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Google backs new artist services business

By | Published on Thursday 16 November 2017

Hey record companies, you know all the millions of dollars that you reckon Google owes you for building its YouTube business on the back of all your lovely music while paying you only nominal royalties? Well, the good news is that Google parent company Alphabet has now located that cash. The bad news is, it’s handing it over to a start-up that plans to render you all redundant within years. Happy days.

Alphabet Inc is one of a small number of investors pumping a reported $70 million into a new US-based music distribution, data and direct-to-fan enterprise called UnitedMasters, which is headed up by Steve Stoute, who worked in the major label system in the 1990s.

At its core, the new company seems to compete with DIY distribution set-ups like TuneCore, CD Baby, Ditto Music and Kobalt’s AWAL. Though UnitedMasters brags that it will offer participating artists better data tools to help them build direct-to-fan relationships online once their music is streaming. And to then use those D2F relationships to sell tickets and merch, or to get brands involved who might also like to reach said fans.

The Wall Street Journal quotes Stoute thus: “We want to build a business that helps musicians, which is my passion, and also helps brands find a much more specific way of investing their money in the category of music”.

None of this is particularly revolutionary, in that various labels, distributors, direct-to-fan companies and new-fangled artist services firms have talked aplenty in recent years about using data to link streams with ticket and t-shirt sales and brand partnerships. Though, arguably, no one is actually doing that particularly well yet, so there are still opportunities for any start-up which has the data tools that can actually do all that.

UnitedMasters also says it will offer a degree of flexibility in how artists access its services and what they give up in return. Though – while the DIY distributors mainly offer one-size-fits-all packages – such flexibility is already pretty common in the next-level-up label services domain. Indeed, it’s one way such companies compete with more conventional labels.

Still, it will be interesting to see how UnitedMasters now evolves, given the not insignificant funding it has managed to raise. It seems unlikely companies of this kind are going to lead to the demise of the more conventional record company anytime soon – despite TechCrunch’s report on Stout’s new business declaring that “record labels are obsolete” – although it is further proof that artists now have more choice when deciding which partners and service providers to engage as they grow their personal artist businesses.