IMPALA Demands Regulatory Action Following UMG’s [PIAS] Purchase: ‘A Share Deal Is One Thing, This Is Something Else’
IMPALA is demanding an investigation into Universal Music Group’s recent purchase of the remaining stake in [PIAS], allegedly the latest byproduct of ‘unchecked concentration in the music market.’ Photo Credit: IMPALA
Now a wholly owned subsidiary of Universal Music Group (UMG), [PIAS] has officially exited the Independent Music Companies Association (IMPALA), which is calling for regulators to investigate the underlying deal.
IMPALA today confirmed the departure of [PIAS] and formally reacted to UMG’s purchase of the decades-old indie label group. Said purchase, we reported earlier this week, saw Universal Music scoop up the remaining 51% of the business after buying a 49% stake in 2022.
Besides thanking [PIAS] co-founders Kenny Gates and Michel Lambot “for their support and insight over the past twenty four years,” IMPALA took aim at the “serious problem” of “unchecked concentration in the music market” and pushed for related regulatory action. (A Wayback Machine copy of the appropriate webpage indicates that only Lambot, not Gates, had been on IMPALA’s board prior to the post-sale exit.)
“The move by UMG squeezes the independents further in an already very concentrated market,” the Brussels-based organization wrote. “It also goes against the principle established by the European Commission over ten years ago during UMG’s takeover of EMI that UMG is already too big.”
Emphasizing the EU’s evidently expired “ten year ban” on acquisitions for UMG, 24-year-old IMPALA then drove home the belief that the [PIAS] play “will increase the power of UMG across Europe and beyond.”
Moreover, regarding the consolidation efforts of all three majors, there’s “a serious risk” that Universal Music, Sony Music, and Warner Music will bring about a “real disruption for the independent sector” by continuing to spearhead indie-sector purchases, per IMPALA.
Multiple IMPALA higher-ups, including AIM interim CEO Gee Davy, weighed in on the [PIAS] sale and its implications for the indie space – with executive chair Helen Smith driving home the perceived need for competition-focused scrutiny.
“IMPALA expects regulators to investigate the acquisition and answer the question the industry is asking about how it is possible for UMG to gain more market share after it was already considered too big,” Smith spelled out of the [PIAS] purchase concerns.
“We would expect both physical and digital markets to be assessed including for distribution services, as well as the impact on competitors, digital services, artists and fans. A share deal is one thing, this is something else,” concluded Smith.
Time will tell whether the sought probe of the newest deal between UMG and [PIAS] comes to fruition – and whether the possible inquiry produces the desired result for the WIN member IMPALA. Previously, Sony Music’s AWAL purchase encountered some regulatory scrutiny in the U.K. but was ultimately approved.
Worth highlighting in conclusion is that [PIAS] co-founder Kenny Gates, as noted at the time of the sale’s announcement, is poised to continue running the business as a division of UMG; the professional status of fellow co-founder Michel Lambot wasn’t quite as clear. However, Lambot is set to “remain active in the music and broader cultural sector through a new business, Emotions,” IMPALA confirmed.
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