Chrysalis disappoints, as new artists fail to incubate

According to The Guardian, music publisher Chrysalis has warned that its revenue from song royalties will fall this year, placing the blame on the "challenging macroeconomic environment" which has depressed sales of CDs. The advertising market downturn has also had a deleterious effect on its synchronisation revenue, which the group earns from music that is used in TV programmes, films and advertisements.

Probably more disappointingly than any of this, Chrysalis has reported that its "incubator" business Echo, which nurtures artists before they sign deals with major labels, has not justified management expectations, Echo has not upstreamed any artists to major labels during the third quarter.

The company must be feeling somewhat let down: it has not placed all its eggs in one basket but has sensibly sought to identify and exploit a variety of IP-related income streams. When the longed-for economic upturn eventually arrives, Chrysalis will be able to tell with greater confidence whether its dip in fortune coincides with the lack of buoyancy of the market on whether its malaise is more serious.