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$600 million:
HYBE, the K-Pop giant behind superstars BTS, struck two deals in the same week in February that saw the company spend over $600 million on M&A. The first of those deals arrived via HYBE America, led by CEO Scooter Braun, agreeing to acquire Atlanta rap powerhouse QC Media Holdings, aka Quality Control, home to acts such as Lil Baby, Migos, Lil Yachty and City Girls. The deal was valued at approximately $300 million in stock and cash. The second ninefigure deal for HYBE that same week was for a 14.8% stake in K-Pop rival SM Entertainment, acquired from its founder Lee Soo Man, in a deal worth 422.8 billion South Korean won (approx. $334.5 million).
HYBE’s nine-figure week
€1 billion: Believe’s ten-figure year
Paris-based music distribution and services company Believe recently reported that it surpassed the milestone of €1 billion in digital music sales (DMS) for 2022. DMS, says Believe, represents the revenue generated from its digital store partners and social media platforms before royalty payment to artists and labels. Commenting on the 10-figure milestone, Denis Ladegaillerie, Believe’s Founder & CEO, said at the time that, “It is a tribute to the strength and passion of our two hearts: our artists, at all stages of their career, who create vibrant music that fans connect to and are inspired by, and our people, who put their digital expertise and technology at their service with respect, fairness and transparency.”
$200 million: Justin Bieber’s big pay day
In January, we learned that superstar pop artist Justin Bieber had agreed to sell a career-spanning catalogue to Blackstone-backed Hipgnosis Song Management (HSM) in a nine-figure deal. Hipgnosis announced that HSM had agreed a deal to acquire Bieber’s “100% interest in his publishing copyrights (including the writer’s share of performance), master recordings and neighbouring rights for Bieber’s entire back catalogue, comprising over 290 titles released before December 31, 2021″. Universal Music Group continues to own the master recordings of Bieber’s back catalogue; it appears that Hipgnosis will now receive Bieber’s artist royalty stream on those masters. UMPG will continue to administer Bieber’s publishing. Commenting on the deal at the time, Merck Mercuriadis, Founder and Chief Executive Officer of Hipgnosis Song Management, said: “The impact of Justin Bieber on global culture over the last 14 years has truly been remarkable.” The Wall Street Journal reported in December that the Hipgnosis/ Bieber deal would be worth around $200 million.
75%: The majors’ (and Merlin’s) Spotify market share
We also learned this quarter that the four ‘major’ recorded music companies – which in this instance means Universal Music, Sony Music, and Warner Music, plus indie collective Merlin – have cumulatively lost 12% of market share on Spotify over the past five years. That stat came to light in Spotify’s annual investor report, which revealed that 75% of plays of music tracks on its platform in 2022 were distributed by the ‘big three’ majors or a Merlin member. That means, of course, that a quarter (25%) of music streams on Spotify in 2022 were distributed by companies who were not affiliated with the majors or Merlin. Said companies include the likes of TuneCore (and its parent, Believe), plus UnitedMasters, and certain other distribution platforms for independent (or ‘self-releasing’) artists. The majors-plus-Merlin market share of all streams on Spotify was as high as 87% in 2017, according to previous Spotify fiscal reports.
