Song rights pioneer Hipgnosis faces uphill battle to keep playing music

Massarsky responded by accusing Stifel of making “a number of erroneous assertions regarding methodology” and said there was no intention to “increase” the value.

Mercuriadis told The Telegraph at the time that Stifel had been “naive and obtuse” in his analysis and was trying to “put himself in the spotlight” by downgrading the company.

Despite the unease, investors remain enticed by the potential of the music streaming story and Hipgnosis’ position in the market.

As music is increasingly purchased through subscription services like Spotify and Apple Music, royalties are becoming more predictable. And there are no clear signs of this momentum slowing down as TikTok, the video-sharing app with millions of UK users, relies on music videos to drive its growth.

The service has been identified in such a way that young users are increasingly discovering music. Fleetwood Mac’s Dreams shot up the Spotify charts last September when a video of a skateboarder rolling along to the song while sipping cranberry juice went viral.

JP Morgan’s Christopher Brown, however, says headwinds are building as Spotify struggles to sustain growth in US and European markets, while podcasts vie for public attention.

It also highlights the burgeoning live music streaming market, which has the potential to attract new audiences and increase payments for publishers.

A more worrying issue for Mercuriadis could stem from a degraded regulatory environment for music streaming on both sides of the Atlantic.

Last Friday, Kevin Brennan, the Labor MP and member of the culture committee, introduced a private member’s bill in parliament with the aim of rebalancing the wealth of streaming music to artists.

The move comes after the committee heard complaints from songwriters and musicians, who have struggled to live off the fraction of a penny they earn from every stream of their work on Spotify, Apple Music and YouTube.

The concerns of the group of MPs prompted the UK competition regulator to take the first steps towards regulatory action by launching a market study into the dominance of the major record labels.

Still, not everyone in the music industry agrees with that sentiment. Record label association BPI said the Brennan Bill would tie up the UK music industry in bureaucracy and stifle label innovation and investment.

“It completely ignores the music industry today and the value labels bring to finding and nurturing talent,” the industry body added.

“Labels are committed to ensuring artists are rewarded based on their success through streaming, but just as UK music is finally emerging from its long downturn, this misguided and outdated regulation would be a damaging step backwards, eroding foundations. of the extraordinary of the United Kingdom. worldwide success in music.

For Mercuriadis, the question is whether it can maintain momentum regardless of the competition and regulatory pressures that come its way.

Investors cite it as one of the main reasons Hipgnosis has built a solid position and remains a draw for artists, producers and songwriters looking to sell.

He proved he could catch the streaming wave with the surging song fund Hipgnosis. It must now prove that it can keep rolling while feeding the appetite of a global investment giant.