In 2019, Fast Company named Universal Music Group the most innovative music company and listed UMG among the Top 50 most innovative companies in the world and "amid the music industry's digital transformation, Universal is redefining what a modern label should look like." UMG has signed licensing agreements with more than 400 platforms worldwide.
The company's origins go back to the formation of the American branch of
Decca Records in September 1934 and its name and company logo originates from
Universal Pictures. Although the movie studio and the music business share a common history, today the former is part of
NBCUniversal and the latter an independent commercial entity. The Decca Record Co. Ltd. of England spun American Decca off in 1939.MCA Inc. merged with American Decca in 1962.
In November 1990, Japanese multinational conglomerate
Matsushita Electric agreed to acquire MCA for $6.59 billion. In 1995,
Seagram acquired 80 percent of MCA from Matsushita. On December 9, 1996, the company was renamed
Universal Studios, Inc., and its music division was renamed Universal Music Group; MCA Records continued as a label within the Universal Music Group. In May 1998, Seagram purchased
PolyGram and merged it with Universal Music Group in early 1999.
2004: Consolidating into a Vivendi subsidiary
In May 2004, Universal Music Group was cast under separate management from Universal Studios, when
French media conglomerate
Vivendi sold 80% of the latter to
General Electric, who subsequently merged it with
NBC to form
NBCUniversal. This came two months after the separation of
Warner Music Group from
Time Warner. In February 2006, Vivendi (which own UMG since 2000) purchased the remaining 20 percent of UMG from Matsushita Electric.
On September 6, 2006, Vivendi announced its €1.63 billion ($2.4 billion) purchase of
BMG Music Publishing; after receiving European Union regulatory approval, the acquisition was completed on June 25, 2007.
2007–2012: UMG acquisitions and EMI purchase
In June 2007, UMG acquired Sanctuary, which eventually became UMG's entertainment merchandising and brand management division, Bravado. The company represents artists such as Justin Bieber, Lady Gaga, and Kanye West, and has partnered with retailers including
In 2008, Universal Music Group agreed to make its catalog available to
Spotify, then a new streaming service, for use outside the U.S. on a limited basis.
Doug Morris stepped down from his position as CEO on January 1, 2011. Former chairman/CEO of Universal Music International
Lucian Grainge was promoted to CEO of the company. Grainge later replaced him as chairman on March 9, 2011. Morris became the next chairman of
Sony Music Entertainment on July 1, 2011. With Grainge's appointment as CEO at UMG,
Max Hole was promoted to COO of UMGI, effective July 1, 2010. Starting in 2011 UMG's
Interscope Geffen A&M Records began signing contestants from American Idol. In January 2011, UMG announced it was donating 200,000 master recordings from the 1920s to 1940s to the
Library of Congress for preservation.
In 2011, EMI agreed to sell its recorded music operations to Universal Music Group for £1.2 billion ($1.9 billion) and its music publishing operations to a
Sony-led consortium for $2.2 billion. Among the other companies that had competed for the recorded music business was
Warner Music Group which was reported to have made a $2 billion bid.IMPALA opposed the merger. In March 2012, the
European Union opened an investigation into the acquisition The EU asked rivals and consumer groups whether the deal would result in higher prices and shut out competitors.
On March 20, 2013, UMG announced the worldwide extension of their exclusive distribution deal with the
Disney Music Group, excluding Japan. As a result of this deal DMG's labels and artists have access to UMG's roster of producers and songwriters on a worldwide basis. The exclusive deal also saw UMG granted unlimited access to all rights pertaining to Disney's 85-year back catalog of soundtracks and albums.
On April 2, 2013, the gospel music divisions of
Motown Records and EMI merged to form a new label called Motown Gospel. In May 2013, Japanese company
SoftBank offered $8.5 billion to Vivendi for the acquisition of UMG, but Vivendi rejected it. In July 2018, JPMorgan said that UMG could be worth as much as $40 billion and then increased the valuation to $50 billion in 2019.
In August 2013, UMG became the first company in the US to have nine of the Top 10 songs on the digital charts, according to
SoundScan and weeks later, became the first company to hold all 10 of the Top 10 spots on the
Billboard Hot 100 Chart.
In September 2013, UMG received a
SAG-AFTRA American Scene Award for the company's commitment to diversity as exemplified by its "entire catalog and roster of artists."
On April 1, 2014, Universal Music announced the disbandment of
Island Def Jam Music, one of four operational umbrella groups within Universal Music. Universal CEO
Lucian Grainge said of the closure, "No matter how much we might work to build 'IDJ' as a brand, that brand could never be as powerful as each of IDJ's constituent parts."Island Records and
Def Jam now operate as autonomous record labels. David Massey and Bartels, who worked respectively at Island and Def Jam Records, were named to the new record labels independently.Barry Weiss, who previously moved from
Sony Music to lead Island Def Jam Music in 2012 when
Motown Records was incorporated into Island Def Jam, stepped down from Universal Music. Additionally, as part of the changes to the labels, Motown Records transferred to Los Angeles to become part of the
Capitol Music Group and previous Vice President Ethiopia Habtemariam was promoted to Label President for Motown Records.
Universal Music Group entered into film and TV production with the 2014 purchase of
Eagle Rock Entertainment. UMG's first major film production was Amy, which won an Oscar for Best Documentary, while taking part in Kurt Cobain: Montage of Heck and The Beatles: Eight Days a Week documentaries. In January 2016, UMG hired David Blackman from Laurence Mark Production where he was president of production as head of film and television development and production, and theater producer Scott Landis as special advisor on theatrical development and production. UMG Executive Vice President Michele Anthony and Universal Music Publishing Group Chairman and CEO Jody Gerson have oversight of the pair. On February 11, 2017,
PolyGram Entertainment was relaunched as a film and television unit of Universal Music Group under David Blackman.
In May 2016, UMG acquired Famehouse, a digital marketing agency. That same year,
Paul McCartney and the
Bee Gees both signed to UMG's Capitol Records, including their catalog releases.
In April 2017, UMG signed a new multi-year licensing agreement with
Spotify, the world's leading streaming service, and in May 2017, UMG signed a deal with
Tencent, China's biggest gaming and social media firm.
In August 2017, UMG and
Grace/Beyond agreed to develop three new music-based television series, 27, Melody Island and Mixtape. 27 would focus on musicians at the age of 27, an age at which
several iconic musicians died. Melody Island was an animated series based on tropical island music with live craft segments. Mixtape had twelve episodes, with each episode connected to a song.
In October 2017, UMG announced the launch of its Accelerator Engagement Network, an initiative aimed to help develop music-based startups around the world.
In November 2017,
USC Annenberg announced UMG's partnership in the "Annenberg Inclusion Initiative", becoming the first music company to do so. The initiative is meant to create change for representation of women and underrepresented racial and ethnic groups in the media industry.
In December 2017, Universal Music Group acquired
ZTT labels, along with Perfect Songs Publishing, from
Trevor Horn's SPZ Group;BMG Rights Management, through Union Square Music subsidiary, retained its back catalogues. That same month, UMG signed a global, multi-year agreement with Facebook becoming the first of The "
Big Three" to license its recorded music and publishing catalogs for video and other social experiences across
Oculus. Sony and Warner signed similar contracts with Facebook the following year. Furthermore, on December 19, 2017, UMG signed a multi-year licensing agreement with
The Rolling Stones signed a worldwide agreement with UMG covering the band's recorded music and audio-visual catalogues, archival support, global merchandising and brand management. That same month, Vivendi announced it would explore selling as much as half of Universal Music Group to one or more investors.
Nielsen's 2018 US Music Mid-Year report, UMG made history with eight of the Top 10 artists, including all of the top five, as well as all of the top eight artists ranked by on-demand audio streams. In August 2018, UMG announced a strategic expansion in Africa, opening an office in
Abidjan to oversee French-speaking Africa, and also unveiling a Universal Music Nigera office in
Lagos to focus on signing local artists and taking them global. In September 2018, singer
Elton John signed a global partnership agreement with UMG across recorded music, music publishing, brand management, and licensing rights.
On November 19, 2018, singer-songwriter
Taylor Swift signed a new multi-album deal with UMG, in the United States, her future releases will be promoted under the
Republic Records imprint. In addition to the promised ownership of her master recordings, UMG agreed to, in case it sells portions of its stake in
Spotify, distribute proceeds among its artists and make them non-recoupable.
In December 2018,
Bohemian Rhapsody" became the most-streamed song from the pre-streaming era and the most-streamed classic rock song of all time. In February 2019, UMG fully acquired music distributor
UMG was named to Fast Company's annual list of the World's 50 Most Innovative Companies for 2019, the first major music company to be included on the list in a decade. UMG is also ranked number 1 in the music category. UMG was named by Forbes as one of America's Best Midsize Employers in 2019.
In June, YouTube and UMG announced that they were upgrading more than 1,000 popular music videos to high definition, releasing them through 2020.
In August 2019,
Vivendi started negotiation to sell 10% Vivendi's stake of Universal Music to Tencent. The deal is expected to be of $3.36 billion.
In February 2020,
Vivendi announced it was planning to go public in an IPO within three years.
The company and
Lego Group announced a music product partnership on April 26, 2020.
On June 16, 2020, Universal rebranded Virgin EMI Records as EMI Records and named Rebecca Allen (former president of UMG's Decca label) as the label's president, bringing back the EMI brand. The same day, UMG announced launch of its new affiliates in Morocco and Israel.
In July 2020, UMG signed a new multi-year licensing agreement with
Spotify to provide value for artists and immense experiences for music fans.
In September 2021,
Euronext Amsterdam announces an introduction price of €18,50[clarification needed] and
Vivendi set an initial valuation for UMG at €33 billion ($38.3 billion). Vivendi distributed 60% of its UMG shares and retaining 10%.
The family of French businessman
Vincent Bolloré is revealed as the majority shareholder with 28% of UMG shares, through its holding company
Bolloré (18%) and its subsidiary
Vivendi (10%), headed by his son
Tencent emerged as UMG's biggest corporate shareholder with 20% of shares.
Pershing Square Holdings held 10% of UMG shares. In its IPO, UMG hits €54 billion ($62.6 billion) valuation which is over a third bigger than initial valuation.
In January 2022, UMG acquired the Icelandic record label Alda Music, which owned the rights to nearly 80 percent of all music released in Iceland.
In February 2022, Universal Music Group announced a partnership with Curio, an
NFT platform, to create NFT collections for its record labels and artists.
On May 31, 2022, Universal Music Group announced Baa1/BBB long-term credit ratings from Moody's and S&P.
In October 2022, Mercedes-Benz launched a new in-car audio collaboration with Apple Music and Universal Music Group. With this new audio standard, UMG allows its artists to base their song approval process on how the final mix sounds in a Mercedes‑Benz and introduced the “Approved in a Mercedes‑Benz” label as a standard.
Universal Music Group co-developed with GoogleVevo, a site designed for music videos inspired by
Hulu.com, which similarly allows free ad-supported streaming of videos and other music content.
On May 24, 2018,
Vevo announced that it would no longer continue distributing videos to
Vevo.com, instead opting to primarily focus on
Los Angeles metropolitan area
Universal Music Publishing Headquarters in Santa Monica, California.
UMG operates in more than 60 territories around the world including Australia, Central America, Brazil, France, India, China, Hong Kong, Taiwan, Sub-Saharan Africa, Central and Eastern Europe, New Zealand, Russia, Ukraine, South Korea, Singapore, Malaysia, Indonesia, the Philippines and more. Company's legal headquarters are in the Netherlands. Universal Music Group's largest corporate shareholder,
Tencent, is headquartered in
Shenzhen, China. Tencent's ultimate largest controlling corporate shareholder,
Naspers, is headquartered in
Cape Town, South Africa.
In 2000, music companies including UMG entered into consent agreements with the
Federal Trade Commission, with no admission of liability, whereby they agreed to discontinue the use of
Minimum Advertised Price programs under which subsidized cooperative advertising was provided to retailers that agreed to adhere to minimum advertised pricing.
In 2002, a similar settlement was entered into with music publishers and distributors
Bertelsmann Music Group,
EMI Music and Universal Music Group and certain retailers, without admission of liability or wrongdoing, with various states. In settlement of the claim, the companies collectively agreed to pay a $67.4 million fine and distribute $75.7 million in
CDs to public and non-profit groups. It was estimated that consumers were overcharged by $500 million and up to $5 per album.
In 2007, with the help of the Electronic Frontier Foundation, Stephanie Lenz sued UMG's publishing company for allegedly improperly requesting that, pursuant to the
Digital Millennium Copyright Act, YouTube remove a 29-second home video in which Lenz's child danced to a recording of
Prince's song "
Let's Go Crazy". After years of litigation, the suit settled in 2018, prior to the court holding a trial on whether UMG had a subjective belief that the video was infringing and not fair to use before sending its request to YouTube. In April 2016, UMG had the audio muted of a video clip showing
Katherine Jenkins singing the British national anthem. They claimed that the recording of "
God Save the Queen" was copyrighted, and YouTube initially complied with this request, but subsequently offered the video with the original audio track.
In December 2007, UMG announced a deal with
Imeem which allows users of the social network to listen to any track from Universal's catalogue for free with a portion of the advertising generated by the music being shared with the record label. All traffic was redirected to
MySpace after that company acquired
Imeem on December 8, 2009.
According to Jody Rosen of The New York Times, the fire which swept through
Universal Studios Hollywood on June 1, 2008, caused "the biggest disaster in the history of the music business". In space rented from NBCUniversal, according to an official document marked "Confidential", the fire destroyed at least 118,230 "assets" (
master recordings), or about 500,000 song titles, owned by UMG. "The vault housed tape masters for
Decca, the pop, jazz and classical powerhouse; it housed master tapes for the storied blues label
Chess; it housed masters for
Impulse!, the groundbreaking jazz label. The vault held masters for the MCA, ABC, A&M, Geffen and Interscope labels; as well as some smaller subsidiary labels. Nearly all of these masters—in some cases, the complete discographies of entire record labels—were wiped out in the fire." In a statement issued on June 11, 2019, UMG said The New York Times article contained "numerous inaccuracies, misleading statements, contradictions and fundamental misunderstandings of the scope of the incident and affected assets."
Following the publication of the New York Times story,
The Roots confirmed that the master tapes for two of the band's albums, including unused material and multi-track recordings, were lost in the fire. Similarly,
Krist Novoselic said he believed the masters for the band's 1991 album Nevermind were "gone forever" as a result of the fire. Representatives for
R.E.M. announced they would investigate the effects the fire may have had on the band's archival materials, while
Rosanne Cash and
Geoff Downes made statements on their possible losses from the fire.
Howard King filed a lawsuit in Los Angeles on June 21, 2019, on behalf of
Steve Earle, the estate of
Tupac Shakur and a former wife of
Tom Petty that seeks class action status for artists whose master recordings were believed to have been destroyed in the Universal Studios fire.
UMG denied that the takedown was ordered under the terms of the
Digital Millennium Copyright Act, and said that the takedown was "pursuant to the UMG-YouTube agreement," which gives UMG "the right to block or remove user-posted videos through YouTube's CMS (Content Management System) based on a number of contractually specified criteria." The video was subsequently returned to YouTube, with the reasons for the UMG takedown remaining unclear. Lawyers for
will.i.am initially claimed that he had never agreed to the project, and on December 12, he denied any involvement in the takedown notice. Megaupload dismissed its case against UMG in January 2012.
Copyright termination lawsuit
On February 5, 2019,
John Waite and
Joe Ely filed a class-action lawsuit against UMG claiming the company is violating their right to terminate grants of copyright after 35 years in accordance with
copyright law of the United States by ignoring Notices of Termination. On May 3, 2019, UMG filed a motion to dismiss the case, stating the Notices of Termination were not valid because the songs were not grants of copyright but
works for hire.