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What Does Private Equity Mean for the Music Business Long-Term?

Private equity in the music business will change the industry - but how? Here are some of the ways the business could actually benefit.

The reason private equity has such a bad reputation is that it usually buys assets with considerable leverage and holds them for a limited amount of time, which can often result in layoffs at companies in which they invest. Music copyrights generate steady cash the way mortgages once did, but while individual investments can rise or fall, it’s harder to imagine that a financial squeeze would lead to a selling frenzy that would send prices downward across the board. So far, on-demand streaming has proved pandemic-proof, and it seems recession-proof, so the only danger would be a collapse of the copyright system — and it’s hard to imagine how that would happen, especially now that the music business survived illegal file-sharing.

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