Germany’s GEMA Acquires a Majority Stake In Digital Distributor Zebralution

Germany's GEMA Acquires a Majority Stake In Digital Distributor Zebralution
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The German rights collection agency GEMA has recently made headlines with its unusual move of acquiring a majority interest in Zebralution, a digital distribution company. With over 75,000 members, including composers, lyricists, and publishers, GEMA is a major player in the music industry, overseeing German royalties for over two million copyright holders worldwide. In 2018, the organization generated revenues in excess of €1 billion ($1.1 billion), with €859.5 million ($951.9 million) distributed to its members.

Zebralution, founded in Berlin in 2004, acts as a digital distributor for over 1,000 independent labels across Europe, as well as audiobook publishers and podcast providers. The company, which was once a part of Warner Music before being sold in 2017, is expected to operate as an independent business after the completion of the acquisition. Kurt Thielen and Sascha Lazimbat, the managing directors and significant shareholders of Zebralution, will continue in their current positions, while the other owners of the company, including Christof Ellinghaus and Konrad von Löhneysen, will remain involved.

GEMA stated that it believes the acquisition will strengthen its position in the growing digital market for music, podcasts, and audiobooks. Dr. Harald Heker, GEMA’s CEO, said of the acquisition, “By taking a stake in Zebralution, GEMA has made a targeted investment that secures its future viability. Through Zebralution, we will also be able to support our members in the digital distribution of their musical works. GEMA’s relevance in the digital music market will thus be significantly increased.” Thielen also commented on the acquisition, saying, “We are very pleased to have found an ideal and extremely strong partner in GEMA. This also bridges a gap for musicians and performers, with the joint objective of achieving fair remuneration for creatives.”

Some industry experts have suggested that the acquisition is a response to the changing landscape of the music industry, with the rise of streaming services like Spotify and Apple Music. As more music is consumed digitally, GEMA’s move to acquire Zebralution may be seen as an attempt to keep pace with a rapidly evolving market. With its extensive network of members and experience in collecting and distributing royalties, GEMA is well-positioned to take advantage of the growing demand for digital distribution services.

The acquisition of Zebralution also marks a significant expansion of GEMA’s reach beyond traditional music distribution. By incorporating podcasts and audiobooks into its portfolio, GEMA is signaling its intent to become a major player in the digital content market more broadly. As the popularity of podcasts and audiobooks continues to grow, GEMA’s acquisition of Zebralution may prove to be a shrewd strategic move that positions the organization for long-term success.

Overall, the acquisition of Zebralution by GEMA is a noteworthy development in the music industry. As the demand for digital distribution services continues to increase, GEMA’s move to acquire an established player in the market may prove to be a smart investment that enables the organization to stay ahead of the curve. With Zebralution’s expertise in digital distribution and GEMA’s extensive network of members, the two companies are well-positioned to work together to achieve their shared objective of fair remuneration for creatives in the digital content space.

The terms of the deal were not announced.