Universal Music Group’s search for ways to convince European regulators to approve its acquisition of EMI’s recorded music division continues.
“Behavioural remedies” remain on the cards, but attention this week is focusing back on UMG selling off labels. The Telegraph suggests that UMG’s classical and jazz labels, and Virgin Records may be up for grabs.
Enter Sir Richard Branson, who has emerged as a potential bidder for Virgin Records – the company he started back in 1970. “The potential disposal of Virgin Records by Universal Music offers a wonderful opportunity to recreate a dynamic independent label in the market,” his spokesperson tells The Guardian. Branson is expected to team up with former Virgin Records France exec Patrick Zelnick on a bid.
It makes for fun speculation, but the crux for approval of the deal continues to be the digital implications. Indie body Merlin is on the warpath, with its board voting to continue its opposition to the deal.
“In a market already hampered by Universal’s exploitation of its market leading position, this proposed acquisition could only serve to damage the digital ecosystem, not only for our members, but also for potential investors and consumer,” says CEO Charles Caldas.
A few years ago, selling off catalogues would have been the key remedy for approval of this kind of deal. In 2012, that’s just part of the picture. Richard Branson may seize the headlines, but comments from the EC and UMG boss Lucian Grainge alike in recent weeks show they understand where the real pressure points are in this approval process.