For a business built on hits, Universal Music Group’s debut as a public company this week will rank as its biggest release.

With UMG’s shareprice leaping 39% on day one of trading on the Euronext Amsterdam exchange, the music giant was valued at a jaw-dropping US$53bn, a blockbuster that makes the music industry appear to be a professional setup, in the best of health and pandemic-proof, with a bright future. And with it, some people become very rich indeed.

Perception is important. Good timing is essential. And history can inform us.

The Universal IPO can’t be properly assessed without an understanding of what came before, and how the worst-case scenario engulfed one of its rivals.

Cast your mind back 10 years, and where you were in life. Perhaps a bit lighter (in body and wealth). Maybe partying a bit more, happier, lost, wide-eyed, confused. Naïve.

Now, consider the music industry 10 years ago.

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Yes, the industry was partying more. It was definitely lighter. Lost, confused. Naïve.

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Though digital was catching on, mainly in the form of the now-near-extinct download format, the total global market continued its years-long decline in 2011, by a rate of 3% year-over-year, according to the IFPI.

Small single-digit shrinkage a decade ago was considered a near-miss, and almost cause for celebration.

Last week, the U.S. recorded music industry, by some distance the biggest market on the planet, posted 27% gains year-on-year, powered by streaming.

The recorded music industry 10 years ago was sick. Some thought it was terminal, save for a miracle.

Cast your mind back 10 years, and the death of EMI. Depending on who you spoke with, the once-great British music major was the smallest of the music majors, or the biggest indie on the planet, with a roster that could make you weep.

Despite controlling the catalogs of the Beatles, Queen, Rolling Stones, Pink Floyd, Radiohead, Robbie Williams and so many others, EMI wasn’t too big to fail.

In 2007, private equity specialist Guy Hands led a buyout of EMI, taking the music giant into private hands for about US$4.7 billion.

At the time, it seemed a princely sum. Today, it’s dwarfed by the value of UMG.

Hands had turned around other flagging business. EMI had its problems, but with Hands’ touch, he figured, the music company and all its prestigious recordings and rights would flourish.

What Hands didn’t bank on was the GFC. Artists jumped ship, lenders wanted their money back.

When EMI was sold and carved up 10 years ago, streaming wasn’t an option. Those rivers of revenue weren’t on the horizon.

UMG’s CEO Lucian Grainge masterminded this week’s IPO, and it was Grainge who was the architect of EMI’s dissection, with Universal retaining some, but not all, of its greatest assets, a move that would assure the necessary approval from regulators.

With UMG’s whopping IPO, the music industry got a health check that’s off the charts. The company wouldn’t be worth what it is today without those pieces of EMI, a once-mighty business that suffered a sad, miserable death several years before streaming would have brought the business back to life.

What would Guy Hands make of it all?