Music publishing is a lucrative business, especially when it comes to the back catalogues of pop’s icons. While better known for the more outlandish aspects of his life, Michael Jackson was a savvy investor when it came to acquiring the rights to his own lucrative catalogue as well as the music of others. At the time of his death, the king of pop owned a substantial stake in Sony/ATV Music Publishing, the world’s largest music publisher. The corporation’s extensive 4 million strong portfolio includes the songs of The Beatles, The Rolling Stones, Taylor Swift, Pharrell Williams and Kanye West.
After a bidding war, which reportedly also included Google, Sony Corp cut a deal with Michael Jackson’s estate in March to buy out Jackson’s share of their subsidiary, granting them complete control of the company.
The $750 million deal has led many rivals, including Warner Music and a lobbying group comprised of independent labels, to claim that the proposed deal affords Sony too much power.
In response to these concerns Sony Corp has faced considerable scrutiny from the European Union’s regulatory authorities.
The thrust of the EU’s reasoning is that if too much power is afforded to Sony, it could gain a monopoly over music publishing and squeeze its competitors out of the market. The dystopian future where one major label controlled the majority of commercial music is indeed a harrowing thought.
The European Union’s antitrust regulators have now announced that they will decide on the matter before August 1st. The regulator could impose a number of conditions on the acquisition, limiting potential abuses of market power. This said, it may also opt to engage in a lengthy five-month investigation.
Competition laws are premised on the idea that if a single organisation gains too much power, it’s the consumers who suffer. Considering that three big labels sell up to 80% of commercial music in a given year, the decision to allow the deal could be a concerning development for artists, labels and music fans alike.
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