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Business News Week In Five
The music business week in five – 20 Jul 2012
By Chris Cooke | Published on Friday 20 July 2012
So, a bit of a funny week really, wasn’t it? Having been bullish for months that their EMI deal would get the go-ahead from regulators no problem, you sensed a real air of panic at both Universal Music and parent company Vivendi last week as European officials started to play hard-ball, resulting in an ever growing list of assets the mega-major was offering to sell to get the green-light. But then the indie label community, the most high profile critics of the deal to date, suddenly found themselves split over the whole thing. Let’s recap that and other stories from the music world this week.
01: Universal proposed an asset sale to secure its EMI takeover, dividing the indies. Bosses at both the major and its parent company Vivendi went into overdrive this week to try and convince European Commission regulators to let them buy the EMI record company. Having resisted offering remedies so far, suddenly Universal was presenting a long list of proposed concessions. Though EC regulators were mainly interested in those that involved Universal selling on chunks of EMI. CMU report
As were some key players in the indie label sector, who now saw an opportunity to buy some lucrative catalogues at favourable rates. That caused a split in the independent community, between those who accept that the Universal/EMI merger is now inevitable, and who would just like the major to be forced to sell on as many assets as possible, preferably to the indies, and those that say the independents should continue to oppose the deal outright, if only on a point of principle. CMU report
Patrick Zelnik, the boss of French indie Naïve and Co-President of indie label trade body IMPALA (which has so far been leading the anti-merger campaign), led the former camp, basically saying he’d support the deal if Universal committed to sell him Virgin Records (he helped Richard Branson launch the then indie Virgin label into France back in the day, and now wants to partner with the Virgin chief to buy the company back). CMU report | FT report
Universal boss Lucian Grainge indicated he’d be willing to commit to give the indies ‘first bid rights’ on any EMI assets he sells. Though the Featured Artists Coalition then popped up to say that, if Grainge was going to give anyone first dibs on catalogue sales, that right should go to the artists who created the recordings in the first place, allowing them to regain control of their former work. So, a very interesting week in the never-ending EMI story. CMU report
02: Google’s anti-piracy commitments were in the spotlight again, although mainly because of a Newsnight discussion on the record industry’s favourite issue of the moment: why doesn’t Google do more to ensure its search engine doesn’t direct people to unlicensed music? Google insisted it did all it could, and that labels and music publishers should focus less on its search engine, and more on targeting payment providers and ad networks that enable piracy sites to make money. Meanwhile, away for the BBC studios, the French Supreme Court said it was “appropriate and proportionate” to force Google to remove terms form its auto-complete suggestions that might lead users to pirated content. CMU report | BBC report
03: MegaUpload’s extradition judge resigned. New Zealand judge David Harvey stepped back from the case, in which the US are attempting to extradite four MegaUpload executives to face copyright infringement charges back in America, after he called the US “the enemy” at a conference last week. It was a flippant remark in a debate on the Trans-Pacific Partnership copyright agreement, but Harvey conceded that it was an unwise thing to say, and that it could lead to accusations of impartiality if he continued to hear the MegaUpload extradition case. Meanwhile prosecutors were busy trying to convince the American courts that the Mega company falls under US jurisdiction even though it is incorporated in Hong Kong, partly by pointing out that Grammy-winning producer Swizz Beatz had been listed as the firm’s CEO when it was shutdown in January, and he is an American citizen. CMU report | BBC report
04: Live Nation apologised for silencing The Boss. The sound was pulled at Bruce Springsteen’s show in London’s Hyde Park last weekend before the singer could perform one last song, or even say goodbye, admist fears of breaking curfew. Live Nation’s Hyde Park stage is subject to some strict licensing conditions, after a battle with nearby residents. Although Springsteen’s guitarist Steven Van Zandt had a drunken rant about the incident, Live Nation said the singer and his team were OK with it, believing it added a bit of mythology to the show. Though Springsteen still mocked London officials when he played in Dublin a couple of days later. CMU report | Telegraph report
05: A report said that catalogue sales were outselling new releases in the US, so that new albums sold 73.9 million units in the first half of 2012, while catalogue releases shifted 76.6 million units. Which is interesting. Remains to be seen if this is a wobble or a new trend. CMU report
And that is your lot for now.
Chris Cooke
Business Editor, CMU
