Monday afternoon saw the official news of a major deal that has been in the works for months that unites Live Nation Entertainment and Universal Music Group in a new pact joining UMG’s management properties, including Sanctuary, Twenty First Artist (and presumably the new producer management arm Twenty First Republic that was formed earlier this year with World’s End) and 5B Artist Management, all under LN’s Front Line Management… Apprehension by banks to finance private-equity firms in buyouts and mergers is growing, according to an WSJ article this week, and that might mean the stable of bidders for EMI is shrinking. It might also mean the likelihood of the music group being sold intact is also lessening… Tomorrow is Facebook‘s big f8 conference, where they will announce many new features and major redesigns, and music fans are looking forward to the expected integration of new streaming services like Spotify, MOG and Rdio. Some are expecting Pandora to be added to that list as well, given the redesigned and relaunched player from the web radio service today, which includes among other things increased sharing capabilities and the removal of the cap on free-listening hours. Exactly how seamless the integration of media services into the social network is unclear, as MediaMemo points out, FB was originally planing on allowing users to access music and video services without ever leaving the site, however now that has changed. Announced speakers and panelists at the conference will include CEO’s from Spotify and Turntable.fm along with Clear Channel Chairman‘s Bob Pittman who has been busy promoting iHeartRadio and manager Troy Carter among many others… Elsewhere, video site Vimeo has launched a Music Store in a new partnership with Audiosocket, that will help video creators easily find and license music… R.E.M. is calling it quits after three decades… Van Halen is reportedly ending their longtime relationship with Warner Bros. Records and heading to Columbia Records… And Jeremy Summers has been named EVP/Chief Marketing Officer at Interscope Geffen A&M.
MOG launches free music service
In addition to revealing more details about investors in the recent funding round, Turntable.fm has also announced that the company is indeed seeking licensing deal with the four major label groups as well as indie labels. This would help the service grow internationally according to CEO Billy Chasen, presumably in addition to offering new and more robust features that licenses would allow for. It appears Turntable is attempting to forge a new kind of licensing deal with labels, something that would fall in between the low-rates that web radio services like Pandora pay and higher ones paid by on-demand services like Spotify… Music streaming service MOG launched a new free ad-supported version of the service called FreePlay yesterday, in a what can be seen as a direct move against Spotify. The concept puts a twist on the freemium model, by giving free-users a “gas tank” of music, which they can refill in perpetuity through various actions like listening, sharing with friends, making playlists, and exploring MOG. A possible leg-up for the new service, will be utilizing its large blog-directory, MOG Music Network, with integrated blogs now able to share songs and playlists with readers via FreePlay tools… Rdio is also releasing a free version of their music service, though details are still few. It’s expected that more information will be disclosed when Facebook reveals its new music-plans next week at its f8 conference; Rdio along with MOG and Spotify are all expected to be partners in the new FB music features – Deezer is also expected to be announced as a Facebook Music partner in Europe… On the heels of all the streaming-music announcements this week, the results of a new study commissioned by mp3-retailer eMusic were released, and they show that 91% of those polled still prefer to own their music, while 76% use streaming services to discover music before buying. More details from the study are here… Meanwhile, Clear Channel has seriously bolstered its online radio service iHeartRadio after recently acquiring Thumbplay, and the company is quickly taking shots at Pandora, who until now has not faced any serious competition in the non-interactive web-radio space. Clear Channel media chief Bob Pittman told Forbes that he doesn’t see Pandora’s business as a “free-standing platform,” and that more functionality will continually be added to iHeartRadio, including possible features similar to Turntable.fm.
An article in the New York Times on Monday, which focuses on the looming copyright termination period that will start in 2013, has stirred up wider attention to an issue and era that record labels and music publishers have had on their calendars for years. The end of the 1970′s into the 1980′s was a time when many now-classic albums were released, helping to bring about a surge in album sales at a time when it was much needed – that coupled with the advent of the CD, carried the industry to the end of the century on a high. The potential loss of copyright ownership to both master recordings and underlying compositions starting in less than two years from now, has the capability of delivering a serious blow to the already beleaguered labels. Today a follow up piece on the Times ArtsBeat blog featured a Q&A with Don Henley, discussing his efforts to inform artists of their rights to get back ownership of their works… The Los Angeles Times examined the possibility of an EMI merger with one of the other three major music groups over the weekend, making comment that regulatory hurdles might not be what they once were. The decade-long industry decline and the technology advances that have corresponded, can be seen as having lessened dominance by the major labels and more importantly decreased the power to dictate consumer pricing, as the article’s sources mention. However, the ability to stifle technology in the form of new digital music services that need licenses from the labels should be considered… Elsewhere, Bruno Mars manager Brandon Creed has been hired as an A&R consultant for the reshaping Universal Republic and Island Def Jam Motown labels, reporting to label group CEO Barry Weiss… HTC made a large investment in Beats Electronics, the headphone company founded by Dr. Dre and Interscope Records ruler Jimmy Iovine, hopefully allowing the two more time to release Dre’s long-awaited next album and focus on winemaking. Forbes reports that the deal could potentially make Dre one of hip-hop’s richest… And is Turntable.fm more hype than hope? The number of unique visitors to the site in the month of July was reportedly just over 200,000 - not exactly game-changing, yet at least.
Worth more than Warner Music?
The first round bids for EMI are in, with multiple reports pointing to more than 10 offers received for either the whole or individual recorded music and publishing arms of EMI Group, from interested parties including Sony, Universal, Warner Music, BMG Rights Management and a host of private equity groups. At least one analysis this week claimed that Citigroup could possibly fetch more than $4 billion for the company based on a similar multiple used in the recent Warner acquisition. An article in FT.com yesterday claims that the current tendered bids range from $3 – $4b, and that between four and six of the submitted offers were for the entire music group. Citi is expected to respond to the opening bidders this week… While less humorous than last summer’s Kings of Leon bird droppings incident, the band’s cancelation of the remainder of their current U.S. tour dates following an abrupt termination of a set in Dallas last week, may prove much more damaging. Rollingstone.com takes a look at other recent tour cancelations with somewhat dubious explanations, and according to reports, the KOL cancellation may cost policy holder, Loyds of London, as much as $15 million in payouts to promoters and others affected… The much talked about Turntable.fm has secured a $7.5 million financing round led by Union Square Ventures, which has some wondering if the startup will next seek licensing agreements with the record labels and music publishers. Lady Gaga and Kanye West are also reportedly among those who contributed to the funding… And The Shins are following fellow former Sub Pop label mates Band of Horse, in moving from the venerable indie to a new imprint-label deal with Columbia Records for their next release.
the dude abides
EMI officially announced on Monday that it will undergo a strategic review process, along with Citigroup, to explore options that include selling the company. The list of potential bidders has been discussed for sometime, with the recent sale of Warner Music only intensifying speculation. The Los Angeles Times reported that Universal Music is planning to make a bid, while other names frequently bandied about include Access Industries (for a WMG merger), BMG Rights Management and other investment players who were in on the Warner bidding. Observers are wondering how much Citi will get for the company – as the WSJ points out, Warner was sold for eight times its 2010 earnings, with some now thinking EMI could fetch as much as 2.5 billion pounds… As Sony Music prepares for the entrance of Doug Morris next month, Rick Rubin has been talking publicly for the first time in awhile, toasting the success of Adele‘s 21 and making it clear he’s always been a ‘creative’ guy and the “voice of reason and positive creativity” – leaving the ‘business’ side of things to the “people at the label.” Where and how the Columbia Records co-chairman will fit into the new Sony regime is unclear, though his comments seem to come at an opportune time… CEO of Hip-Hop Since 1978 management firm, Gee Roberson, has been named chairman of Geffen Records, he will report to Jimmy Iovine… Elsewhere, the social streaming-music site Turntable.fm is attracting a lot of new users and getting increased attention, though some are wondering if that will also mean scrutiny from content owners, as they do not have licenses from any labels. The company maintains that it falls under the protection of the DMCA, similar to how online radio service Pandora operates without licenses… And Best Buy is reportedly preparing to launch a new service called Music Cloud in the U.S., which as the name implies will be a cloud-music service – the company already operates a similar service in the UK called My Music Anywhere; agreements with all the major labels are said to be in place.