🔵 Universal/Downtown - a few thoughts now that it's going ahead
The acquisition passes EU regulator scrutiny, but what does it mean for the future?
Learning that regulators had approved Universal’s acquisition of Downtown did not come as a surprise. Back when the acquisition was announced, I commented that it felt inevitable that this would be approved, largely because the acquisitions were B2B ones rather than B2C, and regulators tend to be looking at the impact on end consumers more than anything else.
I get the sense a lot of other people felt much the same way, as news of the deal going ahead was not really met so much with outrage as a sigh and a roll of the eyes.
So what now? For one thing, I would imagine Universal will have to consider any further acquisitions rather carefully. I have made this comment in the past, though, and feel it is notable that Universal has a habit of quietly extending its tendrils into other spaces in a manner that can evade scrutiny. A good example would be its stake in NTS radio, for example.
Even so, with regulatory scrutiny on the company in general, I would think any further moves it makes would have to be exceptionally well thought out.
I did briefly wonder whether the music giant would swoop for DistroKid, which is apparently up for sale. In reality though, I’m not convinced Universal is all that interested in the kind of exceptionally long-tail business that DistroKid operates, valuable though it is.
But what about artists? In some respects, this development is a gift to businesses that remain fully independent. The likes of IDOL and Absolute leap to mind as prime beneficiaries in a world where not everybody wishes to jump on the Universal bus.
Perhaps a more interesting space to focus on now will be the degree to which Universal attempts to consolidate its power, particularly in light of its new acquisitions. One comment that really stuck with me from the Music Ally Connect event was that of Jonathan Dworkin when he remarked that Lucian Grainge had moved Universal’s HQ to California rather than New York (as originally intended) so as to be closer to Big Tech.
The AI bubble remains un-burst at this point, but you can sense everybody, including Universal, dashing towards it as if it is still a licence to print money. Doubtless Universal will seek to deploy AI wherever it can in the name of benefiting its own investments and artists. The tools that it uses may not be immediately apparent and could even sit out of sight, but I’m fairly convinced that they will now look to implement things at scale that will naturally benefit their ecosystem.
Ultimately, I feel this is likely to be a fool’s errand. I remain firmly of the view that social media is a race to the bottom now. AI tools are being deployed to help us combat other AI tools, and the speed at which slop is filling these platforms is growing daily. To that end then, I see no world in which AI being used to accelerate AI is going to do anything but burn out the entire space. For that reason, I feel like Universal’s desire to buddy up to Big Tech may well prove fruitless in the long run.
I have a quiet suspicion that the acquisition of value through data will also be a focus for Universal from here on. There are a higher number of platforms emerging that are seeking to work with artist data, serving as a central node of collection for the purposes of insight.
Those are exactly the kinds of businesses I could see Universal wishing to swoop for, as the logic feels like a mere extension of the same one that suggested the Downtown acquisition to be a smart move. I have said it a couple of times before now, but I’ll say it again: artists badly need to ensure some kind of clause exists when dealing with data platforms such that all data is returnable to the artist should that platform be acquired.
A comment was made to me earlier that I feel is a very simple truth: when artists sign with genuinely independent businesses, those businesses are answerable to the artist. Universal, on the other hand, is answerable to its shareholders, and artists would do well to remember that before making deals. Lest we forget, as much as Universal likes to crow about empowering artists, in reality it is still taking vast amounts of investment from the likes of Pershing Square Capital. It is like oil and water, in terms of culture versus commerce.
The major is undoubtedly developing a massive power base, but choice remains with artists. I think it will be very interesting to see whether Universal will be able to deliver more through its scale or will simply cave in to a kind of enshittification that will see more and more talent leaving.
I will be watching with interest to see what Universal’s next moves for expansion are. I suspect it will be subtle and quite probably firmly out of sight.
Let’s see.
Have a great day,
D.
🎶 Listening to “Red Rocking Chair” by All Them Witches. This melds that “musing quiet verse” thing with monstrous, copper-bottomed riffage of the kind I love just as much now as I did in the 1990s when the likes of Kyuss were delivering it so perfectly. The kind of music that makes you want to detune your guitar to B, then lay off all manner of dropped power chords until you grow a beard, well, like the one I am sporting right now, LOL. Shouts to Doug for the recommendation!
📺 Watching “Turin 2006 Winter Olympics | Women’s Snowboard Cross Final”. I’ve been loving the Snowboard Cross at this year’s Winter Olympics; genuinely gripping stuff. This final from ten years ago is something else, however. Drama? Tension? It has it all. Absoutely incredible. Extra shout-outs to the commentary, which culminates in what can only be described as Braveheartian-levels of mania. Glorious, every second of it.
🤖 Loving Zorin OS. Like many, I’ve been increasingly exploring alternatives to Big Tech of late, and one thing that caught my eye was this Linux distro aimed primarily at those looking to escape the hellscape that is Windows 11. The way it handles Windows apps is the best I’ve seen; if you run a .exe file to install something, the OS will check what it is, and if a Linux-native version exists, it will point you to that. If there is not a Linux-native equivalent, it then guides you through installation. For me though the main win is just the look of it. Absolutely stunning. Breathe new life into old laptops with this one - you won’t regret it.
Gleefully accepting music recommendations!
I do really enjoy getting suggestions for either existing music or forthcoming releases to check out. So, if there’s something you think I might like, do feel free to get in touch. Always keen to hear the weird and wonderful things going on out there. And, with 6000+ subscribers, I’m happy to spread word on things I’m loving too.
Other bits…
I recently sat down with Nathan at Rinse FM to chat all things AI. It was a great chat, so if you have time, be sure to tune in and have a listen.
Big thanks to FFWD for having me last week. I was not in great shape after a family emergency the day/night before, but it was still a great chat about all things marketing. I really hope we’ll see more events from FFWD now; it was clear to me that there’s a lot of people who really benefit from those conferences happening.
Good read.
Instead of acquiring more IP, they decide to go for the infrastructure.
Let's not forget that acquring Downtown gives UMG access to all the data behind the independent artists and songwriters that are signed up with services like CD Baby and SongTrust. This can give them even more of an advantage when it comes to the independent sector competing with them.
I can't stress enough that both artist and labels outside of the major record label system should focus on owning their infrastructure and data.