Elsewhere in EMI takeover news, another letter appears in the FT today offering an alternative viewpoint on the whole thing, this one from the Featured Artists Coalition.
And whereas Naïve’s Patrick Zelnik, in his open letter on the transaction earlier this week, argued that the EMI acquisition would be acceptable providing the indie sector, in which he operates, was given first dibs on any asset sales, the UK artists body has an alternative suggestion: commit to sell EMI (and, for that matter, Universal) catalogues back to the artists who recorded them in the first place.
The letter highlights an important consequence of any music rights sale, ie that the recording artists (or songwriters if it’s a publisher being sold) whose past work is owned and/or controlled by the music company for sale suddenly find themselves having to work and negotiate with a whole new team of people. Sometimes that can go in an artists’ favour if relations with their label’s former owners had turned sour, but often acts and their managers suddenly see their friends and champions within their label or publisher eased out.
If Universal is going to have to streamline its catalogues to win approval for its EMI bid anyway, why not give the “first right” to bid to all and any artists who might be in a position to pay market value to acquire their former catalogues. The FAC told CMU this morning: “Should regulators consider allowing the Universal/EMI merger to proceed, we believe that all artists signed to any Universal or EMI label should first be allowed to acquire their rights, at market value. Indeed, any artist affected by this deal going ahead should be offered such a remedy”.
Noting Universal boss Lucian Grainge’s previous pledge to spearhead a “manifesto for the new music industry” as part of any EMI deal, the featured artist trade body added: “This is an historic opportunity to create a more sustainable music industry – a future music industry more meaningfully described as a collection of individual artist businesses rather than specific sectors like records, publishing and live”.
The full letter in the FT, included below, is signed by FAC co-chairs Ed O’Brien of Radiohead, Nick Mason of Pink Floyd and Sandie Shaw, all of whom, like Zelnik (with his ambition to control Virgin Records) do have a vested interest of sorts. All have worked with EMI at some point in their careers (though Shaw has actually worked with Universal subsidiaries more frequently).
Radiohead parted company with the UK major somewhat acrimoniously after Terra Firma’s 2007 acquisition of the firm, while Pink Floyd were involved in long drawn out legal wranglings with the label over the future exploitation of their catalogue. Both bands would therefore likely be interested in bidding to regain control of their earlier works if such a sale was on the agenda, allowing them to truly control their future digital destinies. And the world may well be a better place if they could, though, of course, The Head and The Floyd constitute two of EMI’s most valuable catalogues, and it seems unlikely Grainge would want to relinquish control of either of them.
The FAC’s letter is as follows…
Sir, The views of Patrick Zelnik (“A Universal EMI merger could rescue the music business”, Comment, July 17) were as welcome as they were needed. His analysis was incisive, but his solution stopped one step short of perfect.
Divestments in the wake of mergers should first offer copyrights, at market rates, to the artists who created them. To sell them to other corporations, whether large or small, is just a perpetuation of an old business model, which has seen the recorded music business halve in value over 10 years. During that time, the technological revolution has displaced the old music business players. We do not need to repeat the mistakes of the past.
It would be good to have music business people rather than financiers owning and running music companies again. It would be even better to have artists owning their work and entering into partner relationships with service-providing major and independent record companies with all the finance and expertise an artist needs to develop their own business.
Top management at Universal has already concurred with this view. The concept of “turning the taps on” so that music catalogues are much more readily available to users, and copyright ownership is not an impediment to new services, would help build the artist-centric new music business that will benefit creators, investors and consumers.
Ed O’Brien, Radiohead
Nick Mason, Pink Floyd
The Featured Artists’ Coalition,
London W1, UK
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