On… Elliot Grainge, major labels, megastars, and a new era at Atlantic Music Group

MBW Reacts is a series of analytical commentaries from Music Business Worldwide written in response to major recent entertainment events or news stories. Only MBW+ subscribers have unlimited access to these articles. The below article originally appeared within the latest MBW+ Monthly Review email, issued exclusively to MBW+ subscribers.

“Great minds discuss ideas; average minds discuss events; small minds discuss people.”

This slice of wisdom, generally attributed to Eleanor Roosevelt, is one of my all-time favorite quotes.

It’s pithy, it’s powerful, it’s correct. It’s a credo to live by, and I dare say it runs through the veins of MBW.

Now for a magic trick!

Witness my incredible shrinking mind in 3-2-1…

Okay: let’s talk about Elliot Grainge. Everyone Else Is Doing It, So Why Can’t We…

… is just one classic record from the 1990s that’s older than Grainge Jr., who’s yet to turn 31. He’s also younger than Doggystyle and Boom! Shake The Room.

Grainge’s youth is clearly no obstacle to the faith put in him by Robert Kyncl and WMG’s board, who announced the other week that he’ll become CEO of Atlantic Music Group in October.

A 30-year-old boss of AMG dramatically reduces the vintage of US major label heads. Grainge is half the age of some of his competitors.

There’s been endless chatter among bizniks about Grainge’s sudden ascent within the WMG hierarchy, but, summoning the spirit of Eleanor Roosevelt, I struggle to find much of it meaningful.

• Yes, there’s a nepo-baby discussion to be had. Then again, Grainge has bona fides: at the time WMG invested in Grainge’s 10K Projects in September 2023, his independent label had racked up over 30 platinum-certified hits – from artists like XXXTentacion, Ice Spice, Iann Dior, and Trippie Redd. 10K has since delivered successes at WMG like Artemas (current Spotify monthly listeners: 33.2 million) and Forrest Frank (5.9m);
• Yes, there’s also a discussion to be had about the combined market power of Grainges Jr. and Sr. Then again, Atlantic Music Group has a domestic market share in the United States of around 7-8% (of all music); across the entire globe, AMG’s market share will be significantly smaller. (A reminder for US-fixated readers: India is on course to overtake the United States as the world’s biggest music streaming market by volume in the next 12 months);
• Yes, as Robert Kyncl recently stated, outgoing Atlantic CEO/Chairman Julie Greenwald leaves “big shoes to fill”, and Warner was duty-bound to ransack the industry’s very best to succeed her. But precisely which other possible candidates have (a) registered as many multi-genre independent successes these past few years as Grainge and (b) would also be open to a label CEO job at WMG? (That ‘multi-genre successes’ bit is important: execs who’ve thrived in a US frontline landscape dominated by hip-hop over the past decade now see that genre’s market share shrinking as country and Latin music ascend. According to Luminate, ‘hip-hop/R&B’ claimed a 25.8% share of on-demand audio US streams in H1 2024; back in H1 2018, that figure was as high as 37.5%.)

So what does interest me about Grainge?

How he goes about tackling a gigantic question: What is the primary purpose of a US frontline major label in 2024?

I’m not being facetious. Stock answers to that question down the years have typically included: ‘To have massive hits, dummy’ and ‘To break global megastars, dummy’.

But it’s just not that simple anymore… dummy.

For one thing, the definition of a ‘hit’ keeps on getting muddier, exacerbated by labels’ ceaseless obsession with short-term markers of success (aka: weekly charts).

Food for thought: Luke Combs is a superstar. He sells out stadiums, is one of Sony Music‘s biggest global money-makers, and even has his own British tribute act (real name Liam).

The RIAA just announced that two of Combs’ songs (When It Rains It Pours and Hurricane) have surpassed Diamond status in the US.

Yet neither of these tracks ever got higher than No.30 on the Billboard Hot 100.

So are they ‘hits’ or not?

Meanwhile, an increasing number of new artists are apparently having ‘hits’. Spotify announced last month that 79 acts charted in its Global Top 50 chart for the first time in H1 2024 – more than the equivalent period in 2023 (63), 2022 (65), 2021 (54), and 2020 (41).

Bloomberg suggests these numbers tell us that ‘new pop stars are breaking out for the first time in years’.

But they also might tell us that, driven by streaming, TikTok, and all that jazz, consumer attention is flitting between more new artists than ever before – starving emerging acts of the sustained public attention they need to become truly remembered.

Streaming’s disaggregation of listening plus the rise of ‘glocalization’ (local music gaining popularity around the world) are leaving the winner-takes-all megastar an endangered species.

Due to all of this, could we see the strategy of majors like Atlantic Music Group now tip further towards breaking a higher frequency of ephemeral streaming stars – and further away from ‘pulling every lever’ to birth enduring cultural superstars?

That outcome might be a statistical inevitability. In 2022 Warner Music Group confirmed that its five biggest superstar acts contributed just 5% of its recorded music revenues. A decade prior, that number was at 15%.

The fact that Meta just axed premium music videos from Facebook – implying that big-budget promos for superstar artists are a worthless relic of your uncle’s music biz – only adds to this narrative.

The risk of the ‘more stars, fewer superstars’ strategy at major labels, of course, is that it gifts enterprising independents (see: EMPIRE, Pulse/Concord, Big Loud, Believe, Beggars Group etc.) a better chance of competing.

This is something Elliot Grainge and 10K Projects know very well.

In an interview last year, Grainge said that 10K Projects could run rings around its larger competition because, to him, major labels were “a conveyor belt with 100 other priorities” and “mediocre-at-best product management departments”.

Now, as Atlantic Music Group CEO, Grainge will operate that conveyor belt and run those departments.

One wonders whether, at the top of his list of priorities, he’s determined to develop and break abiding global megastars – or if he sees such an aspiration as yesterday’s game.Music Business Worldwide