The Universal Music Group/EMI Merger and the Future of Online Music

Is the music industry like other businesses, and thus subject to concerns about market concentration, or is it an anomaly in which nothing matters but hits? That was one of the central questions at a Senate hearing about a proposed $1.9 billion deal in which the Universal Music Group would acquire the record labels of EMI, giving Universal — already the world’s largest music company — control of the recordings of the Beatles, the Beach Boys and Katy Perry.

The chief executives of Universal Music Group and EMI defended their planned merger during a hearing of the Senate Judiciary Committee’s subcommittee on Antitrust, Competition Policy and Consumer Rights.

Two public interest groups called on the Federal Trade Commission to closely examine Universal Music's bid to buy part of EMI, saying the transaction will increase concentration in the music industry and could stifle the development of new online digital music platforms. One week before a Senate Judiciary Antitrust Subcommittee hearing on the Universal-EMI deal, the Consumer Federation of America and Public Knowledge urged greater scrutiny of the transaction in a report filed with the FTC.

Universal Music Group said it received a statement of objections from the European Union's antitrust regulator over its bid to buy EMI.

On June 21, Universal Music Group Chief Executive Lucian Grainge will press his case for a merger with EMI before the Senate's subcommittee on antitrust and consumer rights.

I will be testifying against the merger of Universal Music Group and EMI Music.