I’record publisher Independent classics Hyperion was sold to Universal Music on February 14. Is this an admission of failure of a model or the beginning of a movement that could grow in the months and years to come? This transaction, which involves the publisher of records by Marc-André Hamelin and Angela Hewitt, leads us to wonder about both the seller and the buyer.
“Harmonia Mundi and Hyperion were for many years the two jewels of independent classical recording. Both finally sink and end up in the bosom of Universal, which is deeply sad when you know what would have thought Bernard Coutaz and Ted Perry, their founders. It’s actually catastrophic and shows that the classic indie record is dead. In his hot reaction to the DutyMonday, Yves Riesel, creator of the blog Couacs (couacs.info), which scrutinizes the evolution of the production of recorded classical music at the time of the streamingdid not mince his words.
Yves Riesel, visionary of digital transformation, is the founder of the Qobuz platform, which will make its long-awaited debut in Quebec next May. He was also, in France, for a quarter of a century, the most colorful distributor of labels traditional freelancers.
He basically sees in this event the sign of a lack of foresight on the part of independent publishers in managing the transition to the digital age.
The pipe
The analyst’s reaction is rich in food for thought. Indeed, the Hyperion-Universal transaction is not an isolated phenomenon. In November 2022, we learned that Universal Music had acquired 49% of the shares of PIAS, after having refinanced it in June 2021. However, PIAS is the Belgian company which, in 2015, had bought Harmonia Mundi, “the” model of all independent, a house founded in 1958 by Bernard Coutaz (1922-2010).
Why 49%? If Universal is moving forward with assured but muffled steps, it is perhaps because when it acquired EMI in 2012, the European Commission forced Universal Music Group (UMG) to resell part of the acquired catalog in order to comply with standards defining the abuse of a dominant position. UMG had to avoid exceeding 40% market share. Virgin Classics and EMI Classics, then escaping absorption, had thus been resold to Warner. “That’s how we went from a suspicion of Universal’s dominant position on classics to a veritable dominant position of Warner Classics on classics,” laughs Yves Riesel!
I’m curious — but worried — what Universal, whose policy is not altruistic, will do with the label, the artists, the Hyperion team.
“I’m curious — but concerned — about what Universal, whose policy is not altruistic, will do with the labelartists, the Hyperion team,” says Charles Adriaenssen, president of Outhere, which brings together labels quality independents and acquired Channel Classics and Analekta in the past year.
Adriaenssen sees this week’s news as an “interesting signal that perhaps indicates a renewed interest in classical music. “In any case, this will fuel speculation among small independents (Chandos, BIS, etc.)”, he adds.
If there is interest and speculation, it is because the profession has fundamentally changed. “If you want to continue producing, you have to have a large catalog. This is the advantage of the majors over us: they have a natural mattress, of the ‘Glenn Gould’ type, which works naturally without doing anything, whereas we have a light catalog”, pointed out to theDuty Didier Martin, from Outhere, during the acquisition of Analekta.
We conclude that Universal’s takeover of Hyperion and, tomorrow, in an even clearer form, of Harmonia Mundi/PIAS is part of a race for the volume of playable music. For Yves Riesel, “those who think that the majors are still mainly publishers today are getting in the way. The majors are pipes. In this sense, the Hyperion transaction could have been made by Universal’s accountant without even referring to his boss, and the boss would have been necessarily happy. That pulls the rug out from under anyone who was thinking of some artistic strategy.
old fashioned editor
“Hyperion was working the old fashioned way on a business model from 20 years ago. He considered himself a publisher, paid for his productions, his costs, his translations, his people”, says Yves Riesel, who notes that the majority of publishers today “spend their time publishing licenses”.
Yves Riesel notes the number of appointments missed by independents over the past 20 years, including, a few years ago, downloading. “They followed what the majors and the variety did so much that they didn’t realize that the download was a very good deal. Selling a disc for $9.99 is like printing money, because once the files are delivered to the platform, there is nothing more to do: no more manufacturing, no more stock… time, that would have been a big part of the solution. »
But we can not say that the sale of Hyperion is an acknowledgment of failure or the collapse of the model. The duty reviewed key data from accounts filed with the UK Companies Registry since 2014. Exercises are positive and cash has grown linearly by 50% in eight years, amounting in December 2022 to 3.6 million Canadian dollars.
It is therefore a healthy company, despite or thanks to its skepticism towards the streaming (Hyperion made it a point of honor to be absent from listening platforms), with a catalog of 2,300 titles available physically and many others for download, 40 years of history and a tidy cash flow that has been sold.
That said, the philosophically logical destination would have been a company like Naxos or Outhere, whose vocation is to manage a “pole” of independent publishers. “When I learned several months ago that Hyperion was for sale, I asked Simon Perry [directeur de l’entreprise] to send me the documentation. I was probing as to the interest of the label and/or catalog for Outhere, but I wanted to decide on parts. For us, size was not a deal breaker. What could have been, is the strategic cohabitation of artists and teams. But I never received anything from Simon, ”reveals Charles Adriaenssen, a comment that suggests that Hyperion went directly to other potential buyers.
Besides Outhere, another buyer could have been Naxos, but Yves Riesel believes that “Klaus Heymann, founder and president of Naxos, at 86, should have either found the money or put his own. Could he have put as many as Universal? he asks himself.
The remark on the age of the owner of Naxos, which is now the largest independent classic catalog to covet, raises the question of the uncertainty linked to the future of these companies in the wake of their transmission. We saw it with the sale of Harmonia Mundi, five years after the death of Bernard Coutaz. “I had absolutely not seen the scenario that neither the son nor the wife wanted to take over, and that Mrs. Éva Coutaz was ill at the time of the sale to PIAS”, concedes Yves Riesel.
Great adventures, such as that of BIS in Sweden — which, according to Mr. Riesel, is in the process of succeeding in transmission in an exemplary manner — were built in the 1970s and 1980s around business builders who are now elderly. “If a wave of consolidation were to follow, which is quite likely given the age of the protagonists, and if the majors invest, this would have a very negative effect on the creativity and diversity of productions”, worries Charles Adriaenssen .
This is perhaps what Yves Riesel evoked when speaking of the “death of the independents”. If there are endearing and lively ones left – Alpha, La Dolce Volta, Atma, Ricercar and a few others – it is disturbing to see such large symbols as Hyperion fall.
For Mr. Riesel, in the event of sudden big maneuvers, the next target could be Naxos “not so much Naxos the label, albeit possibly, but mostly Naxos of America, the world’s largest classical music digital distribution rights holder. »