Brit Indies Protest EMI Deals

While the major independent music companies’ association bothers the European Commission about the sale of EMI, the British indies are planning to write to the UK government to protest the deal.

AIM, the UK’s trade association for the independent sector, is urging its 800 or so members to send copies of a pre-written letter to their local MPs.

Although the letter is critical of the deals that saw EMI’s recorded music business go to Universal Music Group and its publishing to Sony, and urges MPs to “raise this issue in parliament,” it’s not likely to cause alarm at either of the global corporates.

Any MP wanting to raise the issue has already had two months to do so and the UK government itself can do little to stop the deals.

Even the EC, which has the power to stall the deal on the grounds that it reduces competition, will likely look at how the recorded music business has changed since it examined the Sony-BMG merger.

The letter says the sale of EMI will “undoubtedly concentrate the global music market still further into the hands of two dominant major companies – Universal and Sony,” which in itself is enough to demand that the UK government takes a close look at it.

It says that if the deals with Universal and Sony are allowed to go ahead, not even Warner Music – which unsuccessfully bid for EMI’s recorded music business – will be able to compete against the French and Japanese giants.

Reports from the U.S. suggest Warner Music has hired some legal experts to contest the sale of EMI on antitrust grounds.

IMPALA, the Brussels-based independent music companies’ association, has told the EC it should oppose the deal as Universal and Sony already have too much power.

AIM’s letter to the MPs quotes Beggars Group chairman Martin Mills describing Universal’s acquisition of EMI’s recorded music business as “breath-taking arrogance.”

“It’s hard to imagine this acquisition being approved, given Universal’s existing dominance in an over-concentrated market. Even greater dominance would be bad news for almost everyone involved in the art and business of music,” he said.

Meanwhile, Universal is about to lodge its own legal papers with the EC as it seeks support for the EMI deal, although ratings agency Moody is considering downgrading parent company Vivendi because of the “regulatory risks” involved.
A combination of Universal and EMI would control about 40 percent of music sales in the US and Europe and around 50 percent of European downloads.