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News August 28, 2017

Merlin hits distributions milestone

Lars Brandle
Merlin hits distributions milestone

Merlin has pulled off a special trick: the independents’ digital rights agency has paid out its billionth dollar (AUS$1.25 billion) to its members.

The milestone, announced early Monday, follows several years of snowballing revenue growth for the organization, which has licensed more than 20 digital music services from Deezer to Google Play and YouTube Red, iHeartRadio, Pandora, Vevo and Spotify, with which it struck a renewed multi-year global licence in April.

Led by Australian-born CEO Charles Caldas, Merlin was presented to the industry as the “virtual fifth major” in January 2007 and launched for business in May 2008. The not-for-profit Merlin, now affectionately known as the “virtual fourth major” (following the sale and dissection of EMI) currently represents more than 20,000 indie labels and distributors in 53 countries, who collectively account for an estimated 12 percent of the global digital music market.

“It makes me immensely proud to reach this landmark,” says Caldas in a statement. “Like all the best independent labels, Merlin is run with passion, as a lean and efficient operation – albeit with an extensive and profound global responsibility. Our unique structure has empowered Merlin’s members to sit centre stage in the streaming market, while enabling digital music services to capitalise on the immense consumer demand for independent music.

“Even more inspiring is that this billion dollars in revenues comes only from the new-generation services that have launched since we did. In a market still in its early stages of evolution, the more significant growth is arguably yet to come.”

Annual revenue payments to Merlin’s members have increased eightfold in the past five years, with the organisation recently annual distributions for its members grew by 52% year-on-year to US$353 million ($444 million) — more than a third of the total to-date sum — as demand for audio streaming services drives gains.

Michel Lambot, joint founder of PIAS, said its a dream come true. “When we dreamt about acting collectively in setting up Merlin almost 10 years ago we thought we were being really optimistic by setting a budget with an estimated best-scenario turnover of $10 million, some said we were crazy and … now we have delivered a billion dollars to the independent community…wow… I am so pleased and so impressed. Thanks Charles, thank you Merlin. Let’s continue to dream together.”

Merlin now has four offices (London, New York, Tokyo, and an HQ in Amsterdam) and a team of 17.

According to data published in its latest member survey, some 42% of Merlin’s members reported that more than half of their digital revenues came from outside their home territory, while only 17% said the same for physical revenues. In a sign to how streaming is flourishing internationally, Merlin reported revenues from Brazil have now overtaken those from France.

This article originally appeared on The Industry Observer, which is now part of The Music Network.


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