Business News Week In Five

CMU Digest – 28 Sep 2012

By | Published on Friday 28 September 2012


The five biggest stories in the music business this week…

01: Universal’s acquisition of the EMI record company properly began, after regulators in both the European Union and the US approved the deal, after long investigations, last Friday. Ownership formally transfers today, with EMI CEO Roger Faxon exiting as it does so. No remedies were required in America, but in Europe Universal will have to offload up to 60% of EMI’s assets, including the Parlophone label. Various parties have expressed interest, with BMG still thought to be leading the way, though it may take a little time to work out the specifics of what exactly is on the table in terms of rights and artist relationships. Universal will also sell some of its periphery divisions as part of its deal with the European regulator, including indie label services business Co-op Music. Rumour has it independent distributor [PIAS] hopes to acquire that, something several Co-op clients have written to Music Week about, expressing opposition to the proposal. CMU timelineMusic Week report on Co-op Music

02: Lyor Cohen announced his departure from Warner Music, where he has headed up the major’s recorded music operations for sometime, in North America since 2004. It’s thought Cohen had disagreements on the strategic direction that the wider Warner music company should be taking with Stephen Cooper, the man appointed CEO by newish owners Access Industries last year. No word yet on a replacement, though EMI’s outgoing top man Roger Faxon denied rumours he’d been approached. Some wonder if Cohen will be replaced at all, or if label division heads might not just stay reporting into Cooper directly. As for Cohen’s future, the most believable rumour is that he has ambitions to launch a management and brand partnerships agency. CMU report |  New York Post report

03: Music Festivals plc and Guilfest called in the administrators, bringing a very shaky UK summer festivals season to a close with a thud. Music Festivals plc, created by British live music veteran Vince Power just last year, and operators of the Hop Farm and Benicassim, had been issuing gloomy shareholder statements for much of the year, so it going into administration didn’t come as a huge shock. Guilfest, one of the UK’s longest running festivals, was hit by incredibly bad weather and a very crowded events calendar in and around London, resulting in debts making the future of the festival unviable without new ownership. Music Festivals plc report | Guilfest report

04: Two more artists sued over digital royalties, this time targeting Sony Music. This week it was REO Speedwagon and William ‘Boz’ Scaggs arguing that the major should be paying them the higher ‘licensing deal’ royalty on download revenue, rather than the lower ‘record sales’ royalty cut. They join a long line of heritage artists with pre-iTunes contracts suing on this issue, all citing the ruling in the much previously reported FBT Productions v Universal Music case. Sony is hoping that it can circumvent the growing pile of such litigation via a deal struck up in response to an earlier class action on the digital royalties point a few years back. That deal, basically offering heritage artists a 3% royalty increase on downloads if they shut up and go away, is still awaiting court approval. Presumably REO Speedwagon and Scaggs reckon they can get quite a bit more than 3% by suing directly. CMU report | Hollywood Reporter report

05: Megabox and the new look MySpace both posted preview videos. Kim Dotcom has been tweeting about his direct-to-fan platform, which was in development before the rest of the MegaUpload empire was shut down by the Feds, with increased frequency of late. And this week he posted a little video to prove it’s real. Meanwhile the owners of MySpace, including that Justin Timberlake dude, posted a video of their all new website, which will see the once uber-social network starting from scratch with what they hope might become the social media platform of choice for creative types. Neither preview video told us much about what the two services will actually offer. Megabox report | MySpace report

Also in CMU this week, Andy Malt wrote about the woes of the UK festival market this summer in his Editor’s Letter, and he also had a chat to Kid Koala about his new album. The CMU Podcast returned after a bit of a break too, and in the Approved column we had Lianne Le Havas remixed by Laurel Halo, Nadine Shah, Cold Cave, and Scarlet Soho.

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