THE GRAINGE AGENDA, RESTATED

Lucian Grainge took the floor Wednesday at the Code/Media conference in Dana Point, and the UMG ruler made his digital priorities abundantly clear.

“We want to accelerate paid subscription,” Grainge stated, not for the first time. “Ad-funded on-demand is not going to sustain the entire ecosystem of the creators as well as the investors. The whole conversation is obviously about digital music, digital delivery. Moving from ad-funded into premium paid subscription.

“But it’s quite shocking for us to be aware that in the second and third biggest markets in the world, after the United States [Japan and Germany], the bulk of the business is still physical CD.”, of course.

Grainge also talked about the deal UMG had just announced with premium short-form-video service Vessel, wherein selected UMG videos will get an exclusive window on the startup service before they show up on Vevo, YouTube or anywhere else. Vessel subscribers will pay $2.99 a month.

“Vessel represents the latest business model innovation for premium short-form content,” Grainge said. “Jason [co-founder/CEO Kilar] and his team recognize the substantial value of the music videos created by our world-class roster of artists and have built a platform that promises fans a first-rate experience while providing artists and labels new ways to increase the monetization of their creative work.”

Grainge then implied a degree of skepticism about the venture. “We’ll see how they’ll do,” he said. “But if we’re going to transition to premium subscription, it’s a great part of that journey.”

When asked about Apple, the 800-pound gorilla of digital music, Grainge was effusive in his assessment.

“They’ve done phenomenally well with music, and they ended up with an enormous share of the pie,” he said. “And they did phenomenally well with everything else they were able to do with it and around it. There’s always been an emotion in Apple around music and around content. You always felt that they had an emotional intelligence around talent. And that’s only going to get better.”