Shock news! Major labels have equity in digital music services! Yet there’s more to Forbes’ latest feature on the music industry than its reminder that WMG has a stake in SoundCloud, major labels have equity in Spotify and Shazam, and so on. Fun speculation about overall value held by UMG, Sony and WMG for example.
“Forbes estimates that the three labels have amassed positions in digital music startups valued at almost $3 billion–or around 20% of the $15 billion or so the labels are collectively worth,” claimed the piece. “The percentage will shoot even higher if and when Spotify goes public.” But the article isn’t afraid to shirk the more sensitive questions of how these stakes will (or won’t) pay off artists, as well as some of the familiar questions of arbitrage and breakage in how money paid to labels by streaming services gets distributed on (or not) to creators. Which isn’t a surprise within the music industry, but it’s noteworthy in itself that these issues are now being discussed in the wider business press.