Universal Music Group just became the first of the three music majors to open standalone offices in Israel and Morocco, making the announcement early Tuesday morning.
UMG’s EVP of market development Adam Granite, who’s eagerly awaiting a change of scenery, would have been in Tel Aviv for the announcement — if it weren’t for coronavirus-related safety procedures. “I’m normally on a plane all the time, so to be this stuck in one place for this long is very difficult,” Granite, who’s typically based in London due to the convenience of being able to talk to Asia in the morning and Los Angeles in the afternoon, tells Rolling Stone.
The expansions into the Middle East and North Africa mean that UMG can offer A&R services, commercial partnerships, and global operations for local artists in these markets.
Granite says that Israel had been one of the most-developed markets in the world where UMG didn’t have an office. “If you look at it on a GDP basis, from an infrastructure standpoint, and all the things that kind of tick boxes when it comes to where we’re looking to have operations — Israel was definitely a standout,” he says. He notes the high growth of streaming in the country and the tech component. “There’s a lot of amazing innovation there in the tech space. Us also having a better finger on the pulse for broader partners in the music space there made sense,” he says.
UMG’s decision to expand to Morocco was specifically A&R-based. Most Middle East divisions, including UMG’s, are run from Dubai. “Dubai to Morocco is a really long flight,” says Granite. “I think it’s about nine hours, so it’s very hard to stay connected to the local artist community that far away. We’ve been looking at it for a while. Also, Morocco positions us well to take advantage of not just Arabic repertoire for the Middle East, but also artists and repertoire that can easily go into France — via talent we find in Morocco, but also Algeria and some other countries nearby. We felt, from a creative standpoint, that it’s a great place to set up and help find some domestic and regional talent.”
While it’s common for major music companies to stake a claim in far-flung territories, putting down offices is different to striking distribution deals. “We often see some of our competitors announce that they’re doing some ‘expansion’ to a market, but when you read between the lines, it’s actually just a license deal and they don’t have anyone on the ground,” Granite says.
Both of the newest offices have been in the works for at least a year. Granite says that, when his team goes into a new market, they want to be sure they’re doing it in the right way — a way that resonates locally. “You need to have people on the ground who speak the language, who are part of the culture, who local artists can identify with,” he says. “I think it’s very hard to tell the local story in a natural way from far away.” (In other words: When you’re pitching to Spotify’s New Music Friday playlist in Israel, it helps to be in Israel.)
But he stresses that leaders must be business executives as well. That’s why UMG tapped Yoram Mokady, previously an executive at Israeli cable provider HOT Telecommunications, to run its new Tel Aviv office, and local business development executive Serena Safieddine to lead its Casablanca office.
Granite nods to streaming’s borderlessness for a motivating factor of UMG’s global expansion. (It put down new roots in Vietnam a few months ago as well.) “If you were to say 10 years ago that a song in Spanish would be Number One in the U.K. everyone would say, ‘That’s impossible. That’s never going to happen. Capital will never play it,'” he says. “But with streaming, a song like ‘Despacito’ can find an audience here. We see things traveling around the world in ways that have otherwise been unimaginable, because the consumer now has significantly more choice in what they want to listen to. It’s magical.”
Asked if more expansions can be expected down the line, Granite says: “There are definitely a few more on our horizon, but none that I can mention at this point.” He adds: “We’re the largest music company in the world, and we have operations in over 60 countries — and we’re going to continue to look for new markets that can tick those boxes for us.”