The EU have just approved Sony Music’s takeover of EMI Music Publishing despite indie music organisations across Europe warning that it gives them too much influence.
Sony Music now own a 100% stake in EMI Music Publishing following the European Union’s regulators approving the takeover. The acquisition takes the Japanese business giant from 30% ownership in EMI to 100% complete ownership. It began in May when Sony acquired Mudabala’s 60% majority stake for $2.3 billion giving them a massive 90% stake in EMI. They then acquired the final 10% from The Michael Jackson estate for $287.5 million.
The European Union’s regulators had to approve the acquisition to ensure it wasn’t giving Sony too much influence over the music industry, but according to their decision they don’t feel it does. They stated: “The commission concluded that the transaction would raise no competition concerns in any of the affected markets and cleared the case unconditionally.” However indie organisations were quick to criticise the unconditional approval, despite strong opposition to it leading up to the decision.
Indie music trade group IMPALA’s executive chair, Helen Smith said in a statement: “This goes against the regulator’s own precedents. In 2012, it ruled that divestments were required for Sony to become a minority shareholder. Now that Sony is acquiring 100% control of EMI, it is being given unconditional approval. This is inconsistent and simply doesn’t stack up. It is a poor advert for European merger control and sends an alarming message to independent businesses in all sectors, not just music.”
Universal Music Group are generally considered to be the most powerful of the three major labels in the world but the EMI acquisition puts Sony firmly in the lead, at least for Europe. They now own over 4.2 million compositions and have the power to combine both recordings and publishing of music using their label powers and new publishing powers. In some of Europe’s key countries Sony now owns over 70% of their national charts, like; Italy – 77%, France – 73%, Spain – 82%, and the Netherlands – 72%.
Smith continues: “This is bad news for the music sector and the digital single market. Sony will have a near monopoly over the charts and the whole music value chain will lose out as a result. Songwriters, composers, independent labels and publishers, digital services, and of course music fans, will all be worse off. This decision has dealt a significant blow to innovation and cultural diversity in Europe.”