Welcome to Music Business Worldwide’s weekly round-up – the place we make certain you caught the 5 greatest tales to hit our headlines over the previous seven days. MBW’s round-up is supported by Centtrip, which helps over 500 of the world’s best-selling artists maximize their revenue and scale back their touring prices.
With 2024 quickly upon us, the season for tallying up the numbers for 2023 is approaching rapidly.
One firm that’s out forward of the pack on that entrance is streaming service SoundCloud, which advised MBW this week that, 16 years after its founding, it has lastly reached that elusive promised land: annual profitability.
CEO Eliah Seton advised MBW that the corporate is forecasting a €2 million optimistic EBITDA for 2023, a pointy turnaround from the €29 million damaging EBITDA it posted in 2022. What’s extra, the corporate has now achieved eight consecutive months of profitability on an EBITDA foundation.
Additionally this week, MBW dug deeper into Spotify‘s plans to change its payout mannequin within the new yr. Among the many particulars within the plan: Not solely will tracks want a minimal of 1,000 streams within the earlier 12-months to qualify for royalty funds, there may even be a minimal variety of distinctive listeners that will likely be required for a observe to receives a commission – although Spotify isn’t saying precisely what number of.
In different information, Universal Music Group (UMG), the world’s largest music rightsholder, noticed its shares hit €25.77 on the Euronext Amsterdam on Tuesday (December 12). That put UMG’s market cap at €46.944 billion, or round USD $50.68 billion at present alternate charges.
Plus, Sony and Warner hit US web supplier Altice with a lawsuit over alleged music piracy on its community, whereas MBW interviewed Drew Simmons, supervisor of breakthrough artist Noah Kahan.
SoundCloud is experiencing one thing new, a full 16 years after it was based: annual profitability.
In keeping with firm knowledge shared with Music Enterprise Worldwide, SoundCloud is at the moment on target to publish a slim – however optimistic – EBITDA for calendar/fiscal 2023.
The corporate is forecasting a €2 million in EBITDA for 2023, CEO Eliah Seton tells MBW, representing a big enchancment from the €29 million damaging EBITDA the agency posted in 2022.
What’s extra, says Seton, SoundCloud has now achieved eight consecutive months of profitability on an EBITDA foundation.
“Reaching profitability issues as a result of it reinforces that we’re pursuing the precise technique and have taken the mandatory steps to show across the enterprise,” Seton tells MBW…
Common Music Group (UMG) is ending 2023 with a bang.
The world’s largest music rightsholder ended its buying and selling day Tuesday (December 12) on the Amsterdam Euronext with its highest share value of the yr up to now.
The truth is, with a share value of EUR €25.77, UMG completed the day with its largest public valuation for two years.
In keeping with Euronext knowledge, UMG’s share value translated right into a market cap valuation of EUR €46.944 billion.
In US greenback phrases at present alternate charges, that’s price USD $50.68 billion.
That is Common’s highest share value since December 7, 2021 (€25.78) – simply over 24 months in the past.
UMG’s share value peak got here in mid-November 2021, when its day-close inventory value crested at €27.72…
Web service supplier Altice USA is dealing with one other lawsuit from music rightsholders over its alleged enabling of widespread music piracy by means of its service.
Late final yr, Altice was hit with a $1 billion lawsuit on behalf of music rightsholders together with Common Music Group, BMG, and Concord Music Group, who sought to have the web supplier held accountable for “thousands and thousands” of alleged infringements of “1000’s” of their songs.
That lawsuit is ongoing, after a decide within the US District Court docket for the Japanese District of Texas rejected Altice’s movement to dismiss the case earlier this yr.
Now, Sony Music Entertainment and Warner Music Group have filed an identical lawsuit in the identical US District Court docket, accusing Altice of “knowingly contribut[ing] to, and reap[ing] substantial earnings from, huge copyright infringement dedicated by 1000’s of its subscribers…”
When Drew Simmons first discovered Noah Kahan on SoundCloud, he was satisfied he’d found somebody particular. Just one downside: the sensation was not mutual.
“Noah actually didn’t have any idea of what the music trade was,” laughs Simmons. “He didn’t assume I used to be actual – he thought I used to be catfishing him.”
So, Simmons drove a whole bunch of miles to Kahan’s rural Vermont dwelling with the intention to persuade the musician that, not solely was he actual, however that he was the supervisor to assist the nascent singer-songwriter tackle the world.
The truth that, proper now, Kahan is the most popular breakthrough act on the planet reveals that Simmons succeeded in his mission.
However, though there was lower than a yr between Kahan supporting Amos Lee at Pink Rocks, and promoting out the storied venue in his personal proper in July, this was no in a single day viral success.
Kahan’s rise has been an old school story of artist growth, albeit one wherein he reversed the normal alternative-to-pop course of journey…
Spotify is introducing a big replace to the best way it calculates recorded royalties subsequent yr.
Beginning in early 2024, tracks will need to have reached at the very least 1,000 streams within the earlier 12 months with the intention to generate royalties on the platform.
This coverage is among the extra contentious amongst a collection of recent adjustments coming to the platform within the new yr, which had been first reported by MBW in October, and subsequently confirmed by Spotify in a weblog publish final month.
SPOT wrote in its weblog publish that the reasoning behind the brand new monetization coverage is to “higher distribute small funds that aren’t reaching artists”.
The corporate defined additional that “tens of thousands and thousands” of the 100 million-plus tracks it hosts on its platform “have been streamed between one and 1,000 occasions over the previous yr and, on common, these tracks generated $0.03 per 30 days.”
The weblog publish continued: “As a result of labels and distributors require a minimal quantity to withdraw (normally $2-$50 per withdrawal), and banks cost a payment for the transaction (normally $1-$20 per withdrawal), this cash typically doesn’t attain the uploaders. And these small funds are sometimes forgotten about.”
In keeping with Spotify, in combination, these small “disregarded funds” added as much as $40 million in 2022 alone, which the corporate provides “might as a substitute enhance the funds to artists who’re most depending on streaming income…”
