IMPALA objects to EC approval of Universal/EMI merger

Brussels, 21st September 2012

European independent music companies express concern over the EC’s approval of the Universal/EMI merger, announced today.

The independents welcome the EC’s conclusion that Universal’s power is a problem across the whole market, both digital and physical, including access to media. The Commission’s insistence on tough remedies, despite strong positioning by Universal, is also applauded, as well as its clear rejection of arguments that piracy and larger online players are restraining forces.

The remedies package put in place, however, is not considered to be tough enough to curb Universal’s improved market position.

Independents across the world have objected to the merger since it was first announced. The EC concluded in June that it would be to the detriment of competitors, customers, innovation, consumer choice and ultimately, consumers and cultural diversity.

Helen Smith, Executive Chair, IMPALA commented: ”This decision has finally put a freeze on Universal’s ability to expand further and sets a benchmark for constraining abusive behaviour across the whole market. Following the approval of the Sony/EMI merger, however, this decision nonetheless reinforces what is already a powerful duopoly. Contrary to the basic principles of competition in cultural markets, artists and consumers will ultimately pay the price. We will consider our options with our lawyers as soon as the full decision is published. In the meantime, it is vital that the divestments process balances the market and maximise competitive forces to the duopoly.”

Martin Mills, Chairman of Beggars Group, added ”It’s good to see that the Commission has seen this deal as such a threat to the market that it has demanded and received truly swinging commitments on divestments. However, that should not conceal that fact that Universal’s arrogance has paid off for them, that they have destroyed a significant competitor, and that even with these divestments their ability to dominate and control the market has reached even more unacceptable levels. Anyone trying to start a new digital service will be realising that very soon, and we will continue to look to the regulators to monitor ongoing behaviour.”