Welcome to Music Business Worldwide’s weekly roundup – where we make sure you’ve grabbed the five biggest stories that made the headlines in the past seven days. MBW’s roundup is supported by Centtrip, which helps more than 500 of the world’s top-selling artists maximize revenue and reduce touring costs.
Happy birthday AdÃ¨le!
Well, we say happy. We, no doubt like you, went through an eerily familiar cycle this morning as the British star’s first new track in six years – Easy on me – broke loose.
Listen to 1: * chuckles * Well, that’s not a ‘hello’, that’s for sure. Is there even a proper hook in this song? It doesn’t matter to me.
Listen to 5: Okay, that’s actually pretty awesome.
Listen 15: * Forehead rests gently on the steering wheel, eyes wet, mumbled whispers rushing over a quivering lower lip * It’s just that life feels really hard sometimes. I try to hold my head up, to be a good person, but I’m not perfect * sniff *. But who is Adele? Who is?!
You know the chorus.
Another thing that made us cry this week: the colossal size of the deals currently being made in the music rights sector.
Exhibit A: Hipgnosis and Merck Mercuriadis strike a new deal with Blackstone for an initial investment of $ 1 billion – money that will be spent on big buys of great songs – with the potential for more billions to follow.
Exhibit B: Spirit Music Group’s parent company, Lyric Capital, signs a $ 500 million deal with Northleaf Capital Partners that will see funds managed by the latter company acquire a stake in certain music royalty catalogs associated with Spirit.
A billion and a half dollars flying in the music industry, just like that.
Blissful Alert: Last week on MBW’s weekly podcast, Talking trends, we predicted that three things could soon happen in this space: (i) KKR would make a whole new piece of massive music acquisition; (ii) Kobalt Capital would sell one of its managed copyright portfolios for $ 1 billion; (iii) A major change in ownership occurred in the Spirit Music Group catalog.
All three now appear to be doing well, with KKR reportedly funding a $ 1.1 billion acquisition of Kobalt Music Royalty Fund II through the family office of former Goldman Sachs partner Stephen Hendel.
The other big news of the last few days was, unfortunately, a little less worthy of a high-five at the MBW towers.
According to the National Music Publishers Association (NMPA), owners of digital services such as Amazon, Spotify, Apple, Pandora and Google “offer the lowest royalty rates in history” for songwriters in the United States .
They would do so as part of CRB IV, a legal process that will set streaming royalties for songwriters in the United States for the period 2023-2027.
This is playing out, remember, as Spotify and others (outside of Apple) are calling for an increase in the streaming rate for songwriters for the period 2018-2022 (CRB III).
We have yet to see the digital services’ proposals for the CRB IV process (they have yet to be tabled publicly) – but NMPA chief David Israelite has, and he’s fuming.
Disturbingly for those who enjoy harmony in the music business – but pleasantly for those who want songwriters to get more room – the Israelite says, âThis fight has only just begun.
See below for five of the biggest stories to grace MBW’s digital pages over the past weekâ¦
1) WHAT DO THE BILLIONS OF BLACKSTONE MEAN FOR MERCK MERCURIADIS ‘MISSION FOR PARITORS?
As MBW reported on Tuesday, October 12, Blackstone – one of the world’s largest alternative investment firms – is injecting $ 1 billion into a new private fund, Hipgnosis Songs Capital.
In addition, Blackstone invests an undisclosed amount in Hipgnosis Song Management of Merck Mercuriadis, the investment advisor who ultimately chooses how to deploy the money in Hipgnosis Songs Fundâ¦ and now in Hipgnosis Songs Capital as well.
MBW recently caught up with Mercuriadis and the man who made the Blackstone deal with him, Qasim Abbas, to ask them about the music world’s new alliance that everyone is talking aboutâ¦.
2) SPOTIFY AND OTHER STREAMING SERVICES OFFER THE “LOWEST ROYALTY RATES IN HISTORY” FOR AUTHOR-COMPOSERS
Owners of music streaming services, including Spotify, Apple, Amazon, Pandora, and Google, all filed documents with the US Copyright Royalty Board (CRB) this week telling them what they think they should pay authors. -composers for the five years between 2023 and 2027.
Speaking to MBW ahead of the filings this week, David Israelite, president and CEO of the National Music Publishers Association (NMPA) explained that the lawsuit “has fundamental consequences for songwriters and music publishers” .
The files and their contents have not yet been made public, but according to Israelite, “Amazon, Spotify, Apple, Pandora and Google offered the lowest royalty rates in history” …
3) ANOTHER MASSIVE MUSIC CONTRACT, AS A PARENT OF THE SPIRIT MUSIC GROUP STRIKES A $ 500M ALLIANCE WITH NORTHLEAF CAPITAL PARTNERS
Spirit Music Group owner Lyric Capital Group and global investment firm Northleaf Capital Partners have entered into a strategic alliance, through which funds managed by Northleaf hold a stake in certain Lyric-managed music royalty catalogs, led by Jon Singer , Managing Partner, and Ross Cameron, Partner.
Northleaf led the US $ 500 million investment in which the global investment group Caisse de dÃ©pÃ´t et placement du QuÃ©bec (CDPQ) was a major co-investor.
Toronto-based Northleaf, whose portfolio includes more than 400 active investments in 40 countries, manages more than $ 18 billion in private equity, private credit and infrastructure commitments …
4) ADELE’S RETURNâ¦ BUT WHAT ARE WE WAITING FOR?
In this episode of the MBW Talking Trends podcast, we talk about Adele’s return with her new album 30, now confirmed for release on Friday, November 19.
We’re already seeing strong evidence that the British superstar ‘does things his own way’ when it comes to the record and the strategy surrounding it.
5) KOBALT SELLS A MUSIC CATALOG FOR $ 1 BILLION – AND KKR IS IN FIRST POSITION TO BUY IT
Kobalt is reportedly looking to sell its Kobalt Music Royalty Fund II for a price of around $ 1 billionâ¦ and the company is in the final stages of negotiations with a group of investors that includes KKR.
Kobalt Capital has managed two funds over the years.
The second and largest of these funds, Kobalt Music Royalty Fund II, was established in 2017 with $ 600 million to spend, backed by UK pension scheme Railpen, as well as other institutional investors.
MBW’s Weekly Round-Up is supported by Centtrip, which helps more than 500 of the world’s top-selling artists maximize their income and lower their touring costs.Music trade around the world