BMG has announced an alliance with Universal Music that will see the latter handle the physical distribution of the former's releases from next year. Though the alliance could go further than that, with "further collaborations" already under discussion.
The alliance with Universal follows BMG's recent decision to end its long-running partnership with Warner Music's services division ADA.
It handled both digital and physical distribution for the BMG recordings division. However, BMG is now in the process of bringing digital distribution in-house. When that was announced last month it was confirmed physical distribution would still be outsourced, but to a new partner.
That new partner is Universal's Commercial Services division. BMG said yesterday that "the transition of physical products to UMG is expected to commence the second quarter 2024 and will be fully transitioned by the end of 2024".
As for other ways the two music companies may work together, BMG's statement added: "Further collaborations between BMG and UMG are already under discussion from exploring shared positions on industry matters to joining forces in adjacent business lines".
Confirming the new deal, BMG CEO Thomas Coesfeld says: “Our alliance with UMG is a significant step to further enhance our service to BMG-signed artists. We are delighted to partner with UMG, the world leader in music-based entertainment on our thriving physical recorded music business. Their scale, technology and commitment promises to further expand opportunities for BMG-signed artists around the world".
Universal Music boss Lucian Grainge adds: “BMG has brought a fresh vision to the music business, and we look forward to partnering with BMG on a variety of initiatives to provide greater opportunities to artists and our respective companies".