African Music Bops Attract Universal Music Group
By CultureBanx Team
Universal Music Group strikes a new licensing deal with Africa’s Boomplay
Boomplay has more than 36M users
The world’s largest music publisher Universal Music Group (UMG) is pushing further into Africa through a new licensing deal with Boomplay. This new agreement will cover multiple markets across the continent, which is widely fragmented but remains one of the last true music growth opportunities in the world.
Why This Matters: Boomplay is Africa’s leading music streaming service with more than 2 million songs and thousands of music videos, spanning genres like Afrobeat, Afropop and hip-hop. They have more than 36 million users and add nearly 2 million new users each month. Under the terms, Boomplay will distribute music from UMG’s labels through its streaming service in Nigeria, Ghana, Kenya, Tanzania, Rwanda, Uganda and Zambia.
The UMG family of labels include Capitol Music Group, Island Records, and Def Jam just to name a few. They have a deep roster of heavy hitters like Rihanna, Kendrick Lamar, Drake and Migos. Revenues for UMG during the first half of 2018 amounted to more than $3 billion, led by a 34.3% spike in streaming revenues.
While the music industry’s annual global recorded revenues between 1999 and 2014 declined from an estimated $27 billion, music publishers, specifically Universal Music Group thrived. By the end of 2015, UMG was getting over half of its digital revenues from streaming with payments from the likes of Pandora and YouTube. The move comes as owner Vivendi is looking to sell up to half of the shares of UMG, which analyst estimate is worth around $40 billion.
Situational Awareness: The success of streaming has attracted lots of new investment, and longtime owners have seen an opportunity to cash out. Earlier this year in one of the biggest music deals ever, Sony (SNE -0.62%) bumped up its ownership to nearly 90% of the EMI Music Publishing catalog, the sale was valued at $4.75 billion.
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