Universal Music Group
Universal Music Group N.V. is a Dutch-American music corporation under Dutch law. UMG's corporate headquarters are located in Hilversum, Netherlands, and its operational headquarters are located in Santa Monica, California. As the biggest music company in the world, it is one of the "Big Three" record labels, along with Sony Music Entertainment and Warner Music Group. Tencent acquired ten percent of Universal Music Group in March 2020 for €3 billion and acquired an additional ten percent stake in January 2021. Pershing Square Holdings later acquired ten percent of UMG before its IPO on the Euronext Amsterdam stock exchange. The French Bolloré family still owns 28 percent of UMG. The company went public on September 21, 2021, at a valuation of €46 billion.
As of April 2024, UMG's catalogue includes over three million recordings and four million compositions.
History
Early history
The company's origins go back to the formation of the American branch of Decca Records in September 1934, and its name and company logo originate from Carl Laemmle's Universal Pictures. Although the movie studio and the music business share a common history, today the former is part of Comcast and the latter an independent commercial entity. During World War II, many record companies donated their metal masters to recycling for the war effort. However, Universal was an exception and donated more than 200,000 of their historic master recordings to the Library of Congress. The Decca Record Co. Ltd. of England spun American Decca off in 1939. MCA Inc. merged with American Decca in 1962.In November 1990, Japanese multinational conglomerate Matsushita Electric agreed to acquire MCA for $6.59 billion. In 1995, Seagram acquired 80 percent of MCA from Matsushita. On December 9, 1996, the company was renamed Universal Studios, Inc., and its music division was renamed Universal Music Group; MCA Records continued as a label within the Universal Music Group. In May 1998, Seagram purchased PolyGram and merged it with Universal Music Group in early 1999. Seagram's entertainment assets were then sold to French media conglomerate Vivendi in 2000, along with UMG.
2004: Consolidating into a Vivendi subsidiary
In May 2004, Universal Music Group was cast under separate management from Universal Studios, when Vivendi sold 80% of Universal to General Electric, who subsequently merged it with NBC to form NBCUniversal. This came two months after the separation of Warner Music Group from Time Warner. In February 2006, Vivendi purchased the remaining 20 percent of UMG from Matsushita Electric. On September 6, 2006, Vivendi announced its €1.63 billion purchase of BMG Music Publishing; after receiving European Union regulatory approval, the acquisition was completed on June 25, 2007.2007–2012: UMG acquisitions and EMI purchase
In June 2007, UMG acquired Sanctuary, which eventually became UMG's entertainment merchandising and brand management division, Bravado. In 2008, Universal Music Group agreed to make its catalogue available to Spotify, then a new streaming service, for use outside the U.S. on a limited basis.Doug Morris stepped down from his position as CEO on January 1, 2011. Former chairman/CEO of Universal Music International Lucian Grainge was promoted to CEO of the company. Grainge later replaced Morris as chairman on March 9, 2011. Morris became the next chairman of Sony Music Entertainment on July 1, 2011. With Grainge's appointment as CEO at UMG, Max Hole was promoted to COO of UMGI, effective July 1, 2010. In January 2011, UMG announced it was donating 200,000 master recordings from the 1920s to 1940s to the Library of Congress for preservation. In 2011, EMI agreed to sell its recorded music operations to Universal Music Group for £1.2 billion and its music publishing operations to a Sony-led consortium for $2.2 billion. Among the other companies that had competed for the recorded music business was Warner Music Group which was reported to have made a $2 billion bid. IMPALA opposed the merger. In March 2012, the European Union opened an investigation into the acquisition The EU asked rivals and consumer groups whether the deal would result in higher prices and shut out competitors.
On September 21, 2012, the sale of EMI to UMG was approved in the European Union and the United States by the European Commission and Federal Trade Commission respectively. However, the European Commission approved the deal only under the condition the merged company divest one third of its total operations to other companies with a proven track record in the music industry. UMG divested Mute Records, Parlophone, Roxy Recordings, MPS Records, Cooperative Music, Now That's What I Call Music!, Jazzland, Universal Greece, Sanctuary Records, Chrysalis Records, EMI Classics, Virgin Classics, and EMI's European regional labels to comply with this condition. UMG retained the Beatles and Robbie Williams. The Beatles catalogue was transferred to UMG's newly formed Calderstone Productions, while Williams' catalogue was transferred to Island Records.
2012–2017: EMI integration and divisions reorganization
Universal Music Group completed their acquisition of EMI on September 28, 2012. In November 2012, Steve Barnett was appointed chairman and CEO of Capitol Music Group. He formerly served as COO of Columbia Records. In compliance the conditions of the European Commission after purchase of EMI, Universal Music Group sold the Mute catalogue to the German-based BMG Rights Management on December 22, 2012. Two months later, BMG acquired Sanctuary Records for €50 million. On February 8, 2013, Warner Music Group acquired the Parlophone Label Group for $765 million. Later in February, Sony Music Entertainment acquired UMG's European share in Now That's What I Call Music for approximately $60 million. Play It Again Sam acquired Co-Operative Music for £500,000 in March 2013. With EMI's absorption into Universal Music complete, its British operations consist of five label units: Island, Polydor, Decca, Virgin EMI and Capitol. In the Greek market, as part of its divestiture plans, Universal Music retained Minos EMI and sold Universal Music Greece to Greek investors who renamed it Cobalt Music. Edel AG acquired the MPS catalogue from Universal in January 2014.On March 20, 2013, UMG announced the worldwide extension of their exclusive distribution deal with the Disney Music Group, excluding Japan. As a result of this deal DMG's labels and artists have access to UMG's roster of producers and songwriters on a worldwide basis. The exclusive deal also saw UMG granted unlimited access to all rights pertaining to Disney's 85-year back catalogue of soundtracks and albums. On April 2, 2013, the gospel music divisions of Motown Records and EMI merged to form a new label called Motown Gospel. In May 2013, Japanese company SoftBank offered $8.5 billion to Vivendi for the acquisition of UMG, but Vivendi rejected it. In July 2018, JPMorgan said that UMG could be worth as much as $40 billion and then increased the valuation to $50 billion in 2019. In August 2013, UMG became the first company in the US to have nine of the Top 10 songs on the digital charts, according to SoundScan and weeks later, became the first company to hold all 10 of the Top 10 spots on the Billboard Hot 100 Chart. In September 2013, UMG received a SAG-AFTRA American Scene Award for the company's commitment to diversity as exemplified by its "entire catalog and roster of artists."
On April 1, 2014, Universal Music announced the disbandment of the Island Def Jam Music Group, one of four operational umbrella groups within Universal Music. CEO Lucian Grainge said of the closure, "No matter how much we might work to build 'IDJ' as a brand, that brand could never be as powerful as each of IDJ's constituent parts." Island Records and Def Jam operated as autonomous record labels. David Massey and Bartels, who worked respectively at Island and Def Jam Records, were named to the new record labels independently. Barry Weiss, who previously moved from Sony Music to lead Island Def Jam in 2012 when Motown was incorporated into it, stepped down from Universal Music. Additionally, as part of the changes to the labels, Motown Records transferred to Los Angeles to become part of the Capitol Music Group. Ethiopia Habtemariam, who was previously the label's vice president, was promoted to the label's president, chairwoman and CEO. Habtemariam vacated her position and left Motown on November 29, 2022. A month following the Island Def Jam disbandment, longtime Interscope Records CEO Jimmy Iovine departed from the label, which ended his 29-year relationship with UMG. Iovine's departure also made way for a restructuring at Interscope Geffen A&M Records, resulting in the hiring of Interscope chief operational officer John Janick as its new chairman and CEO. Grainge said of the reorganization, "Since coming to UMG nearly two years ago, he has consistently shown why he is widely regarded as one of the most talented, innovative and entrepreneurial executives in the music business today and will be a key player in the future generation of industry leaders. John is the ideal executive to be writing the next chapter in IGA's illustrious history." In 2024, UMG later restructured various labels into its respective "East" and "West" coastal group of umbrella units. Island, Def Jam, Republic and Mercury Records were reorganized under the New York City banner called Republic Corps., while Interscope, Geffen and Capitol Records were brought under the Santa Monica banner, alias Interscope Capitol Labels Group.
Universal Music Group entered into film and TV production with the 2014 purchase of Eagle Rock Entertainment. UMG's first major film production was Amy, which won an Oscar for Best Documentary, while taking part in Kurt Cobain: Montage of Heck and The Beatles: Eight Days a Week documentaries. In January 2016, UMG hired David Blackman from Laurence Mark Production, where he was president of production, as head of film and television development and production, and theater producer Scott Landis as special advisor on theatrical development and production. UMG Executive Vice President Michele Anthony and Universal Music Publishing Group Chairman and CEO Jody Gerson have oversight of the pair. On February 11, 2017, PolyGram Entertainment was relaunched as a film and television unit of Universal Music Group under David Blackman.
In 2015, UMG's Capitol Records earned all the major Grammy Awards for the year, with Sam Smith receiving Best New Artist, Record of the Year and Song of the Year awards and Beck winning Album of the Year. In March 2016, Universal Music Canada donated the archives of EMI Music Canada to the University of Calgary. In May 2016, UMG acquired Famehouse, a digital marketing agency. That same year, Paul McCartney and the Bee Gees both signed to UMG's Capitol Records, including their catalog releases. In April 2017, UMG signed a new multi-year licensing agreement with Spotify, the world's leading streaming service, and in May 2017, UMG signed a deal with Tencent, China's biggest gaming and social media firm. In July 2017, "Despacito" by Luis Fonsi, Daddy Yankee and featuring Justin Bieber, became the most streamed track of all time. By 2018, the song had broken several Guinness World Records, including Most Weeks at Number 1 on Billboard Hot Latin Songs chart and most-viewed video online.
In August 2017, UMG and Grace/Beyond agreed to develop three new music-based television series, 27, Melody Island and Mixtape. 27 would focus on musicians at the age of 27, an age at which several iconic musicians died. Melody Island was an animated series based on tropical island music with live craft segments. Mixtape had twelve episodes, with each episode connected to a song. In October 2017, UMG announced the launch of its Accelerator Engagement Network, an initiative aimed to help develop music-based startups around the world. In November 2017, USC Annenberg announced UMG's partnership in the "Annenberg Inclusion Initiative", becoming the first music company to do so. The initiative is meant to create change for representation of women and underrepresented racial and ethnic groups in the media industry. In December 2017, Universal Music Group acquired Stiff and ZTT labels, along with Perfect Songs Publishing, from Trevor Horn's SPZ Group; BMG Rights Management, through Union Square Music subsidiary, retained its back catalogues. That same month, UMG signed a global, multi-year agreement with Facebook becoming the first of The "Big Three" to license its recorded music and publishing catalogs for video and other social experiences across Facebook, Instagram and Oculus. Sony and Warner signed similar contracts with Facebook the following year. Furthermore, on December 19, 2017, UMG signed a multi-year licensing agreement with YouTube.