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Main >> News Listing >> June 2004 >> Article ID 5195
 Christina's Label Battles for #1 spot in Record Labels | Type: Internet Article |
| | Universal's global lead under pressure | Jun 17, 2004 | by Dan Milmo
Summary:
...Sony BMG would control 25.1% of the global record market - based on 2003 sales data - if they merged their record labels, whose artists include Christina Aguilera, Alicia Keys and Bruce Springsteen... |
Universal Music faces stiff competition for the number one spot in the global record market if Sony and BMG merge their recorded music businesses, according to figures published yesterday.
Sony BMG would control 25.1% of the global record market - based on 2003 sales data - if they merged their record labels, whose artists include Christina Aguilera, Alicia Keys and Bruce Springsteen. That would put the joint venture in front of Universal Music, which saw its global share slip from 25.4% to 23.5%, according to figures from trade body the International Federation of the Phonographic Industry.
Sony BMG, however, will not include Sony's Japanese business, which is not part of the merger and is the dominant player in the world's second largest music market. Once Sony's Japanese sales are stripped out, the new company's share falls to about 22.6%, according to analysts at UBS Warburg.
Sony and BMG met European commission officials on Monday in an attempt to persuade them to approve the merger. Sources close to the process yesterday said the latest figures would make little difference to the commission's deliberations, which have been based in part on sales data from 1998 to 2003. The commission's objections centre on the major record groups' alleged "collective dominance" of the market, which in turn allows them to coordinate CD prices.
The commission has set a deadline of July 22 to reach a decision, and it must contact Sony and BMG before the end of this week if its concerns, as laid out in a recent statement of objections, have still not been assuaged.
A spokesman for Universal said a star-packed release schedule contributed to unusually strong 2002 market share figures. "In 2002 nearly every one of our superstar acts delivered a record, including Eminem, Shania Twain, U2 and Elton John. So it was an extraordinary year and it's tough to compete with that."
EMI celebrated yesterday after strong performances from Coldplay, Norah Jones and Radiohead raised its market share from 12.2% to 13.4%, pushing it above Sony into second place. The UK group's biggest gains were in Japan, Australasia and North America, traditionally a weak spot for a company which has struggled to make headway in the world's largest market.
EMI's market share gain reflected robust sales for the group last year, when it outperformed an overall market that fell 7.6% to $32bn (£17.6bn).
Sony and BMG had contrasting fortunes in 2003. BMG, a subsidiary of the German media group Bertelsmann and the smallest of the five majors, saw its market share leap from 9.6% to 11.9% on the back of significant improvements in North America and Europe. Sony, owned by the eponymous electronics group, slipped from 13.8% to 13.2%, with North America and Europe underperforming.
Warner Music kept fourth place after increasing its share from 11.8% to 12.7%. |
 Source: Guardian Unlimited | |
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