Last of the Mergers?

Sony and BMG’s merger has been approved by the regulatory authorities. Consolidation is an inevitable part of the period of readjustment that the music industry is going through post CD replacement cycle and in the face of piracy and DVD / game console competition. The merger was approved because its aims are very different from previously rejected mergers. The focus here is on survival, not increasing market share. However the European regulatory authorities appear to sending out the rather mixed message that they approved this deal but probably wouldn’t any future major merger. At least that is what I read between the lines of ‘paying close attention’ to the future development of the music industry. If that means that EMI could find it difficult to get any potential merger approved that would in my opinion be highly unfair. EMI would be penalized simply because they were slower to get a merger in place. In very simple terms the role of the European Union is protect and uphold the interests of its member states. If EMI was to suffer as a result of having a future merger blocked, the Commission would have failed in that duty.

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