How Universal Music Group became the biggest record label in the world

The record labels play a major role in the contemporary music industry. The biggest record companies in the US have spread their reach all over the world influencing music industries outside of the country as well. Among the top three companies in the country, Universal Music Publishing Group is Undoubted, the biggest record label in the world by 2018 revenue. It dominates nearly 98% of the global music market right now. It is actively operating in 68 countries for years

Origin

The company started as merely the American branch of Decca Records in September 1934. In 1962, MCA Inc merged with the American branch of Decca Records. In 1995, Japanese company Matsushita Electric bought MCA Inc for $6.59 billion. A year later in 1996, Seagram bought almost 80% of MCA from Matsushita. It was then the company was named Universal Studious Inc. They named the music division Universal Music Group. PolyGram was also included with UMG in 1999 after it was acquired by Seagram.

Separation from Universal Studios

When Universal Studios’ 80% share was sold to General Electric by Vivendi, UMG was put under separate management. Vivendi is in charge of UMG since 2000. The rest of the 20% of Universal Music Group was bought by Vivendi in 2006 from Matsushita Electronics.

2007-2012

UMG obtained Sanctuary in 2007. It eventually became Bravado, the company’s brand management division. In 2011, EMI sold its recorded music operation to UMG for $1.9 billion. Though the merger sparked an investigation, later it was given clearance in both Europe and the USA.

2012-2017

In 2013 UMG acquired the distribution deal with Disney Music Group. The deal got them access to all of Disney’s songs and albums. Motown Records’ gospel section and Emi merged forming a new label called Motown Gospel. According to JPMorgan, UMG was worth $40 billion in 2018 and $50 billion in 2019. It became the first company to have all the 10 songs in the top ten spots on Billboard Hot 100 in 2013. UMG started making movies in 2014. Their first film ‘Amy’ won an Oscar for the best documentary.

2018-present

UMG’s single, ‘Despacito’ earned many Guinness World Records in 2018. The company was included in Fast Company’s 50 most Innovative companies for 2019. Tencent acquired 10% of UMG from Vivendi in August 2019. The deal between UMG and Pershing Square Tontine Holdings was suspended in 2021.

Vevo

Vevo was co-developed by UMG. But in 2018, Vevo announced that they will not distribute music through their site Vevo.com anymore. They decided to focus on YouTube syndication instead.

Record labels under UMG

The most famous music labels in the United States are under Universal Music Group. The company also has joint shares in some of the biggest record labels around the world. Some of these record labels are:

Interscope Records, Geffen Records, Capitol Music Group, Republic Records, Def Jam Recordings, Island Records, Caroline Records, Universal Music Latin Entertainment, Universal Music Group Nashville, The Verve Label Group, Universal Music UK, and many more.