Outlook: So Warner Music, the only one of the four major record label companies to be based in the US, has had EMI snatched from under its nose by French-owned rival Universal Music. Warner has coveted EMI for so long, the outcome of the auction looks almost like a tragedy, but it may yet have the last laugh.
Getting the takeover through the competition authorities in Europe will be tough going for Universal. The economics of the music industry may have been completely upended since the last European Commission examination, but the dominance of the major labels has only increased since then.
The internet has given new opportunities for unsigned artists and indie labels to reach customers, but when it comes to making the big bucks, it is cutting deals with concert promoters and ticket sellers like Live Nation and Ticketmaster that really count. With a greater proportion of artists' money coming from touring and merchandising, anything that puts them at a negotiating disadvantage must be resisted.
Even Warner would have had trouble navigating these issues. Now it is the much bigger Universal that will foot the legal bill, in order to get clarity on competition regulators' views of the industry landscape. If the deal gets through, Warner can pick up some of the pieces that Universal will surely be made to sell; if it doesn't, Warner will know whether it is worth bidding again.