Beatport Ceases Payments To Music Labels
SFX, what is SFX? It is an live events conglomerate with the notable assets of ID&T and Beatport. Yes, that means it owns your favorite festivals, TomorrowWorld, Tomorrowland, Mysteryland and all the way to Life In Color. It is one of the biggest giants behind the scenes of the glamorous EDM industry at present day.
Beatport, the go-to site to purchase the newest EDM tracks, has frozen payments to certain labels as its parent company ‘SFX’ undergoes the process of “going private” – converting from a publicly traded company into a private entity. Accounting for 90% of digital income for certain labels, this delay in payments can potentially be damaging to the market stability.
The CEO of SFX Robert Sillerman is currently restructuring the company and buying the stocks at 3.07 dollars per share – given that he owns about 35% of the company right now, it will cost him approximately $774 million to completel the buyback. If he fails in completing such task, a sale of ‘SFC’ key assets, including Beatport, might become fair play.
Here is an official statement that SFX has released to its label partners:
Since inception over 10 years ago Beatport has paid almost $200,000,000 to its label partners. Beatport’s parent company, SFX, is currently involved in a ‘going private’ process that has trapped certain earned label payments. This process will be coming to an end in the next few weeks, at which time all payments will be able to be made. Beatport prides itself on being the broadest and original friend of the makers of electronic music and will clear this one time obstacle very shortly. In the meantime, feel free to contact your label manager with any questions. Thank you for your patience and continued support.
As you could imagine, people are not happy about this. Label owner Morgan Geist has spoke up and contested about this decision:
How will this play out and impact the EDM community? Stay tuned for more updates.