The day the bank foreclosed on EMI’s hedge-fund owner, a source at Universal told me ‘we’ll carve it up between us and Sony.’
Which is exactly what happened.
Outside bidders were discouraged from the outset by Citigroup’s $4 billion price tag and Warner Music, despite its Len Blavatnik billions, lacked the bluff and experience to play ball with the big boys. They walked away from the table last week, around the same time as Universal did. But Universal were just bluffing. In their mind, the outcome was never in doubt.
So what does that leave?
Just two majors left in the music industry – Universal and Sony – with Warners, Bertlesmann and anyone else rubbing their noses on the windownpane from the outside.
And what does that mean for you and me, the consumers?
A source at Universal tells me that they will to continue treat EMI as a competitor until the deal is cleared by the monopolies authorities. After that, it’s crunch down and merger. EMI, 120 years of music history, will disappear.
The EMI brand, which had a certain distinctive value, will vanish into a corporate maw. The music we get from Universal and Sony will become safer and more homogenous. Given that the two have cooperated in this deal, they will find new ways to work the market to their advantage, not ours. EMI had been badly run for decades but its disappearance is a loss for all who care for independent music voices.