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BMG is stepping away from the live music business after agreeing a deal which will see its two live companies, Undercover and Karo, transferred back to the minority shareholders.
The German-headquartered music giant acquired a majority stake in Brunswick-based promoter/event production firm Undercover in October 2020, enabling it to “offer artists an integrated tour promotion and ticketing service” on an opt-in basis, in addition to “releasing recordings and publishing songs”.
BMG and Undercover subsequently formed a strategic alliance with Karo, the company behind the Taubertal Festival, in 2021, and booked out Berlin’s 1,600-seat Theater des Westens every night until the end of 2024 to showcase domestic and international recording artists.
However, in late 2023, BMG CEO Thomas Coesfeld announced the company would be focusing on its “core service areas” of music publishing and recordings moving forward.
“We wish BMG and its team all the best and every success in focusing on its core business”
“Michael Schacke [Undercover founder/owner] and Volker Hirsch [Karo founder/owner] are seasoned entrepreneurs who have built enviable reputations in the live music business,” says BMG chief content officer Dominique Casimir. “We are pleased to have agreed terms which allow them to pursue an independent future and we wish them and their teams the best for the future.”
The new deals will see the two companies return to their previous ownership structure.
“I have looked for and found the best solution for Undercover and our artists,” says Schacke, who launched the company in 1991. “Undercover will remain strong and independent in the future. We wish BMG and its team all the best and every success in focusing on its core business.”
Founded in Tauber Valley in 1996, Taubertal has featured acts including Biffy Clyro, Placebo, Rise Against, Pink, Die Toten Hosen, The National and Skunk Anansie.
“It has been a pleasure working with Michael Schacke and Dominique Casimir and we are pleased yet again to be pursuing an independent course as we near the 30th year of existence of Taubertal in 2026,” adds Hirsch.
The record business has had a complex relationship with its live counterpart down the year
The record business has had a complex relationship with its live counterpart down the years, arguably reaching its zenith with the controversial proliferation of so-called ‘360’ deals with artists in the late 2000s/early 2010s.
More recently, major label Warner Music Group (WMG) crossed the divide to acquire India-based live events and artist management company E-Positive. WMG said that the deal would strengthen its position in the market while allowing its artists “to tap into new expertise in brand partnerships and live events”.
Also in 2023, Warner Music France’s live entertainment and concert production company Décibels Productions secured a majority stake in French talent agency Les Visiteurs du Soir, while Warner Music Poland bought a minority stake in Polish concert and festival promoter Big Idea in 2022.
Meanwhile, Sony Music Masterworks, a division of Sony Music Entertainment (SME), acquired a majority stake in Barcelona-based Proactiv Entertainment last year. Other investments by Sony Music Masterworks include Backyard Cinema; Holland-based GEA Live; Dubai-based concert promotion, talent management, events and production company MAC Global; Raymond Gubbay Ltd and UK concert promotion and production company Senbla.
Elsewhere, Universal Music Group (UMG) launched live music arm U-Live in 2012. French-headquartered media giant Vivendi, which announced the partial spin-off of its UMG stake in 2021, is reportedly working with advisers on potentially offloading parts of its Vivendi Village subsidiary, including See Tickets and 11 festivals such as the UK’s Love Supreme and Kite, as well as Garorock in France.
Sources indicate that Vivendi has concluded its ticketing and festival businesses were not of sufficient scale to compete with the likes of Live Nation and AEG. The Financial Times reported the firm is seeking up to £300 million (€348m) for See Tickets, which it bought for €96m in 2011, with AEG and CTS Eventim said to be among the interested parties.
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Tomorrowland, the world’s biggest dance music festival, has launched Tomorrowland Music, a new record label which will be distributed worldwide through Virgin Music Label & Artist Services, a division of Universal Music Group (UMG).
The Berlin-based label will be led Alexander Neipp, Daniel Schmidt and Magnus Textor (Virgin Records) and Tina Adams (Virgin Music Label & Artist Services). Its first release, out tomorrow (27 August), will be ‘You Got the Love’ by Never Sleeps, a new project by Afrojack and Chico Rose.
Michiel Beers, CEO and founder of Tomorrowland, says: “Creativity is something that can’t be stopped at Tomorrowland. I’m very proud of how resilient our team was to find new ways of bringing Tomorrowland into the reality of the last period. We have taken the extra time to focus on projects that were on our list for a long time and one of them was definitely launching our own Tomorrowland Music label.
“Michel Van Buyten, music manager of Tomorrowland Music, will work closely together with artists to help create strong stories around their releases. With the combined forces of our dedicated label team, Tomorrowland Media House, and the different Virgin Music teams worldwide, our aim is to introduce fans in every corner of the world to the most exciting projects in electronic music.”
Tomorrowland, which has been held in Boom, Belgium, since 2005, was cancelled in 2021 for a second year running after local authorities pulled its permit, citing concerns over Covid-19.
“I’m confident the new label is going to be a special place and a great home for artists”
A digital festival, Tomorrowland: Around the World, took place on 16 and 17 July, featuring music from Armin van Buuren, Nicky Romero and Charlotte de Witte.
Frank Briegmann, chairman and CEO of Universal Music Central Europe, comments: “Over the past 15 years Tomorrowland has built a reputation as one of the world’s leading festivals and electronic music brands by consistently expanding and evolving their relationship with music fans. Today, Tomorrowland is one of Europe’s most innovative music brands, respected by artists and loved by the millions of people who have attended their events around the world.
“We are delighted to have partnered with them to support the launch of their new label venture and to have created a uniquely flexible model utilising our expert and proven teams at Virgin Records Germany, Virgin Music Label & Artist Services teams around the world, and other flagship UMG labels worldwide to help drive success and create global hits for Tomorrowland. We look forward to a very successful partnership together, and to further enhancing our ability to provide partners, labels and artists with new and innovative ways to achieve global success.”
“Joining forces with Tomorrowland Music feels like love at first sight,” adds Magnus Textor, head of A&R for Virgin Records Germany. “It’s great to see that we share the same passion for electronic music and artists. Everyone who has ever been to Tomorrowland or even just seen one of their event films has experienced their dedication. Therefore, I’m confident the new label is going to be a special place and a great home for artists.”
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BMG Rights Management, the Berlin-based record label and music publisher, is entering the live business for the first time with the acquisition of a majority stake in promoter/event production firm Undercover.
Brunswick-based Undercover, which usually promotes in excess of 200 concerts and shows annually, will form the basis for a new live music and events business unit within BMG in Germany. The company also serves a tour agent, brokering tours and festivals for national and international artists across Germany, Austria and Switzerland (GSA), and develops and produces its own touring formats.
Undercover CEO Michael Shacke and his team of 30 will remain in place following the acquisition, the terms of which were not disclosed and which is expected to close by the end of this month.
The deal, says BMG, means that, in addition to “releasing recordings and publishing songs, BMG can now offer artists an integrated tour promotion and ticketing service” on an opt-in basis.
“An important part of our job will be to form a centre of excellence for events”
Dominique Casimir, BMG’s EVP of repertoire and marketing for continental Europe, says: “Moving into live is the logical extension of BMG’s plan to integrate all the services an artist could need under one roof, with the artist brand at the centre of it all. Crucially, we have found in Michael Schacke and his team a partner who shares our values.”
“I founded this company in 1991 to be able to perform with my band, and that’s how I became a promoter. This idea has since grown into a nationwide concert agency with over 30 employees,” adds Schacke. “Discussions about a partnership with BMG commenced long before the coronavirus pandemic, but we are now perfectly set up for when the market returns.
“There is a significant opportunity for us working together to offer a genuine alternative for artists in Germany and beyond, building on Undercover’s established recipe of ‘live entertainment and artist partnership’.”
The acquisition comes during a time of upheaval in the Covid-hit German live music market, and follows the launch of new promoter DreamHaus – also based in Berlin, and staffed with a number of former Live Nation Germany employees – last week.
Maximillian Kolb, managing director of BMG GSA, says: “Artists want partners who build their business around them, rather than the other way around. Above all, this means offering the best possible service.
“Moving into live is the logical extension of BMG’s plan to integrate all the services an artist could need”
“The German music market has proven to be extremely adaptable and is one of the strongest in the world, especially in the live segment. I am very happy that we have become the first territory within BMG to be able to offer a complete service portfolio to artists, including live.”
Launched in 2008 as the successor to Sony BMG, BMG Rights Management – owned by German media conglomerate Bertelsmann – represents artists including Iron Maiden, John Legend, Bring Me the Horizon, Bloc Party, Alt-J, Tame Impala, Morrissey, MIA, Frank Ocean, Jess Glynne, David Crosby and Kylie Minogue for label services and/or publishing.
Undercover will form part of a network of Bertelsmann brands, the Bertelsmann Content Alliance, which also includes broadcaster RTL, book publisher Penguin Random House and magazine publishing Gruner and Jahr (Stern, Capital, Geo).
Casimir, who is also a board member of the Bertelsmann Content Alliance, explains: “An important part of our job will be, together with the Undercover team, to form a centre of excellence for events within the Content Alliance. We look forward to working with the other divisions and together adding even more value to our artists and media brands by creating bespoke live experiences.”
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With fans left deprived of the live experience and much of the industry facing stagnated revenue streams, livestreaming is developing fast as a credible new source of income for artists, promoters and other rightsholders.
Livestreaming has been used one way or another for many years now, be it by festivals looking to expand their audience reach, artists seeking to enhance fan engagement or maximise audience numbers, streaming services looking to tap into the live business, or video games crossing over into the music space.
In the wake of the coronavirus crisis and live event shutdown, many have moved into the virtual space as a means of driving much-needed revenue and of raising funds and awareness, or simply of boosting spirits.
According to International Music Managers Forum’s (IMMF) Jake Beaumont-Nesbitt, however, the coronavirus crisis has not instigated anything completely new here, but rather has “accelerated and diverted” what was already happening in this online live event space.
As the business begins to become accustomed to its new reality, however long it may last, the potential and need to properly commercialise the livestreaming game is becoming ever more apparent.
“Who knew it would take a global pandemic to serve as a catalyst for some serious conversations about what this side of the business could look like?”
“One of the flip sides of the global health crisis, so to speak, is that people are realising there is a commercial business here,” Ruth Barlow, director of live licensing at the independent Beggars Group of labels tells IQ.
“Who knew it would take a global pandemic to serve as a catalyst for some serious conversations about what this side of the business could look like?”
Barlow, who has been licensing livestreams for the Beggars Group for around ten years, occupying the space between live and recorded and attempting to get both to see eye to eye, believes there is potential for “a business that both the live industry and labels can share in here”.
“I think there are really strong indicators that a healthy online business can sit comfortably aside real-time events and has the potential to generate ancillary revenue for rightsholders, promoters and artists alike,” says Barlow.
Too often, she says, there is a tendency for the live industry to see streaming live from festivals and other events purely as ‘promotional’ activity, leading rightsholders, artists and others to miss out on commercialising the content and collecting royalties on commercial platforms.
“These big live companies could act as the trusted gatekeepers for this, figuring out the licensing and taking the strain off artists”
Beaumont-Nesbitt agrees that the trend to view livestreams predominantly as marketing opportunities has led to “a failure on the part of major record labels to properly move into this space over the past 10 to 15 years.”
Now as offline replaces online for a period, Beaumont-Nesbitt believes the major players of the live entertainment and, potentially, esports worlds can capitalise on the potential of livestreaming.
Through leveraging in-depth audience knowledge, together with pre-existing brand relationships and well-trusted festival and event identities, the live industry could gain an edge over its recorded counterparts in the online event creation space.
Much like in the real-life live events market, Beaumont-Nesbitt expects consolidation to be key here, with a few major players likely to prove to have both the recognisable identity and the diversity of offering to succeed.
“These big live companies could act as the trusted gatekeepers for this, figuring out the licensing and taking the strain off artists.”
“A proper conversation is needed about licensing to create a mutually beneficial situation for the recorded and live sector alike”
However, for Barlow, it is imperative that the recorded sector be involved too, as generally permission is needed from labels and the artists’ publishers before any form of recording or broadcast takes place.
It’s been an “uphill struggle” over the years to convince promoters that labels have a say in livestreaming, says Barlow, yet paying for an artist to play a show does not automatically include the rights to livestream these performances.
Licensing, it seems, is a sticky issue within the livestreaming business. Unlike at an offline event, audiences online spread beyond national boundaries, stretching the certainty of many national collective management organisations’ (CMOs) license agreements.
The diversity of online platforms and the lack of unification or regulation between them also complicates matters, with each negotiating different licensing rules. A live stream on Instagram, for example, is recorded as well and available on demand for 24 hours or longer after it was “live”, which technically turns a livestream into a recording, requiring a different set of rights. A growing number of platforms also stream primarily user-generated content, making it much harder to identify which licensor holds the rights in the content.
“A proper conversation is needed about licensing to create a mutually beneficial situation for the recorded and live sector alike,” says Barlow.
The future of livestreaming looks bright, as more consumers get accustomed to viewing live content online and the return date of live events as we know them remains uncertain
In response to the coronavirus outbreak, Beggars Group has been partaking in another form of livestreaming, one that does not originate from a live – or even “virtual” event – in real time, but rather involves the resurfacing of old live footage, that is then repurposed and broadcast at a set time on platforms such as YouTube Premieres.
This form of livestreaming allows viewers to watch and react to content together, mimicking the temporality and collectivism of a live show. Beggars Group is able to use such content as, over the years, it has been licensing and retaining the rights to a whole host of live performances.
“The level of engagement with long-form content on certain platforms has been pretty bonkers,” says Barlow, hinting that more previously unseen footage from across the Beggars Group’s roster is set to be aired soon.
The future of livestreaming looks bright, as more consumers get accustomed to viewing live content online and the return date of live events as we know them remains uncertain. As the lockdowns rumble on and infection rates continue to rise in many places, it seems that rebuilding consumer confidence may prove tricky and, even after the peak of the pandemic has passed, there will be a demographic that may seek their live experience elsewhere, at least for a time.
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