Universal Music vows it’s not same old song
Jeffrey Goldfarb

LONDON—Universal Music, the world’s largest record company, said on Thursday it is transforming itself into a broader entertainment company that derives more revenue from untapped sources like advertising and apparel. “New opportunities will emerge to monazite our assets and create new revenue streams,” senior executives told about 40 analysts and investors in London. Slides from the presentation were posted on the company’s Web site.
Record sales have been hammered for five years as listeners illegally downloaded music for free while the industry scrambled to revamp its business model. Sales have begun to level off as mobile phone ringtones, legal downloading and subscriptions offset the decline in CD sales. Universal Music said those businesses have swelled to 100 million euros in the first-half of 2005 from virtually nothing two years ago.
Record companies continue to pursue new untested ventures, like Universal’s deal earlier this week making its music available to mobile phone maker Motorola for a new wireless service, iRadio. Total first-half revenue at Vivendi-owned Universal Music gained 9 percent from the year-ago period to 2.2 billion euros as profits nearly tripled to 142 million.