Investor interest in Warner Music Group expands to institutional investor seeking a minority stake, including Chinese streaming giant Tencent. Meanwhile, Billboard digs deep into the WMG IPI financials and implications on investing in music more broadly.
And Nielsen MRC reports that streaming music subscription rates are showing strong resiliency in the wake of the pandemic.
Music is attractive to investors because it's a countercyclical investment, meaning its value does not rise and fall with prevailing market trends. The recorded music business has grown 10% or more a year since 2015 because streaming services convinced consumers that accessing music could be better than owning it, not because global GDP grew the same amount each year.
Tencent is now indeed in talks to buy a minority stake in WMG, worth $200m... as one of a number of institutional parties kicking the tires of WMG before it goes public as a potential “anchor” investor.
MRC Data found that 84% of people who added a new music subscription service (“subscription adders”) in the previous two weeks said they are likely to continue paying for it after COVID-19. That was up from 79%, 76% and 78% in the previous three COVID-19 surveys.