UMG Central Europe's Frank Briegmann On Growing the Business, YouTube vs. GEMA, EMI/UMG Merger
UMGI

Appointed to the newly-created position of president Central Europe and Deutsche Grammophon, Universal Music Group International on Feb. 18, Frank Briegmann is responsible for overseeing the label’s operations in over a dozen European markets, including Austria, Switzerland, Hungary, the Czech Republic, Slovakia, Poland, Russia, Bulgaria, Romania and the Nordic Countries, Denmark, Finland, Norway and Sweden.
 
Based in Berlin, Briegmann was promoted Feb. 18 to the post of chairman and CEO of Universal Music Germany, having served as label president and CEO since 2004. In 2010, he was made president Universal Music Germany, Austria, Switzerland and Deutsche Grammophon. Prior to joining Universal, Briegmann held a succession of posts at Bertelsmann Music Group (BMG), where he quickly progressed through the ranks to become SVP international in 2002. In 2004, the Rietberg, Westphalia-born executive joined Universal Music Germany, where, at age 36, he became the youngest ever CEO in the history of major labels in Germany. Speaking exclusively to Billboard.biz, Briegmann outlines his vision for the future, the challenges ahead and why he hopes the ongoing dispute between YouTube and German collecting society GEMA will soon be resolved.
 
Billboard.biz: Congratulations on your appointment as President Central Europe and Deutsche Grammophon. What are your short-term and long-term ambitions in the role?
Frank Briegmann: The main ambition is for the company to become even stronger in finding and selling our artists from various countries all over the region. We have been, and will [continue to] successfully sell our Anglo-American repertoire within the region. But I think we need to understand that there [are] a lot of great local artists as well, and [we will] try and export them to other territories. Secondly, the digital markets in those countries are quite different from each other. Sweden is one of the markets that grew last year, mainly because of the strong growth of the streaming services. I think there is a lot we can learn from each other, and [we will] leverage this knowledge throughout other regions.
 
In many European markets, such as Germany and Austria, sales of non-English-language domestic artists and repertoire have steadily grown in recent years. Is this an area of increasing focus for Universal? And what is the knock-on effect for international artists in the region?
Anglo-American repertoire is just as important for us as the domestic repertoire -- a market and a company can only be healthy with both. In Germany, the domestic market share has seen a massive increase over the last [few] years. When I started [here] nine years ago, domestic artists' albums in the total market was below 40%. Now we see the domestic share slightly above 50%. In recent years, the interest and appreciation of local repertoire has increased considerably in Europe. The variety and accessibility of music from artists from all around the world is great for consumers. It’s all very quick. But if you really want to connect with your fans you need to work the market and be present. This means more effort for international artists. In Germany, interestingly, last year’s album market was dominated by domestic artists and the single market by international artists.
 
Max Hole, chairman and CEO of Universal Music Group International, recently said that, in order to grow, the industry must turn its focus to emerging, smaller markets. Do you share his belief and, if so, what European territories do you think hold the greatest potential returns?
Absolutely. I believe in growth. That said, the potential of Eastern European markets is probably bigger because it is driven by a growing middle class, improved legal certainty (with certain reservations) and events like Croatia’s approaching entry to the EU. Whereas, the physical market, especially in Eastern Europe, is very tough due to piracy. I think the digitalisation, especially in Eastern (but also Western) Europe provides huge further opportunities.
 
In 2011, Germany overtook the United Kingdom in IFPI’s world rankings to become the third largest music market globally. What, if any, lessons can other markets learn from the German music industry?
Unfortunately, Germany did not overtake the U.K. through growth, but thanks to a comparatively smaller decrease. The reasons could be the stability of the German economy, even in times of crisis, and German consumers’ preference for physical products. At the same time, we focused on the digital market and encouraged as many digital players as we could -- but we also dedicated a lot of resources to supporting all the physical retailers in the market. So I think that there are business reasons, but there are also consumer-mentality reasons for this development.
 
A key factor in the resilience of the German market has been the slower migration from physical to digital services, compared to other international territories. As that migration inevitably speeds up, how do you plan to prevent the slide in music sales that other markets have experienced? 
In my view, the most important steps to take are, firstly, the further expansion of digital services, with the main focus on product benefits and user-friendliness. At the end of the day, our legal services have to be more attractive than everybody else’s, including illegal ones. We are continuously working on that with our [digital] partners. Secondly, we have to take care of the physical market, especially premium products. In this particular area, I actually think that new growth is possible. And thirdly, we must fight for effective measures against music piracy, both nationally and internationally. Obviously, in the last couple of years we have put a lot of effort into getting the government to lobby on behalf of our industry. And we will keep on doing the same in those countries [that] I now take responsibility for. I haven’t had any of those discussions as yet, but we want to create conditions that enable growth for our artists.
 
A lot of press attention around the EMI/Universal merger has focused on its ramifications in the U.S. and U.K. What are the practical implications of the deal in Central Europe?
For now, I can only talk about the GSA (Germany, Switzerland, Austria), where we have a full integration of the EMI operation. And the practical impact is that we take on board the EMI operation and their artists, except Parlophone Label Group, and will revitalize the EMI labels and brands. In Germany we are going to move from Cologne to Berlin. I made the announcement at the end of last year that the larger parts of EMI that we do retain, which is everything except the Parlophone Label Group, will be moved over [from Cologne] to Berlin. There will be redundancies, yes, but these will largely affect the administration rather than the front line operations.
 
What are some of the main challenges and obstacles that you face in further growing Universal’s market share throughout Central Europe? 
A big challenge is still the issue of music piracy. We are at different stages of this process in each market. In Austria and Switzerland, for example, we still have no legal basis for our fight. In Germany, at least we can use civil litigation against copyright infringers. But it remains our main objective to convince politicians of the need for effective methods. That will be the way to protect the economic basis for our investment in artists, which we are fully committed to.
 
The long-running dispute between German collecting society GEMA and Google, YouTube's parent company, over licensing rates has dragged on for several years now. Do you hope a resolution is on the horizon? 
Absolutely. This has been going on for a long time. I believe it’s good for both sides to resolve this issue and [transition] YouTube into a legitimate service, where it can at least show [music] videos and GEMA can make money [from] them. I personally think the situation has been going on for far too long.

Questions? Comments? Let us know: @billboardbiz

Print