China’s Tencent Music Entertainment is to adjust its business model after being hit with regulatory penalties and seeing its share tumble to record lows. It will downplay music streaming and control of exclusive content and instead emphasize related services such as karaoke and social entertainment.
Source: Tencent Music Changes Focus After Regulatory Slap, Profits Drop
In June, Ackman announced he’d use his SPAC to buy the UMG stake after nearly a year of searching for a target. After pushback from the SEC, which among other issues questioned whether the deal met the New York Stock Exchange’s listing requirements, he announced he would be purchasing a stake through his hedge fund instead of a SPAC.
Source: Bill Ackman’s SPAC slapped with lawsuit claiming company is illegal
The biggest trade publishers continue to get larger: Hachette Book Group has entered into a “binding commitment” to acquire one of the industry’s largest and most unique independent publishers, Workman Publishing. HBG is paying $240 million for Workman, which had sales of $134 million last year. The deal is expected to be completed by the end of September.
Source: Hachette Book Group Will Acquire Workman Publishing for $240 Million
TikTok’s crop of book lovers are boosting sales for Canada’s largest bookseller. In its second-quarter earnings report, Indigo Books and Music Inc. said In its second-quarter earnings report, Indigo Books and Music Inc. said that #BookTok is having a noticeable positive effect on demand, especially for older titles.
Source: #BookTok Is Boosting Sales For Brick-And-Mortar Bookstores – Tubefilter
Disney Plus rebounded in the second calendar quarter of the year, reeling in 12.4 million net new subscribers to stand at 116 million worldwide as of July 3 — beating analyst targets. Wall Street analysts on average had forecast Disney Plus subscribers coming in at 112.8 million for the period.
Source: Disney Plus Tops Expectations, Reaches 116 Million Subscribers
US-based Tempo Music Investments has acquired a portion of Tyler Joseph’s catalog. The $1 billion backed Tempo was launched in 2019 and funded by Providence Equity Partners, a premier private equity firm specializing in the media, communications, education, software and services industries, in partnership with Warner Music Group.
Source: Tempo Music buys into music catalog of Twenty One Pilots’ singer-songwriter Tyler Joseph
Tensions between the creative community and the entertainment industry’s gatekeepers over compensation have been on the rise since spring of last year, when Covid-19 upended the way entertainment is distributed and consumed. Ultimately studios are moving toward the Netflix system—big upfront payments to talent and no profit participation; Netflix’s all-you-can-eat subscription model makes it virtually impossible to attribute revenue to a particular movie or series.
Source: Scarlett Johansson Lawsuit Stirs Debate Over Streaming-Era Movie Compensation
France-based Vivendi, parent of Universal Music Group, has sold 7.1% of that company’s share capital to Pershing Square Holdings, the investment firm managed by billionaire Bill Ackman, for $2.8 billion, with the possibility to sell him a further 2.9% by September 9, 2021. The deal values UMG — the world’s largest music company — at 35 billion Euros, or around $41 billion.
Source: Vivendi Sells 7.1% of Universal Music Group to Bill Ackman’s Pershing Square for $2.8 Billion
At stake is the lucrative power play between distributors and creators that the streaming revolution overturned. Hitmakers accustomed to decades of risk-free profit-share deals have been moping around since Netflix — followed by streaming competitors including Disney+ and Amazon — swooped into town brandishing a new kind of deal: lump sum buyouts that limit talent upside while adding value to their platforms.
Source: Let’s Make A Deal: Who’s For Sale In Hollywood And For How Much?
Spotify’s not having a great time. The streaming service faced a punishing reaction on Wall Street following its second-quarter results last month: Daniel Ek’s firm’s share price fell 5.7 percent in a day, wiping around $2.5 billion off the market cap of the company in a few short hours.