🔵 In the market share discussion, let's not forget the services companies
Why the Universal/Downtown deal affects considerably more than just indie labels
Hi there -
I’ve spent the last couple of weeks chatting to all manner of heads of businesses, and unsurprisingly the topic of the day remains the Universal/Downtown acquisition.
One area I’m yet to see given much focus from critics, however, is the potential for this deal to affect a wide range of service companies, examples of which would cover anything that labels might employ - accounting, production, D2C, marketing, creative content and so on.
To date, much of the discussion (and objection) appears to be focused entirely on the effect this deal will have on the labels themselves - something Martin Mills outlined so clearly in his response published last week.
Chatting with a few colleagues in the independent sector though, I was initially surprised at just how much concern there is around the Downtown acquisition. However when you stop and consider it all, the reasoning makes a lot of sense.
Downtown, lest we forget, is not a conglomeration of labels. It comprises businesses like distribution company Fuga, royalties and publishing business Songtrust, and royalty accounting company Curve. All, to their credit, have been incredibly successful in acquiring business from independent labels, but sadly all will now be owned by Universal, and therefore subject to the wider agenda of that company.
So why the concern? After all, there are competitor businesses out there in all of the spaces Downtown’s companies sit in.
Really, this is about what Universal could form as a whole, and the impact on wider competition that this might bring.
When we look at, say, Sony’s acquisition of companies like AWAL or The Orchard, one might argue that they at least stayed in a particular lane: artist and label services, respectively, in this case. With the Downtown purchase, Universal is really opening up a much wider scope of offering to artists - one that doesn’t just see it competing with labels, but with a multitude of other companies beyond that as well.
It sheds light on the logic of hijacking the “independent” term; in time I’ve no doubt that Universal will present its Virgin Music division as the all-in solution for independent artists, allowing its parent company to present and position itself as an indie champion. Which, when you think about it, is a grim proposition, given this is really just a huge multinational corporation.
Equally, if the Downtown acquisition is allowed to proceed, one wonders where this leaves Universal relative to other service acquisitions. Could it buy up a D2C business, for example, and further broaden out its ecommerce offerings? Could it buy up a pressing plant business and threaten indie operators in that space?
Ergo, some of this is about the intended Downtown buy, but it is also about the ramifications of what might follow if this purchase passes competition authority scrutiny.
(Sidenote: another angle was put to me about this from one MD: the idea that anyone looking to sell their business will now be tapping up Universal, knowing it has arguably the deepest pockets. After all, if you can’t beat them, you join them. Possibly an obvious statement, but a worrying one relative to the exit plans of any indie labels or service businesses.)
For me then, this all warrants highlighting, because I fear that any opposition to the Downtown purchase will focus more on market share relative to recorded music itself. In that regard, this is precisely where we need indie trade bodies to look beyond their own purview and do some outreach to services companies or others it feels may be affected, and work to bring this all together under a united front.
This is a time to really make a thorough, extensive defence of a sector currently being whittled away to nothing. It is also a time to speak up; I have had a couple of people remarking that “X who runs [Well Known Indie Label] is wildly opposed”, but perhaps now is a time to step up and voice that concern. Staying quiet benefits nobody. This topic has to stay in the news, and that might be one way to achieve that.
Have a great evening,
D.
P.S. One ironic note, given my comments of late: it occurred to me when discussing this all that there is no trade body representing the services companies that work in the music industry. With the sheer volume of outsourcing that goes on across the entire music industry, I find that quite surprising. Something to consider, perhaps? Ideally on the basis there is only one trade body representing everyone, that is!
🎶 Listening to “Perverts” by Ethel Cain. I’d be tipped off about this release last week after being told it was to be the Album of the Week at The Quietus, but since then I’ve seen chatter around this album grow and grow, with my own team all getting stuck in too. Well worth your time; challenging, angular, indulgent… but fantastic.
📺 Watching “Nintendo Switch 2: First Look” on YouTube. Finally!! I became a huge Switch fan largely due to the portability that allowed quick “pick up and play” gaming, that suits my lifestyle perfectly. Curious to see what the price is on this, but initial signs are all good. No drastic changes, but plenty of smart improvements.
🤖 Playing with Sunsama, an organiser app/platform that I first discovered when it was recommended as being good for people with ADHD. I’m hugely cynical about claims like this as frankly it feels like ADHD and neurodiversity has become this new goldmine to cynical developers etc, BUT… I’m pleased to report this one is actually pretty cool and suits me down to the ground. Worth a look if you’re unhappy with how you currently approach organising your day or week.
Notes in dispatches:
Normal service on Network Notes will resume soon - i.e. the full dispatch with news roundups etc. Honestly the issue here is just time: we have so much going on at MU right now that juggling running the company with finding time to compile all the news etc is proving extremely hard. For now though, I’d sooner send out these slightly reduced instalments of NN and at least get something to you all.
I will be at the Music Ally Connected conference next week delivering a presentation on “Understanding the Music Fan in 2025”. If you’d like a copy of the presentation in the days after it has been delivered, ping me an email and I’d be happy to share.
I’m now posting over on Bluesky too, so if you want hot takes on stories as they break etc, follow me over there. 🦋