Indies Contest EMI-Warner Deal

While business journalists worldwide are speculating whether EMI will up its bid for Warner Music or if the American company will make a counter-offer for the British outfit, the Euro independent music companies have made it clear that – whatever the deal – they’re against it.

Given that the indies used Impala, their Brussels-based trade association, to challenge the Sony BMG merger, the only real surprise is the amount of time it has taken to announce that it’s going to oppose a EMI-Warner tie-up as well.

Impala issued a statement May 30th confirming it will “forcefully oppose” any merger between the two on the grounds that the new company would control more than a quarter of all recorded music sales and close to 50 percent of the music publishing market.

The publishing percentage is open to question because it’s unlikely that monopoly authorities would allow the merged company to hang on to both EMI Music and Warner Chappell. It’s equally unlikely that EMI-Warner could even afford to.

What looks beyond dispute is the indies’ contention that a second merger among the majors, coming on the heels of the still-contested merger between Sony Music and BMG, would leave control of more than three-fourths of all music released around the world in the hands of three companies – Universal, Sony BMG and EMI-Warner.

Since Warner and EMI’s first attempt to merge in 2000, Impala has been at the forefront of defending consumer choice, cultural diversity and the viability of a broad range of cultural production. That merger was defeated because of strong action by the EU Commission.

Last year Impala, which represents more than 2,500 European independent music companies, appealed the decision of the European Commission to allow the merger between Sony and BMG, a case that’s still pending in the European Court of First Instance.

Impala was established in April 2000 to assist independent record companies and music publishers represent their own agenda and organize themselves in the face of increasing concentration in the music sector.

– John Gammon