Sony And BMG To Merge – Record Label Consolidation Begins

Deals

from the here-it-comes... dept

As the big five established record labels have continued to struggle with the new digital world and all of the potential business models they prefer to ignore, it’s been no surprise that they’ve felt lost. Thus, the rumors of mergers among the labels have been heating up over the past few months. It looks like the race to merge has begun as the NY Post is reporting that Sony Music and BMG will merge. This follows a recent failed attempt to sell BMG to Warner Music and continued talks to merge EMI with Warner. Of course, big music label mergers in the past (EMI with BMG and Warner with EMI) have been stopped by regulators, but this time people think regulators are more open to the idea. Now, here’s the tricky part: chances are only one such merger will go through. So, if BMG/Sony makes it out the door first, then it may kill off the plans of Warner and EMI. Meanwhile, they’ll all continue to miss any opportunity to actually embrace new business models, but that’s a story for another post.