UMG leads the new order of recorded-music companies, Sony dominates music publishing

Music & Copyright’s annual survey of the recorded-music and music-publishing sectors has revealed how much Universal Music Group (UMG) and Sony have benefited in market-share terms from the breakup of EMI and the consolidation of the two music-industry sectors. UMG cemented its position as the largest recorded-music company last year, and Sony is now the clear leader in terms of corporate publishing control.

European Commission gives the nod to the UMG/EMI deal

Earlier today the European Commission said yes to Vivendi/UMG’s bid to buy EMI Recorded Music. The full Commission press statement is here . Is anyone surprised at the outcome? Our guess is no. If the Commission didn’t want the deal to go through it would have said so months ago.

In the release there are some big name artists that are part of the Parlaphone sell-off (Coldplay, David Guetta, Tinie Tempah). The statement issued earlier today by the Association of Independent Music’s Chairman and Chief Executive Alison Wenham described these divestments as “the crown jewels of EMI.” But there are also quite a lot of artists and bands being divested whose best days are behind them (Tina Turner, Duran Duran, Jethro Tull, Depeche Mode, Moby) and whose value is going to lessen over time. But, UMG has The Beatles and so the company now has the two biggest UK bands ever (inc. The Rolling Stones) in its stable. Other icons moving under UMG’s control include the Beach Boys, Genesis and Bob Seger. Contemporary big names that pass to UMG include Katy Perry, Emeli Sandé, Robbie Williams, Herbert Grönemeyer, Lady Antebellum and Norah Jones.

The Adele effect hits major-record-company market shares in 2011

Music & Copyright’s annual survey of the recorded-music and music-publishing industries has revealed that Universal Music Group (UMG) remained the world’s biggest record company and Universal Music Publishing Group (UMPG) the largest music-publishing company in 2011. The positioning of each of the four major record-label and music-publishing companies was unchanged last year. Although this lack of change could suggest that 2011 offered up “more of the same” in the recorded-music and music-publishing sectors, such an assumption would be wide of the mark.

Does Adele’s success dispel the myth that the majors’ dominance hampers market access for indies?

In the two weeks before the publication of the current issue of Music & Copyright, we conducted a poll of visitors to this blog asking whether Adele’s success disproved the argument that major-record-company dominance hampered market access for independent artists. Unsurprisingly, the majority of voters said no (see chart below). Despite the phenomenal success of Adele, one artist, no matter how big they have become, would certainly not be enough to invalidate the argument. But there have been a number of other indie-label successes that could form part of a case against the arguments concerning market-access restrictions.

What happens now for EMI?

With the dust finally starting to settle after the not guilty verdict presented to Citigroup by a jury at the US District Court for the Southern District of New York, speculation has inevitably turned to what will Terra Firma do with EMI now. The usual suspects have suggested a merger with Warner Music or a breakup of the company. To a large extent, the direction Terra Firma takes to deal with EMI’s massive debt is completely out of the Hands of the senior management of the record company. It’s perhaps worth remembering that the fact that EMI has such a massive debt is not the fault of how well the record company has done, but is more a consequence of the timing of Terra Firma’s takeover and the financial markets collapse. But, despite all the comings and goings, EMI still seems to be operating well and has of late increased revenues, no mean feat when recorded-music sales are continuing to fall.

Sony Music makes gains on dominant Universal in 2009

SME was the only music company to record an increase in market share for all sectors tracked by Music & Copyright in 2009. SME’s recorded music division narrowed the gap with the global leader UMG and although Sony/ATV remained the smallest for the four major publishers, it has closed in on third placed Warner Chappell.

UMG maintained its position as the largest recorded music company and music publisher for the fourth consecutive year in 2009, despite losing market share to its rivals. UMG’s share in terms of revenues generated from the sales of both physical and digital recorded music decreased to 27.7% from 28.6% in 2008. In contrast, SME saw its share increase to 23.1%, narrowing the gap with UMG to 4.6 percentage points.

For music publishing, Music & Copyright has calculated that Universal Music Publishing’s (UMPG) share of global publishing revenues decreased to 22.9% in 2009 from 23.2% in 2008. UMPG became the largest music publisher in the world following Vivendi’s purchase of BMG Music Publishing in 2007. Prior to UMPG taking the lead, EMI Music Publishing was the largest publisher in the world. It remained in second place in 2009 with an increased share of 19.3%.

According to Simon Dyson, editor of Music & Copyright, “2009 was a good year for SME with the company increasing its market share for both physical and digital sales, the only one of the four majors to do so. EMI’s publishing division also performed well last year, closing the gap with Universal.”

Totaling all the revenues received by the major music groups (recorded music sales, music publishing and general licensing including neighboring rights etc), Music & Copyright has calculated the figure for 2009 stood at US$22.15 billion, down 6.8% on US$23.77 billion in 2008. UMG was the leader in 2009 with a reduced market share of 27.2%. The overall successful year for SME saw it close the gap on UMG with an increased share of 20.9%.

Music & Copyright is a fortnightly research service published by Informa Telecoms & Media.