BMG Rights Management

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BMG Rights Management GmbH

logo
legal form Company with limited liability
founding October 2008
Seat Berlin Germany
GermanyGermany 
management
  • Maximilian Dressendörfer ( CFO )
  • Ben Katovsky ( COO )
Number of employees 904
sales 600 million euros
Branch music
Website www.bmg.com
As of December 31, 2018

BMG Rights Management ( BMG for short ) is an international music company headquartered in Berlin . It combines various activities of a music publisher with those of a record label .

BMG was established in October 2008 following the departure of Bertelsmann in Sony BMG established. From 2009 to 2013 the US private equity investment company KKR held a 51% stake in the company, which meanwhile developed into one of the largest music publishers in the world. BMG is 100% owned by Bertelsmann and is one of eight corporate divisions in the group. The portfolio includes, for example, rights to works by the Rolling Stones , Jason Aldean , David Bowie , Chrissie Hynde , Nena , Roger Waters , Iggy Pop , Quincy Jones and Lenny Kravitz .

history

Music at Bertelsmann

In the 1950s, Bertelsmann entered the music market when it expanded the reading ring to include sound carriers. Under the name of Ariola one was record label established, this came the press shop Sonopress. In 1975, Ariola opened an office in the United States. With the purchase of Arista Records (1979) and RCA Records (1985), Bertelsmann grew into one of the largest music groups in the world. The various subsidiaries were combined in 1987 in the Bertelsmann Music Group (BMG). This served a wide variety of genres, in addition to folk and pop music , for example, classical music was a focus.

In response to declining sales in the entire music market, Bertelsmann and Sony agreed in 2003 to merge their music businesses under the name Sony BMG. In addition, in 2006 Bertelsmann sold its subsidiary BMG Music Publishing to Vivendi . Since the business models of established music publishers and record companies no longer did justice to the digital transformation of the music industry, Bertelsmann parted with its stake in Sony BMG in 2008. The company was then renamed Sony Music Entertainment .

BMG is founded

Bertelsmann founded the new BMG on October 1, 2008 with a small portfolio of music rights for around 200 artists that Sony BMG had taken over. The business model was geared towards fairness, service and transparency.

The new BMG was founded in the midst of the financial crisis in 2008, within two weeks of the collapse of Lehmann Brothers. Since Bertelsmann was unable to finance the necessary investments on its own, the financial investor Kohlberg Kravis Roberts & Co. (KKR) acquired a 51% stake in BMG in 2009 . Bertelsmann kept 49% and provided management.

International expansion

Bertelsmann initially stated that the new BMG would concentrate on the European broadcast market. After KKR joined the company, international expansion became the focus of the company. The acquisition of Cherry Lane Music Publishing in 2009 was crucial for this, giving BMG its first foothold in the United States. In 2010, BMG made further acquisitions, including from Evergreen Copyright Acquisitions.

In 2011, Bug Music was acquired by BMG, followed in 2012 by the music publisher R2M Music. In addition, there were reports of Bertelsmann's interest in the EMI Group , which was eventually taken over by Universal Music . The antitrust authorities issued various requirements, including the sale of some labels. In this way, BMG gained access to Mute Records (2012) and Sanctuary Records (2013). Both acquisitions added music recordings from the 1960s, 1970s and 1980s to the portfolio.

Promotion to corporate division

In 2013 KKR ended his engagement at BMG. Bertelsmann thus became the sole shareholder four years after the financial investor joined the company . Under the leadership of CEO Thomas Rabe , who had already played a key role in building BMG during his tenure as CFO, Bertelsmann declared music to be a strategic growth area again.

In 2013, the company began representing the rights to works by Robbie Williams and the Rolling Stones. The portfolio also grew through acquisitions of music labels such as Union Square Music, Vagrant Music and Infectious Music (2014), but also S-Curve Records and Rise Records (2015). In 2016, among others, the label ARC Music and the catalog from The End Records came to BMG. With the acquisition of Basement, BMG started in Brazil, one of Bertelsmann's growth regions. BMG also signed an exclusive agreement with Warner Music's Alternative Distribution Alliance for the physical and digital distribution of music. On this basis, BMG consolidated its historically grown sales structure. In cooperation with Alibaba , BMG expanded into the Chinese market. In the future, the Internet company should sell musicians and composers via its web channels and ensure correct licensing.

In the 2015 financial year, BMG was part of the Corporate Investments division at Bertelsmann. In 2016, the group elevated its subsidiary to an independent division. To this day, BMG is considered a prime example of building and expanding growth platforms at Bertelsmann.

Takeover of BBR Music

In 2017, BMG announced the acquisition of BBR Music Group, including the labels Broken Bow Records, Red Bow Records, Stoney Creek Records, Wheelhouse Records and the music publisher Magic Mustang Music. With a volume of more than 100 million dollars , it was the largest record takeover in the company's history. BMG improved its position in the field of country music and secured a permanent presence in the Nashville music industry as well as influence in the US market in general.

Corporate structure

Quartier 205 in Berlin-Mitte , where the BMG headquarters is located (2018)

BMG's parent company is BMG Rights Management GmbH, a limited liability company under German law. The object of the company is "the distribution, development and delivery of music" for use in the media, at concerts or for other purposes. Numerous subsidiaries and holdings belong to BMG, such as BMG Rights Management (Europe) GmbH. In addition to Germany, BMG is present in Australia, Brazil, China, France, Great Britain, Italy, Canada, Spain, the United States as well as the Benelux countries and the Scandinavian region.

The management of BMG consists of Hartwig Masuch ( Chief Executive Officer ), Maximilian Dressendörfer ( Chief Financial Officer ), Ama Walton ( General Counsel and Chief Human Resources Officer ) and Ben Katovsky ( Chief Operating Officer ). Masuch has been a member of the Bertelsmann Group Management Committee since 2013.

In the 2018 financial year, BMG generated around 600 million euros. 92.5% of sales came from rights and licenses, 7.5% from products and goods. BMG generated over half (50.2%) in the United States. Other important markets were Great Britain (16.6%), Germany (7.7%) and France (5.7%).

Business model

BMG provides musicians with the services commonly offered by music publishers and record labels. Unlike its main competitors, they operate under one roof and on the same technology platform. This integrated structure and its declared goal of integrating all of its offices internationally through a matrix management structure are geared towards maximum efficiency. More recently, it has also added film, television and books to its offering.

Publishing

BMG Publishing represents the rights of songwriters such as Mick Jagger, Keith Richards, Kylie Minogue, Ringo Starr, Nena, Roger Waters, Alice Merton, Billy Idol, Cat Stevens, Poo Bear , Aphex Twin, Bebe Rexha, Bruno Mars, Iggy Pop, Bibi Bourelly, Jean Michel Jarre, Jess Glynne, David Bowie, Bring Me The Horizon, Death Cab for Cutie, Kings of Leon, George Ezra, Johnny Cash, Robbie Williams, Tame Impala and many others.

In addition, BMG represents some of the largest publishing catalogs in the music sector, such as Chrysalis, Virgin, R2M Music, Talpa Music, Union Square Music, Cherry Lane, Francis Dreyfus Music, Alberts, Blondie, Adage IV, Bug Music and Primary Wave.

Recordings

BMG Recordings includes artists like Dido, Kontra K, Kylie Minogue, Jason Aldean, A Perfect Circle, Lenny Kravitz, Max Giesinger, blink-182, Blondie, Good Charlotte, Cypress Hill, Roger Waters, Bryan Ferry, Richard Ashcroft, Fatboy Slim, Marianne Faithfull, The Kinks, Morrissey, Ry X, Nakhane, Adel Tawil, Scorpions, KitschKrieg and The Prodigy.

Rise Records, Mute Records, Trojan Records, Vagrant, Union Square Music, Sanctuary Records, S-Curve Records, Infectious, and the BBR Music Group are label imprints of BMG.

Awards

Web links

Individual evidence

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