From Downtown’s $500m credit agreement to Concord’s Hipgnosis bidding war exit… it’s MBW’s Weekly Round-Up

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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 maximize their income and reduce their touring costs.


One in five paid music subscribers would be willing to pay for a “super-premium” subscription tier, according to research cited by Universal Music Group‘s leadership team.

That insight into the thinking on monetization of superfans is just one of the things we gleaned from the company’s latest earnings call, which came hot on the heels of the announcement that UMG had inked a fresh licensing deal with TikTok.

We also learned this week that Concord is bowing out of its bidding war with Blackstone for ownership of Hipgnosis Songs Fund‘s assets.

Meanwhile, Warner Music Group released its fiscal Q2 (calendar Q1) earnings this week, posting total revenues of USD $1.494 billion for the quarter.

The same day as WMG’s earnings, Downtown Music announced it had secured an additional $500 million credit capacity from Bank of America, with which the company plans to pay advances to indie artists.

Finally, TikTok sued the US government, asking a federal appeals court in DC to review the constitutionality of the recently-passed law forcing parent company ByteDance to sell TikTok’s US operations or face a nationwide ban.

Here’s what happened this week…


The Photo Access/Alamy

1) UNIVERSAL MUSIC GROUP SEES A FUTURE WHERE 1 IN 5 STREAMERS PAYS FOR A ‘SUPER-PREMIUM’ TIER (AND 3 OTHER THINGS WE LEARNED FROM UMG’S Q1 EARNINGS CALL)

It’s no surprise that TikTok was a key topic of discussion on Universal Music Group‘s Q1 earnings call on Thursday (May 2).

Just hours ahead of UMG revealing that its revenues grew 7.9% YoY at constant currency to USD $2.8 billion in Q1, the companies ended a three-month-long licensing dispute with a shiny new deal.

But that’s not all that was on UMG leadership’s minds. Monetizing superfans continues to be a big priority.

In response to an analyst’s question, UMG Chair and CEO Sir Lucian Grainge said: “We know that we could better monetize higher-value customers, the research suggests that 1 in 5 paid music subscribers would be willing to pay for a premium tier. That’s enticing…”


2) CONCORD BOWS OUT OF HIPGNOSIS BIDDING WAR, SAYING ITS $1.51BN OFFER IS ‘FINAL AND WILL NOT BE INCREASED’

The race to acquire UK-listed Hipgnosis Songs Fund took a turn Thursday (May 9) as Concord announced that it would not raise its latest offer – leaving global investment firm Blackstone as the frontrunner in the ongoing takeover battle.

Concord’s latest announcement signifies its withdrawal from the competition, leaving Blackstone in a strong position.

“Concord Bidco confirms that its offer of $1.25 per Hipgnosis Share is final and will not be increased,” the company said in a statement obtained by MBW.

The Hipgnosis Songs Fund board had earlier recommended Blackstone’s offer to its shareholders, while withdrawing its previous recommendation of Concord’s $1.25-per-share offer…


Photo credit: Emmie America

3) WARNER MUSIC GROUP GENERATED $1.49BN IN CALENDAR Q1; SUBSCRIPTION STREAMING REVENUES ROSE 13.5% YOY

Warner Music Group has issued its financial results for the three months ended March 31, 2024 (calendar Q1 – the company’s fiscal Q2).

According to the company’s results, WMG saw its quarterly global company-wide revenues reach USD $1.494 billion (across recorded music, music publishing, and other activities).

Warner Music Group’s recorded music revenues were up 4.3% YoY at constant currency to $1.189 billion.

That growth was driven, according to WMG, by growth in digital and licensing revenue, and was “partially offset by lower physical and artist services and expanded-rights revenue”…


4) DOWNTOWN SECURES $500M CREDIT AGREEMENT FROM BANK OF AMERICA FOR INDIE ARTIST ADVANCES

Downtown Music, a division of Downtown Music Holdings, just secured another $500 million of credit capacity from Bank of America to expand its services for independent artists and labels.

Downtown says that it initially established its partnership with Bank of America in 2022 with a $200 million credit facility to provide artists and rightsholders with advances in exchange “for a short-term share of future royalties”.

The company has now expanded its credit facility with BoA by an additional $500 million to boost its capacity to pay advances to indie artists.

As noted by Bloomberg on Thursday (May 9), Downtown offers advances “ranging from tens of thousands of dollars to several million dollars”.

Today, across its operations, Downtown Music Holdings claims to be the world’s largest independent service provider


Credit: Ascannio/Shuttterstock

5) TIKTOK SUES US GOVERNMENT OVER ‘UNCONSTITUTIONAL’ DIVEST-OR-BAN LAW, SAYS SALE BY BYTEDANCE IS ‘IMPOSSIBLE’

TikTok and parent company ByteDance have filed suit against the US government over its recently-passed law that requires ByteDance to sell the platform’s US operations or face a nationwide ban.

In a complaint that TikTok said it filed on Tuesday (May 7) with the US Court of Appeals for the District of Columbia, the company described the law as “unconstitutional.”

“Congress has taken the unprecedented step of expressly singling out and banning TikTok: a vibrant online forum for protected speech and expression used by 170 million Americans to create, share, and view videos over the Internet,” the complaint stated.

“For the first time in history, Congress has enacted a law that subjects a single, named speech platform to a permanent, nationwide ban, and bars every American from participating in a unique online community with more than 1 billion people worldwide…”


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

https://www.highcpmgate.com/f0c2i8ki?key=d7778888e3d5721fde608bfdb62fd997

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