Sir Lucian Grainge’s tone does not tell Universal Music Group’s first – quarter earnings call, but the chairman of the world’s largest music company confirmed what had long been expected but never announced: Drake has signed a comprehensive and multifaceted contract with him the company. which includes recording, publishing, product and visual media projects.
These “expanded portfolios,” as Grainge noted in the call, which encompass multiple creative channels and revenue streams, include The Weeknd ‘s recently announced extension and expansion of The Weeknd’s deal with UMG, which aligns it – like Drake – the Republic Records. . (The Drake agreement was completed in 2021.)
Of course, the lingering question is: how big is Drake’s bag?
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An insider describes the market as “Lebron-sized,” unnumbered. Drake himself seems to have referred to such an arrangement in the lyrics for “Lemon Pepper Freestyle” (from his EP “Scary Hours 2”), which includes the lyrics “Three- sixty upfront, it all comes full circle”, is that, $ 360 million. He also mentions “master ownership” in “The Remorse,” the last song on “Certified Lover Boy,” and Migos’ “Having Our Way,” Drake raps, “Billionaires speak to me differently when they see my bill Lucian Grainge’s salary ”, referring to UMG’s CEO.
Since 2014, Drake has translated more than 37 million units of album projects. He is also the first artist to surpass 50 billion combined streams on Spotify. It’s no exaggeration to assume that Drake’s music brings in $ 50 million a year, sources say, and that the market could be around $ 400 million or more, either.
For UMG, which is listed on the Euronext stock exchange, the agreement helps consolidate its catalog. The company owns 3 million sound recordings and Spotify has 4 of the top 5 streaming artists of the last decade, according to an investor report released by UBS Research in the summer of 2021. Drake was listed in that report among the “re – listed” from UMG for 2021 and noted that € 1.52bn was spent on acquisitions of catalog and artist previews in 2020 (Drake appears alongside Bob Dylan and Cash Money; his songs are incorporated also in the UMPG system).
It was just under three years ago that Drake released “Scorpion,” breaking streaming records and, as reported at the time, making the rapper a free agent. Meanwhile, Drake’s status – and influence – only increased as the Canadian artist continued to drop solo songs in 2020 (“Laugh Now Cry Later” f. Lil Durk) and as a featured guest (” Life Is Good “by Future,” Popstar “by DJ Khaled) and in 2021 (” What’s Next “,” Wants and Needs “f. Lil Baby,” Sexy Way 2 “,” You’re Mines Still “by Yung Bleu) , and now in 2022 (Stay U by Future with Tems).
“Drake benefits from an in-depth catalog that works well,” says an industry veteran. “Plus, he became a free agent at a young age.”
In June 2018, he considered the kind of arrangement Drake could reach once his obligations to UMG were met and outlined various possibilities, including a rich touring market. However, with the coronavirus pandemic, which banned the running of concerts for most of 2020 and 2021, and the frantic buying and selling of artists’ catalog – multiplying by more than 20 times in some cases -, the more mature environment for UMG. highlighting his most successful artist by “renegotiating and paying him big buckets,” offers an industry observer with knowledge of similar markets.
In July 2020, businessman Steve Stoute and rapper Russ discussed the possibility of Drake becoming independent and predicted a big payoff in the future. “Drake is about to get the biggest wallet in the history of the music business,” said Stoute, CEO of United Masters, following Russ’ s remarks, who said, “Do you think if Drake is right now, completely independent. If Drake posts a picture on the ‘Gram’ of his new album, link in bio – fk link in bio, “new album out” – and was completely independent, Drake will make $ 10 million a week for f. -ing 60 weeks. “
Added Stoute: “If Drake goes it alone, the music business is over.”
A leading music lawyer says: “Drake has the bargaining power because of split net profit with the best market terms and a huge down payment in advance.”
Toronto’s native business is not limited to his own recording career. Its OVO label, hosted by Warner Records, is inhabited by various artists such as PARTYNEXTDOOR and Dvsn, and OVO’s streetwear line is reported to have $ 50 million in revenue by the end of 2018. In its clothing portfolio, there is a Nike market and line, ” Nocta, “attached to” Certified Girlfriend Boy. ” He also recently launched “Better World Fragrance”, a luxury candle company.
Drake is said to have ended his contractual duties for the Young Money / Cash Money label – “As soon as this album hits me, I’m out on the market,” he rapped on the song “Is There More” – which is circulated throughout . Republic.Record.
The multiple Grammy winner has sometimes criticized his relationships with companies and others. On the remix of “Family Feud” by Lil Wayne, Drake raps, “Ayy, tell me if TD Bank is approving loans / I’m wondering what Universal is paying him for Wayne / My friend spent his life doing platinum and gold / I should have half the label itself, shit is out of control. “” In the next line, the rapper yells at Apple’s head on raw material: “Someone you call Larry Jackson, I need some ownership if we push / ‘Business is booming in my name / I want a bite of the apple like Adam and Eve. “
On “BB King Freestyle,” Drake says, “The classics that I keep writing, the lights on the Universal building keep flashing.”
And in 2019 “Omerta,” Drake brags, “I wish I was playing in a sport where we got rings / I wouldn’t have in either hand for anything.”
“LeBron-attempts” might more aptly describe the richness of the Drake deal. Apart from the often stated assertion that rappers want to be basketball players and vice versa, the way NBA and hip-hop superstars attract attention – and make big money – in the cheap markets of their industry respectively. LeBron James signed a $ 154 million four-year deal to join the Lakers in 2018 and added another $ 85 million for another two-year extension, but it also requires deals with Nike, McDonald’s and ABC Studios. Back home, James helped boost Cleveland’s economy by returning to his hometown of Cavaliers, bringing millions of dollars to the city from new business. For music, Drake has the same market power – and has a lucrative partnership with Nike, among other brands – but on a global stage.
UMG’s revenue in the first quarter of 2022 increased by 21.6% (16.5% in fixed currency) to € 2,199 million ($ 2,310 million). Music publishing revenue increased by 32.5%, music recording revenue increased by 11.3%, and marketing and other fixed currency revenue increased 69.8% year-on-year.