By guest blogger Taylor Lambert and Kevin Erickson
In the age of on-demand streaming, it’s common to hear people talk about music as “limitless”— something that flows forth endlessly like water. Indeed, musicians around the world release a huge volume of new music every day. But in practice, most consumers’ exposure to the world of new music is extremely limited. It’s one of the thorniest problems—if there’s so much music out there, why do consumers end up being exposed to so little of it? Why should the music marketplace be a winner-take-all system?
Of course, whether or not you view this as a problem to be solved could depend on whether you’re fortunate enough to be one of the “winners.” Still, media critics have long pointed to the role of gatekeepers who exercise considerable control what music reaches audiences. From radio programmers to retail managers to talent buyers to music reviewers and beyond, the most powerful labels do their best to keep their offerings front and center—often at the expense of independents. Radio is the still the number one source of “music discovery,” but commercial AM/FM radio broadcasters in this era of ownership consolidation tend to be highly risk-averse in their programming choices. Playlists are narrow and repetitive, as our research has documented. It has been the strong hope of the independent sector that online music services would be more democratic, allowing more artists to find audiences than was possible in the old-school media world.
[…]Artists are also worried about the merger’s consequences. “It’s all totally stacked against the creator,” said Casey Rae-Hunter, who heads the Future of Music Coalition, an organization representing independent and unsigned musicians. “And the Universal-EMI merger gives them even more leverage to do really scary things.”
[…]”This was supposed to look a lot different,” said Rae-Hunter, who also runs the tiny, independent record label Lux Eterna and records as The Contrarian.
“We were supposed to not just solve the access problem about reaching new audiences, but also to monetize that activity in a way in which 99 percent of that activity was not captured by the major labels,” Rae-Hunter said. “But we see now that the majors still dictate the terms.”[…]
[…]Universal told the Journal the E.U.’s approval “will benefit the artistic community and music industry” and that Universal is glad it will hold onto more than two-thirds of EMI’s global business. But IMPALA, a trade group representing European independent record labels, protested that the required sell-offs wouldn’t be enough to limit Universal’s increasing grip on the market. Casey Rae, deputy director of the U.S. nonprofit Future of Music Coalition, told Politico that “there’s not really going to be any number of divestitures that will make this a groovy deal.” Somewhere, someone at General Electric, the majority owner of Universal-owning (and now EMI-owning) Vivendi, a French media conglomerate, is chanting “swag.”
Many musicians have also voiced opposition to the deal, arguing that existing record label contracts are stacked against artists — and will likely remain so absent significant changes in the digital marketplace. On average, musicians only receive $23.40 out of every $1,000 in music sales under the current system.
The American Antitrust Institute, the Consumer Federation of America and the Future of Music Coalition — a group representing independent and unsigned musicians — are all opposed to the deal.
[…]“The major labels are incredibly good at extracting maximum value from whatever they touch, and with only three left, they’ll be able to dictate the terms of the digital marketplace in ways we’ll be feeling for years to come,” said Casey Rae, deputy director of the Future of Music Coalition, a national nonprofit that opposes the deal.
“It’s always been conventional wisdom that if the EU accepted this deal, that the United States would mirror that,” Rae said. “But there’s not really going to be any number of divestitures that will make this a groovy deal.
[Post authored by FMC Policy Fellow Daniel Lieberman]
Last week, Universal Music’s bid to takeover EMI Music went before European antitrust regulators, who will rule this September on a merger that would further consolidate the major record label system. If you are just tuning in, EMI is the crown jewel of the United Kingdom’s music catalog, home to classic recordings by the Beatles,Pink Floyd, David Bowie, and more contemporary releases by the Beastie Boys, LCD Soundsystem and Norah Jones. Further background on this merger is available here. read more
Washington, D.C .— Future of Music Coalition (FMC) has for several months raised questions about a proposed merger between Universal Music Group and EMI Music, which would have a negative impact on artists as well as the growth of a legitimate digital music marketplace that rewards creators and fans alike.
News recently broke of an EMI proposal to European regulators that included divestitures and behavioral remedies meant to alleviate concerns over market concentration and resultant consumer harms. These supposed palliatives, however, do nothing to address concerns over the merger’s impact on the U.S. market, including the impact on innovation and leverage within the independent sector.
The following statement can be attributed to FMC Deputy Director Casey Rae: read more
As the castles crumble, does it really matter if UMG merges with EMI, anyway? YES, according to groups like Impala and now the Future of Music Coalition, which are actively lobbying on both sides of the Atlantic against the tie-up. Meanwhile, the labels have formally submitted their request to the European Commission, which pegged March 23rd as an approval date. US submissions happened two months ago, according to details shared by Impala…
A week after the Grammy Awards celebrations, the music industry is hunkering down for what could be an intense yearlong fight over corporate consolidation.
The ownership landscape of the major music companies has shifted significantly in the last year. In May, the Warner Music Group was sold to Access Industries, a conglomerate controlled by the Russian-born billionaire Len Blavatnik, and in November Citigroup reached deals to split EMI — home to the catalogs of the Beatles, Coldplay and Katy Perry — between Sony and the Universal Music Group. read more
On February 15, 2012, Future of Music Coalition sent a letter to the Federal Trade Commission voicing concerns about the propsed aquisition of EMI Music by Universal Music Group (UMG). In it, we describe how competition allows for more innovation and opportunities for artists, and that the sheer market power of a post-acquisition UMG would inhibit the growth of the legitimate digital music marketplace.
February 15, 2012
Mr. Richard Feinstein, Esq., Director
Mr. Norman Armstrong, Esq., Deputy Director
Office of Policy and Coordination
Bureau of Competition, H-374
Federal Trade Commission
600 Pennsylvania Avenue, NW
Washington, DC 20580