Universal Music Responds: “We’re Not Firing Our CEO”

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Universal Music Group and its corporate parent, Vivendi, are now publicly denying rumors that Universal CEO Lucian Grainge’s job is in serious danger.  In a statement issued this morning, Vivendi noted that Grainge would be staying with the company until ‘at least 2020’ and will help to lead a broader expansion towards content monetization.

“Lucian Grainge, the CEO of Universal Music Group, was extended in his position until 2020,” the statement (originally in French) reads, without offering any further detail.  “UMG will accelerate the monetization of music in digital.”

It’s unclear if contracts have actually been signed, or whether the statement was merely issued to calm questions among partners and internal staff.  The response comes just weeks after an exclusive report in Digital Music News pointed to extreme instability at the top of Universal Music Group, and the very serious possibility of Grainge’s dismissal within months.  The move would closely follow the ouster of UMG digital chief Rob Wells, who was dismissed over concerns over unchecked free access and overly-cozy, ‘freemium-hugging’ ties with Spotify.

The DMN report on Grainge quickly garnered tens of thousands of views, and according to our same sources, stirred considerable discussion within the upper ranks of both UMG and Vivendi.  That may have also included considerable response by the embattled Grainge himself, who has been lobbying intensely to convince upper-level executives that massive music devaluation is a solvable problem.  “The value of music keeps crashing, [the devaluation] is not reversing at all and you have tech companies giving the middle finger,” one source close to the organization told Digital Music News.

“But Grainge is saying ‘don’t fire the general in the middle of the war’.  He’s making that case, apparently with some success.”

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But the devaluation problem only seems to be intensifying, with tech ‘partners’ increasingly dictating licensing terms back to massive media companies like UMG, not the other way around.  That has certainly been the case with Spotify, whose CEO, Daniel Ek, has flatly refused to close an unlimited free-access window, while spending millions to successfully draw government attention towards coordinated efforts between Apple and major recording labels to force stricter pay-only structures.

Separately, YouTube remains a giant free-access cesspool for UMG, with a subscription-based solution, Music Key, now a floating mirage with an unknown release date.  Elsewhere in Freetown, Universal and Sony Music Entertainment are exerting heavy pressure on SoundCloud to properly license their content, while dangling massive lawsuits.

And what about Apple Music?  So far, traction seems disappointingly low after the first month, though Apple is sticking with a far smaller, three-month trial window.

More as it develops.

13 Responses

  1. smg77

    It’s a good thing the tech companies are driving the bus. The labels had their chance to give consumers what they wanted when Napster was still around and they couldn’t see past their obscene greed to actually follow through.

    • FarePlay

      I’m so fing tired of this consumer driven BS that is simply the evolution of piracy. Anyone who says they’re happy that tech is driving the bus knows nothing about the record business.

      Unfortunatly, you are not alone. When the labels took the deal with Spotify, it was a sign that they had no idea what they were doing.

      • Anonymous

        What would you have done if you were in their shoes? Their options were getting mighty slim by the time Spotify came knocking. Nothing was working.

        We can talk about needing to fight and end piracy all we want. But there is only so much the major labels can do within existing laws and their countless resources spent trying to change that continues to fall short to this day.

        • Remi Swierczek

          Just take 2 billion users of Shazam, Soundhound & Google Voice Search and convert them to conventional shoppers at Radio and streaming converted to conventional music store!

          Enjoy and listen to any music anywhere but if you want to enjoy it again any time at your place pay for addition to the playlist. Current broadcast and streaming numbers can effortlessly deliver $100B music industry by 2020 at just 39¢ per tune.

          Twitter with 200M users made $30B IPO.
          Shazam with 500M users is broke, PIMPING for free music to 500M freeloaders.
          It is sad by they have to, if Shazam does not do it, DRUNK with advertising cash Google always will!
          Time to get new fair use act to force Google to sanity. It will lock music in virtual walls and bring a lot of cash to everyone, especially to lost in advertising, unti-music, Google boys.

  2. Remi Swierczek

    The man and the fellowship around him is the most clueless team for any music monetization.

    All current problems, some of them irreversible, of music industry originated at UMG under Mr. Grainge watch!

  3. digitalwarz

    Not like i care, but it seems like no one is actually practicing both “show bizz”aka UMG, and so forth, and “i’m an indie” aka soundcloud, etc, at once and on a daily basis. Since i do both, with various names and projects, i’d put it simply: both models suck. or not. at the end of the day, i eat , i sleep, and i do what i want with my remaining time. Anarcho capitalism FTW 😉

  4. californiaflight

    My Question buy money to spend for more potential business growth porfolio burn money in the heat of fire is ashes to the devil royal furnace who does it better spend or burn in hell? UMG is stand to make over 8.9 Billion or better yet over 12 .5 billion in world sales and who is calling this upon one of the most savvy bull work individuals of all the U M G , Shame on greed when its not really the CEOs fault ? Umm no its the deceiver fault where infernal partners really do not understand spotify growth quite well. No one controls air not a one, a hoak and hearsay is the same information on money life, Now can take it away and screw up UMG growth with the current supervisors who stand to make others run to the privy an puke with sadness because of the UMG success despite unspoken words , hears how the desire of flesh or desires of burning money ashes can crush potential sales of UMG. Without exact proof an with a hasty move and of hearsay allegations one could inflict upon a massive yearly lost of clients sells merchandise site acquisitions infer-structure damage for years to coming forth . Leave this alone Please wait wait ! Not until 2021 then after its all clear then ask yourself did I throw my golden egg away? U M G its no need to show anxiety in a rush of hearsay now we will as an investor not make it back, trust me on this its not about just r\profit sharing someone goof a clever hoak and will find out who did? We will and we must do smart money investigation on who why an but? We do not cut of the horse head when the who won the race can keep winning the races unless you wear the blame of not finishing the race as HEAD of the class its not about the race finishing it with another horse its about the U M G staff and infrastructure who dare to challenge the establish growth keep components um Keep steady never lean on hearsay always always get facts Capis.

  5. Unjustified Self-Aggrandizement Dep't

    To be clear here:

    a) DMN reports – “exclusively” – that it’s “sources” say that Lucian Grainge is about to be fired – over a month ago.

    b) More than a month later, Vivendi issues a standard PR statement announcing that Grainge has been re-upped on his contract for another 5 years, and that is part of a broader 5 year strategy. Nothing about ANY response or previous reports or rumors regarding Grainge.

    c) DMN then tries to associate – and indeed bolster – it’s previous incorrect report, by referencing the completely unrelated announcement of Grainge’s continuation, as some sort of “response” to DMN.

    That is some serious delusion of self-importance, right there.

  6. Margaret

    In other news…Josh Greenberg has been permanently fired from Grooveshark…according to Paul @DMN.