Image by Laurenz Heymann/Unsplash

Remember when Spotify invested in distributor DistroKid back in October 2018? Now its biggest rival is making a similar move. Yesterday, Apple led a $50m Series B funding round for UnitedMasters, alongside Alphabet (yes, Apple and Google’s parent company investing together) and Andreessen Horowitz.

Apple isn’t just opening its wallet: the deal includes a strategic partnership which the distributor claimed would create “dramatic new opportunities” for its artists. CEO Steve Stoute’s statement reiterated a familiar theme from his past pronouncements on the industry.

“The power in the music industry has shifted back into the hands of the artist. We are taking that power and using it to place the industry’s intellectual property back into the hands of its rightful owners,” he said.

Which should at least spark some fun conversations between label execs and Apple’s Eddy Cue, although his statement – “The contributions of independent artists play a significant role in driving the continued growth and success of the music industry, and UnitedMasters, like Apple, is committed to empowering creators” – was more measured.

It’s a big moment for UnitedMasters, not least in keeping the investment cash flowing: the company’s first round of funding was $70m in November 2017. The distributor currently has 1m artists on its books, and cites NLE Choppa, Lil Tecca, Lil XXEL and Tobe Nwigwe among its breakout successes so far.

Still, bigger picture: Apple has invested in a distributor, Spotify has invested in a distributor, SoundCloud has become a distributor after buying one (Repost). These are very interesting times, and while Spotify quickly retreated from its experiment with direct artist uploads to its platform, it’s clear that the big DSPs are all thinking hard about the future shape of the industry, and augmenting their (still vital) partnerships with labels with deeper involvement in distribution and the artists-direct sector.

Image by Laurenz Heymann/Unsplash

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Stuart Dredge

Music Ally's Head of Insight

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