Universal, the industry’s top player, is being blamed for delaying the release of the market-share report while it tries to gain regulatory approval for its proposed $1.9 billion takeover of EMI’s recorded music business.
Yesterday, the International Federation of the Phonographic Industry was slated to hold a press briefing with top music executives in London to unveil its latest report, “Investing in Music.”
The event was canceled, however, when fighting broke out over the report.
According to two sources, Universal, run by CEO Lucian Grainge, wanted to downplay the role of the major record labels in launching and shaping new artists.
At the same time, the record giant wanted to add new wording on growing competition in digital music distribution from new services such as TuneCore and The Orchard, which works with independent labels to gain distribution.
Sources said that Universal wouldn’t sign off on the report unless the changes were made, while rivals refused to OK it if the IFPI bowed to Universal’s demands.
“This report suddenly doesn’t make sense,” said one music source. “It’s really unfair.”
Universal insiders denied trying to hold up the report, saying they simply want it to reflect the realities of today’s marketplace.
All four labels have to agree on the wording of the report before it can be distributed.
Frustrated by the back and forth, IFPI head Frances Moore e-mailed the labels last week, saying that if they couldn’t agree, the industry group didn’t want to play referee. Moore told parties the report would be delayed until fall.
London-based IFPI couldn’t be reached by press time.
Universal’s bid for EMI is the music industry’s biggest deal in years, and will reduce the number of major labels from four to three. With the purchase of EMI, Universal’s share of the global music market would jump from 30 percent to about 40 percent.
Last week, Universal’s Grainge and other top music execs testified before a Senate subcommittee on antitrust issues over the EMI deal, which needs approval from US and European regulators.
“I have no doubt labels add value, but you just don’t have to have one in a world where an artist can deliver an album to fans themselves,” said Live Nation boss Irving Azoff, who testified in support of Universal.
The delay in the IFPI report means it likely won’t be released until after the European Union rules on Universal’s EMI acquisition by September.
Universal is expected to receive details of the EU’s “Statement of Objections” toward the end of this week. The Vivendi-owned company then has 30 days to respond to the letter with its remedies.
Separately, the Federal Trade Commission is expected to rule in favor of Sony’s deal to acquire EMI’s music publishing assets as early as next week. Sony’s deal, in partnership with a host of investors, will see EMI Publishing run as a separate venture alongside Sony/ATV.
Universal, Sony and Warner Music Group declined to comment.
IFPI, Warner Music Group, major record labels, music business, music industry, the International Federation of the Phonographic Industry, Music Group, Universal, independent labels