Universal Music Group (UMG) has announced their plans for 2024, including job cuts and an “artist-centric” streaming model.
A report by Bloomberg alleged that the company was planning to lay off hundreds of jobs within the first quarter. Anonymous sources claimed that the recorded music department would suffer the most cuts. In 2022, UMG reported it employed 10,000 workers globally. UMG have not specified how many jobs will be lost.
It follows a wave of job cuts in the music industry; Warner Music reduced its workforce by 4 per cent last year, whilst Spotify cut a whopping 17 per cent of jobs last December. Music Week claimed that UMG “is not about to make cuts on the scale of Spotify”.
The news comes alongside UMG’s launch of an “artist-centric” streaming model last year in an effort to reduce AI-generated content. UMG partnered with Deezer to give “professional artists” a “double boost”, as well as demonetising “non-artist noise content” from the royalty pool.
In addition, UMG removed a viral AI-generated Drake and The Weeknd collaboration from streaming services.
Amongst these changes, Bloomberg reports that UMG’s new streaming model will take some time to make impact; as a result, CEO Sir Lucian Grainge can satisfy shareholders by “trimming costs”, hence why UMG may be making the job cuts. Grainge allegedly referred to the redundancies on an October earnings call, which he referred to as “cut to grow”.
“We will cut overhead in order to grow it elsewhere,” Bloomberg reported him saying on the call. “We do have experience in managing the business, in managing the teams, and the businesses within that make up the group, and we’ve got a plan.”
Though UMG did not respond to Bloomberg‘s request for a comment, a spokesperson told Music Week: “We continue to position UMG to accelerate its leadership in music’s most promising growth areas and drive its transformation to capitalise on them.
“Over the past several years, we have been investing in future growth – building our e-commerce and D2C operations, expanding geographically, and leveraging new technologies.
“While we maintain our industry-leading investments in A&R and artist development, we are creating efficiencies in other areas of the business so we can remain nimble and responsive to the dynamic market, while realising the benefits of our scale.”