Audio Video News

Reversing a lengthy losing streak, the Universal Music Group has become the first of the big four record labels to significantly increase revenue in many years. The Vivendi-owned company posted a nearly five percent increase for the first half of 2008, even after adjusting for currency fluctuations.

Could it be that all those MPAA lawsuits against consumers had a positive effect? Probably not, considering that Universal's results have not been shared by the other three major labels.

What Universal has been doing is cutting lots of deals for online distribution. In that area alone, it increased revenue by 33 percent, enough to push overall revenue to an increase of 4.9 percent. Most of Universal's competitors have also seen increased revenue from online distribution, but in their cases, that hasn't been enough to offset declining CD sales.

Universal was the first major label to launch a full-scale insurrection against iTunes, offering DRM-free MP3 downloads through Wal-Mart, Google, and Best Buy. The company has also explored subscription-based marketing with other partners, most recently through Sky, the British satellite TV and internet service provider. Additional areas of revenue growth for Universal have been music publishing, with the 2007 acquisition of BMG Music Publishing, and merchandising. See Vivendi site (PDF).