In his annual memo sent to staff on January 9, Grainge highlighted the company’s achievements in 2023 before looking at what he thinks the future holds in terms of growth and when it comes to campaigns and artist initiatives around streaming and AI.
Grainge said that as 2023 begins, a number of critically important issues need to be addressed if the industry is to continue to thrive and, more importantly, if the value of artists’ work is respected.
This, he said, requires a new streaming royalty model that would properly reward the artist-fan relationship. “Because artists are at the center of everything we do, we called it the ‘artist-centric model.’ I’m proud to say that in just a few months, several global platforms, including the world’s largest music platform, have already adopted artist-centric principles that will transform the way artists are compensated for their work. In the coming months, I think you’ll see more platforms adopting these principles. For what? Because it’s the right thing to do both for artists and the broader music ecosystem. As this new model becomes more widespread, the impact will be profound: a healthier, fairer and more vibrant music ecosystem that rewards all artists – whether major, independent or DIY – at all stages of their career.
Grainge also revealed UMG’s next area of focus. “We first focused on a fairer way to distribute the streaming pie to real artists by combatting fraud and other aspects that deprive artists of their fair compensation. The next focus of our strategy will be to grow the pie for all artists, strengthening the artist-fan relationship through superfan experiences and products.
“UMG is already in advanced discussions with its platform partners regarding this phase and will have more to announce in the coming months. Additionally, we will strengthen our internal capabilities through groundbreaking partnerships that will accelerate our artists’ ability to create experiential, commercial and content offerings for their fans. In short, we are creating the model for the labels of the future.
On AI, Grainge said UMG had shown the industry the way forward in dealing with the challenges and opportunities presented by new technology.
“At the start of 2023, many “experts” saw AI as an imminent threat. Our point of view? Just as we had with so many previous doomsday proclamations, we rejected this short-sighted assessment. On the contrary, we saw AI as presenting opportunities. And then, just like we did with streaming, we worked to turn those opportunities into reality.
Along the same lines, Grainge said UMG launched the Responsible AI initiative whose mission was to lobby for public policy by establishing ground rules to protect artists from unethical uses of AI. AI and forge private sector partnerships with AI companies.
“In the past, new, often disruptive technologies were simply introduced into the world, leaving the music community to develop the model by which artists would be fairly compensated and their rights protected. As for AI, we will continue to create opportunities for our artists, while leading the fight to protect them from unethical uses of this technology. And around the world, we will continue to prioritize and fight for policies that serve art – not at its expense. We also plan to announce more real-world commercial applications for ethical, artist-led AI,” he said.
