TODAY'S TOP STORY: The jury began its deliberations yesterday in the latest R Kelly trial in Chicago. That followed closing statements from the prosecution and legal reps for all three defendants in the case... [READ MORE]

TOP STORIES Jury starts deliberations in latest R Kelly trial
DEALS Utopia Music buys Cinram Novum
Reservoir and PopArabia acquire Voice Of Beirut

LABELS & PUBLISHERS Activist shareholder calls on Warner Music to hand over files on sexual misconduct allegations
Universal Music announces another revamp of its distribution and label services business
Sony Music rebrands the neighbouring rights agency it bought from Kobalt

DIGITAL & D2F SERVICES YouTube paid out $6 billion to the music industry over the last year
AND FINALLY... Marcus Mumford says old advice from Neil Young influenced the sound of his solo album
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Jury starts deliberations in latest R Kelly trial
The jury began its deliberations yesterday in the latest R Kelly trial in Chicago. That followed closing statements from the prosecution and legal reps for all three defendants in the case.

Having been found guilty a year ago of running a criminal enterprise in order to access and abuse women and teenagers, Kelly currently faces specific charges in relation to the alleged production and distribution of videos featuring the sexual abuse of children - described as 'child pornography' in American law.

He is also accused of enticing minors to engage in criminal sexual activity and - alongside his co-defendants Derrel McDavid and Milton 'June' Brown - of conspiring to obstruct justice. The latter relates to allegations Kelly and his team sought to interfere in an earlier criminal investigation and trial in the 2000s sparked by the leaking of a tape allegedly showing the musician sexually abusing a fourteen year old girl.

Much of the defence phase of the trial was dominated by the testimony of Kelly's co-defendant and former business manager Derrel McDavid - during which the abuse allegations against Kelly were rarely challenged - with McDavid simply insisting that he was not aware of Kelly's alleged criminal conduct, and that he genuinely believed, at the time, that his employer's accusers were lying in a bid to extort money from the star.

To that end, the closing statements from Kelly's lawyer Jennifer Bonjean arguably constituted the most important part of his defence. According to the Chicago Tribune, she urged jurors to set aside any preconceptions they had about her client as a result of all of the media coverage of this criminal case and last year's high profile trial in New York.

She also argued that a lot of the "unflattering evidence" that has been presented during this trial, in a bid to further tarnish Kelly's reputation, was actually irrelevant to the charges he faces. The jury, therefore, she said, need to focus very specifically on each of the charges, and asses what evidence and testimonies are actually relevant to ascertaining his guilt or not of each of those things.

Despite criticising the prosecution for trashing her client's reputation, Bonjean nevertheless used a chunk of her closing statement to trash the reputations of many of the prosecution's witnesses. Many of those witnesses had received immunity from prosecution for their own alleged crimes, she stressed, including previously lying before grand juries, and some had a long history of dishonesty.

The implication, of course, was why accept that those people are now suddenly telling the truth? If you find a cockroach in your soup "you don't just toss the roach and eat the soup", Bonjean said, throwing a little metaphor into the mix. "You throw out the whole soup", she added, "there are just too many cockroaches with these witnesses".

Bonjean also continues to question the timelines of the events described by some witnesses, including Kelly's alleged victims. That is a crucial part of the defence's strategy, suggesting that the women who claim they had sex with Kelly when they were underage were in fact at least seventeen at the time, the age of consent in Illinois.

Needless to say, Jeannice Appenteng - speaking for the prosecution - was keen to stress there were no ambiguities or blurred lines in this case. The evidence was clear, she argued, Kelly was a serial sexual predator, and his co-defendants made the decision to help him hide his crimes so that his pop star career could proceed and they would continue to make money from it.

"What R Kelly wanted was to have sex with young girls", Appenteng told the court, "and what the people around him wanted … they wanted to help their boss, including helping him get away with it".

Jury deliberations are due to continue later today.


Utopia Music buys Cinram Novum
Utopia Music has further expanded its interests in music distribution by acquiring UK-based physical distributor Cinram Novum. Given that it already owns Proper Music, that means Utopia now controls a lot of the infrastructure for distributing physical releases in the UK.

The physical music distribution market contracted significantly in the 2000s, of course, as CD sales slumped. Although a small number of players remained, winning over the clients of those that closed down, and also often providing logistical support and infrastructure to the new digital distributors which wanted to offer physical distribution as an add-on service.

Cinram was one of the companies that survived, providing physical distribution services for Sony Music and Universal Music as well as indies like [PIAS].

Although it did fall into administration in 2017 before being rescued via an acquisition by Patriot Group Investments. And, with physical music sales continuing to decline - even if those declines have slowed somewhat - the Cinram business has still been operating in a challenging market.

But becoming part of Utopia's recently launched music distribution division presumably safeguards the future of Cinram in the years ahead. Utopia, of course, has been very acquisitive of late. As well as the deal in January to buy Proper Music - the UK's other key physical music distributor - in February it also acquired the Absolute Label Services business.

And, beyond music distribution and label services, it has also acquired Sentric Music on the publishing side, as well as companies like music industry focused financial services business Lyric Financial, Quincy Jones-backed music metadata set-up Musimap, music industry directory ROSTR and data analytics platform ForTunes.

Confirming the latest acquisition, Utopia's COO Roberto Neri says: "The loss of Cinram Novum would have been detrimental to the entire UK music industry, resulting in financial losses and disruption for labels, retailers, artists and their fans. Through this acquisition our intention is that Utopia can secure Cinram's future".


Reservoir and PopArabia acquire Voice Of Beirut
Reservoir and its Abu Dhabi-based partner PopArabia have acquired Lebanese record label and music publisher Voice Of Beirut.

"Reservoir continues to demonstrate its commitment to our strategy of investment in the Middle East and North Africa region and emerging markets", says Reservoir CEO Golnar Khosrowshahi.

"Through our efforts with PopArabia and deals like the acquisition of Voice Of Beirut, we now represent a growing breadth of diversity in music from the Middle East across styles, eras and rights types", she adds. "We're excited to share that music on a global scale, especially as we continue to see increasing interest in regional music around the world".

PopArabia Founder and Reservoir's EVP Of International And Emerging Markets, Spek, adds: "The acquisition of Voice Of Beirut deepens Reservoir and PopArabia's presence in the Arab world. Not only is it the largest Middle East acquisition we have done thus far - in terms of catalogue size - but when viewed in context with the other crucial deals we've done this year, it is clear we are firmly establishing ourselves as a meaningful player in the Arabic music space".

Voice Of Beirut launched in 1980 and the company's catalogue spans traditional Arabic and modern pop music from across the Middle East - with a particular focus on Lebanese pop songs from the 1980s and 1990s.


Activist shareholder calls on Warner Music to hand over files on sexual misconduct allegations
Former Atlantic Records A&R Dorothy Carvello has used her status as a shareholder in Warner Music to try to force the music major to share any records it has on sexual misconduct allegations - and other claims of bad practice - that have been made within the company.

In a letter sent to the major earlier this week, according to Billboard, Carvello's lawyer states that there are "concerns that WMG's management is not doing enough to investigate and act upon allegations of sexual misconduct at the company, and not monitoring the distribution of artist royalties in a manner that ensures sound accounting and payment".

"Both issues", the letter adds, "have the potential to expose the company to substantial liability and cause great reputational harm to WMG … [and] raise serious concerns about the truthfulness and accuracy of the company's statements to investors".

The letter then details a number of specific allegations and also requests documents relating to internal investigations, as well as information on any settlements and non-disclosure agreements that were made.

Carvello's request for information is being made using a statute in Delaware's company laws, which requires a company incorporated in a state to share requested information if a shareholder has a "proper purpose" that is "reasonably related to such person's interest as a stockholder".

Speaking to Rolling Stone, Carvello says: "I want to see what the actual investigations, if any, were against these claims. We need more transparency from Warner Music Group. I don't want a board that rubber stamps this behaviour".

Commenting on Carvello's letter, a spokesperson for Warner told reporters: *"*We take allegations of misconduct very seriously and enforce policies that respect and protect people that raise concerns".

"WMG has an employee code of conduct designed to reinforce a safe, inclusive environment, and we continue to listen and learn for ways to stamp out discrimination and harassment from our industry", they added. "The allegations detailed in this letter have already been dealt with publicly, many of them were raised years or decades ago".

Carvello, who was the first female A&R at Atlantic Records US, previously detailed her personal experiences of working in the industry in her 2018 memoir 'Anything For A Hit: An A&R Woman's Story Of Surviving The Music Industry'.

Earlier this year, she also launched the Face The Music Now Foundation, an organisation that will support survivors of sexual harassment and abuse in the music industry. It also aims to work to change a system of what it refers to as "institutionalised abuse" within the sector.

As part of those efforts, Carvello announced earlier this year that she had become a shareholder in all three of the major record companies, with a view to eventually forcing - with the support of other shareholders - the termination of any NDAs currently in force over current or former employees relating to harassment.

It remains to be seen how effective her initial efforts with her former employer will be - she has said that she will launch legal action if Warner refuses to hand over the requested information. While Warner is incorporated in Delaware, Sony Music and Universal Music are not, so she will have to use alternative means to make similar requests of the other two majors.


Universal Music announces another revamp of its distribution and label services business
Universal Music has further expanded and revamped its music distribution and label services operations, acquiring mtheory Artist Partnerships and putting its founders in charge of an all new Virgin Music Group, under which will also sit the major's existing Virgin-branded label services divisions, as well the Ingrooves business.

All three majors have expanded the services side of their businesses in recent years, of course, providing distribution and other services to independent labels, and also to those artists that want to set up and run their own labels, but also want access to the infrastructure and influence of the major label system.

Last year, Universal rebranded its various artist and label services units around the world - which were operating under the Caroline brand - as Virgin Music Label & Artist Services, it no longer using the Virgin Records brand it got via its 2012 acquisition of EMI for frontline labels (well, not in the UK and the US anyway). Since that big old rebrand it has also launched Virgin Music services divisions in a number of other markets.

Those various Virgin Music services units will now sit within this all-new Virgin Music Group. That is most significant in the US, where - despite last year's rebrand - Virgin Music Label & Artist Services still operated as part of Universal's Capitol Music Group, where the Caroline business had previously sat. With this new revamp, Virgin Music Label & Artist Services US will become part of the new global services division.

The Ingrooves distribution and label services business has always operated a bit more autonomously from the rest of the Universal Music Group, despite being fully acquired by Universal in 2019, the major having previously been a minority shareholder. Under the new revamp, it will be formally part of the Virgin Music Group as well.

Seemingly prompting, at least in part, this latest revamp of Universal's services operation is the acquisition of mtheory Artist Partnerships, the label services unit of independent music firm mtheory, which also has a team providing services and support for artist management companies. mtheory Artist Partnerships will be the third strand of the Virgin Music Group, and the founders of mtheory - JT Myers and Nat Pastor - become co-CEOs of the all-new Universal Music division.

This all raises the question, of course, as to who will be running the mtheory manager services business now that Myers and Pastor have all this Virgin Music Group CEOing nonsense to deal with. But I can answer that question. Newly appointed mtheory Manager Services CEO Cameo Carlson, that's who. mtheory is also spinning off a producer royalty platform it operates as a standalone company which will be headed up by another co-founder, Jon McMillan.

So there you go. Consider yourself informed, and please update any major label corporate structure charts you have next to your desk or maybe stuck on your bedroom wall. And now, some official quotes for you all to ignore...

Universal Music CEO Lucian Grainge: "In order to remain the best home for artists and entrepreneurs we must drive innovation in our own businesses - offering new and high-quality resources for artists from all corners of the world while continuing to lead the industry's transformation. Nat and JT's track record for creating forward-thinking partnerships with artists that are built on a foundation of trust, creativity and business acumen is exactly the kind of leadership we want for the new Virgin Music Group division. Together with our frontline labels and global footprint, Virgin Music Group offers artists unmatched creative and commercial support".

Universal Music EVP, CFO and President Of Operations Boyd Muir: "Expanding the community of artists, labels and entrepreneurs with whom we work presents a significant opportunity for us, strategically complementing our labels and leveraging UMG's existing world-class infrastructure. Having worked with mtheory, I know that the vision for the growth of the industry that Nat and JT bring will be a great fit for UMG and our artists, today and in the future".

mtheory founder and Virgin Music Group co-CEO JT Myers: "mtheory was founded on the idea that we could transform the music industry by offering better, more aligned partnerships with artists. By bringing these incredible global teams and resources together, we have the opportunity to turbo-charge that vision, and deliver even more value to artists, labels and music entrepreneurs".

mtheory founder and Virgin Music Group co-CEO Nat Pastor: "We are so thankful to Sir Lucian and Boyd for entrusting us with the iconic Virgin Music brand, one of the most successful independent labels in the industry's history, as well as Ingrooves, arguably the most sophisticated music technology platform in the world. JT and I have worked together for over 20 years, and we're THRILLED to continue our journey to transform the music industry together, along with the Ingrooves, mtheory and Virgin teams".


Sony Music rebrands the neighbouring rights agency it bought from Kobalt
The neighbouring rights agency formerly known as Kobalt Neighbouring Rights is now called Kollective Neighbouring Rights. You know, because it's no longer owned by Kobalt.

The agency was acquired by Sony Music last year as part of the same deal that got the major the AWAL distribution and artist services business. And, like AWAL, it now sits alongside Sony's existing distribution and artist services business The Orchard.

When we talk about neighbouring rights in this way, we mean the money generated from the broadcast and public performance of sound recordings. And neighbouring rights agencies help labels and artists manage that revenue stream.

The broadcast and public performance of recorded music is usually licensed via the collective licensing system, so the licences are issued and money collected by collecting societies like PPL.

Each society only issues licences and collects money in its home country, though societies around the world are connected through reciprocal agreements. This means each society can issue licences covering something nearing a global catalogue of music, plus artists and labels can simply join their local society and access all the income collected by societies in other markets.

Or at least in theory. Neighbouring rights agencies have relationships with societies all over the place and argue that - by better managing each artist or label's rights and data - they can ensure more accurate and rapid payments of this money than if the artist or label just joined their local society and relied on the global collecting society network.

The record industry at large generally started taking its broadcast and public performance revenue streams much more seriously in the 2000s as CD income slumped, making the management of these specific rights seem more important, creating a role for neighbouring rights agencies. Kobalt entered this domain back in 2012.

As well as the rebrand that allows the now Sony-owned agency to keep its 'K' without using the 'Kobalt' name, Kollective Neighbouring Rights has also announced it is launching a new platform powered by the good old Orchard.

Confirming the rebrand and platform revamp, KNR CEO Ann Tausis says: "Today marks the start of a new era for KNR. We are excited to build on our relationship with The Orchard to unveil an upgraded custom-built system that will help serve our global clients in enhanced, more streamlined ways, while continuing to provide best-in-class service".

"There are still untapped markets in neighbouring rights", she goes on, "and we're looking forward to utilising the global footprint of The Orchard to initiate collections for our clients in additional territories. I'm very excited about the rebrand and our new identity".

Meanwhile, Orchard boss Brad Navin adds: "The Orchard provides first-class solutions, cutting edge technology, expert guidance and brand transparency to our clients. Expanding these services to KNR's roster will further empower performers to maximise their neighbouring rights collections as they navigate a global web of complex and evolving revenue streams".


YouTube paid out $6 billion to the music industry over the last year
YouTube has announced that it handed more than $6 billion over to the music industry in the twelve months to June this year. That, it says, is an increase of $2 billion year on year, with 30% of the payout coming from music used in user-generated content.

In a blog post announcing the figures, YouTube' Global Head Of Music, Lyor Cohen, states: "We want our twin engine of ads and subscriptions to be the number one contributor of revenue to the [music] industry by 2025. That's why YouTube is monetising all music formats (short and long form video, audio tracks, live, etc), on all platforms (desktop, tablet, mobile, and TV), in over 100 countries. And overall watch time of music content on YouTube across desktop, tablet, mobile and TV continues to grow year over year".

"As our twin engine continues to hum", he continues, warming to his metaphor, "we're seeing profound changes in music. We must accompany this movement to be the best place for every music fan. Fans want to discover, consume and participate in music across multiple content formats, and only YouTube can deliver that entire experience in one place".

"We just saw this play out with Blackpink's 'Pink Venom' release", he adds. "Fans went from the music video teaser, to the Shorts challenge, to the livestreamed premiere of the music video, and beyond. Then WOW: 'Pink Venom' became the biggest 24 hour music video debut of 2022, and the third largest 24 hour music video debut of all time". Lovely stuff.

In addition to royalty stats, Cohen's blog post also further trumpets YouTube's TikTok rival Shorts, saying that it is now generating over 30 billion views per day. And, he says "we're creating long-term monetisation solutions for Shorts" promising that there will be "more to share on this soon".


CMU:DIY: Artist:Entrepreneur Day returns to Manchester 
The Artist:Entrepreneur Day from the Featured Artists Coalition and CMU:DIY is returning to Manchester next month in partnership with English Folk Expo.

Once again three FAC artist entrepreneurs will talk about their individual artist businesses, explaining how music-makers go about building a fanbase, and generating revenues from their music rights, shows and fan relationships.

They will be joined by CMU's Chris Cooke and a team of music industry experts to provide insights, ideas and lots of practical advice for early-career music-makers looking to build a business around their music.

This is all happening on Saturday 15 Oct at Home in Manchester. Info and tickets here.

Marcus Mumford says old advice from Neil Young influenced the sound of his solo album
Marcus Mumford has said that he took on board advice from Neil Young while recording his debut solo album, properly considering the longevity of what he was creating.

"Neil Young sat me down about ten years ago and told me the importance of recorded music, and that I should pay more attention to the way in which we record", he tells the NME. "I was always [like], 'Ah, it's just an advert for a live show'. He was like, 'No man, these things last'".

"I felt like on this record, I listened to that [advice]", he continues. "I paid closer attention to the way it sounded than anything I'd ever done before".

So, I don't know if that means that all of Mumford & Sons' albums were just thrown together without much thought. You can decide that for yourself.

In a wider interview with the website, he reflects on comments made by another songwriter about the process of making music, saying: "Sometimes, I think the best songs do just come out. Noel Gallagher talks about songwriting like you hold your hands out and you wait for what drops from the sky and if you don't hold your hands out, then Bono or Chris Martin's going to catch them".

Surely they don't get all of them. Maybe they do. Are Bono and Chris Martin hoarding all the truly great songs? And, if so, why don't they put some of them out?

Mumford's debut solo album, '(self-titled)', is out this Friday.


ANDY MALT | Editor
Andy heads up the team, overseeing the CMU Daily, website and Setlist podcast, managing social channels, reporting on artist and business stories, and writing the CMU Approved column. (except press releases, see below)
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Chris provides music business coverage, writing key business news and CMU Trends. He also leads the CMU Insights consultancy unit and the CMU:DIY future talent programme, as well as heading up CMU publisher 3CM UnLimited. (except press releases, see below)
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