As expected, the digital music market was the core issue at yesterday’s US Senate subcommittee hearing into Universal Music Group’s proposed acquisition of EMI’s recorded music division. For a good overview, read the coverage from the New York Times, Wall Street Journal and Billboard.

We covered Beggars Group’s Martin Mills’ views on the dangers of UMG having “the power to dominate Internet services and impose their demands upon them” yesterday. Unsurprisingly, UMG boss Lucian Grainge disagreed.

“The thought that we would constrict our artists who we’ve invested in, and construct the investment we make in EMI to dissolve the market would be commercial suicide,” he told the hearing. “We would be insane not to license, develop, make our music available through as many platforms, through as many retailers as possible.”

There were odd moments – Public Knowledge’s Gigi Sohn’s suggestion that UMG’s refusal to license Grooveshark as an example of its lack of innovation, for example. Meanwhile, Edgar Bronfman Jr’s point – “At 50% of the hits, Universal can say no to anything” – was a good one, but somewhat eyebrow-raising given WMG’s traditionally-hawkish approach to licensing.

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Stuart Dredge

Music Ally's Head of Insight

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