Market leader seeks more power - IMPALA comment on Sony-Sony/ATV deal

Brussels, 22nd April

With Sony’s buy out of the late Michael Jackson estate's shares in Sony/ATV finalised this week, IMPALA has confirmed that it has serious concerns over the impact of the deal on Sony’s market power:

"The EU effectively set a limit three years ago due to concerns about prices. It is difficult to imagine how the Sony/ATV deal could secure approval from the European Commission.”  commented IMPALA’s Executive Chair, Helen Smith.

The buy out would reinforce the market power of the world’s biggest music publisher and give it control over more of the world’s music than before. That was one of the concerns raised by the European regulators the last time Sony made an acquisition. The EU said it would raise prices, particularly for online services.

Brussels has an impressive track record on merger cases. When Sony bought EMI, it had to make concessions and Universal bought EMI records just three years ago, the EU really turned up the heat. Universal had to sell two thirds to get EC approval. That’s one the biggest set of divestments in history and highlights what IMPALA dubs “a real risk when market leaders get greedy". Universal also had to accept having its digital contracts monitored for ten years.

"If Sony ends up in the same position as Universal, that’s not quite what they had in mind.” added Helen Smith, flagging that there is an even bigger risk for the world’s biggest music publisher, and that is not getting it through at all.

 

About IMPALA
IMPALA was established in April 2000 to represent European independent music companies. One of IMPALA's missions is to keep the music market as open and competitive as possible. IMPALA has an impressive record on competition cases in the music sector. The first EMI/Warner merger was withdrawn in 2001 following objections from the EU after IMPALA intervened, in its first year of existence. It also won a landmark judgment in 2006 in the Sony/BMG case, and when Sony acquired 30% of EMI publishing in 2012, it was at the cost of significant divestments. The biggest set of remedies proportionately ever in a merger case was secured later that year, when UMG was forced to sell two thirds of EMI records and had to accept ten years of scrutiny over the terms of its digital deals. When WMG bought Parlophone in 2013, IMPALA secured a hefty divestments package for its members. On top of mergers, IMPALA has also been involved in other anti-trust cases involving the music sector, such as the abuse complaint against YouTube in 2014 and the call for regulating unfair business practices by large online players. IMPALA has also submitted observations on Apple’s bid to acquire Shazam.  See the organisation's other key achievements in IMPALA's milestones.

 

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