Andrew Edgecliffe-Johnson Financial Times 04/08/13
Recording artists Jay-Z and Beyonce arrive at the presidential inauguration on the West Front of the U.S. Capitol January 21, 2013 in Washington, DC. Barack Obama was re-elected for a second term as President of the United States©Getty
Recording artists Jay-Z and Beyonce arrive at the presidential inauguration on the West Front of the U.S. Capitol January 21, 2013 in Washington, DC. Barack Obama was re-elected for a second term as President of the United States
Universal Music, fresh from cementing its position as the world’s largest music company by acquiring most of EMI’s record labels, has won a contest for distribution rights to artists under Jay Z’s Roc Nation label.
Roc Nation, the label founded by rapper-entrepreneur Shawn “Jay Z” Carter and financed by Live Nation, the live music group, had been distributed since 2009 through Epic, the Sony Music-owned label. The prospect of its contract with Sony expiring had triggered what one person familiar with the process described as a “hugely competitive” battle for the rights to distribute artists under one of the most successful labels of recent years.
Universal would not disclose how much it was paying Roc Nation, but the multiyear, global deal will give it a share of the revenues from forthcoming albums from Jay Z and Rihanna, who has been signed to Universal but managed by Roc Nation. Other artists including J Cole and Rita Ora remain under contract to Sony for further albums but will transfer when those contracts expire.
The deal comes days after Roc Nation launched a sports management arm, signing Robinson Cano, the New York Yankees second baseman, as its first client. In February, Roc Nation moved an administration deal for its music publishing to Warner Chappell from Sony ATV, the joint venture between Sony and Michael Jackson’s estate.
Distribution deals with large companies are common for smaller labels without the resources to distribute CDs globally and to negotiate with large digital download, streaming and radio services.
The Roc Nation agreement brings Jay Z back to Universal, which is owned by France’s Vivendi. Already one of the world’s biggest selling artists, he spent three years as president of Universal’s Def Jam Recordings, where he signed Rihanna and Kanye West before leaving to launch Roc Nation.
Lucian Grainge, Universal’s chairman and chief executive, said in a statement: “In just five years, Roc Nation has established itself as one of the most successful brands in music with a reputation for developing some of today’s most influential and popular talent.”
The new deal “extends our relationship with the extraordinary Rihanna and represents a homecoming for Jay Z – a brilliant artist and entrepreneur, who has been a creative cornerstone of our company,” he added.
In the announcement, Jay Z hailed what he called “a new age deal”, giving Roc Nation “a unique opportunity [of] being able to continue to operate as an independent label with the strength, power and reach of the best major.”
Smaller rivals lobbied against Universal’s bid for EMI, arguing that enlarging the market share of the global market leader would make it harder for them to compete for new artists or for large deals