The Giants Sony and BMG Merge

The decision of the European Commission to allow the merger of Sony and BMG creates a giant of enormous proportions. The next step is the merger of Warner and EMI. Ultimately, two mega companies will control the entire music world.

Our customers can have any color of car they want as long as it’s black – one of the famous statements by American industrialist Henry Ford. This statement may seem funny today, but it reflects the secret desire of every industry, including today’s – it wants a predictable customer. A customer who does not wander in their demands and whose needs are easy to predict. A customer who actually reduces costs. Although the consolidation of the industry is justified by cost reduction, this rarely happens. For example, the consolidation of the automotive industry did not lower car prices, and the consolidation of the music industry did not lower the prices of music CDs.

The decision of the European Commission to allow the merger of Sony and BMG creates a giant of enormous proportions. The next step is the merger of Warner and EMI. Ultimately, two mega companies will control the entire music world. There is not much diversity now either. Sony, BMG, Warner, and EMI control almost 90 percent of commercial music worldwide. While there were hundreds of music companies creating hundreds of bands and singers during the vinyl record era, today there is no diversity. It was from the world of small productions that large companies found new stars.

Today, even so-called punk bands are under contract with one of the four major companies. Large music companies are sluggish and quite uncreative, managing the impossible – turning punk bands into performers of somewhat faster hits. That such a consolidation policy in such a creative field as music production is not the happiest is shown by the fact that the music television MTV has the lowest viewership in its history. The global power of giant music companies seems to turn back the wheel of time: Our customers can listen to any singer they want if they like Justin Timberlake.

The decision that the merger of Sony and BMG does not violate market competition rules has surprised many. Impala, the global association of independent music productions, which finds itself in an even tougher situation due to this merger, has strongly protested against this decision. However, the decision is made and is unlikely to be changed. If this continues, there will only be two giant music companies on the planet. (Jasmin Krpan)