BMG Rights Management explained

BMG Rights Management GmbH
Logo Alt:official logo of BMG
Type:Division
Industry:Music
Founded: in Berlin, Germany
Hq Location City:Berlin
Hq Location Country:Germany
Num Locations:20 countries
Num Locations Year:2020
Area Served:Worldwide
Services:Music rights management
Revenue: €602 million
Revenue Year:2020
Profit: €137 million
Profit Year:2020
Num Employees:974
Num Employees Year:2020
Parent:Bertelsmann
Footnotes:BMG's main distributor is Universal Music Group for physical media marketing only,[1] with digital distribution duties being transferred to BMG's own systems. Additional distributors, depending on artist and division, are Sony Music, RED Distribution, PIAS Group, SPV GmbH, Good2Go, Demon Music Group, Rough Trade and others.
Trade Name:Bertelsmann Music Group (2009–present)

BMG Rights Management GmbH (also known simply as BMG) is an international music company based in Berlin, Germany.[2] It combines the activities of a music publisher and a record label.[3] [4]

BMG was founded in October 2008 after Bertelsmann sold its stake in Sony BMG.[5] From 2009 to 2013, the investment firm KKR held 51% of the company, which became one of the world's largest music publishers during that time.[6] [7] BMG is 100% owned by Bertelsmann and one of the group's eight business divisions.[8]

History

Music at Bertelsmann

See main article: article and Bertelsmann Music Group. In the 1950s, Bertelsmann entered the music business when it added music to its book club.[9] Ariola, a record label, was launched and Sonopress, a pressing plant, was established.[10] [11] In 1975, Ariola opened an office in the United States.[12] Bertelsmann acquired Arista Records in 1979 and RCA Records in 1985, thereby becoming one of the world's largest music companies.[13] Its various subsidiaries were brought together in 1987 to form Bertelsmann Music Group (BMG), which did business in a number of genres, including folk, pop, and in particular classical music.[14]

In response to declining sales in the overall music market, Bertelsmann agreed to merge its record label interests with Sony in 2003; the company was called Sony BMG.[15] [16] Furthermore, in 2006, Bertelsmann sold its subsidiary BMG Music Publishing to Universal Music Group.[17] [18] Having reached the conclusion that established music publishing companies and record labels were not appropriate for an increasingly digital music business, Bertelsmann sold its stake in the Sony BMG joint venture in 2008.[19] The company was subsequently renamed Sony Music Entertainment.[20]

Launch of the new BMG

In October 2008, Bertelsmann launched the new BMG with a small portfolio of recorded music rights of around 200 artists it retained from Sony BMG.[21] It declared it would pursue a business model focused on fairness, service and transparency.[22]

The launch of the new BMG came amidst the 2008 financial crisis, and within two weeks of the collapse of Lehman Brothers.[23] [24] Since Bertelsmann could not supply the required funds on its own, a 51% stake was sold to financial investor KKR in 2009.[25] [26] [27] Bertelsmann retained 49% and the right to appoint the company's management.[28] The transaction allowed BMG to increase its equity ratio.

International expansion

Initially, Bertelsmann had announced that the new BMG would focus on the European broadcast market. After KKR became the majority shareholder, the company set its sights on expanding internationally.[29] [30] A key step towards achieving this goal was acquiring Cherry Lane Music Publishing in 2009, which provided BMG with its first foothold in the United States.[31] [32] [33] [34] BMG made several other purchases in 2010, including Evergreen Copyright Acquisitions.[35] [36]

In 2011, Bug Music was bought by BMG,[37] followed by music publisher R2M Music in 2012.[38] Bertelsmann was also reported to be interested in buying EMI,[39] but EMI was ultimately acquired by Universal Music Group and Warner Music Group (record labels) and Sony/ATV Music Publishing (songwriters).[40] [41] The regulatory authorities approved the deal subject to some conditions, including the sale of several labels.[42] BMG was thus able to acquire Mute Records (2012) and Sanctuary Records (2013),[43] [44] as well as the publishing catalogues of EMI Virgin Music and Famous Music UK from Sony/ATV.[45]

Becoming a group division

In 2013, KKR sold its stake in BMG to Bertelsmann,[46] making it the sole shareholder of the company.[47] Under the leadership of Chief Executive Officer Thomas Rabe,[48] [49] who had been a key driver of BMG's expansion during his time as Chief Financial Officer, Bertelsmann again cited music as one of its strategic growth areas.[50]

In 2013, the company began to represent rights to songs by Robbie Williams and the Rolling Stones.[51] [52] Record labels were also added to the portfolio including Union Square Music (distributor of Universal Music's ZTT Records and Stiff Records),[53] Vagrant Music and Infectious Music (2014),[54] [55] as well as S-Curve Records[56] and Rise Records (2015).[57] Other acquisitions followed in 2016, including the label ARC Music and the catalog of The End Records.[58] [59] By acquiring Basement, BMG entered the market in Brazil,[60] one of Bertelsmann's growth regions.[61] [62] The company also signed an agreement with Warner Music's Alternative Distribution Alliance for the physical and digital distribution of music,[63] allowing BMG to consolidate its longstanding sales structures.[64] BMG further expanded by entering the Chinese market in cooperation with Alibaba, allowing the online company to distribute the work of musicians and composers via its web channels while securing copyrights.[65]

In the 2015 financial year, BMG was part of the Corporate Investments division at Bertelsmann.[66] In 2016, the media group turned the subsidiary into a stand-alone division. Today, BMG is considered a prime example of how growth platforms are created and leveraged at Bertelsmann.[67] [68]

Acquisition of BBR Music and new labels

In 2017, BMG announced the purchase of BBR Music Group,[69] including the labels Broken Bow Records, Red Bow Records, Stoney Creek Records, Wheelhouse Records and the music publisher Magic Mustang Music.[70] With a value of more than 100 million dollars, the transaction was the largest recorded music acquisition in the company's history.[71] BMG thus improved its position in the country music segment and ensured its long-term presence in the Nashville music industry and its overall impact on the United States market.

In 2022, BMG announced its first new British record label within the group since 2009, Tag8 Music.[72] [73] [74] This label was set up in association with ex-Bros member Craig Logan and his management company Logan Media Entertainment, with Tag8 Music featuring established acts such as Pixie Lott, Roachford, and Louise Redknapp as part of its roster. On the Official Albums Chart Top 100 of 4 November 2022, the label charted its first hit album in the form of Blue's Heart & Soul.[75] [76] [77]

In October 2023, BMG signed with Universal Music Group for physical distribution, and started self-distributing its own catalog on digital platforms, thus ending their partnership with Warner Music.[78]

Corporate structure

BMG's parent enterprise is BMG Rights Management GmbH, a limited liability company according to German law. The company's objective is "the marketing of music, as well as its development and delivery" for use in media, at concerts and for other purposes.[79] BMG has numerous subsidiaries and shareholdings, for example, BMG Rights Management (Europe) GmbH.[80] In addition to Germany, BMG is present in Australia, Brazil, China, France, Italy, Spain, the UK, the Benelux countries, the United States, Canada, and Scandinavia.[81]

BMG's senior management includes Thomas Coesfeld (Chief Executive Officer), Mathis Wolter (Chief Financial Officer), Ama Walton (General Counsel and Chief Human Resources Officer) and Ben Katovsky (Chief Operating Officer).[82] Masuch has been a member of Bertelsmann's Group Management Committee since 2013.[83]

In the 2018 financial year, BMG posted revenues of €545 million. Rights and licenses accounted for 91.1% and products and merchandise 8.9%. Almost half of its revenues (44.1%) were generated in the United States. Other important markets were the United Kingdom (24.7%), Germany (6.3%) and France (3.9%).[84]

Business model

BMG offers musicians the services generally provided by music publishers and record labels. Unlike its major competitors, it runs them under the same roof and on the same technology platform.[85] [86] [87] More recently, it has added film, television, and books to its roster of services.[88]

Publishing

BMG publishing represents the rights of songwriters.[89]

Production music

BMG has a significant library of production music (library music), for use in films, television, advertising, and other media. These catalogues include MusicDirector (part of Talpa Music), Human Music, Music Beyond, X-Ray Dog, Beds & Beats, Valentino Production Music, Immediate Music,[90] AXS Music,[91] Altitude Music, and Must Save Jane.[92]

Labels

Awards

External links

Notes and References

  1. BMG Forms Alliance With Universal Music Group. October 19, 2023. Universal Media Group.
  2. Web site: Musikverlag BMG. mediabiz.de. de. January 10, 2018.
  3. News: Bertelsmann bietet Musikern neuen Service. Arndt. Ohler. October 9, 2008. Financial Times Deutschland. 5. de.
  4. News: Bertelsmann belebt BMG. David. Hein. October 16, 2008. Horizont. 6. de.
  5. Web site: Bertelsmann Unveils BMG Rights Management. Wolfgang. Spahr. October 14, 2008. billboard.com. January 10, 2018.
  6. News: Bertelsmann ist die Musik wieder wichtig. March 2, 2013. Die Welt. 13. de.
  7. Web site: Bertelsmann holt die Musik zurück in den Konzern. Volker. Briegleb. March 1, 2013. heise.de. de. January 10, 2018.
  8. News: Bertelsmann sortiert sich neu. Kai-Hinrich. Renner. March 23, 2016. Handelsblatt. 24. de.
  9. Book: 175 Years of Bertelsmann: The Legacy for Our Future. 2010. C. Bertelsmann Verlag. Munich. 27. 978-3-641-05407-6.
  10. News: Bertelsmann feiert: Heute wird der Medienkonzern 175 Jahre alt. July 1, 2010. Westfalen-Blatt. de.
  11. News: Superstar und Freund der Mohns. December 23, 2014. Neue Westfälische. 3. de.
  12. News: Von der Welt lernen: Erfolg durch Menschlichkeit und Freiheit. Reinhard. Mohn. 2008. C. Bertelsmann Verlag. Munich. 978-3-570-01110-2. de.
  13. News: Musikkonzerne auf Chancensuche. October 14, 2000. Tiroler Tageszeitung. de.
  14. Book: 175 Years of Bertelsmann: The Legacy for Our Future. 2010. C. Bertelsmann Verlag. Munich. 48. 978-3-641-05407-6.
  15. News: Bertelsmann und Sony machen gemeinsam Musik. November 7, 2003. Der Tagesspiegel. 21. de.
  16. News: Elefantenhochzeit in der Musikbranche. December 15, 2003. Wiener Zeitung. 14. de.
  17. News: Musikverlag BMG geht an Vivendi. September 7, 2006. Wiener Zeitung. 26. de.
  18. News: Bertelsmann treibt Schuldenabbau voran. December 28, 2006. Handelsblatt. 18. de.
  19. News: Bertelsmann steigt bei Sony BMG aus. Brenda. Strohmaier. August 6, 2008. Die Welt. 12. de.
  20. Web site: Bertelsmann überlässt sein Musikgeschäft Sony. August 5, 2008. dw.com. de. January 10, 2018.
  21. News: Bertelsmann setzt auf Vermarktung von Rechten. Schweizerische Depeschenagentur. October 14, 2008. de.
  22. News: Der Künstler ist König: Bertelsmann steigt mit neuer Firma wieder ins Musikgeschäft ein. Martin. Krause. October 15, 2008. Neue Westfälische. de.
  23. News: de. Konjunktur bremst Bertelsmann. Hans-Peter. Siebenhaar. Handelsblatt. November 12, 2008. 16.
  24. News: de. Wie Bertelsmann wieder Musikriese werden will. Ileana. Grabitz. Die Welt. March 4, 2013. 14.
  25. News: Bertelsmann: Duett mit Heuschrecke. July 9, 2009. Der Tagesspiegel. 20. de.
  26. News: Bertelsmann paktiert mit Investor KKR. Lutz. Knappmann. Andrea. Rungg. Arndt. Ohler. July 9, 2009. Financial Times Deutschland. 8. de.
  27. News: BMG Is Back: Buying Songs With KKR Cash. Wolfgang. Spahr. August 15, 2009. Billboard. 17.
  28. News: KKR greift Bertelsmann im Musikrechtegeschäft unter die Arme. Hans G.. Nagl. July 9, 2009. Handelsblatt. 12. de.
  29. News: BMG sucht in großem Stil Musikrechte. Andrea. Rungg. January 22, 2010. Financial Times Deutschland. 8. de.
  30. News: Bertelsmann-Musiktochter auf großer Einkaufstour. July 26, 2010. Rheinische Post. de.
  31. News: Bei Bertelsmann spielt wieder die Musik. Hans-Peter. Siebenhaar. May 4, 2010. Handelsblatt. 26. de.
  32. News: de. Bertelsmann übernimmt Rechte an Elvis-Songs. Lutz. Knappmann. March 29, 2010. Financial Times Deutschland. 7.
  33. Web site: BMG Rights Management Enters U.S.. Wolfgang. Spahr. December 14, 2009. billboard.com. January 10, 2018.
  34. Web site: BMG Rights Management to Acquire Cherry Lane. Andre. Paine. March 26, 2010. billboard.com. January 10, 2018.
  35. Web site: BMG Rights Venture Buys Music Publisher. September 21, 2010. wsj.com. January 10, 2018.
  36. News: Bertelsmann holt sich Clapton und Cocker. September 21, 2010. Neue Westfälische. de.
  37. Web site: BMG Rights Management to Purchase Bug Music. September 12, 2011. billboard.com. January 10, 2018.
  38. Web site: Bmg Acquires 2Pac, Neil Sedaka Hits with R2M Buyout. musicbusinessworldwide.com. March 1, 2012. February 25, 2019.
  39. News: Bertelsmann schielt auf EMI-Archiv. June 25, 2009. Börsen-Zeitung. 10. de.
  40. News: Das stille Konzert der großen Fünf. Volker S.. Stahr. May 6, 2001. Berliner Morgenpost. 17. de.
  41. Web site: Musikindustrie: Universal darf EMI übernehmen. September 21, 2012. sueddeutsche.de. de. January 10, 2018.
  42. Web site: EU-Kommission: Universal darf EMI unter Auflagen übernehmen. September 21, 2012. focus.de. de. January 10, 2018.
  43. Web site: BMG Acquires Mute Records Catalog. Ed. Christman. December 21, 2012. billboard.com. January 10, 2018.
  44. News: Universal Music agrees to sell Sanctuary Records. Los Angeles Times. 2013-02-14. Dawn C.. Chmielewski. 2013-02-15. https://web.archive.org/web/20130215162618/http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-universal-music-agrees-to-sell-sanctuary-records-20130214,0,6072346.story. 2013-02-15. live.
  45. Web site: BMG Buys Virgin, Famous Music Catalog From Sony/ATV. Scott. Roxborough. hollywoodreporter.com. December 21, 2012. February 25, 2019.
  46. News: Bertelsmann Takes Control of BMG. Gerrit. Wiesmann. March 1, 2013. Financial Times. January 10, 2018.
  47. News: Bertelsmann dirigiert jetzt wieder: Finanzinvestor KKR verkauft 51-prozentige Beteiligung an der Musiktochter BMG. Martin. Krause. March 2, 2013. Neue Westfälische. de.
  48. News: Das Imperium kehrt zurück. Steffen. Könau. March 2, 2013. Mitteldeutsche Zeitung. de.
  49. News: Jahr der Umbauten. March 27, 2013. Neue Westfälische. de.
  50. News: Bertelsmann setzt wieder voll auf Musik. March 1, 2013. Die Welt. 3. de.
  51. News: de. Robbie Williams singt exklusiv für Bertelsmann-Tochter BMG. Westfalen-Blatt. October 18, 2013.
  52. News: Satisfaktion für Bertelsmann. Hans-Peter. Siebenhaar. de. June 27, 2013. Handelsblatt. 21.
  53. Web site: BMG Purchases Union Square Music. Ed. Christman. Richard. Smirke. November 6, 2014. billboard.com. January 10, 2018.
  54. Web site: Vagrant Records Bought by BMG Chrysalis. billboard.com. Ed. Christman. November 17, 2014. October 1, 2018.
  55. Web site: musicbusinessworldwide.com. Infectious Music Acquired by BMG in £6m Deal. September 2, 2014. October 1, 2018.
  56. Web site: musicbusinessworldwide.com. BMG Acquires New York Label S-Curve Records. November 3, 2015. February 25, 2019.
  57. Web site: BMG Buys Metal Label Rise Records. May 18, 2015. billboard.com. January 10, 2018.
  58. Web site: BMG Acquires Assets of New York Indie The End Records. June 30, 2016. musicbusinessworldwide.com. January 10, 2018.
  59. Web site: BMG übernimmt Mehrheit am Chess-Verlag ARC Music. January 19, 2016. mediabiz.de. de. January 10, 2018.
  60. Web site: BMG Launches in Brazil and Acquires John Telfer's Basement. May 31, 2016. musicbusinessworldwide.com. January 10, 2018.
  61. News: Bertelsmann sucht Chance in Brasilien. March 20, 2014. de. Westfalen-Blatt.
  62. News: Bertelsmann setzt auf Brasilien. March 21, 2014. Börsen-Zeitung. 11. de.
  63. Web site: Warner Music's Global Deal for BMG's Sets up Showdown with RED. Ed. Christman. April 28, 2016. billboard.com. January 10, 2018.
  64. Web site: Warner Signs BMG Deal for Exclusive Worldwide Distribution of Catalogue. Tim. Ingham. April 19, 2016. musicbusinessworldwide.com. January 10, 2018.
  65. Web site: BMG kooperiert mit Alibaba. March 30, 2015. dw.com. de. January 10, 2018.
  66. Web site: Annual Report 2015. https://web.archive.org/web/20160611052010/https://www.bertelsmann.com/media/investor-relations/annual-reports/annual-report-2015-financial-information.pdf. live. June 11, 2016. Bertelsmann. January 10, 2018.
  67. News: Bertelsmann sichert sich die Stars. Bernhard. Hertlein. March 2, 2013. Westfalen-Blatt. de.
  68. Web site: Wachstumsplattformen: Großartige Chancen. Bertelsmann. de. January 10, 2018.
  69. Web site: BMG Acquires Nashville Indie BBR Music Group, Home of Broken Bow Records and Jason Aldean. Marc. Schneider. Ed. Christman. January 30, 2017. billboard.com. de. January 10, 2018.
  70. Web site: Musikrechte: Bertelsmann goes Country. Catrin. Bialek. January 31, 2017. handelsblatt.com. de. January 10, 2018.
  71. Web site: BMG Beats Majors to Acquire Jason Aldean Label Broken Bow. January 30, 2017. musicbusinessworldwide.com. January 10, 2018.
  72. Web site: Alistair Norbury shares his vision for Tag8 Music - BMG's first UK label launch in 13 years .
  73. Web site: BMG and LME launch new label Tag8 with albums from Blue, Pixie Lott and Roachford .
  74. Web site: UK: BMG and LME launch new label Tag8 with albums from Blue, Pixie Lott and Roachford . November 2, 2022 .
  75. Web site: Official Albums Chart Top 100 | Official Charts Company . .
  76. Web site: Heart & soul | full Official Chart History | Official Charts Company . .
  77. Web site: Blue | full Official Chart History | Official Charts Company . .
  78. Web site: BMG FORMS ALLIANCE WITH UNIVERSAL MUSIC GROUP; PLANS TO MOVE PHYSICAL DISTRIBUTION TO UMG’S COMMERCIAL SERVICES DIVISION. 19 October 2023. musicbusinessworldwide.com.
  79. Web site: Unternehmensregister (Amtsgericht Charlottenburg, HRB 116072). Bundesanzeiger Verlag. de. January 10, 2018.
  80. Web site: Unternehmensregister (Amtsgericht Charlottenburg, HRB 143973). Bundesanzeiger Verlag. de. January 10, 2018.
  81. Web site: About BMG. October 2, 2015. January 10, 2018.
  82. Web site: BMG Promotes Ben Katovsky to COO, Ama Walton to Global General Counsel. billboard.com. Wolfgang. Spahr. July 13, 2018. October 1, 2018.
  83. News: Bertelsmann stockt Führungskreis auf. June 4, 2013. Börsen-Zeitung. 16. de.
  84. Web site: Annual Report 2018. https://web.archive.org/web/20190328093051/https://www.bertelsmann.com/media/investor-relations/annual-reports/bertelsmann-annual-report-2018-finance-engl.pdf. live. March 26, 2019. March 28, 2019. Bertelsmann. 21, 130. April 1, 2019.
  85. News: Bertelsmann startet neu im Musikrechte-Geschäft. October 15, 2008. Die Welt. 15. de.
  86. News: Bertelsmann will mehr Musikrechte. June 25, 2009. Neue Westfälische. de.
  87. Book: Blauth, Sabrina. Digitalisierung in der Musikindustrie: Wirtschaftliche Probleme und die Suche nach alternativen Einnahmequellen. 2016. Diplomica Verlag. 978-3-95934-339-8. Hamburg. 25. de.
  88. Web site: BMG Publishes First Book With "The Odessey: The Zombies in Words and Images". billboard.com. Andy. Gensler. April 4, 2017. January 10, 2019.
  89. Web site: Publishing. October 2015. BMG . January 10, 2019.
  90. Web site: BMG Production Music Expands With Acquisition of Movie Marketing Mainstay . March 22, 2018 . https://web.archive.org/web/20180305194336/http://variety.com/2017/music/news/bmg-production-music-acquires-immediate-1202597122/ . March 5, 2018 . Paula. Parisi. October 23, 2017 .
  91. Web site: BMG Production Music Beefs Up: Acquires AXS, Makes Two Key Hires . September 13, 2017 . March 22, 2018 . https://web.archive.org/web/20180323171823/http://variety.com/2017/music/news/bmg-production-music-beefs-up-acquires-axs-makes-two-key-hires-1202556519/ . March 23, 2018.
  92. Web site: BMG Brings Together 400,000 Production Music Tracks Under One Brand. musicbusinessworldwide.com. February 25, 2019. February 6, 2017. https://web.archive.org/web/20170209182730/http://www.musicbusinessworldwide.com/bmg-brings-together-400000-production-music-tracks-one-brand/. February 9, 2017.
  93. Web site: BMG Gets Soul, Acquires Minder Music And Cavalcade Recordings. Hypebot. July 9, 2015. April 26, 2019.
  94. Web site: BMG acquires Cheyenne Records catalog including music by Germany's most successful girl group No Angels. November 26, 2020. Music Business Worldwide.
  95. Eshy Gazit Launching New Label With BMG To Release Monsta X, Wonho. Billboard. Lipshutz. Jason. June 15, 2021. October 25, 2021.
  96. Web site: American Society of Composers, Authors and Publishers. 2016 ASCAP Pop Music Awards. October 4, 2018.
  97. Web site: American Society of Composers, Authors and Publishers. 2017 ASCAP Pop Music Awards. October 4, 2018.
  98. Web site: American Society of Composers, Authors and Publishers. 2018 ASCAP Pop Music Awards. October 4, 2018.
  99. Web site: Winners 2018. The Production Music Awards. January 10, 2019. January 5, 2019. https://web.archive.org/web/20190105210606/http://www.productionmusicawards.com/winners-2018/. dead.
  100. Web site: The A&R Awards 2018: All the Winners. musicbusinessworldwide.com. November 7, 2018. January 16, 2019.

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