Last year, Taylor Swift accounted for 2% of the music industry’s entire sales.
But as the megastar prepares to make history — in the running to become the first artist ever to win the Album of the Year Grammy four times — her success marks an exception in the music industry, not the rule, the Financial Times said in a report Sunday (Feb. 4).
For example, Swift’s own label, Universal Music Group (UMG), is preparing to cut hundreds of jobs in the week to come. And while the Grammys might be a big night for Swift, the company will take a more low-key approach to the night, the report said.
Universal is skipping its yearly pre-Grammys artist showcase, normally a lavish event, out of concern that it would appear insensitive amid the layoffs, sources told the FT.
And the CEO of another large music company described the mood in Los Angeles this week as “a hangover” after several years of roaring growth.
“We’re in a different phase now,” the chief executive said. “Let’s face it.”
Warner Music last March cut about 4% of its staff, or 270 jobs, while publisher BMG laid off around 40 employees in October, the FT said.
According to the report, the music industry is still growing, though at a slower pace than in past years when streaming was still in its infancy. In the first nine months of last year, Universal’s revenue climbed 7% year over year, compared to 24% for the same period in 2022.
As covered here last year, the label has been pushing for greater streaming payouts from leading platforms. During an earnings call in October, CEO Lucian Grainge said the label was “frustrated” with the progress from major players in the industry in regard to making the payment structures more “artist-centric.”
More recently, Universal has been battling with TikTok in a dispute that has led to the removal of artists like Swift and Billie Eilish from the social media platform.
UMG claims TikTok has been unwilling to compensate artists properly and protect musicians from the harmful effects of artificial intelligence. TikTok counters that UMG is prioritizing greed over the interests of the company’s artists and songwriters.