From price hikes at Spotify to Warner’s major new hire… it’s MBW’s Weekly Round-Up

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.


The changes to Spotify‘s subscription tiers and pricing are coming in fast and furious these days. On Monday (June 3), the company announced a price hike in the US, the second one in less than a year, bringing the price of a Premium individual subscription to $11.99 a month.

Meanwhile, in the UK, Spotify has launched a “music-only” tier, a move that was signaled by CEO Daniel Ek on an earnings call a few months ago.

The new tier arrives amid a fierce debate with music publishers over Spotify’s reclassification of its Premium tiers as “bundles” with audiobooks, reducing the amount it pays out in mechanical royalties in the US.

In other music streaming news, Spotify and other streamers are unhappy with Canada’s government after it brought in new regulations requiring them to pay 5% of their Canadian revenue to various funds that support traditional radio stations, as well as Canadian content creators.

Elsewhere in the world of digital music, Twitch has signed “first-of-its-kind” agreements with the recording majors (Universal Music Group, Sony Music and Warner Music Group), as well as with indie representative Merlin, to allow DJs on the platform to legally play music on their livestreams.

Finally, MBW decided to evaluate the oft-made assertion that Merck Mercuriadis overpaid for Hipgnosis Songs Fund‘s assets. We broke down the numbers, and found that Hipgnosis’ catalog is actually worth more than people thought.

Here’s what happened this week…


Credit: Diego Thomazini/Shutterstock
1) AFTER HIKING US PRICES AGAIN, SPOTIFY OFFICIALLY LAUNCHES A MUSIC-ONLY SUBSCRIPTION TIER… IN THE UK

Spotify has launched a new music-only subscription tier called Basic Individual, which doesn’t offer access to audiobooks.

The new tier appears to be available in the UK only at present and costs £10.99 per month.

Spotify announced on Monday (June 3) that its individual Premium tier is going up by $1 per month in the United States to $11.99.

Spotify’s new Basic Individual (aka music-only) tier in the UK has been quietly launched amid a fierce debate between the music streaming platform and music publishers in the United States over SPOT’s decision to reclassify its Premium tiers as ‘bundles’ by combining music and audiobooks…


Credit: Priscilla Grant/Everett Collection/Alamy
2) HIPGNOSIS SONGS FUND’S CATALOG TURNED OUT TO BE WORTH MORE THAN A LOT OF PEOPLE THOUGHT.

Two billion, two hundred and six million.

The approximate number of music biz lunches since Hipgnosis Songs Fund floated in 2018 at which people have suggested Merck Mercuriadis has overpaid for assets.

Not really… that’s just how it feels sometimes.

$2.206 billion is actually the amount spent in US dollars by Hipgnosis Songs Fund – via Mercuriadis – on catalogs to date, as per HSF’s latest interim report.

So, has Mercuriadis (via HSF’s longtime investment adviser, Hipgnosis Song Management) really overspent on the catalogs owned by HSF today…?


3) SONY, UNIVERSAL, WARNER AND MERLIN STRIKE MUSIC LICENSING DEALS WITH TWITCH FOR DJ LIVESTREAMS

Amazon-owned livestream platform Twitch has struck what it calls “first-of-its-kind” deals with multiple rightsholders to allow DJs to legally play music in their livestreams on the platform.

Twitch has struck deals with all three major music companies, including Universal Music Group, Warner Music Group, Sony Music, and a large number of independent labels via Merlin.

According to Twitch, since early 2020, the number of DJs streaming on the service has more than quadrupled and that “over 15,000 of them have been able to build and monetize communities of music fans on Twitch”.

Twitch says that the new program, set to launch later this year, will also create promotional opportunities “on and off” Twitch including placement on the Twitch homepage, as well as sponsorship opportunities exclusive to DJs…


4) WARNER MUSIC GROUP POACHES GOLDMAN SACHS’ MICHAEL RYAN-SOUTHERN TO LEAD GLOBAL M&A

Warner Music Group CEO Robert Kyncl has previously hinted that his company is keen to grow its presence in various crucial sectors of the music business via acquisition.

Now, he has found the executive to lead that mission.

Widely respected exec Michael Ryan-Southern is leaving Goldman Sachs, joining Warner Music Group to lead all M&A activity at the global major music company.

At Warner, he will assume the newly created post of Executive Vice President, Corporate Development, effective August…


5) MUSIC STREAMING SERVICES COME OUT SWINGING AGAINST CANADA’S NEW ‘DISCRIMINATORY TAX’ THAT REQUIRES THEM TO HAND OVER 5% OF THEIR CANADIAN REVENUES

Music streaming services are criticizing a new regulation in Canada that requires major streaming services to pay 5% of their revenue to various groups supporting the creation of Canadian content.

“We are deeply concerned with today’s decision to impose a discriminatory tax on music streaming services that are already making significant contributions to Canadian artists and culture,” Graham Davies, President and CEO of the Digital Media Association (DiMA), said in a statement issued on Tuesday (June 4).

“Streaming is the main source of revenue and engine of growth for music in Canada, benefiting the industry, creators, fans and consumers. And this is effectively a protectionist subsidy for radio.”

Among others, DiMA represents Amazon Music, Apple Music, and Spotify


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

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