands in Middle East, plans to discover and produce local artists in Saudi Arabia
South Korea-headquartered K-Pop company SM Entertainment is expanding in Saudi Arabia.
Soo-Man Lee, the firm’s Chief Producer, signed a memorandum of understanding (MOU) with the Ministry of Investment Saudi Arabia (MISA) to enter the local market and promote joint projects.
Through this business agreement, SM says that it will actively promote S-Pop (Saudi Pop) via the discovery and production of local artists.
The company also plans to establish “a metaverse platform to share Korean and Saudi culture…”
5) CAPITOL DROPS ‘ROBOT RAPPER’ FN MEKA, AS PROJECT IS ACCUSED OF BEING AN ‘INSULT TO THE BLACK COMMUNITY’
‘Virtual artist’ FN Meka has been dropped by Capitol Records less than two weeks after the label announced his signing.
The move follows a backlash revolving around stereotyping and appropriation and a strongly worded statement from the activist group Industry Blackout.
Capitol Records confirmed on Tuesday (August 23): “CMG has severed ties with the FN Meka project, effective immediately. We offer our deepest apologies to the Black community for our insensitivity in signing this project without asking enough questions about equity and the creative process behind it.
“We thank those who have reached out to us with constructive feedback in the past couple of days-your input was invaluable as we came to the decision to end our association with the project…”
Music Business Worldwide