BTS Confirms Deal With Universal Music Group — Here’s What You Need To Know

Here’s what it all means.

The world’s top-selling recording act has entered a distribution and marketing deal with the world’s largest music company. BTS‘s agency recently confirmed reports that the group has signed with Universal Music Group (UMG), ending their deal with Sony Music‘s Columbia Records and The Orchard that began in 2018.

V, Jungkook, RM, Jin, Suga, Jimin, and J-Hope of BTS> | @bts_bighit/Twitter

According to reports, BTS operated on a month-by-month contract with Columbia and simply needed to notify them of intent to terminate their contract. The partnership with UMG is expected to begin on December 1, 2021.

Reports stated that a poor relationship with Columbia (with BTS and HYBE founder Bang Si Hyuk opposite Columbia CEO Ron Perry) and a close friendship with UMG CEO Lucian Grainge have pushed BTS to exit their previous partnership in favor of a new one. The original report from Billboard read that BTS and Bang had never met Perry in person despite the Columbia CEO frequently flying out to South Korea to work on BTS’s music, notably co-producing and co-writing “Butter.”

BTS with former Bighit CEO Bang Si Hyuk. | TIME

Prior to BTS’s departure from Columbia Records, the company handled the group’s North American distribution. Historically, distribution came in the form of physical records; the distributor would get the artist’s vinyl or CD to the store where listeners would then purchase it. In today’s digital age, it consists of uploading artists’ music to streaming services such as Spotify and determining distribution strategies like playlisting. Essentially, distributors are responsible for getting the music out to the public.

Logo for Columbia Records. | Columbia Records

While Columbia handled BTS’s North American distribution, UMG handled their distribution in other territories such as Japan. Their new partnership means that UMG will now be in charge of a large portion of BTS’s global music distribution.

The group’s new deal will see UMG’s INgrooves handling distribution and Interscope‘s Geffen Records handling marketing as well as providing creative support. Distribution deals are a cornerstone of the music industry as they allow artists to expand their audience and increase their presence among the public.

Logo for Geffen Records. | Geffen Records

UMG stands tall among other music companies and is valued at over $50 billion dollars. According to data from Digital Music News, the “big three” of the music industry (UMG, Sony, and Warner Music Group) make up 69% of the industry’s market share. Within that, UMG dominates with 32%, rivaled only by thousands of independent labels who collectively make up 31%.

UMG and HYBE first announced their strategic partnership in February 2021. This consisted of plans to introduce a new global artist project and examine the opportunities for communication between artists and fans through community platforms such as Weverse. The two also announced a collaboration with YG Entertainment (whose group BLACKPINK has been signed to Interscope since 2018) to launch a new online live-streaming platform.

Logo for UMG. | Universal Music Group

The monumental deal between BTS and UMG adds to the increasing number of distribution deals between K-Pop artists and international labels as the genre grows in popularity. Other artists signed to UMG labels include fellow K-Pop groups BLACKPINK, NCT 127, and SEVENTEEN as well as American artists Taylor Swift, Justin Bieber, and Billie Eilish.

Logo for HYBE. | HYBE

Bighit Music released a statement on October 22, 2021, confirming the deal with UMG and addressing their departure from Sony.

We have decided to sign a new deal with Universal Music Group/Interscope regarding distribution and marketing in the United States and other regions.

It is our continued effort to expand the strategic partnership with them, announced last February.

While we greatly appreciate our time with Sony (Columbia/Orchard) and will forever be grateful for all they have done and will continue to do, we look forward to our new chapter in partnership with Universal.”

— Bighit Music

Source: MBW, Bloomberg and Digital Music News