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Vivendi, of course, owns Universal Music Group, not to mention having considerable  media, games and telecommunications interests.

How much of his working week is spent thinking about the music business, given that Vivendi has six separate businesses? “My time is organised around what needs attention,” he said.

“My professional time is probably split equally between all six… My leisure time is obviously spending more time than anything else with music!”

However, UMG’s share of revenues within Vivendi has declined, pointed out moderator Ben Fenton from the Financial Times. Lévy batted back the question, pointing to healthy profit margins for Vivendi’s music subsidiary.

The market has been difficult, we’ve cut a lot of costs, we’ve played a major role – maybe the biggest of any players in the music area – to keep the costs under good control. But also to reorganise, reinvent the music industry, which needs new business models.”

Lévy said that 30% of Vivendi’s revenues come from business models that did not exist a few years ago, showing how its music business is only part of the way towards what it will be in the future.

Lévy also talked about partnerships with mobile operators, retailers and other businesses, and said that Vivendi is making new revenue streams that are not substitutes for download sales. For example, in India UMG has a partnership with operator Reliance to offer various music services. “We do the same in Singapore with Singtel, in the Middle East, in Brazil…”

His big point: UMG is seeing the popularity of music being turned into revenues, in markets around the world. He also mentioned the need for the help of governments, leading Fenton to ask whether they are doing enough to help the creative industries.

“Obviously they are not,” he replied. “Governments are trying their best, and there have been some legislations that have been implemented to fight copyright infringement through various ways… But I have to say, in some countries we’ve had nice words, nice speeches, and nothing at all.”

Lévy cited Germany as an example of a “disappointment” for the lack of talk about such measures. However, he welcomed moves in France and Sweden as more encouraging.

He was asked about dealings with ISPs, and whether Lévy regrets the ‘rather warlike’ relationship that has developed between rightsholders and ISPs. Lévy said he wouldn’t characterise it in these words. “At one point in time ISPs were probably using broadband access to catch new users, but obviously having access to illegal content was directly or indirectly a way to create a market for themselves,” he said.

“I think this is not true any more. We see many opportunities for partnerships between ISPs and music stores. Music is, to the ISPs, a key way to differentiate and to create more loyalty… to offer something to their customers and to reduce churn. So things have changed a bit.”

Lévy praised online music videos service Vevo too, and said it’s a sign that “more and more, music is tied up to video product”. He hopes Vevo will launch in Europe soon, but admitted that the necessary licensing negotiations are “complicated”. That said, in France, Universal Music has launched Off.tv, a similar service.

How about Vivendi’s other businesses, such as its Activision Blizzard games publisher. Lévy said there is much more co-operation between Activision and UMG, for licensing music into games. “The TV business is quite different,” he said, while suggesting that there is more scope for interesting deals between UMG and Vivendi’s mobile operators.

Would Vivendi be interested in buying any parts of EMI? “Not the debt!” joked Lévy. He elegantly evaded the question by pointing to several artists who have left EMI and joined UMG in recent times (the Rolling Stones for example, or Queen).

“It’s obvious to everybody that further consolidation of the music industry has been prepared and not executed over the recent years, for reasons which I cannot explain,” he continued.

Lévy was asked about social media’s role in the music industry. “We need to make sure that our content is available through any platform, and obviously social networks are an important part of it,” he said. “Going directly to consumers is part of the strategy.”

How about differences between North America and Europe? Why is Spotify having problems launching in the US, and why have a number of the US services not crossed the Atlantic?

Lévy said licensing is clearly more complex in Europe, due to the fragmented market. “We have to adjust to each market and even to each country,” he said.

“In Sweden, Spotify has been very successful. We expect Spotify to be able to find agreements with all its partners that it could launch as early as possible in the United States, but there are other streaming and subscription services available to American consumers. At the end of the day, the market is very complicated…”


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About Author

Stuart Dredge

Stuart Dredge is a freelance journalist, and a regular contributor to Music Ally, The Guardian and more... including midemblog :)

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