“How do I love thee? Let me count the ways.
I love thee to the depth and breadth and height
My soul can reach”
Elizabeth Barrett Browning
On December 31, Tencent Holdings Ltd reported to its shareholders that a Tencent-led Consortium will enter a share purchase agreement with Vivendi to acquire a 10% stake in Universal Music Group, valuing the deal up to €30 billion ($33.6 billion). Tencent Music Entertainment Group and undisclosed “global financial investors” make up the group. It can increase its stake in UMG to as much as 20% at the same valuation until January 15, 2021.
According to the Recording Industry Association of America (RIAA), music streaming accounted for 80% of the US recorded music market in 2019, up from 7% of the market back in 2010. Additionally, the number of paid streaming subscriptions has soared to 600 million accounts, up from a reported 1.5 million in 2010. Physical and digital download sales correspondingly fell, making up only 9% of the market this past year.
The United Kingdom broke a record with a total of 114 billion music streams in 2019, according to a new report released by the British Phonographic Industry (BPI). Streaming now accounts for nearly 75% of all music consumed in the country.
Catch Exploration’s co-founder Rene Merideth at The NAMM Show on Friday January 17th at The Anaheim Hilton to discuss topics in machine learning and data analytics in the music industry. Register here to attend.
We are also truly saddened to inform you of the recent passing of William the Great, a long-time companion of Aaron Davis, on Friday December 27th, 2019. Please read more here for the full tribute.
Now, the details...
Compiled by Heidi Seo
Exploration Weekly - January 3, 2020
Official: Universal Music Group to Sell 10% Stake, Worth Over $3 Billion, to Tencent-Led Consortium
Tencent Holdings Ltd announced on December 31 to its shareholders that a Tencent-led Consortium has signed a share purchase agreement with Vivendi to acquire 10% of Universal Music Group. The deal holds an enterprise value of €30 billion ($33.6 billion). The Tencent-led Consortium is joined by Tencent Music Entertainment Group and undisclosed “global financial investors”. Reports suggested earlier this month that Tencent was turning to sovereign wealth funds in order to raise the capital needed to complete the UMG deal. According to the parties, the Tencent group can increase its stake in UMG to as much as 20% at the same valuation until January 15, 2021. Before the Consortium-UMG transaction finalizes, Tencent and UMG say that they also intend to enter into a second agreement that grants Tencent Music Entertainment (TME) an option to acquire a minority equity stake in UMG’s Greater China business. This transaction will be subject to the receipt of regulatory approvals and other customary closing conditions, and is expected to close by the end of the first half of 2020, says Tencent.
Streaming Accounted for 80% of US-Based Recording Revenues, Up from 7% in 2010
The Recording Industry Association of America (RIAA) recently announced in a Twitter post that music streaming accounted for 80% of the US recorded music market in 2019. Music streaming, in fact, has soared in the US during the last ten years. In 2010, streaming represented only 7% of the market. In correspondence with the dramatic rise in music streaming, the number of paid streaming subscriptions has soared, too. In 2010, there were only 1.5 million such accounts, but by the middle of last year, there were more than 600 million of them. The rise in paid subscriptions over the decade occurred in conjunction with the growth of both Spotify and Apple Music, which launched stateside in 2011 and 2014, respectively. On the other hand, physical and digital download sales fell. In 2010, physical sales accounted for 52% of the market while digital downloads accounted for another 38%. However, today they collectively make up only 9% of the market.
For the First Time Ever, Music Streams Cross 100 Billion Annually in the UK
The British Phonographic Industry (BPI) released a new report, saying that there were a total of 114 billion music streams in the United Kingdom during 2019, which breaks a record. This represents a 3000% increase from the number of streams in 2012, which was the first year that the organization started tracking this type of data. The report further stated that streaming now accounts for nearly 75% of all music consumed in the country. Among those songs streamed, Lewis Capaldi’s “Someone You Loved” was the most streamed song in the UK, with 228 million streams. Consumers in the UK also bought 4.3 million vinyl records, which was the highest amount this century. In addition, 80,000 compact cassettes were bought, which was the largest amount in 15 years.
EMI Re-Opens Its Kanye West Litigation After Failing to Agree a Settlement
Legal proceedings filed earlier this year between Kanye West and his publisher EMI have reached inconclusive results for settlement, and the Sony/ATV-owned publisher has now asked a judge to re-open the case. West sued EMI in January in a bid to get out of his ongoing contractual commitments to the publisher. Filed in California, the case revolved around a rule under Californian state law that says that no one can be forced into a service contract that lasts longer than seven years. West started working with EMI in 2003, meaning, he argued, his commitments to the company ended in 2010. California’s seven-year rule has long been debated on how it applies to record and publishing contracts in the US music industry. EMI pointed out in a countersuit that its deals with West fall under the laws of New York State, where there is no seven-year rule. Legal reps for both West and EMI reported in September that an “agreement in principle” had been reached that should be finalized “within 90 days”. That settlement deal would result in both sides’ respective litigation being dropped. However, EMI’s reps filed new papers earlier this week with the courts in New York stating that no final settlement has yet been agreed, and wants its lawsuit to be re-opened.
Triller Claims 26.5 Million Users Make It “Bigger Than TikTok” in the US
Triller recently made an announcement that it listed new artist investors, launched full-song in-app streaming, and reached 26.5 million monthly active users (MAUs). The social music video app counted 13 million MAUs less than two months ago. In the press release, Triller further went to claim that it is now “overtaking TikTok in the United States” with the MAU total. Earlier this year, TikTok reported that it had 26.5 million MAUs in the US. As for Triller’s new streaming feature, it will enable users to stream full-length songs within its app, as well as creating playlists. In addition, new investors listed in the announcement include Snoop Dogg, The Weeknd, Marshmello, Lil Wayne, Kendrick Lamar, and Tyga.
George Gershwin’s “Rhapsody In Blue” Enters the Public Domain
“Rhapsody in Blue” by George Gershwin, along with many of his compositions from 1924, are entering the public domain and are now freely available to adapt. This has upset the Gershwin estate, because they are worried that someone will adapt the music in ways that Gershwin would never approve of. These titles interestingly should have gone into the public domain 20 years ago. However, after lobbying from entities such as the Gershwin Family Trust and Disney, US Congress extended copyright protection from 75 years to 95 years. Gershwin made news back in April 2019 when Downtown Music Publishing obtained the rights to represent Gershwin’s music catalog.
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