Michaël Majster, founding associate at Paris-based Majster & Nehmé and a 30-year authorized veteran, described the data-related fears as stemming “extra from fantasy or paranoia than from a concrete, lifelike, and rational evaluation”.
Throughout his profession, Majster has represented each multi-platinum and rising artists in France, plus outstanding impartial report labels and distributors, and a significant music writer. He has not represented UMG or Downtown.
He’s rated within the prime tier of music legislation practitioners in France by the industry-standard Décideurs Leaders League.
In July, some 200 staff of impartial music firms and commerce our bodies signed a letter citing information issues about UMG’s potential acquisition of Downtown subsidiariesFUGA and Curve Royalty Methods.
The letter contended that UMG’s possession of those subsidiaries would grant it entry to delicate information from impartial labels, reminiscent of “distribution info – together with artists and track developments, and efficiency on digital platforms [plus] important enterprise info reminiscent of pricing, contractual phrases and strategic relationships”.
Majster argued that a lot of this information is already “simply publicly accessible or accessible” by means of current market intelligence providers.
“I don’t see how this Downtown information gives any perception that UMG doesn’t have already got.”
Michaël Majster, Majster & Nehmé
“You’ll be able to see the variety of streams for every title on Spotify, for instance,” he famous, including that labels routinely use specialised instruments like Luminate and Chartmetric for in-depth market evaluation.
“When [I’m] negotiating on behalf of artists with a significant like UMG it’s clear to me that [Universal] already has extremely refined instruments that permit it to grasp the music market and all market developments,” Majster stated.
“Buying Downtown is not going to change the scenario considerably on this respect.”
Europe’s competitors regulator confirmed in July that it had opened an in-depth (Part 2) inquiry into UMG’s proposed $775 million acquisition of Downtown, following an preliminary Part 1 investigation.
The EC has cited preliminary issues that the transaction could permit UMG to “scale back competitors within the wholesale marketplace for the distribution of recorded music within the European Financial Space by buying commercially delicate information of its rival report labels.”
The unique November 26 deadline for the investigation’s completion was not too long ago prolonged to December 10.
Addressing particular issues about UMG accessing artist royalty information through Curve Royalty Methods, Majster questioned the sensible worth of doing so for the key.
“I don’t perceive how the information mirrored in artists’ royalty statements might be of any curiosity in any respect to a label [considering signing them],” he stated.
“While you enter into negotiations with an artist — whether or not by means of their supervisor, their lawyer, or immediately with the artist — you possibly can merely request this info,” Majster stated, noting that competing labels often obtain the identical info concurrently throughout bidding wars.
“Negotiations are primarily based extra on what an artist desires to realize sooner or later, which isn’t essentially correlated with what they’ve already of their contracts.”
“I don’t perceive how the information mirrored in artists’ royalty statements might be of any curiosity in any respect to a label… While you enter into negotiations with an artist, you possibly can merely request this info.”
Michaël Majster, Majster & Nehmé
Addressing fears about UMG utilizing Downtown or FUGA’s information to determine rising artists and signal them forward of impartial labels, Majster was skeptical.
“The whole market has a lot entry to information,” he stated. “They will all see the streams on a weekly foundation of each track on the earth in each nation.
“I don’t see how this Downtown information gives any perception that UMG doesn’t have already got.”
He pointed to current major-owned distribution providers – Sony‘s the Orchard, Common’s Virgin Music Group, and Warner‘s ADA – as proof.
“If the [internal partner label] information from a distributor was so vital, then we might have already seen the disruptive results on the enterprise of the majors utilizing their information from, for instance, The Orchard, Virgin [Music Group], and ADA to benefit themselves. Has anybody actually felt that?”
Common has proposed buying Downtown (plus FUGA and Curve) by means of its indie-servicing division, Virgin Music Group (VMG).
Earlier this 12 months, VMG co-CEOs JT Myers and Nat Pastor addressed inner information safety issues in a letter to employees, stating: “Betraying the belief our shoppers have bestowed on us could be self-destructive: they might shortly, and fairly rightly, finish the connection. Which is why we’re proud to say that for the reason that day we entered this enterprise, we have now by no means had a single criticism of misuse of consumer info of any form.”
Majster emphasised that any information misuse by a Downtown-owning UMG would set off extreme penalties: “Any misuse of this information would trigger vital reputational injury and will lead to extreme sanctions from the competent authorities within the numerous European international locations.”
He famous that such information would sometimes fall below GDPR protections in Europe, and would possible be lined by confidentiality agreements between Curve and its shoppers.
Crucially, he famous the absence of documented circumstances of main labels misusing distribution or providers information to this point. “By no means!” he said when requested about such cases over the previous decade, including that issues round potential UMG information misuse seem to lack particular examples of problematic practices.
“No particular circumstances are given [by critics of the Downtown deal] as an example these fears or any probably problematic practices,” Majster noticed.
UMG has maintained confidence that its Downtown acquisition will create “an improved providing within the rising and extremely aggressive label providers class.”Music Enterprise Worldwide
