Steve Cooper reveals the next frontier for Warner Music Group
With two good quarters in a row, double-digit revenue growth in recorded music and publishing, and a return to black, Steve Cooper, CEO of Warner Music Group (WMG), is optimistic about the next steps.
“We are focused on maximizing the reach and revenue of our artists and songwriters across all fandom touchpoints,” he said on an earnings call after the release of Warner’s financial statements in the second quarter, ending March 31.
“Whether it’s a social media clip, a soundtrack for a home workout, a live performance in a metaverse, or an NFT digital collectible… these points show. how the music ecosystem expands and deepens its relationship with people around the world. ”
The most recent example of Warner’s artist-fan connection initiatives came earlier this week, with an alliance and investment in Los Angeles-based virtual entertainment company Wave.
Using broadcast technology and real-time game graphics, artists become digital avatars in a virtual world, in which they broadcast live concerts that fans can watch and interact with.
“Through this partnership, Wave will work with WMG to develop virtual performances, experiences and monetization opportunities for our global roster,” Cooper added.
“This includes exploring new forms of ticketing, sponsorship and live interactions.”
Warner has already worked on events to uncover in 2022.
“We were early to see that music would be a breeding ground for digital collectibles,” added the Chief Warner.
“In 2019, we invested in [blockchain technology company] Dapper Labs, the creators of NBA Top Shot.
“Last September, we started experimenting in this market by collaborating with Apple to release two NFT CryptoKitties inspired by rock band Warner Records, Muse.”
Three months ago, Warner pumped an eight-figure sum into social gaming platform Roblox, after investing in virtual artist label Spirit Bomb that creates pop and DJ identities out of animated characters.
Another new alliance, announced on April 30, was with the world’s largest avatar tech company, Genies.
This will bring Warner artists to life as avatars, with the reasoning that “cultural icons and figures are some of the most expressive people on the planet and they shouldn’t be constrained by the limits of the real world,” said Akash Nigam, CEO of Genies.
As part of a new revenue stream in merchandising, artists will sell limited-edition digital clothing – like clothing, accessories, and tattoos – to their fan’s Genie avatars to commemorate key moments in life. such as song or album releases.
Cooper told Financial Editors, “Our goal is to develop genuine, quality, and eco-friendly products that build long-term fandom relationships.
“Although this space is still in its infancy, we are excited about its potential.”
Cooper noted how opening offices in India, Vietnam, Peru and Turkey and alliances with Chinese Tencent, Russian Zhara Music and Rotana in the Middle East have enabled Warner to reach more consumers and customers. artists.
Q2 figures show the growing diversity of the group. Net income was US $ 117 million, compared to a loss of $ 74 million in Q2 2020.
Revenue for the quarter increased to $ 1.25 billion from $ 1.07 billion last year. Recorded music rose 16.8% to $ 1.06 billion and publishing (Warner Chappell) rose 15.7% to $ 192 million.
Streaming continued to grow 23.2% to $ 722 million, while strong demand for new releases and catalogs for vinyl releases drove physical revenue up 25.5% to $ 118 million.
Revenue growth in digital and sync was partially offset by declines in performance and mechanical charges related to COVID.
Top sellers included Megan Thee Stallion, Dua Lipa, Michael Bublé, Ed Sheeran, Ava Max, the Hamilton recording of the cast, Roddy Ricch and the Japanese Yellow Monkey.
“Our success has been driven by new top releases from our incredible artists and songwriters, as well as the daring and imaginative performance of our world-class operators,” Cooper concluded.
“We’re excited for the rest of the year as we have a fantastic selection of new music from established superstars and emerging talent.”