The estimated $55 million music market in Israel, like the Middle Eastern country’s comparatively small size, would quantify as the equivalent of a rounding error for a global music company. But its recorded music revenue growth was up 10.2% in 2021, per the IFPI, and the majors are taking notice.

In 2021, UMG opened a Tel Aviv office housing a recorded music division and an arm of Universal Music Publishing Group (headed by managing director Yoram Mokady and general manager Itamar Shafrir, respectively). Universal Music Israel’s A&R team has hit the ground running, signing local talents like Michael Ben David and Ozel, the latter who performed an industry showcase in May which brought out execs from the U.K. and tastemakers from Israeli radio — still an influential media source in the country — and the live industry.

In addition to developing Hebrew-language artists, the company has partnered with James Diener, who signed Maroon 5 to its first label deal at A&M Octone Records and whose Freesolo Management has represented Avril Lavigne and the Struts, and Ken Levitan, whose Nashville-based Vector Management is home to T Bone Burnett, Kesha and Kid Rock, to find a six-member boy band — Israel’s take on BTS or One Direction.

Comprised of Jews and Arabs, the guys will sing in English under the banner As1One. The plan, Levitan told an Israeli television program, “is to bring them to the U.S. or possibly the U.K. to write and record and hopefully come up with some global hits.” As1One is looking at a summer 2023 launch.

Warner Music has also planted roots in Israel, announcing in May that Mariah Mochiach, a music biz veteran who, in her career, has looked after the repertoire of such labels as Beggars Group and Domino Recordings, would lead a Tel Aviv affiliate as GM. The company has a bit of a head start, having signed Noa Kirel (pictured at right) — Israel’s answer to Ariana Grande — and Noga Erez (pictured at left), who received a momentum-building co-sign from Katy Perry, to Atlantic Records U.S., although neither singer has yet broken out abroad.

“The digital transformation of our industry has made it more global than ever, lowering the barriers to music discovery and making it easier for artists to connect with fans all over the world,” says Mochiach. “Israel is a market with a thriving local scene and a strong appetite for international music. We’ve been involved in the market with partners for many years, but now seems the perfect moment to go one further and establish Warner Music Israel.”

Certainly Haim Saban thinks so. The founder of the independent Saban Music Group, which signed the Israeli duo Static and Ben-El as well as 22-year-old heartthrob Mergui (an ex of Kirel’s), says, “Israel is a very small country, only 10 million people, and the upside there is pretty limited.” Although Saban recognizes that these local stars “have to give up significant income” in order to pound the pavement in the U.S. or internationally — and obtaining a work visa presents its own set of challenges — he sees the wisdom in setting your sights big. “If you’re going to put in the work, why not target the 8 billion people of the world?”

A key element of Saban acts is the production of the music. For a two-year-old label (which is distributed through UMG’s Virgin) to already have a recognizable sound can make all the difference, and as a result, Israeli producers like Jordi (who helmed Mergui’s “Sucks to Know You (FU)”) and Jonathan Goldstein are finding themselves fully booked for the foreseeable future. Meanwhile, in the states, Israeli-American Omer Fedi is racking up credits on massive hits like Lil Nas X’s “Montero (Call Me By Your Name”) and 24kGoldn’s “In the Mood.”

“Noa Kirel is a good singer, but there is no ‘Noa sound,'” Saban posits. “I wish Noa all the success in the world. If she gets the right material, she can be very successful. And Mergui, if he’s successful, is giving her an incredible coverage with the release of his EP, where he tells the story of what happened between them.”

Spoken like a true promotion vet, although when asked if he was aware that Mergui’s clap-back to Kirel, “Sucks to Know You (FU),” was released a year to the day after her “Please Don’t Suck,” he feigned surprise. “I did not know that! I honestly don’t think we planned it that way.”

The key factor, says Warner’s Mochiach, is that these artists “are also fluent in English, which is an advantage when it comes to doing international promotion. … Israeli artists’ ambition, creativity and professionalism puts them in a good position to find a place on the global stage.”

Likewise, Saban adds, the major labels “have recognized that they’re not in Israel just to sell Justin Bieber and Drake records. They’re there because they think there is a pool of talent. And they are right.”

A Variety and iHeartRadio Podcast