Boards of Canada beef with, erm, The White House; Turning text message drama into songs; Universal says "no" to $55bn; Stream League lets you play Fantasy A&R; Last•fm goes indie; and more!

0:03Hello, welcome to The Price of Music, brought to you by your pals at Music Ally. If you want a guide to what's going on in the music industry and how it all works, then, well, here we are. We'll be looking at the finances of the music industry, whilst also bringing you stories and comment from the pop business in the past week. He's Stuart Dredge, I'm Joe Sparrow, and Stu, let's start with a particularly big number this week. Okay, my big number this week is 55 billion euros, which is the amount that Universal Universal Music Group is not being bought for by a hedge fund. Right. Now, okay. I could have picked many other numbers.

0:41It's not being bought for by a hedge fund, but this is a specific number because an offer had been made of that amount. Yes. Explain this, because we know that Universal Music Group is the biggest label in the world. It seems to be doing all right, pulling in tons and tons and tons of cash, biggest artists in the world, etc., etc. So what was this deal about then? Why do they want to buy them? Well, yeah, it came from this hedge fund called Pershing Square, which is already an investor in Universal. And so it was 55 million euros, which is about$64 billion at current exchange rates or 47.5 billion pounds at the Kings.

1:19And I think part of the offer was like saying, we think Universal is not doing a good enough job of its share price. It's not being valued by the markets, which is true. because this offer was 55 billion euros and Universal Music Group's market cap, so the value of shares, is currently 35.4 billion. So not only was this bidding a lot more, but it was saying, yeah, you're not doing a good enough job of, you know, this should be a more valuable business. So it's partly that and saying, we think we can run it different ways. We think we do this, this, that. It was one of those offers where some of the money was going to be cash.

1:55Some of the money was going to be made by selling Universal Music Group's Spotify stake. and some of it was going to be debt. So debt sort of thing, which is a kind of a famous when hedge funds take over things and sometimes there is a sort of a massive wadge of debt loaded onto the company, be it Man United or something else. One of the other big shareholders in Universal is Bellore Group, which is French media investment thing. And they said, we don't agree with this deal. We don't think it's a good idea. We don't, and this guy, who runs Persia, we don't think he's the right person to be in charge of UMG.

2:25So quite personal. And he'd already said without this company below a group agreeing, this deal is dead. So that happened. And then Universal went, all right, then we're rejecting it. But it had gone quite personal at the start, right? He'd sort of said, hey, the people who are running it at the moment, which is basically pointing a big finger at Lucian Grange, who leads the company, aren't doing a good enough job. He sort of was very specific about that one. Kind of, although it was of course saying, oh, big respect for them, and we had dinner, and they were quite keen on the idea, in a sense.

2:52So there was a bit of olive branch waving going on. But yeah, Universal, said basically the deal is not in the best interest of umg its shareholders artists songwriters employees and other stakeholders which is a nicely pointed long list i think and said it fundamentally and materially undervalues umg and will not develop a superior value creation which i think the interesting thing here is like umg we know umg's value at the moment it's 35.4 billion euros that's what the markets value it at share price um but umg clearly thinks it's worth a lot more than that and it can do that itself. It can drive its price higher.

3:28So the question now is like, what's it going to do then? Staying independent, well, staying independent sounds a crazy thing to say, doesn't it? Universal Music Group. But staying as a plucky independent upstart, the focus will now shift onto how is it going to make sure that, well, it's not Wall Street, it's Amsterdam Strasser, isn't it? How is it going to get investors to agree that it's worth a lot more than that? So basically, this hedge fund said, hey, by the way, we want to buy you for$20 billion above your market capitalization because we don't think you're valued high enough. And then Universal Music Group basically did a sort of switcheroo and said, well, we're going to reject your offer because we don't think you value us high enough.

4:09Yeah, and they're kind of agreeing, I suppose. They're both agreeing it's worth a lot more than even the offer. But Universal was saying we could do that ourselves. So yeah, so for now, Universal Music will stay. there hasn't been any follow-up from Pershing Square saying what it's going to do now. But having said in the past, this deal won't work if we don't have this particular shareholder on board and they said no, it looks like it's dead in the water. But I'm always open to the minute after we stop recording some massive development happening. We can discuss that next week if we need to. Stu, three big stories this week.

4:42And I'm absolutely thrilled to note that the number one on our list is featuring Boards of Canada. So this week, enigmatic duo Boards of Canada have somehow ended up beefing with the White House. I was going to say that that wasn't on my bingo card for this year, but that's just normal life now. The whole idea of bingo cards has kind of gone out the window, hasn't it? So this is... You are the person who, whenever Boards of Canada had a new release out, you messaged the whole team, pointing out that there's a new release and we should listen to it. So I thought, but yeah, I mean, it's weird though.

5:20This is a weird story because like we've seen the last year, the White House and the US administration, they put these social media posts out and they usually use whatever the biggest pop song is by the biggest pop act who has liberal views. So Olivia Rodrigo, Sabrina Carpenter, they did it to SZA as well. And they'll do this and it's kind of quite clearly a strategy, but okay, we're going to use someone's music in our post promoting detention centers or immigration throwouts, things that artists don't like. And then the artist protests and it gets more publicity and views and notoriety. So it's kind of a trolling strategy, isn't it?

5:59It's a cat thing, isn't it, of just sort of slapping something on the table to distract from, I don't know, another Epstein headline or something like that. Well, quite. So this week, I mean, it's weird because I can't imagine what you'd think. If you were like a big fan of the president and you saw an Instagram reel from the White House that's kind of glitchy visuals and you can't quite work out what's there and it's got this strange music in the background because it looked like a Boards of Canada promo. I mean, I think in my understanding of them, it was quite close to what their visual aesthetic is like.

6:32Yeah, so essentially, there's lots of strange things about this because like you say, all those artists you listed before that they've used music and got the criticism and blah, blah, blah, are quite big artists. Boards of Canada are, as you said, an enigmatic duo who re-emerge every, like, cicadas every 13 years and do something and then go away again. And they have this very weird visual aesthetic. And the White House copied that. The first weird thing is that, how big is that Boards of Canada audience? I guess they must have done some data crunching and observed that the overlap between Boards of Canada fans and the libs that they really want to aggravate is pretty much a perfect circle.

7:15Maybe so. And it's weird because they got the reaction they wanted, so Warp Records quickly said, neither label nor band condone the unauthorized use of their music political messaging. But it's strange. But I think the other thing is, we talk about Dead Cats. It has distracted a bit, but not much. from this bin fire, that's the Freedom 250 concert. Oh, yeah. So what's going on with this thing? Well, so this has been happening in parallel to this. And maybe they popped out boards of Canada thinking we need something that no one will expect. But this is a concert. So it was originally announced like a bipartisan thing, not a political thing.

7:50It was celebrating 250 years of American independence. And they announced this series of concerts. And the phrase in the press release was star-studded. Some of those stars, yes, please. Well, Martina McBride, who is a star, I'm very good, a country singer. And I love the 90s night with C &C Music Factory, Vanilla Ice, Milli Vanilli, and Young MC, which... Wow. I will defend Young MC to the death, but everything else I would happily leave behind. Well, but obviously some strangers say that C &C Music Factory has neither C nor C in it anymore, the founders. Milli Vanilli has one of the people who were in Milli Vanilli when they weren't singing their songs.

8:30Yeah. And then they had the Commodores and Flo Rida and Brett Michaels out of poison as the bill. And in the days following the announcement, pretty much most of them pulled out and said, we thought this was a bipartisan neutral thing. We didn't think it was going to be so political because it was found to be very, very strongly linked to the current president. So as far as I know, at the moment, Banana Ice is still playing. And he gave an interview that maybe didn't help the cause saying, I'll go play for Putin and I'll play in Iran if you want. I don't care. Yeah. The guy in Milli Valilli is still there, but the people who actually sang the Milli Valilli songs have come out and said, we don't support this.

9:06It's not us. And then what happened was the president posted saying, cancel it. They were boring anyway. And now he is the headliner for the opening ceremony, which has become a political rally. Although I don't know if they've given Bordes of Canada a call. Maybe there's still that. Well, I was going to say, they haven't played live for about 25 years, Bordes of Canada. One thing I will say about Bordes of Canada is that, you know, again about this video, is that the White House are putting out this kind of propaganda stuff, which doesn't really have an end other than, you know, it's not like they need to remind us that they're doing all these things that are controversial.

9:39They're doing it really just to aggravate people, right? It is the attention economy of just... It just felt like trolling. It's trolling, yeah, at the highest level. And it's essentially the attention economy, isn't it? Of saying, right, we're going to hijack your attention with this. And then we're going to move on to something else and move on to something else. And in some ways, it doesn't really matter to them who it is because even if you don't know who Bored to Canada is, you're sort of dragged into the new story anyway. And it's about the fact that they've pulled in this artist you don't know and they're complaining about it.

10:14I mean, this has happened a lot now. It's hard to sort of know how to respond to this, isn't it? They're going to just keep doing it. And the only real way of dealing with it and pushing back is ignoring it, maybe. Listeners will spot that we are studiously avoiding saying the norm of the president. It's what he wants. But it's a fascinating state of affairs watching this US administration's interactions with music. Because obviously there are some very prominent right-wing musicians in the US. Kid Rock, for example. I mean, that's pushing the word prominent, isn't it? I mean, he's just... He's morphing this now because he's supporting Trump, surely.

10:53Well, maybe so. But it is fascinating to see. I mean, the same week, Tom Morello from Reggie at Spoon announced his own, what's it called? Power to the People Festival in October, which is going to be a celebration of peace, justice, solidarity, music, and community action. So very much positioned as a celebration of those good things, not an anti-president or anti, you know, but it's by definition it's in. And they've got Bruce Springsteen, Foo Fighters, Joan Baez. If we're talking about I Love the 90s, they've got Cypress Hill. Oh, nice. Okay. Yeah. And you sort of look at those two events and go, wow, could you really not get any better acts for concerts celebrating the 250th anniversary of America?

11:33But they're not getting Bruce Springsteen, are they? They're not getting superstars aligning with them. And it's a really weird set of affairs where we've seen the left wing trying to use the power of these artists to win people over and it doesn't work. And then the right wing, all they have to do is just annoy them and it seems to solidify their position, which is odd, isn't it? Last FM, next. This is... I love the 90s, or not quite the 90s. Close enough. I mean, this is one of the very, very early big music tech startups. And 20-odd years ago, or 19 years ago, it was once so buzzy that a big US media corporation bought it for nearly$300 million.

12:12Nearly 20 years later, it's going independent again. First of all, why? And secondly, is that big news now? Wow, it's one of those things, isn't it? Because Last FM was one of the... together with Pandora, I suppose, at the time, it was the height of music tech's coolness. And it was, you know, wow, this is long before Spotify, you know, long before. And yet CBS Interactive bought it for$280 million, which felt like one of those, with no disrespect to Last FM, which was really good, it felt like a big US corporation with more money than cents going, we're going to buy this thing. We don't quite know why or what we're going to do with it.

12:49It might fit with our radio business, possibly. Who knows? A bit like when Rupert Murdoch bought MySpace and it sort of didn't really work out. Which is I want to be not disrespectful because like Last of M it was really good so for people who are like what is Last of M which might be quite a few people it was it was personised radio wasn't it it was like sort of radio streaming service that would play music based on your tastes it would learn more about you as you went and again and a lot of it was the back end of it was the tracking what you listen to and like and it's been going ever since then and like gradually sort of slipped from view in terms of being mainstream as things like Spotify emerged, those become dominant services.

13:25But it's been getting, it's been scrambling everything I listened to quietly for the last 20 years. And when I log in now, it's like, wow, these are interesting recommendations that I want to check out. So it's good. But yeah, so basically it's spent that last 20 years, in a way it feels like the kind of forgotten stepchild, like playing with its toys in a bedroom somewhere, while CBS or whatever CBS was at the time, I mean, now it's Paramount Skydance Corporation via 17 different mergers. without ever feeling core to the company's business. But on the plus side, they never shut it down. It just carried on doing its thing.

13:57And when I was writing this story, I looked at its financial results because it still files them. And it was like it made 2.2 million quid in 2024. It did make quite a big loss of nearly 700 ,000 quid. But it's still, people are paying to use Last.fm to kind of scrabble their stuff and to make recommendations. So this announcement was like, yeah, now we're going to be a new chapter as an independent company that will focus fully on building listening insights, community features of music bands. So what they're trying to do is kind of build that stuff around streaming, the community stuff, recommendations, which, I mean, as someone who dives in now and again, back to my account, it is really good.

14:40But what it's fighting against is, I think all the big streaming services nowadays, they give you some idea of here are some insights. Like Spotify has got its rap thing and then recently it's done its 20-year thing. Spotify is telling you more about what you listen to in engaging ways. It might not be as deep as Last.fm, but it might feel deep enough for most people to seek out anything else. Yeah, I mean, I guess it has in the last decade, let's say, had a bit of a, you know, the focus is back from people who really love data and really love music. and that sort of is, you know, perhaps explains partially their position at the moment.

15:19But if you look at it from an independent business perspective now, they've got 20 years of millions and millions and millions of people's listening data. You think if you train an AI on that, there's got to be something of value in there, right? It tells you something about how and why people listen to music. And, you know, you could go through all that data and surely there's a big business, there's a good business to be made here out of 20 years of data, surely. I wonder if there's an acquisition to be made here also. You think about something like Who Sampled, which gathered all the details on samples and their backgrounds.

15:49And then Spotify bought it and used it as a basis for its new feature. So there's something still valuable in Last of Us. This next story introduced me to the concept of paying over$5 for a biscuit. Warner Music Group is on the verge of settling its lawsuit with the US cookies chain Crumble. and that's crumble without an e to make it sound like i guess like a late 90s startup again um and crumble for clarification sell cookies that cost around about five dollars and why are brands and retailers getting sued by major labels for their social posts at the moment yeah well this is an ongoing story so the background is as individuals like me and you and anyone listening we can make an instagram post tap the music button pick a track from the library and that's covered by Instagram's licensing deals with labels and publishers, and the same for TikTok and Snapchat.

16:43It's why we can make a post of our, I don't know, our cat and soundtrack it with ACDC or whatever else we want. But you can't do that if you're a brand or a business. So if you are, if I was Stuart Dredge... Why is that? Explain for our listeners why you can't do that. Well, because if you want to use commercial music in your social posts, you need a proper sync license. Because you're a business, and by using the music, you're adding value to your business. Yeah, and these licensing deals cover individuals' personal posts. They do not cover brands and businesses. And that's why last year there was a succession of brands, so like fitness brands and fashion brands and now cookie retailers, being super major labels.

17:22They said, look, we have counted 170 plus of your social posts using music by our artists and you didn't have a license. For clarity, is this the kind of thing where you have a brand like this and then they will get a micro-influencer or someone to essentially make a social post saying how great their$5 cookies are. And then they put music in the background and then that blows up. And it's sort of like a layer of removal. Well, this was an individual doing it. It wasn't us doing it, honestly. We paid for them to do it, but... Well, this is two layers. So one, it's the brand's own posts on their own accounts.

18:00And then there is this other layer of influencers who are being paid by them. In some of the cases we've seen, the brands have argued, well, we don't have any control over the music they use, and they can choose whatever music they want, and they're allowed to have music in their post. And in some of the cases, I think there was some sympathy towards this argument and said, actually, no, where you've got them is on their own social posts. They're using music in their own accounts. But anyway, in this case, Crumble was Super Warner Music, and they're now filed saying their budget's settling, which seems to be the way these things turn out.

18:30There haven't really been big court cases as such. it's tended to be the announcement of the lawsuit and then at some point it gets settled quietly. If you're charging$5 for a biscuit I'm sure you've got a bit of cash in the bank to pay off all the music, right? Do you know, you're going to get in trouble for that I think. Isn't it for Americans that a cookie is different from a biscuit? Sorry to our American listeners, I mean cookie. Biscuit is a sort of savoury scone, isn't it? I called Oreos biscuits the other day and one of our American colleagues who I love and respect pointed out to me that it's not a biscuit, it's a cookie.

19:03And I need to now go and look at what the difference is. Tomato, tomato. Stu, any other business? Another day, another 17 baffling trends on TikTok, made up by young people to confuse us oldie wonks. But, okay, text messaging to song trend. I mean, go on, tell us about that. I love how the intro is exasperated and weary. text a song is when people take particularly entertaining or spicy messaging threads and then turn them into song lyrics and songs using Suno so this is a trend one example was a woman at a terrible date where the guy messaged her basically demanding she refund him for dinner and Uber because she wouldn't sleep with him the things that used to go viral on Twitter are screenshots the best one is someone who's got a panicked messaging thread with a friend who's stuck in a man's bedroom and his living girlfriend has just come home unexpectedly and they're texting their friend by saying help.

20:06And they turn it into a gospel track which really has to be seen. So these things, this idea of, right, I'm going to take a funny messaging thread. It's like parents doing things with their kids comedy messaging threads or people turning their bosses slack orders into songs. So basically anything that's funny, oh, I can make a song of it. And this sounds flippant, but as this took off, Suno's app downloads in the US quadrupled week on week with no other obvious spur for that other than this TikTok trend. And you also saw very quickly, Suno added this feature where you can now turn a screenshot of text by your messages into lyrics.

20:46So it's seen this and gone, right, this is the thing we need to lean into. So, I mean, look, I would rather eat my own eyeballs than engage with TikTok for more than five minutes. But when I did look at, these are funny right some of these are actually funny and when you when you take this kind of panicked message thread someone texting from under the bed you know and turn it into a gospel track it is it does give you a laugh right it sort of struck me that this is what platforms like this are for they're these ai generative music platforms are for making like one shot one-off songs that get a bit of a laugh or go or it's a bespoke birthday song or something and then you never listen to it again or it lives in a very very short space and you know it works it's quick it's easy people are enjoying doing it and then we'll possibly move on to something else in the future but that's a very different way of thinking about music that's produced to quite a high value so if we assume that these kind of these platforms are making music that sounds in terms of production at a reasonable, recognizable, this is good enough level.

21:54In the past, these songs would have cost hundreds and hundreds, maybe even thousands of dollars to make. They could take two minutes now, and they can be a trend for a couple of days and then disappear again. This feels like what this AI generative music stuff is for, which, I mean, we've discussed that ad nauseum, but what I wanted to talk about to you was this is just a very different way of thinking about music, isn't it? Music is now this throwaway commodity, and it's never really been like that. No, and then maybe that's not a terrible thing because maybe this separates it. Maybe the music made by professional human artists is still art, is still wonderful.

22:29And then music made by everyone can be throwaway disposable memes, ways of connecting, ways of making people laugh. And maybe those two things kind of live side by side with the obvious caveat that the thing being used to make it should be licensed because what lets me make a funny gospel song about my friend under the bed has been trained on the entirety of gospel music and they're not getting paid at the moment. So there's that, you can't overlook that thing hovering in the background. But yeah, if and when everything gets licensed, this might be where AI music has a place that isn't swamping Spotify with slop.

23:08Yeah. You know, it's something people use to communicate and this stuff is funny and it's really entertaining. And like you say, it doesn't have to live for weeks, and it doesn't have to. And the other thing is that this is more complicated. There is money there. Like if a TikTok video is watched, you know, 500 million times, there's money around that. Ads on TikTok and things. And so the question there is how does that money make its way to different people involved in this process? There's a lot there, isn't there? Because for a start, yes, those models have been trained on all of gospel music ever, and those people are not getting paid for it at the moment, but then they would never have been paid for it because nobody would have paid a gospel choir to create one of those songs.

23:49I mean, that would be going quite far, wouldn't it? Yeah, yeah. I mean, that's the point, isn't it? You couldn't have afforded to do it before. So now you can do it. You're not paying them, but that money wouldn't have existed anyway. But at the same time, you're right. There's a lot of money being generated here around music, but it's not that money. It doesn't seem to be reaching the gospel choirs who've been recorded for nearly 100 years. And are these models going to start revealing what they've trained on so that money can work its way back to them? We don't seem to have an answer to that yet.

24:19And then the third part is the idea about, you know, this increasingly, it seems unusual that streaming platforms are just allowing so much AI-generated music onto their platforms because why do people want this stuff? Like you say, if this is what it's good for, which is living in the moment and dying in the moment, you know, having the lifespan of a butterfly, that's fine. but it doesn't need to be archived forever this is different to the music we're used to right which does need to be archived forever yeah and it does i think it does point as well to this this this weird contradiction a lot of us feel which i think there's a pressure i think in the music industry especially just to be quite hard line on air music and say it's not as good as human music it's not properly trained you know to be quite and i don't enjoy listening to it at all and actually this that gospel track made me laugh so much and I wanted to share it with everyone I knew and I thought it was really funny and I think it's quite hard to say that because we feel like, and then we have to go caveat oh dear about the training so this is why I think if the licensing can be sorted out so that these models are all properly licensed and money is flowing back from the people who use them to do stuff then we can actually enjoy the good things and go yeah actually this is what it's for, this is what it could be without that kind of weight dangling and saying this is this is bad does that make sense yeah again it comes back to that idea of how we define music because if i think we can safely say it is not good music like i'm not going to go home and like fire up a playlist of these songs to listen to at home but if i see something in the moment and it makes me laugh then that also has value does that make it good music i would say that the problem here is that we don't have a we need to change the definition of what music is and we've it's always been recorded music that is operating in a certain way and now we have this other form of recorded music which is very throwaway has very low value in terms of creation execution but can create a lot of value in terms of how it's shared around the world and that's just a completely different business and way of thinking about music um and talking of charts and rankings there's a new site called stream league which wants to turn music releases into a fantasy sports style game this is again shifting music to something else what is it stew well this is from a guy called kieran donoghue who's like a oh yeah sort of startup founder who's but he tried to share my playlist back in the day he's kind of a you know he's always the man who's got a new idea about it and it's it's a weekly fantasy draft which i believe is a sports thing more probably more american where you it's kind of it's not like having a fantasy team as such but you're drafting, well, it's that area.

27:00In this case, every Friday, this site publishes the latest New Music Friday playlist on Spotify. So I think it's 100-odd tracks. And then what you have to do as a player is choose 10 of them to draft your picks, you know, 10 of these tracks. And what you're looking for is the ones you think are going to get the most streams in that next week. And then over the week, there's this league table of all the players based on total streams for their draft of 10 songs. And it's interesting because it sounds like kind of a novelty fun thing. But Kieran reckons it could become a quite interesting barometer of what the people in the business think is going to be a hit.