Warner Music Group Buys Parlophone

Jimmy Haas

by Jimmy Haas

Published May 16, 2013


Warner Music Group has finalized the purchase of Parlophone Label Group, which was the last remaining piece of the break-up and sale of EMI over the last few years. EMI, which had been the fourth most powerful major label in the world, had its recorded music division bought out by Universal Music Group for $1.9 billion in late 2011. However, European regulators required that one third of EMI be sold off to preserve competition in the music market. In the end, UMG sold off some labels that EMI had owned, such as Parlophone, which itself owns other labels such as Chrysalis and Ensign. However, they retained the rights to The Beatles and Robbie Williams. At the same time, Sony Music Group purchased EMI Music Publishing, the largest music publisher in the world, for $2.2 billion.

The break-up of EMI was required by European regulators because they felt that Universal would have an unfair market share if they were allowed to purchase the entirety of EMI. They felt that way because Warner Music Group is the smallest of the three major labels and they would not create an unfair situation upon their acquisition of the Parlophone Label Group. The Parlophone label is home to some huge acts such as Pink Floyd, Coldplay, David Guetta, and some of Radiohead's older albums.

According to Billboard, independent label groups such as Merlin and IMPALA will be sold about one third of Parlophone's assets, as part of WMG's deal with regulators. Which third, however, is up to Warner.

The Guardian also points out that with new owners come new deals with artists. Whereas EMI was known for giving more favorable deals, including partnerships with artists such as Robbie Williams, Warner is known to push for 360 deals, in which the label receives part of every revenue stream an artist has including live shows and merchandising. This has been the trend of major labels, which they claim as necessary due to decreasing revenues from music sales.

However it works out, the artists on Parlophone are most likely just happy to finally have everything sorted out after years of short-lived new owners. Hopefully they can also keep the favorable deals that EMI had worked out with them as well.

Via New York Times

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