Welcome to Music Business Worldwide’s regular round-up, where we make sure you catch the five biggest reports that have made headlines in the last seven days. MBW’s round- away is supported by Centtrip, which helps over 500 of the country’s best- selling artists increase their income and decrease their touring costs.
We learned this week that the tracking and publishing rights to the famous group fronted by Freddie Mercury were sold to Sony Music for an even higher rate than the media had anticipated:$ 1.27 billion, following more than a year of rumors and reports that the purchase of Queen’s catalog may surpass the billion-dollar mark.
Beyond that stables- stove of a deal ( which has not yet been formally confirmed ), much of the information in the songs business this week focused on a “music industry- located” company: TikTok.
This week, MBW broke the news that the ByteDance- owned cultural media company is forming an investment team to buy music rights and companies, meaning it could quickly be less “music- opposite” and more, also, an true music company.
We also learned this week that Kobalt’s subsidiary Amra, which claims to be the” first and only global digital collection society,” has invested more than$ 50 million in its technology to date.
Meanwhile, ByteDance is planning to spend$ 2.1 billion to build an AI hub in Malaysia, making the China- headquartered company just the latest tech giant to invest heavily in that country’s burgeoning AI industry.
Finally, this week, we asked the question: What if Spotify took Sony Music Group Chairman Rob Stringer’s advice, and started charging for its free, ad- supported subscription tier? The short answer is “it depends”, but in all likelihood, Spotify would make a lot of money.
Here’s what happened this week…
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1 ) QUEEN CATALOG TO BE ACQUIRED BY SONY MUSIC IN$ 1.27BN DEAL ( REPORT )
In a landmark deal worth GBP £1 billion ( USD$ 1.27 billion at current exchange rates ), Sony Music Entertainment is scheduled to buy the catalog of legendary rock band Queen.
According to Hits, which cited sources on Wednesday ( June 19 ), that Sony Music has won the rights to Queen’s recording and publishing rights as well as royalties from previous agreements with Disney Music Group and Universal Music Group.
Queen’s catalog features megahits like Bohemian Rhapsody, Another One Bites the Dust, We Will Rock You, and many more.
UMG, as Disney’s distributor, will reportedly retain distribution rights in North America, although Sony will receive the royalties. In 2026 or 2027, UMG’s worldwide distribution rights will then transfer to Sony, making Sony Music the exclusive distributor and owner of all of Queen’s content globally.
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2 ) TIKTOK IS FORMING A MEDIA PARTNERSHIP TO ACHECT MUSIC PERFORMANCE AND COMPANIES.
We asked two years ago if TikTok was gradually transforming into a record label.
With its SoundOn service, the ByteDance-owned platform was just beginning to enter the music distribution industry and was looking to hire A&, R executives with experience from record labels.
With a plan to buy and invest in music rights, MBW revealed on June 18 that TikTok is moving this evolution forward.
We’ve learned that TikTok is establishing an internal Music Content Investment Team with offices in Los Angeles, New York, and San Jose that will concentrate on “partnership or acquisition opportunities in the music content space on a global level.”
In other words, TikTok is moving into the competitive music M&, A market …
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3 ) TIKTOK PARENT BYTEDANCE TO SPEND$ 2.1BN TO DEVELOP AI HUB IN MALAYSIA
Malaysia has become a major focus for global tech companies ‘ investments in AI.
The latest in a line of tech companies betting on Malaysia with a large-scale investment centered on the booming AI business is ByteDance, the China-based parent company of social video app TikTok.
As reported by Reuters, a social media post last week from the country’s Investment, Trade, and Industry Minister Tengku Zafrul Aziz, indicated that ByteDance “plans to invest in AI and make Malaysia an AI hub for the region with a proposed investment of about RM10 billion”, which converts to approximately USD$ 2.1 billion …
4 ) Amra has spent more than$ 50 million on its technology to date, with the majority of it spent in the last three years.
Amra has grown into a substantial company since being acquired/launched by Kobalt in 2015. In the year to June 2022, the latest FY for which public financial numbers are available, Amra posted USD$ 117.3 million in revenues.
No wonder Francisco Partners, the company that acquired a majority stake in Kobalt in 2022, highlighted Amra as a growth priority. ( FP’s Matt Spetzler once again referred to Amra as” the only global digital licensing platform. )
Amra has revealed a statistic today ( June 20 ), which illustrates its own assessment of the potential growth that Kobalt/FP sees in the future: the company has confirmed that it has invested more than USD$ 50 million in technology to date, with the majority of that money being spent over the past three years…
Credit: Nicolas Ospina Soriano/Shutterstock
5 ) WHAT WOULD HAPPEN IF SPOTIFY STARTED CHARGING A ‘ MODEST FEE ‘ FOR ITS AD- FUNDED TIER… OR SHUT IT DOWN ENTIRELY?
The current model of “free” ad-supported music streaming may need to be changed.
In a presentation to Sony Group investors on May 30th, Chairman of Sony Music Group, Rob Stringer, took aim at freemium services offered by companies like Spotify.
The Sony executive suggested that DSPs should close the “price gap” between paid and free users, particularly in mature streaming markets, as he suggested.
Stringer’s solution: charging current free users a “modest fee” to listen to music and other content via ad- supported services.
So, what would happen if Spotify, as Stringer suggested, now additionally began charging a modest fee for access to its ad- funded tier…?
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 Business Worldwide
