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Vinyl Records Take Licensing for Another Spin image

Vinyl Records Take Licensing for Another Spin

Vinyl records are turning up the volume on licensing, mirroring the sharp rise in the category’s overall business.

Once largely discarded to close-out bins, vinyl records’ return to relevance has been building for several years. The U.S. reported $1 billion in sales in 2021, the biggest year for vinyl since 1986, according to the Recording Industry Association of America.

That growth marked a 61% year-over-year increase in revenue, though there have been signs that the vinyl business could be slowing—sales were up just 1% at 19.1 million units in the first half ended in June.

While it’s difficult to determine how much of the vinyl record business involves licensed properties, there have been signs of a renewed interest in recent months. For example, Konami Cross Media NY licensed supplier Ship to Shore Media to release limited edition vinyl LP soundtracks for gaming properties Bomberman and Contra. The Bomberman vinyl contains the original Nintendo Entertainment System soundtracks for both Bomberman and Bomberman II, which were released by developer Hudson Soft in 1983 and 1994, respectively. The vinyl also features new artwork by Japanese artist Maddie Copp.

Funko, meanwhile, acquired Mondo. In addition to licensed posters and collectibles, Mondo also operates Death Waltz Recording Co., a business Funko plans to expand, CEO Andrew Perlmutter said. The label’s recent releases through the online Mondo Shop include original soundtracks for Amazon series Lord of the Rings: The Rings of Power and E.T. The Extra-Terrestrial. The latter is a 180-gram version that is significantly heavier and thicker than the standard 12-inch, 120- and 140-gram versions and is considered to be an “audiophile grade.” There is also a three-record soundtrack for the Wizard of Oz due this fall.

“Everyone is definitely more open to vinyl these days,” said Aaron Hamel, co-founder of Ship to Shore Media. This is in part due to the demand from coveted Millennial and Gen Z customers, he said, as well as efforts to take advantage of the nostalgia trend that is showing staying power in a post-pandemic world.

Yet these increased vinyl sales have strained the pressing industry’s manufacturing capacity. Independent pressing plants—like Third Man Pressing in Detroit, founded by former White Stripes former front man Jack White—have been operating at maximum capacity. As a result, independent companies and artists have faced 10-month delays in production. White has pushed major record labels like Warner Music Group, Universal Music Group, and Sony Music to reopen vinyl pressing plants that were mothballed long ago to help ease the crunch.

The return of internal vinyl production at major record labels could hamper independent suppliers, many of whom also cater to the licensed vinyl business where production runs are typically less than 5,000 units. That compares to the 500,000 units produced for the launch of singer Adele’s 30 album last November, when vinyl and streamed versions were released at the same time.

“If the major labels resume production, it could be devastating for the independents because they would lose a significant part of their business,” Hamel said. “And suppliers like Ship to Shore would lose a source for smaller volume, limited edition production.”

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