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.
After more than a year of rumors and reports that the sale of Queen’s catalog would break the billion-dollar mark, we got word this week that the recording and publishing rights of the legendary band fronted by Freddie Mercury sold to Sony Music for an even higher price than expected: $1.27 billion.
Beyond that barn-burner of a deal (which has not yet been officially confirmed), much of the news in the music biz this week focused on a “music industry-adjacent” company: TikTok.
This week, MBW broke the news that the ByteDance-owned social media company is forming an investment team to buy music rights and companies, meaning it could soon be less “music-adjacent” and more, well, an actual music company.
We also learned this week that Kobalt subsidiary Amra, which calls itself “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)
Sony Music Entertainment is set to acquire the catalog of legendary rock band Queen in a landmark deal worth GBP £1 billion (USD $1.27 billion at current exchange rates).
That’s according to Hits, which reported on Wednesday (June 19), citing sources, that Sony Music has emerged as the winning buyer for Queen’s recording and publishing rights, as well as royalties from previous deals 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. UMG’s worldwide distribution rights will then transfer to Sony in 2026 or 2027, making Sony Music the sole distributor and owner of all Queen content globally…
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2) TIKTOK IS FORMING AN INVESTMENT TEAM TO ACQUIRE MUSIC CONTENT AND COMPANIES
Two years ago, we asked if TikTok was slowly turning into a record company.
The ByteDance-owned platform had very recently entered the music distribution market with its SoundOn service, and was hiring for A&R execs with record label experience.
On June 18, MBW revealed that TikTok is taking this evolution to the next stage – with a plan to acquire and invest in music rights.
We’ve learned that TikTok is forming an in-house Music Content Investment Team based in Los Angeles, New York, and San Jose, focusing 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 focal point of AI-related investment from global tech giants.
ByteDance, the China-headquartered parent company of social video app TikTok, is the latest in a series of tech companies betting on Malaysia with a large-scale investment centered on the booming AI business.
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 invested more than $50m in its tech to date – with most of it spent in the past 3 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 reiterated Amra’s status at the time as “the only global digital licensing platform”.)
Today (June 20), Amra has announced a statistic that tells its own story of how seriously Kobalt/FP sees the opportunity ahead of it: Amra has confirmed that it’s surpassed USD $50 million in total technology investment to date, with the lion’s share of that figure being spent in the past three years…
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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 could be headed for an overhaul.
Last month, Sony Music Group Chairman Rob Stringer took aim at freemium services offered by the likes of Spotify during a presentation for Sony Group investors on May 30.
The Sony executive suggested that DSPs should close what he called the growing “price gap” between paid and free users, especially in mature streaming markets.
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
