Vivendi Confident Of EMI Deal

While Vivendi remains confident that Universal’s acquisition of EMI’s recorded music business will get regulatory approval, and opponents of the deal are equally sure it won’t, a Reuters straw poll of antitrust experts also came out equally divided.

Philippe Capron, the French company’s chief financial officer, says there is “a lot of noise” but most of it comes from competitors, not customers or partners in the music industry.

“We are confident the decisions will enable us to go ahead,” he said.

Outgoing Warner Music chairman Edgar Bronfman Jr. has promised his company will fight the takeover “tooth and nail.”

Indies organisation IMPALA says it’s confident the European Commission will find that Universal already exerts undue influence over the market and development of online players, all of whom depend on the market leaders’ repertoire.

The eight experts interviewed by Reuters were split on the likely outcome of Universal’s intended acquisition of what was once a major rival.

However, they pretty much agreed that on both sides of the Atlantic the decisions may hang on what sort of market the new behemoth would be dominant.

Those who felt Universal’s union with EMI would get regulatory approval pointed out that all the major companies have been weakened by file-sharing and the power of supermarkets putting a downward pressure on the price of CDs and digital downloads.

“Ten years ago, the labels had power. Today they don’t have any power,” said Daniel Sokol, a lecturer on antitrust issues at the University of Florida. “If the US Federal Trade Commission blocks it, it’s just because they don’t understand the market.”

Two of the antitrust experts who felt the deal would be blocked said Universal will struggle to overcome the opposition that Warner – now owned by Access Industries – has organized against it.

They said the FTC could be swayed into blocking the deal if Warner and organisations such as IMPALA can generate enough complaints.

IMPALA has already pointed out that, in 2011, about 90 percent of the Top 1,000 for downloads and airplay were from the big four music companies.

“These results are very revealing, especially as they already factor in independent successes such as Adele,” said IMPALA executive chair Helen Smith. “They send a serious warning about the dangers of concentration in music for diversity in Europe.”