ghost of miles Posted November 6, 2003 Report Posted November 6, 2003 Don't know what to think about this: Bertelsmann, Sony to Merge Music Cos. By MELISSA EDDY, Associated Press Writer FRANKFURT, Germany - Bertelsmann AG (news - web sites) and Sony Corp (NYSE:SNE - news) (news - web sites). announced a preliminary plan to merge their music businesses Thursday, setting the stage for a music company that would vie for world primacy with Universal Music Group. A merger of Sony Music Entertainment and Bertelsmann's BMG, if it comes to pass, would bring together the world's No. 2 and No. 5 music companies as the industry struggles with losses blamed on music piracy. The new company, to be called Sony BMG, would be equally owned by Sony and Bertelsmann and run by Andrew Lack, chairman and chief executive of Sony Music Entertainment. Rolf Schmidt-Holtz, the chairman and chief executive of BMG, would serve as chairman of the board. Bertelsmann didn't say whether the two companies had agreed on financial terms in their letter of intent or what issues remained to be worked out before a final agreement could be struck. Patrick Reilly, a spokesman for BMG, said the two companies had agreed to hold exclusive talks, but he did not say for how long. In a letter to BMG employees obtained by The Associated Press, Schmidt-Holtz said the venture should be completed in the "coming weeks and months." A spokesman for Sony said Lack was traveling and couldn't be reached. The deal would put some of music's biggest stars under a common corporate roof. Sony Music Entertainment's labels include Columbia, Epic, and Sony Classical, and it is home to pop artists including Bruce Springsteen, Beyonce Knowles and Celine Dion (news - web sites). Among the stars on BMG's various labels are Dido, the Dave Matthews Band, Christina Aguilera, Alicia Keys, Avril Lavigne and the late Elvis Presley. Other major record companies also are seeking to merge as a way to shore up their strength in the face of declining album sales and rampant file-swapping on the Internet. EMI Group PLC (news - web sites) of Britain is in talks about the possibility of buying Warner Music Group from Time Warner Inc., three years after European regulatory opposition ended their discussions about a possible joint venture. Sony BMG would have a combined global market share of 25.2 percent, according to the market measurement firm IFPI, just behind the 25.9 percent share held by industry leader Universal Music Group, which is part of the French conglomerate Vivendi Universal. In the U.S. music market, however, the combined company would edge out Universal as the largest, based on the most recent figures available from Nielsen SoundScan. Sony and BMG have a combined 28.3 share of U.S. sales, versus 27.8 percent for Universal, according to SoundScan. If the deal goes through — it still faces approval by U.S. and European regulators — it would combine Sony and BMG's recorded music business but would exclude music publishing, physical distribution and manufacturing. Antitrust lawyers said changes in the market could mean Sony and Bertelsmann would have an easier ride than Warner Music and EMI, which European Union (news - web sites) regulators feared would lead to an oligopoly of four firms controlling 80 percent of the European market. "I'd imagine that it's a totally different market today than it was when the (European) Commission last reviewed it, particularly the advance in the ability to download music over the Internet," said Mark Powell of White and Case in Brussels. Given declining sales and profits, Sony and Bertelsmann may try to argue they need to be bigger to survive, Powell said. The board of the new company would be split, with an equal number of directors from each partner, and senior executives from both groups would join the venture. Sony shares fell 78 cents to $35.99 in early afternoon trading on the New York Stock Exchange (news - web sites). Bertelsmann is privately held. Quote
AfricaBrass Posted November 6, 2003 Report Posted November 6, 2003 Great! Eventually, we'll end up with ONE big company that doesn't re-release anything except neophyte compilations. Quote
king ubu Posted November 6, 2003 Report Posted November 6, 2003 Great! Eventually, we'll end up with ONE big company that doesn't re-release anything except neophyte compilations. ... copy controlled, as soon as EMI gets part of the deal... ubu Quote
AfricaBrass Posted November 6, 2003 Report Posted November 6, 2003 Great! Eventually, we'll end up with ONE big company that doesn't re-release anything except neophyte compilations. ... copy controlled, as soon as EMI gets part of the deal... ubu And the copy control won't actually work. It will just make the CDs sound worse. Quote
Philip Posted November 6, 2003 Report Posted November 6, 2003 Their are also reports accessible via Google News, but buried in stories on this development, that the relevant banks have agreed terms whereby Warner and EMI may merge. Hope the authorities in the EU scuper these developments, as they have earlier attempts at "rationalisation". Quote
Christiern Posted November 6, 2003 Report Posted November 6, 2003 Years ago, when RCA approached me about producing albums, John Hammond threatened me: "You do one album for RCA and you're through at Columbia!" I wonder if he's now spinning past Canton province? Quote
Stefan Wood Posted November 6, 2003 Report Posted November 6, 2003 Maybe, just maybe this will improve the reissue program of BMG, in terms of jazz. Sure, there's the Bluebird reissue series, but there is so much more to be put forth from that label! Ahh, maybe it will enable Mosaic to have some RCA boxes.......... The EMI/Warner thing is interesting. EMI is interested in buying Warner, and not the other way around? Quote
Claude Posted November 6, 2003 Report Posted November 6, 2003 Great! Eventually, we'll end up with ONE big company that doesn't re-release anything except neophyte compilations. Microsoft will buy them all and release the music in WMA files, which must be activated (paid) everytime you listen. Quote
wolff Posted November 6, 2003 Report Posted November 6, 2003 Sony owns the SACD technology anf Microsoft owns HDCD technology....... Quote
Jazzmoose Posted November 6, 2003 Report Posted November 6, 2003 And the copy control won't actually work. It will just make the CDs sound worse. Which, with what they'll be releasing, will be a good thing! Quote
AfricaBrass Posted November 6, 2003 Report Posted November 6, 2003 And the copy control won't actually work. It will just make the CDs sound worse. Which, with what they'll be releasing, will be a good thing! Good point. I guess there's a silver lining after all. Quote
mikeweil Posted November 6, 2003 Report Posted November 6, 2003 (edited) And the copy control won't actually work. It will just make the CDs sound worse. By that time we've all switched to SACD's I guess - sound of CDs won't matter any longer - but the burners and copy control game reaches round 2! Edited November 6, 2003 by mikeweil Quote
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