In today's CMU Daily: Dodgy distributor 3tone insists that new investment is just around the corner, but now it emerges that companies associated with its backer Carlton James are linked to a major fraud investigation

One Liners: Warner x Tips; Deezer CEO departs; Ticketmaster and IDOL appointments; Spotify audiobooks tier; Co-op Live licence; UK Eurovision entry; new music from Pharrell x Miley, Liam Payne, Martin Garrix, Griff, Cage The Elephant, Twenty One Pilots, Sevdaliza, Jordy, Mui Zyu, Joe & The Shitboys, and Hamferð

Also today: Universal Music has sent another memo to artists and songwriters telling them that not having their music on TikTok is going to be good for them in the long run, a new report on sexual harassment and abuse in the music industry says the sector has “followed a playbook” for decades that “shields predators”, and the NTIA says that consumer demand for socialising is booming but inflation means the night-time economy is still losing money

Plus: How Annie Lennox nixed Microsoft Bing’s hopes to be Apple’s favourite search engine

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Dodgy distributor 3tone linked to company being investigated by Serious Fraud Office

Dean Roberts of 3tone claims he’s “secured a direct line of communication” with the UK’s Association Of Independent Music to discuss the future direction and focus of the dodgy distributor - and is now misrepresenting that call to further delay paying what he owes to artists, labels and former employees that he’s screwed over.

In an email shown to CMU, the 3tone boss uses the call with AIM to deflect demands for payment, and goes on to say that AIM COO Gee Davy will be able to give an “honest opinion on 3tone Music’s directional focus moving forward”.

When CMU contacted AIM to ask what that “honest opinion” might be, Davy said, “AIM has been horrified by the reports of the situation at 3tone. We are following up on a number of points provided by CMU in the interests of supporting members of the independent music community caught up in this situation”. She went on to say “the email reported here by CMU was not approved by AIM and should not be taken to suggest any type of endorsement”.

Sources external to AIM say that one option Dean Roberts is keen to pursue is that 3tone should be allowed to “trade its way out” of the current situation, and he is - yet again - hinting that a “new finance agreement” is just days away. Sources say he’s implied that this is the “only way” that anyone will get paid.

In September, when CMU began its investigation into 3tone, Roberts repeatedly promised customers - and told CMU - that money from investors was on the way “any day”, but that events outside his control were holding things up. One of those events was - he claimed - that the attacks perpetrated at the Supernova music festival, and Israel’s subsequent attacks on Gaza, had held up money from “Israeli investors”.

The email sent to 3tone customers most recently also says that the company’s “financial partners” have been subject to events that were “out of their control”.

Unusually for Roberts, this time, this might contain a grain of truth. However, that truth may be worse than the previous fictional “things are held up” excuses 3tone has made in the past.

As CMU previously revealed, 3tone’s “financial partner” is ‘private investment group’ Carlton James, and it was the “Carlton James Diversified Alpha Fund” that invested money into 3tone under “secured finance agreements”. In an all hands meeting with staff in March 2023, Roberts said that 3tone had received “£3.5 million” over a three year period from Carlton James. CMU has been shown documents that appear to show around £1 million in payments from Carlton James to 3tone between February 2019 and December 2022.

While those funds came via the “Carlton James Diversified Alpha Fund” what is much less clear is the origin of the money going through that fund.

Our original reporting highlighted the complex structure of companies in the UK, British Virgin Islands, Cayman Islands and other jurisdictions that Carlton James uses to operate. One of those companies is the “Navigator Global Fund Management Platform SPC” - or “Navigator Fund” - which was formerly called “Carlton James Mollitium Offshore Fund Manager Platform SPC”.

In March 2022, a major financial scandal erupted in the UK after funeral plan provider Safe Hands collapsed into administration, leaving more than 46,000 people who had pre-paid for funerals out of pocket.

Kilimanjaro Live // Event Coordinator (London Hybrid)

The Ivors Academy // Temp Event Assistant (London/Hybrid)

Union Chapel // Visitor Engagement Coordinator (London)

ICE // System Accountant - NetSuite Implementation (London)

Horizon is CMU's new weekly newsletter - published each Friday - that brings you a hand-picked selection of early-stage career opportunities from across the music industry.

Whether you're looking for your first job in music or you're ready to take a step up, Horizon is here to help you find your dream job faster.

👉 Click through to see the current selection.

ONE LINERS

Olly Alexander, Deezer, Pharrell Williams x Miley Cyrus + more

DEALS

Warner Music has expanded its worldwide distribution deal with Indian record label Tips Music. “Over the last few years, Warner Music has enjoyed access to Tips Music’s amazing Hindi catalogue and been able to offer unique sales support, which has seen us successfully promote its Bollywood soundtracks to a global audience”, says Alfonso Perez-Soto, Warner Music’s President Of Emerging Markets. “We’re now able to tap into even more incredible music, and our teams around the world will be looking to connect Tips Music’s artists and songs with more international fans”.

APPOINTMENTS

Deezer has announced that CEO Jeronimo Folgueira is leaving the company, just as it posts its best ever financial results and increased subscriber growth. ”I am extremely proud of what we have achieved over the last three years”, he says. “Not only the strong 2023 financial results announced today and our listing on Euronext Paris, but also the adoption of our new brand identity, our evolution to an experience service platform, and the introduction of the new artist centric payment system. It has been an honour to serve Deezer as CEO and I remain fully committed to supporting the company through the management transition”.

Ticketmaster UK has hired Danny Hannaford as Senior Director of Client Product Solutions. He joins from Ticketek. “Joining Ticketmaster represents an incredible opportunity to contribute to the forefront of live entertainment and ticketing innovation”, he says. “I look forward to the journey ahead and am excited to be a part of this dynamic team”.

IDOL has hired Mandy Freebairn as US Label & Project Manager, joining from Omnian Music Group. At the same time, the company has re-signed its deals with US labels Le Plan Recordings and Caravan Palace, and signed a new one with Old Soul Music.

LIVE BUSINESS

Mancheter’s new Co-op Live arena has had its premises licence approved. Good news, given how many shows it’s already announced. "We are delighted that Manchester City Council’s Licensing Sub-Committee has voted to approve our application for a premises licence”, says General Manager Gary Roden. “Manchester deserves the best, and with the opening of Co-op Live just weeks away we’re excited to begin this new chapter in the city’s enviable cultural story”.

RELEASES

Olly Alexander has released his UK Eurovision entry, ‘Dizzy’. Is it a winner though? It feels like a track someone would write as a quick example of what a Eurovision song sounds like, before stopping it and saying, “But obviously not that”. We’ll see though. We’ll see.

Pharrell Williams and Miley Cyrus have got together for new single ‘Doctor (Work It Out)’.

Liam Payne is back with new solo single ‘Teardrops’. More music is due in the coming months.

Martin Garrix has released new single ‘Biochemical’ with Seth Hills.

Griff has released new single ‘Miss Me Too’.

Cage The Elephant have released new single ‘Out Loud’, and announced that they will release their sixth album ‘Neon Pill’ on 17 May.

Twenty One Pilots will release new album ‘Clancy’ on 17 May. Out now is new single ‘Overcompensate’.

Sevdaliza has released new single ‘Good Torture’ featuring Elyanna.

Jordy has released new single ‘Wonderkid’, featuring JME.

Mui Zyu has released new single ‘The Mould’, taken from her second album ‘Nothing Or Something To Die For’, which is out on 24 May.

Joe & The Shitboys are back with new single ‘Mr Nobody’.

Hamferð have released new single ‘Hvølja’. Their new album ‘Men Guðs Hond Er Sterk’ is out on 22 Mar.

Universal Music sends another memo to songwriters about its big TikTok bust-up

Universal Music has published another statement addressing its artists and songwriters about the big bust up with TikTok. Acknowledging the disruption caused for many of those artists and writers by its licensing stand-off with the video-sharing platform, it insists that it is acting in the best interests of the wider music community. "We have a long history of successfully fighting for our songwriters and will continue to do so", it declares.

The new statement comes as the second key deadline passed after TikTok failed to agree a new licensing deal with the biggest music rights company in the world.

Failure to agree a new licensing deal meant that TikTok had to remove all the recordings released by Universal labels by the end of January, and then all the songs published and licensed by Universal Music Publishing by the end of February. Removing the songs means the stand-off now affects artists and labels that have no direct connection with Universal, if they have released recordings of songs in which the major has even a small stake.

"TikTok is removing Universal Music Publishing songs because there is no licence in place", the new note to songwriters begins. "As you may have heard, to date, they have not agreed to recognise the fair value of your songs, which so many other digital partners around the world have done".

For those artists signed to Universal that use TikTok as a crucial fan engagement tool, the licensing stand-off is particularly problematic, restricting what those artists can do on the platform.

Many of those artists may share the concerns about TikTok under-paying for music, but at the same time are annoyed that full use of such an important platform has been cut off so abruptly. They also probably don't share the confidence of Universal CEO Lucian Grainge and CFO Boyd Muir on their investor call earlier this week that music-using creators and music fans on TikTok will just move over to Instagram and YouTube.

"We understand the disruption is difficult for some of you and your careers", the new letter continues, "and we are sensitive to how this may affect you around the world. We recognise that this might be uncomfortable at the moment”.

“But it is critical for the sustained future value, safety and health of the entire music ecosystem, including all music fans” it adds. “As always, Universal Music Publishing will only support partners that value songwriters, artists and your songs. We have a long history of successfully fighting for our songwriters and will continue to do so. You should expect nothing less from us".

In its original open letter to artists and writers announcing that licensing talks with TikTok had collapsed, Universal stressed that its bust up wasn't just about money.

TikTok and its owner Bytedance, it said, had failed to respond to its concerns over AI and online safety. It dwells on the AI point in more detail in the new letter, citing media reports about TikTok's plan to encourage video creators to increasingly make use of AI-generated recordings where it doesn't have to pay any royalties to the music industry.

"TikTok's intentions with respect to AI are increasingly apparent", the new letter says. "While refusing to respond to our concerns about AI depriving songwriters from fair compensation, or provide assurances that they will not train their AI models on your songs, recent media reports reveal 'TikTok and ByteDance leaders have long wanted to move the app beyond music' [and] 'TikTok has an incentive to push the use of these AI recordings rather than the copyrighted and licensed recordings'. Every indication is that they simply do not value your music".

Seeking to back up that statement, the Universal letter links to two articles, one behind a paywall on The Information’s website and the other a Bloomberg report which mainly speculates about TikTok’s motivations. In that article, it is University Of Washington School law professor Peter Nicolas who says, “As long as TikTok doesn’t need to pay or needs to pay less for them, then TikTok has an incentive to push the use of these AI recordings rather than the copyrighted and label-licensed recordings”.

It’s no secret that Bytedance has been investing in generative AI for years, although it’s not clear if Universal has specific knowledge about TikTok’s strategy in that domain which backs up the claim that its “intentions with respect to AI are increasingly apparent". Certainly it hasn’t shared any of that knowledge if it does have it, instead expecting songwriters to take its position on the situation on mere trust.

Universal-signed artists and writers will likely share the major’s concerns about TikTok not providing assurances that it isn’t training its AI models with their music. Though some might also note that, so far, Universal itself hasn’t provided much assurance that it will get specific consent from artists and writers before allowing their music to be used in AI training, if and when there are platforms willing to pay the major music company for the privilege.

We await to see where this dispute goes next - and to what extent Universal Music can keep its artists and songwriters on side.

New report outlines “the scathing history” of sexual abuse and cover ups in the music industry

The music industry has “followed a playbook” for decades that “shields predators” working in the sector from allegations of sexual harassment and assault, according to a new report published by four US-based not-for-profit organisations.

Called 'Sound Off', the report "chronicles the scathing history and financial impact of decades of sexual abuse and cover ups in the music industry, from the 1950s to the present". It is part of new campaign which calls on music companies to commit to a number of measures to help stop sexual harassment and assault within the industry.

"For decades, the music industry has condoned, perpetuated and often marketed a culture of sexual abuse of women and underage girls", the report begins. "Thousands of artists, executives and shareholders have made billions of dollars in profit – while engaging in and/or covering up criminal sexual behaviour".

Citing media reports, and other studies and investigations, into sexual harassment and assault in the music business, it observes, "the music industry has followed a playbook for dealing with sexual abuse that shields predators, including musicians, producers, managers, executives, and other behind-the-scenes players, from liability".

Among the campaign demands are a call for a commitment from music companies to stop using non-disclosure agreements to silence victims; publication of the names of artists and executives credibly accused of sexual assault and harassment; and the establishment of a new independent organisation - funded by MusiCares - called the Make The Music Industry Safe Division.

The main part of 'Sound Off' summarises allegations of sexual harassment and assault that have been made against 32 specific artists and 27 people working behind the scenes in the industry, including in the studio and for music companies. That includes Ryan Adams, Nick Carter, Diplo, Elvis Presley, Jerry Lee Lewis, R Kelly, Marilyn Manson, Sean Combs, Ahmet Ertegun, Russell Simmons, LA Reid, Kenny McPherson and Neil Portnow.

It concedes that "while there are lawsuits identifying some of these alleged perpetrators, many of these allegations have not been fully evaluated in a civil court. Accordingly, the allegations should be considered just allegations and should not be considered proven or substantiated in a court of law. All individuals should be considered innocent until proven guilty".

However, together the allegations made against all these artists and executives demonstrate the extent of the problem, and the corporate culture that tolerates and exacerbates that problem.

"This report sets out to detail the prevalence of sexual abuse and misconduct in the music industry and how its very culture opens the door to such behaviours", it says. "Additionally, this report details how major record companies ignored allegations, silenced victims and even enabled such abuse".

The report has been put together by The Representation Project, Lift Our Voices, The Punk Rock Therapist and the Female Composer Safety League. There is more information about the campaign and a link to download the report here.

Setlist Podcast: The music business in 2024

In this special edition of Setlist, Andy Malt and Chris Cooke dive into topics covered in CMU's latest series of masterclasses, which look at the music business in 2024. We talk through key trends in streaming, copyright, AI and more.

🎧 Click here to listen - or search for 'Setlist' wherever you normally listen

Consumers keen to socialise but night-time economy still struggling, NTIA annual report finds

Night time industries remain a significant employer in and contributor to the UK economy. However, despite increased consumer spending over the last three years, when adjusted for inflation, turnover is almost stagnant, putting businesses at risk.

These are some of the key findings of the Night Time Industries Association’s third annual ‘Night Time Economy Report’, which crunches data from 2022.

Overall, consumer spending in 2022 was £136.5 billion, up from £95.7 billion in the COVID-19 impacted 2021, but also an increase on the £121.3 billion generated in 2019, the year before the pandemic hit. Which is an initial indication that there is cause for celebration. Indeed, the NTIA notes this is an indication that people are keen to socialise post-pandemic.

However, it also notes, “large rises in inflation have essentially wiped out any turnover gain” and, as a result, the night-time economy “has been in a period of financial stasis”. In fact, it reckons, when factoring in the impact of the pandemic and inflation, the sector has actually lost £95 billion over this period.

Figures such as these are a tool for lobbying the government, highlighting the importance of the sector to the wider economy and the need to ensure its stability. A key figure for this is ‘gross value added’, which is the government’s measure of a sector’s overall performance. The NTIA says that this was £43.5 billion in 2022, which is down from £47.5 billion in 2019.

This, the report says, shows that while there were outward signs of recovery in the night time economy in 2022, “in terms of its underlying fundamentals - eg its productivity and profitably - it is a sector that remains hobbled”.

Introducing the report, NTIA CEO Michael Kill says that it is clear that the night-time economy has “weathered storms of uncertainty” and that the rise in consumer spending indicates “a pent-up demand for social engagement”. However, he adds, “underlying challenges persist, threatening the sector's sustainability”.

“We must heed the clarion call for action”, he says. “The challenges posed by the pandemic and the looming spectre of economic uncertainty demand concerted efforts to safeguard the [night-time economy’s] future. As we navigate the complexities ahead, let this report serve as a compass, guiding our collective endeavours to ensure a thriving, resilient night-time economy for generations to come”.

Find out more and download the full report here.

And Finally! Apple brushed off Bing for its lack of Annie Lennox knowledge

You know the multiple times a day when you half recall a TV theme tune from your childhood, or want to know how old a celebrity is, or you suddenly decide you need to know how to whittle? What do you do? You whip out your phone and search. And which search engine delivers you the results in the 704th tab you’ve opened in your browser may well have been decided by one person - Annie Lennox.

Now, in this familiar but imagined scenario, you are on an Apple device. You also use Apple’s own Safari browser. And you have not - this is important - you have not changed the default search engine. You haven’t even thought about it. Why would you? Everything is just fine. No need to change anything at all. It’s a beautiful and simple system that is thanks, once again, to former Eurythmics vocalist Annie Lennox.

Read this week's And Finally! in full...