The European Commission has this week unconditionally approved Sony Corporation’s $750m acquisition of the 50% of music publishing business Sony/ATV, which is currently owned by theMichael Jackson Estate.
It’s a significant development, essentially the world’s second largest record company controlling 100% of the world’s largest publishing business, including the catalogues of artists including The Beatles (pictured), Bob Dylan, Taylor Swift and Amy Winehouse.
The move has understandably raised the ire of smaller publishers and independent label trade groupIMPALA, with Executive Chair Helen Smith commenting to Music Week yesterday: “This decision is clearly wrong. It goes against the EU’s previous analysis of concentration in music, as well as the concerns raised during this market investigation”.
Smith continued: “We will need to read the decision in full when published to understand properly why the Commission has allowed this transaction to go ahead – there is a fundamental flaw somewhere”.
Smith has a point regarding the EC’s previous track record regarding consolidation in the music rights sector. In 2012, the Commission ruled that in order for Universal to complete their acquisition of EMI, they would need to offload certain catalogues and assets to offset the market dominance gained.
However, according to Reuters, the EC said in a statement: “The transaction will not materially increase Sony’s market power vis-a-vis digital music providers compared to the situation prior to the merger”.
Sony’s interests in recorded music and published songs have historically run separately following a deal struck with Jackson for ATV in the early 1990’s. The publishing was a joint venture, so this merger of the two interests does unquestionably increase the major company’s overall market dominance.
The acquisition still needs approval in the US but at this stage it’s unlikely to be blocked having gained approval from the EC.
In other Sony news, the major now reportedly makes $25m a week from streaming, a figure that has overtaken physical and download sales.
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