SFX and Beatport hold payments to labels and right holders

Beatport is an online music store which specializes in electronic dance music and it is a privately owned company. In 2013, Robert F.X Sillerman's company SFX Entertainment, decided to buy into Beatport for $50 million. Before Sillerman's purchase of Beatport, Beatport's annual revenue was around $15-$18 million in 2012, with losses of $2 million. The company has raised $260 million in 2013by selling 20 million shares at $13 per share. SFX now owns and operates Beatport, which is the trusted global home of electronic dance music where fans and DJs can connect to discover new music and participate on the evolution of new music. SFX Entertainment is a public corporation, and the leading producer of live events, media and entertainment exclusively focused in the electronic dance music culture. For the past few years SFX's revenue has been in high rise due to the involvement in many global music festivals such as Tomorrowworld, Tomorrowland and Mysteryland. CEO and Chairman 

In the past week or so, Beatport has announced that they will suspend royalty payments to the artists and records holders, due to issues with the parent company, SFX "going private" process. CEO and Chairman Robert Sillerman has been going through the process of buying out SFX for $5.25 per share which would value SFX Entertainment at $490 million. After a community outrage from discovering that Beatport is only paying out royalities to only specific record labels, they are tryiong to fix the situation as quick as possible. Robert Sillerman released a statement saying how deeply embarrassed, both personally and professionally, he is for what has occurred: 

“I regret that unrelated elements made Beatport delay some payments for the first and only time in its more than 10 year history. The way we handled this was inexcusable and should never have happened. The thousands of creators who have made Beatport what it is today deserved better, and I am deeply embarrassed, both personally and professionally, by what has happened.”

Beatport is waiting to for Sillerman to secure financing for his takeover of the publicly traded company. Beatport released a statement:  “It was confirmed today that Beatport’s label supplier payments, which have been delayed temporarily via a hold at SFX Entertainment, will be processed next week. We deeply regret any hardships this delay has placed on members of the creative community – especially independent labels and artists, who are the lifeblood of electronic music culture and who have been long standing partners and suppliers to Beatport since 2004. We are truly sorry this has happened, and that we allowed payment distribution to get caught up in unrelated matters.

The outcome from a company going from public to a private corporation can bring significant problems to the employees of a company and it is not fair to the people who work so hard to achieve the goals of the company and to provide the best service possible to their target market. At least Sillerman, realizes that the situation was handled incorrectly and hopefully would not happen again in the future. Beatport has provide the resources and tools for not only the electronic dance community but also to the Djs, prodocers,  and artists that work so hard to have their music available. Hopefully the situation will be handled as quick as possible to get the monies that these creative partners deserve.