RUMOR MILL
“EMI’s labels will be reinvigorated and artists will have more choices, which will lead to more competition in this dynamic market.”
——Lucian Grainge
Thursday, June 21, 2012
UMG-EMI SENATE ANTITRUST HEARING HIGHLIGHTS
Excerpts From Today’s Testimony by Lucian Grainge, Irving Azoff, Gigi Sohn
In advance of today’s hearing on the UMG-EMI merger by the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights, we’ve gathered some excerpts from the prepared testimony of three of today’s speakers. And while we don’t know the exact order of their appearances, we were tipped that Irving Azoff will directly follow Edgar Bronfman. Fun stuff, eh?
Lucian Grainge, UMG: “The future of the music industry depends on new ideas, new business partnerships, and of course, the development of new artistic talent. This industry will always change and redefine itself. But one thing will remain constant—the demand for great music. I look forward to reinvigorating EMI’s labels with Universal’s resources, expertise, and innovation, so that EMI can continue its tradition of discovering, producing, and sharing with the world some of the greatest music of our time…
“With Universal’s infusion of resources and commitment to investing in artistic development, there will be a healthy future for [EMI]. We are absolutely committed to investing in EMI as a distinct business that can help us develop even more music and more choice for consumers and fans everywhere. EMI’s labels will be reinvigorated and artists will have more choices, which will lead to more competition in this dynamic market…
“Through our acquisition of EMI, Universal will enhance the creative investment in the company and further broaden the support for digital services. This will provide more opportunities for artists and more music and choice for consumers than ever before.”
Irving Azoff, Live Nation: “Approximately 40% of Front Line artists aren’t even on labels. I have no doubt that labels add value, but you just don’t have to have one in a world where artists can deliver an album direct to fans themselves. It’s a little like hiring an interior decorator to re-do your house. The experience and results can be great but some acts enjoy and prefer to do it on their own and put their own imprint on things. And with services like iTunes, CD Baby, Top Spin, ReverbNation, Pro Tools, Facebook, Spotify—you name it—artists can do everything themselves very professionally…
“The reason a combined EMI-UMG is a good thing rests in the much bigger picture. Our industry has been turned on its head in the last decade. With all the 3 great developments the internet has brought us, the economics are still daunting. Most musicians make a living today from touring—not record sales as they once did. And it makes sense, since consumers aren’t buying $15 CDs any more, they’re paying for a single track download from Amazon or iTunes or listening to ad-supported services that result in mere fractions of a penny-per-play being paid to the artist—or worse, still, they just go to a torrent site and get it for free. Late to embrace the Internet, labels are playing catch-up—but any way you slice it, recorded music sales are still the core of a label’s business model…
“Bottom line: The people concerned that a combined EMI-UMG would have too much 'power' really just don’t get what has happened to this business over the last decade. Labels don’t control artists. Those days are gone. And no label in the world can control the supremacy of the modern music fan. The power shift has already taken place—and no one should worry for a minute that it rests with the labels any longer.
Gigi Sohn, Public Knowledge: “New digital services provide that kind of access and as a result have been wildly popular in 2011 alone, consumers bought 1.3 billion singles and 100 million albums at a cost of nearly $2.5 billion. A combined UMG-EMI is a threat not only to the current services that exist (and there aren’t that many to begin with), but especially to any future ones that might arise.”
The webcast of the hearing, which begins this afternoon at 1:30 p.m. (ET)/10:30 a.m. (PT), can be streamed here.
Lucian Grainge, UMG: “The future of the music industry depends on new ideas, new business partnerships, and of course, the development of new artistic talent. This industry will always change and redefine itself. But one thing will remain constant—the demand for great music. I look forward to reinvigorating EMI’s labels with Universal’s resources, expertise, and innovation, so that EMI can continue its tradition of discovering, producing, and sharing with the world some of the greatest music of our time…
“With Universal’s infusion of resources and commitment to investing in artistic development, there will be a healthy future for [EMI]. We are absolutely committed to investing in EMI as a distinct business that can help us develop even more music and more choice for consumers and fans everywhere. EMI’s labels will be reinvigorated and artists will have more choices, which will lead to more competition in this dynamic market…
“Through our acquisition of EMI, Universal will enhance the creative investment in the company and further broaden the support for digital services. This will provide more opportunities for artists and more music and choice for consumers than ever before.”
Irving Azoff, Live Nation: “Approximately 40% of Front Line artists aren’t even on labels. I have no doubt that labels add value, but you just don’t have to have one in a world where artists can deliver an album direct to fans themselves. It’s a little like hiring an interior decorator to re-do your house. The experience and results can be great but some acts enjoy and prefer to do it on their own and put their own imprint on things. And with services like iTunes, CD Baby, Top Spin, ReverbNation, Pro Tools, Facebook, Spotify—you name it—artists can do everything themselves very professionally…
“The reason a combined EMI-UMG is a good thing rests in the much bigger picture. Our industry has been turned on its head in the last decade. With all the 3 great developments the internet has brought us, the economics are still daunting. Most musicians make a living today from touring—not record sales as they once did. And it makes sense, since consumers aren’t buying $15 CDs any more, they’re paying for a single track download from Amazon or iTunes or listening to ad-supported services that result in mere fractions of a penny-per-play being paid to the artist—or worse, still, they just go to a torrent site and get it for free. Late to embrace the Internet, labels are playing catch-up—but any way you slice it, recorded music sales are still the core of a label’s business model…
“Bottom line: The people concerned that a combined EMI-UMG would have too much 'power' really just don’t get what has happened to this business over the last decade. Labels don’t control artists. Those days are gone. And no label in the world can control the supremacy of the modern music fan. The power shift has already taken place—and no one should worry for a minute that it rests with the labels any longer.
Gigi Sohn, Public Knowledge: “New digital services provide that kind of access and as a result have been wildly popular in 2011 alone, consumers bought 1.3 billion singles and 100 million albums at a cost of nearly $2.5 billion. A combined UMG-EMI is a threat not only to the current services that exist (and there aren’t that many to begin with), but especially to any future ones that might arise.”
The webcast of the hearing, which begins this afternoon at 1:30 p.m. (ET)/10:30 a.m. (PT), can be streamed here.
