A New Powerhouse in Independent Music Services

Virgin Music Group has officially closed its acquisition of Downtown Music Holdings, a move poised to significantly alter the competitive dynamics within the independent music sector. As part of this strategic consolidation, Pieter van Rijn, formerly the CEO of Downtown Music Holdings, has been appointed as the Chief Operating Officer (COO) of VMG. This appointment signals VMG’s commitment to building a comprehensive, end-to-end platform designed to empower artists, labels, and rights holders globally.

Based in Amsterdam, van Rijn will report directly to VMG’s co-CEOs, Nat Pastor and JT Myers. His responsibilities will encompass overseeing worldwide operations, spearheading technological advancements, driving product development, and ensuring the seamless strategic integration of the two companies. This integration aims to leverage the strengths of both organizations, creating a more robust and versatile service offering for the independent music community.

Van Rijn’s extensive career has been marked by leadership roles across various facets of the music industry, including distribution, publishing administration, neighboring rights, and synchronization licensing. His tenure as CEO of FUGA, where he oversaw substantial expansion, transforming the company into a full-service label services platform operating in over 50 countries, demonstrates his proven ability to scale and innovate within the music tech space.

Regulatory Approval and the Divestiture of Curve

The completion of this deal follows a rigorous two-phase competition review by the European Commission, which ultimately approved the $775 million acquisition. A key concern for regulators centered on potential data access risks associated with Curve Royalty Systems, Downtown’s sophisticated rights-management and accounting platform. This platform holds sensitive financial information for numerous labels, and regulators sought to ensure fair competition.

To secure approval, Universal Music Group (UMG), VMG’s parent company, agreed to divest Curve entirely, ensuring its independent operation until a suitable buyer is found. Beyond this divestiture, the Commission concluded that the merger would not substantially diminish competition, citing the presence of numerous alternative service providers and a moderate combined market share.

The initial announcement of the acquisition plans between Virgin/UMG and Downtown came in late 2024. The overarching goal was to unify Downtown’s diverse suite of services – encompassing FUGA, CD Baby, Songtrust, and Downtown Artist & Label Services – with VMG’s established global distribution network, neighboring rights expertise, synchronization capabilities, and marketing prowess. Downtown, founded in 2007 by Justin Kalifowitz, currently serves over 5,000 clients and represents more than four million creators worldwide.

A Transition of Leadership and a Vision for the Future

The acquisition also marks a significant leadership transition, with Justin Kalifowitz stepping down from his role as CEO. Kalifowitz announced his departure in a public letter, reflecting on nearly two decades at the helm of Downtown. He emphasized that the company was built during a period of industry upheaval, thriving by embracing innovation and empowering independent creators. He underscored that Downtown’s lasting legacy lies not in its deals or catalog, but in its people and its commitment to service.

Kalifowitz stated, “Service beats control. Infrastructure beats trend-chasing. Culture beats hierarchy.” He expressed confidence in van Rijn and the Virgin leadership team, believing they are well-equipped to guide the combined organization forward. Andrew Bergman, Downtown’s former chairman, will transition into a senior advisory role, providing continued guidance during the integration process.

Executives from both VMG and Downtown have consistently framed the acquisition as a long-term investment in the independent music sector. Pastor highlighted van Rijn’s appointment as evidence of VMG’s dedication to a thoughtful and strategic merger. Van Rijn emphasized that the combination will enhance choice, service, and global reach for the independent community, while Myers credited Downtown’s leadership for fostering an organization deeply committed to independent creators.

What impact will this consolidation have on the accessibility of services for emerging artists? And how will the divestiture of Curve Royalty Systems affect the royalty accounting landscape for independent labels?

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