Getting that musical cheese [Catherine Falls Commercial/Moment via GettyImages]
Hey Snackers,
After galavanting through space, Jeff Bezos has returned to Mother Earth: the Amazon founder pledged $1B to conserve 30% of the world’s land and sea by 2030.
Stocks ticked down for the day, continuing Monday’s sell-off after China’s Evergrande drama spooked global markets.
Sound on… Universal Music Group’s stock soared ~40% yesterday after dropping on an Amsterdam stock exchange, giving the world’s largest record label a $53B market cap. UMG represents stars like Taylor Swift, Justin Bieber, Billie Eilish and The Beatles. Now, it’s benefiting from the streaming revival of the music industry.
YouTube to MP3 download… The rise of streamers like Spotify and Apple reversed the music industry’s 15-year, LimeWire-powered decline. Since 2016, record labels’ sales have increased every year. Last year, streaming accounted for 83% of $12B total US music sales. But the “Big 3” record labels — Universal, Sony, and Warner — were privately owned until recently.
The digital economy needs a soundtrack… and TikTok, Peloton, and Fortnite-maker Epic Games are paying big bucks for the best beats. The opportunity to supply in-app songs is so huge: already, 10% of the total $22B in global streaming sales last year came from partnerships with popular apps. UMG already partners with Spotify, Apple, Facebook, Snap, TikTok, and video-sharing app Triller. Looking ahead, its CEO expects billions in future deals with makers of smart speakers, connected cars, and social apps.
The Netflix of cars... What Volkswagen's going for. This month, the car giant launched an electric car subscription service in Germany to accelerate its creatively-named “Business Model 2.0.” Volkswagen's goal: transform from a car manufacturer to a "mobility services provider."
Flexible like pandemic leggings... A typical car lease locks you in for two years. VW's subscription is flexible, with a three month minimum. This week, VW also showed its commitment to low-commitment mobility by filing an offer to buy European rental car giant Europcar. Europcar's 350K vehicles at airports and train stations could support the expansion of VW's subscription footprint.
The new generation is "low commitment"... That requires high-flexibility biz models. Even pre-pandemic, Millennials were moving more often than previous generations. During the pandemic, people moved from cities to suburbs and Airbnbs, and from offices to "work-from-anywhere" locales. 70% of US companies will continue offering remote or flexible work options. And over a third of Gen Z and Millennial workers are looking for new jobs. When you don't know where you’ll be in two weeks, long-term commitments are daunting. Now, more car manufacturers might adopt flexible subscription models.
Authors of this Snacks own shares of: Apple, Amazon, Spotify, Snap, Uber, Moderna
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