12 Comments

Marvelous article, thank you! Coming from Eagle Point Cap.

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Hi Sleepwell, a thousand thanks for writing this. Someone posted a link to this under the PSTH subreddit and I'm so glad I caught it. This is very informative. I have a couple questions I would love to get your thoughts on, if you don't mind me asking.

Very broadly, what are your thoughts on Universal Music Group as an investment?

I was originally sold on the strong IP that UMG has, and more importantly their "know-how" of making a star. While it continuously gets easier to publish music online, the fact that this is a benefit to everyone results in it not being a benefit. In fact, that led me to the belief that UMG's ability to "make a star" by knowing how to promote/market is what upholds their importance and future success - their "moat". But with the advent of new technologies, such as Spotify, I am starting to wonder how defendable this "moat" really is. Thanks to technology, middlemen in any industry are increasingly being cut out, much like you alluded to, and I don't see how music is an exception. The Discovery feature that you mentioned even seems to be the beginning of exactly this. As Spotify is the platform that the users interact with, don't they have the power to one day choose which songs to promote? Thereby replacing what I had originally thought to be UMG's greatest asset - their knowledge of effective promotion?

From the other posts I've made asking for other's opinion on this I've gotten some counter arguments that UMG does a lot more than that and therefore will always be relevant. I don't completely disagree with that, but as an investment, I have to consider their future relative to today at the price I'm paying for today. In addition, I don't see the other services they provide as very defendable. Financing, for example, can very easily be Spotify's next path at vertically integrating itself within the industry.

I apologize for the length post, but would really like to hear your thoughts. Thanks!

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Hi - This is a great article, well written and clear. Can you pls share your thoughts on how NFTs may potentially change the dynamics of the industry with I assume giving greater tools to the artist. I am particularly interested in how this will impact the labels and likely timeline/probability of changes in market dynamics. Many thanks! Jason

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Why doesn't SPOT just become a label or acquire one?

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Hi Sleepwell..Thanks so much for this writing..Could you write one more piece which is focus on how song been streaming in the video format?I mean such as platform like VEVO,Youtube Twitch etc..Audio and Video/visual format should be some different right?Thanks...

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I understand you know Spanish... actually I learned most about the royalties from a very popular creator on Youtube https://www.youtube.com/watch?v=YmaLdu9LKg0 and he did a very good job at explaining for people who have no idea πŸ˜‡ your post is super well written, well done. I think many have recently subscribed to you this week, including me!

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Hi Author, I really liked the way your decoded such a complex topic on streaming royalties. It helped to clear so many unanswered questions I had. Thanks a lot for this. I know lots of handwork, research and thought process have gone into this article.

I have one follow up question on this:

Q- A DSP like Spotify has multiple ways (radio station, on-demand, curated playlist) to stream a song on its platform.

My question is whether there is any difference in calculation of royalty fees to publishers for each of these multiple ways of streaming?

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