'Music is a growth business again' — Sony/ATV Music Publishing CEO Martin Bandier
By Randy Lewis
May 15, 2018 | 11:20 AM
Martin Bandier, chief executive of the world’s leading music publisher, Sony/ATV Music Publishing, has had many reasons to celebrate recently.
Last week, the company commemorated 52 straight weeks with songs by Sony/ATV writers in the No. 1 spot on the Billboard Hot 100 singles chart — starting in May 2017 with “Despacito” by Luis Fonsi, Daddy Yankee and Erika Ender and continuing this month with Drake’s “Nice for What.” The next day, Sony/ATV was named publisher of the year at Broadcast Music Inc.’s annual BMI Pop Music Awards ceremony in Los Angeles.
The one-two celebratory punch is especially gratifying for Bandier, who is navigating an ever-changing landscape. Music publishers have been forced to adapt to a new world order in the music business, one in which streaming, rather than owning, is consumers’ preferred way of getting their music. Even so, Sony/ATV had 26 of the 50 most-performed songs of 2017.
Bandier sat down with The Times to talk about how this affects the creative community that writes the songs music lovers most want to hear.
He came to Sony/ATV in 2007 after 17 years at the helm of the world’s previous top music publisher, EMI Music Publishing, which became part of the Sony/ATV family after Bandier helped negotiate its acquisition in 2011. The firm now represents a catalog containing more than 3½ million songs by artists including the Beatles, Bob Dylan, Elvis Presley, Stevie Wonder, Taylor Swift, Ed Sheeran, Pharrell Williams and Drake.
Sony/ATV is privately held and does not release revenue figures. But according to the Music & Copyright organization’s annual survey of the publishing business, global revenue from publishing grew 11.2%, compared to 2016, to $4.92 billion overall in 2017. Sony/ATV’s portion of that total was estimated at 27.3%, or $1.34 billion. In second place is Universal Music Publishing Group, with a market share of 19.5%, or $959 million for fiscal 2017, with Warner Chappell Publishing at 11%, or $541 million.
What does it mean to you that Sony/ATV was named publisher of the year at the BMI Pop Music Awards last week?
It’s one of the most prestigious events of the year, because, as I explain to people, it’s not a beauty contest. It’s a contest based on merit, [recognizing] songs that are the most-performed songs on radio, television, etc. We had the most performed songs and won that award. The song ‘Shape of You,’ written by one of our writers, Ed Sheeran, won song of the year [as the most performed song of 2017].
The music industry’s business model now centers on streaming services. It’s been the case for performers and record companies, and I see it’s also become the primary revenue source in music publishing as well.
We all lived through a downslide of physical CD sales and of digital downloads. And then on the horizon came streaming. It was something we all looked at, and we all thought it was in interesting thing where you can pay a certain amount of money and all you can eat — like a buffet in Las Vegas: $10 and all you can eat. And it sort of took hold, and it grew. In this past year, [publishing] revenue from streaming was greater than both the CD physical sales and digital download sales, which is pretty remarkable. It continues to grow at pretty significant rates.
The U.S. Copyright Royalty Board recently approved a rate increase of almost 50% on royalties from streaming to songwriters. Spotify has agreed to boost what it pays to music creators. And the American Society of Composers, Authors and Publishers (ASCAP) recently reached a deal with YouTube to more fairly compensate their members for music posted on that service. Is the world coming around to recognize the value of music that for years has been largely traded and posted for free?
There were no rate raises in the interactive streaming world for almost 10 years, [because for a long time] no one thought that streaming meant anything. This time [with the CRB decision], we got raises over a five-year period of time.
Everything is sort of falling into place…we’re talking from an industry point of view. For us, we had the best financial year we ever had last year.
So after all these years of dour news about the future of the music business, you seem pretty up about where things are today.
I always felt that the music copyright publishing business is similar to the alcohol business: In bad times, you drink, and in good times, you drink; and in bad times, you play music — you might play a different type of music — and in good times, you play music. We’re in a real growth period, and I’m excited. Every day.
Your company just completed a rather remarkable run — a full year with Sony/ATV songs at No. 1 on the Billboard Hot 100.
You have no idea what an unbelievable accomplishment that is. We are in a very competitive business, and it gets more competitive every day, because people want to be in the music business.
That’s a statement that hasn’t been uttered much in the music business in recent years, what with the steady decline in sales of recorded music in physical or digital form.
Let me unequivocally state that the music business is a growth business today. Five years ago, people were looking around and wondering, “Are we just going to putter around forever and ever and ever?” Because we weren’t a growth business.
I actually endowed a school at Syracuse University, my alma mater, which is the Bandier Program for music business and entertainment industries. I did it — what, 15 years ago? — and I started to feel guilty about the students. I was saying to myself, “God, all these kids who love music and want to be in the business — their passion was so great — am I putting them in a position of doom and gloom?” Now, we get 400 applicants for 30 spots [each year].
Our business is growing, competition is incredibly keen, and there is so much money floating around that wants to own content. And what better content can there be than songs?