No. 26

September 01, 2015

It was reported by Music Business Worldwide on August 24, 2015 that Sony Music will be acquiring the German label Century Media in a buyout for $17 million dollars. Century Media includes several other labels: Another Century (rock), InsideOut Music (progressive), People Like You (post-punk, alternative) and Superball (alternative, modern progressive), with more than 50 staff across the U.S. and Europe. The label was founded in 1988 by Robert Kampt with co-owner Oliver With÷ft, who passed away January 2014 at the age of 49 after a long period of illness. [Click Here to read MMM's article about Withoft's death ] Century Media has been behind the success of music acts like Suicide Silence, Shadow's Fall, Lacuna Coil, Arch Enemy, Queensr che, Kansas, Devin Townsend, and many more.

While terms of the deal were not disclosed, sources say that Century Media and its family of labels, generate about $12 million in revenue, including $5 million from the U.S. The deal further enhances Sony's presence in the hard rock/heavy metal market. In the U.S., as a distributor, Sony Music Entertainment is the No. 1 major with 33.6% in album market share, including Century Media. As part of the deal, owner Robert Kampf will service as CEO of the Century group, and the label will continued to be distributed by RED in the U.S.; while Sony will also pick up international distribution. While Century Media will become a wholly-owned subsidiary of Sony Music Entertainment, sources say the deal did not include the company's music publishing assets. RED Distribution president Bob Morelli said "Century is one of the best hard rock labels in the business and Robert is an accomplished executive who understands the genre like few others. We are excited to continue working with Century to grow the business for their talented roster of artists." The deal will further strengthen the company's successful partnership with Kampf and his team through Sony's expanded global relationship. Sony Music Entertainment executive VP of international, Adam Granite, said in a statement that the deal will provide "a tremendous opportunity to grow our respective hard rock and heavy metal businesses globally." Kampf will report to both Granite and Dennis Kooker, Sony Music Entertainment president of global digital business and U.S. sales. Kampf said "The company I founded over 25 years ago is moving into its strongest chapter yet with the best music company in the world, Sony Music. By working with Sony and RED, it will allow Century's labels to further grow as a dominant force in rock, prog, alternative and metal."

The buyout of Century Media comes on the heels of Sony recently settling litigation in a major piracy lawsuit with Russia's largest social networking website VKontakte ( the Russian equivalent of Facebook ) who have signed a goodwill agreement in a move that could potentially become a game changer for the Russian music industry. The agreement came after an arbitration court in St Petersburg began considering lawsuits filed against VKontakte by Sony Music Russia, Universal Music Russia & Warner Music UK, over uploads of illegitimate music tracks by its users. The lawsuits were filed in April 2014 after months of preparation, during which the plaintiffs said repeated attempts were made to persuade VKontakte to tackle its copyright infringements. With a large portion of piracy occuring in Russia, Sony's ability to gain ground combating piracy should secure them an even greater market share of album sales.

Sony has made some progressive business moves this year and the acquistion of Century Media might well be a game changer too. Heavy metal music has existed on small independent labels who have grown their businesses over decades. Loss of sales from piracy has hurt these independent labels the most, driving them out of business or into corporate buyouts. The struggle can be clearly seen here when one of the largest independent labels, Century Media, carries an evaluation of just 17 million dollars with only a 12 million dollar a year revenue generated from its huge roster of music artists. The question remains to be answered as to what will happen to the music artists on Century Media if album sales continue to dwindle and Sony chooses to drop the lowering grossing artists in favor of a corporate model.

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