Inside Track: Speaking to Asia, UMG’s Lucian Grainge Warns Against ‘Repeating Past Mistakes’ With Short-Form Videos

SINGAPORE – Is it time to make TikTok into a verb?

That was the question put to Ole Obermann, the global head of music for TikTok and parent company ByteDance. “I kind of hope so,” Obermann said last week at the All That Matters business conference here. “I am making a Xerox. I am googling something. I am making a TikTok. I am watching a TikTok. I am TikToking…”

The rapid ubiquity of the Chinese-owned short-form video platform was the elephant in the room for many of the music industry figures who gathered in Singapore for three days of Asia-focused panels (and six nights of music). Among the biggest takeaways: Short-form video content is posing new challenges and opportunities for artists and labels wanting to profit from the medium — without losing control of what feels at times like a runaway, content-producing hamster wheel.

Universal Music Group chairman and CEO Lucian Grainge, who spoke at the conference via livestream video from Los Angeles, called the “explosion” in short term video on social networks a “megatrend that is only going to spread and accelerate.”

While not mentioning TikTok by name, the UMG chief, however, was quick to warn the industry to “avoid repeating past mistakes,” especially when MTV and YouTube built big businesses without giving much back to the industry. “In those early days, we were given a lot of reasons why our artists shouldn’t get paid,” Grainge said. “People said, ‘It’s great promotion, or you can use it as a platform for discovering new artists…technology platforms were built on the backs of the artists’ hard work and those who invested in artists early in their careers, with very little return.”

But that was then, this is now. Grainge spoke of the “sea change” from where the industry was a decade ago, noting that social media giant Meta, for example, has gone from generating zero dollars for the industry five years ago to becoming one of UMG’s top 10 revenue-generating partners. He also acknowledged YouTube’s recent announcement that it had paid rights-holders $6 billion in the 12 months ending June 22.

As for TikTok, the Chinese-owned company wants to co-exist with record labels and publishers. “We can be one big happy value-creating family,” said Obermann.

Still, with 100,000 tracks being added to music platforms every day “it’s becoming harder and harder for artists, even the most talented artists, to break through all of that noise,” Grainge said.

Wendy Ong, co-president at TaP Music, agreed. “It is getting harder to find anything that looks like a unique aesthetic,” she told conference attendees. Ong, whose firm has handled the careers of Lana Del Rey and (previously) Dua Lipa, expressed concern that artists are burning out trying to keep up with the demands of producing non-stop social content. “Now we are back to chasing numbers and high performance on video views…Instead of a space for creation, [social platforms are] becoming a space for distribution.”

Content-production burnout is “something we are acutely aware of — that constant impetus to keep driving and producing content,” said Paul Smith, YouTube Music’s managing director for the Asia Pacific region. Smith relentlessly promoted YouTube Shorts in Singapore, bringing on stage an example of what he sees as the ideal Shorts influencer: Thai-born singer Sorn, a former member of K-pop group CLC, who is now trying to forge a solo career. Sorn said she regularly posts Shorts four to five times a day.

“I know it is pretty draining for artists to constantly be creative and put out content every single day,” said Sorn, 25. “But to be really honest with you, it is a must. It is a part of the job.” She said she tries to bank extra Shorts to get a day off from time to time.

Ong later expounded on the futility of fighting the pressures artists are under. “Everything is 24-7 online,” she said at a small offsite dinner hosted by Outdustry, the music industry services company. “When do they get to figure out who they are without making mistakes? And if they make the mistakes when they are already at a major, they get dropped. So, it is incumbent on us to help new artists figure out that part of the equation.”

For now, 15-second videos figure prominently, Grainge said. UMG’s internal consumer research in the world’s major music markets shows that for the last year, short form content with global reach rose from 19% consumer engagement to 32%, he said. “The growth is stunning and points to a powerful opportunity for our artists, for us in the music community and for the platforms as well.”

Overall, streaming in all forms continues a rapid ascent across Asia. Audio and video streams in the region ballooned by 19% to 11.4 billion from January through August, not including India, Australia, or New Zealand, said Helena Kosinski, global vp with Luminate. “It’s big and it’s growing fast,” she said in Singapore. The top three overall streaming markets in Asia, by volume, are Japan, Indonesia and the Philippines, while the three fastest growing, she said, are Vietnam, South Korea and Indonesia.

Some countries have more work to do than others to create popular local markets. In Japan and South Korea, less than half of music consumers are engaging with music outside of those countries, while in the Philippines, 80% of music consumers are focused on music outside of their home country, Kosinski said.

The Great ‘Re-Connect’

After two years of virtual events — the 2020 edition featured conference producer Jasper Donat doing an opening interview with The Cookie Monster of “Sesame Street” fame — this year’s All That Matters, dubbed “The Great Re-Connect,” was held live only for people who made the trip to Singapore. (The panels will be available for replay, for free, about two weeks after the event.).

Nevertheless, the conference – which also featured channels devoted to sports, gaming, marketing, web3 and digital content – drew a record number of attendees, just short of 2,000 (many paying $1,299 for all-inclusive VIP passes), to a new Hilton hotel in the high-end Orchard Road shopping district. Even a few Chinese companies, whose executives have struggled with China’s zero-Covid policies, made the trip. TC Pan, Tencent Music Entertainment’s group vice president, told Billboard offstage that he had spent about 150 days in various forms of quarantines to be able to travel during the pandemic.

As in 2019, All That Matters was timed to run as the Singapore Formula 1 Grand Prix motor sports race week was getting into full swing. The racing event regularly draws the super-wealthy from around the world, some of whom reveled last week in parties at Marquee nightclub featuring dance music DJs Afrojack and Steve Aoki. Last week was essentially Singapore’s coming-out party after myriad lockdowns and false-returns-to-live, as a crypto conference and the Milken Institute’s Asia Summit were also happening here.

Labels And Artists Looking Outside – Not Only Inside — Asia

For All That Matters attendees, the emphasis shifted this year from 2019, when UMG used the Singapore event to announce new Southeast Asian offices primed to discover local talent, the formation of Asian sub-labels for Def Jam and Astralwerks and the development of local streaming-led markets. Those trends continue. But this year, labels and artists flashed a yearning to break their local Asian stars out to a global audience — and everyone seems to be chasing the South Koreans.

Members of the team behind Filipino pop sensation SB19 – who Billboard nominated for its Top Social Artist award, in part because of the prowess of its fan army, “18” – talked in Singapore about how the group, originally formed by a Korean agency, was trying to emulate the discipline and dance prowess of K-pop acts, while singing in English and pioneering “P-Pop,” the Philippines’ newly anointed pop genre. “There is so much that we take from the inspiration of the Koreans,” said Roslyn Pineda, vp for artist relations and business development for Asia and general manager of the Philippines for Sony Music Entertainment. That includes, she said, the organized efforts of K-pop fanbases to push their artists forward.

SB19, which is signed to Sony Music Philippines, hits the road next month for its first U.S. tour, starting on Nov. 5 at the Palladium Times Square in New York.

The rise of Korean repertoire — not just in music but across entertainment including television and movies — continues to be a rising force in the global music industry, said Sulinna Ong, Spotify’s global head of editorial. “A hit can come from anywhere,” she said. “People are more open to something that isn’t Anglo. That diversity is a good thing for everyone.”

A glance at the current Spotify Global Top 10 or Top 20 reveals that 50% of that repertoire is sourced from outside the U.S. or Europe. “50% is pretty incredible,” Ong said, noting Latin music and Korean repertoire are king.

Those continental plates have shifted in less than a decade. In 2014, Spotify operated in just over 50 markets, and the export of music was “largely trans-Atlantic.” Fast forward eight years, Spotify is now in 183 markets, U.K. and U.S. repertoire are declining, while key markets such as South Korea, Colombia, and Puerto Rico are rising in their exports.

“We’re now in an era defined by diversification in taste,” said Ong, powered by streaming.

Additional Reporting By Lars Brandle.