Aug. 01--Universal Music Group Chairman and Chief Executive Lucian Grainge is set to lead the world's largest record label for at least five more years as the industry's shift to digital streaming accelerates.
His new contract, announced Friday, keeps him with the company until 2020 as part of a five-year "development plan" for Universal Music, which is owned by French conglomerate Vivendi.
The label hopes to make more money from increasingly popular streaming services such as Spotify and the new Apple Music.
It's also looking to other businesses such as sponsorships as the more traditional methods of selling music continue to fade, as well as new markets such as India, China and countries in Africa.
Underscoring the shift, U.S. album sales fell 4% in the first half of 2015 compared with the same period last year, according to figures from Nielsen Music. Meanwhile the number of streams through Internet audio and video services soared more than 90%.
Grainge has led the 7,000-employee Universal Music since 2011.
In that time, he oversaw major deals including the purchase of EMI amid close regulatory scrutiny, a partnership with Jay Z's Roc Nation and the sale of its 14% stake in Beats to Apple. The company also underwent a substantial reorganization during his tenure.
Over the last four years Universal Music's total annual sales have increased just 2%, though revenue from digital music has grown by 58% in that time. Digital represented about 36% of Universal's sales in 2014.
"We have literally thousands of people around the world whose responsibility, task, joy, is to get as much music to as many fans in as many ways as possible," Grainge said in a 2014 profile in the Los Angeles Times. "Music has been around a thousand years, and it's going to be around for another thousand years. Human beings like rhythm. That's why there is a future. It's never going away."
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