Market consolidation and other competition issues
IMPALA’s aim is to keep the market as open and as competitive as possible for the independent sector. All markets need big companies and all businesses need good options to grow or sell. At the same time, when big is too big, competition suffers and the regulators need to step in.
This means keeping an eye on what’s happening across the market, including with consolidation as that squeezes the independents further in an already very concentrated market and also impacts key markets such as digital.
One example is raising the alarm about what is happening with juggernaut economics in the music market – unstoppable acquisitions and control of digital services, see for example here.
We also raise red flags over other practices which hamper competition such as TikTok’s boycott of Merlin which also raises issues under the EU’s Digital Markets Act. New ways of looking at competition issues in key strategic markets such as music is also important, as these markets which have their own specificities.
IMPALA has an impressive record on competition cases in the music sector. The first EMI/Warner merger was withdrawn in 2001 following objections from the EU after IMPALA intervened, in its first year of existence. It also won a landmark judgment in 2006 in the Sony/BMG case, and when Sony acquired 30% of EMI publishing in 2012, it was at the cost of significant divestments. The biggest set of remedies proportionately ever in a merger case was secured later that year, when UMG was forced to sell two thirds of EMI records and had to accept ten years of scrutiny over the terms of its digital deals. When WMG bought Parlophone in 2013, IMPALA secured a hefty divestments package for its members. IMPALA also represented the independents in the various Sony/EMI merger cases from 2012 to 2018, where the EU ultimately approved the acquisition based on remedies Sony agreed in 2012. In the UK, we also contributed to the CMA deciding to go for a detailed investigation into the SONY/AWAL merger here as well as raise concerns about other strategic acquisitions.
We also raised concerns over UMG’s acquisition of [PIAS] in October 2024, and again in December 2024 following the announcement that UMG-owned Virgin Group’s was buying Downtown, further reducing independent routes to market. IMPALA continued to sound the alarm on UMG’s consolidation strategy, described as a “juggernaut” approach aimed at total market control. This included raising objections to the acquisition of Downtown Music, which went under full phase two EU scrutiny following a referral by a national competition authority, and ending with structural remedies 14 months after the deal was announced, see here for the conclusions to draw.
Additional concerns emerged during the process with UMG’s purchase of 8Ball Music in the Netherlands and Amazon’s disproportionate promotion of major label content through its “Streaming 2.0” model. IMPALA consistently warned that these moves pose serious regulatory and structural threats to the independent sector, potentially limiting choice for both artists and music fans alike.
In June 2025, IMPALA published a report on « Combatting the emergence of a two-tier music streaming market », carried out by industry experts Dan Fowler and Katherine Bassett (statement here). As well as evaluating how a two-tier market has evolved, the authors benchmark the current state of the music streaming market against IMPALA’s streaming plan as a set of KPIs for the industry. The report concludes that there are “five critical areas for immediate attention”:
- Combatting AI dilution and streaming fraud through cross-industry collaboration and regulation.
- Reforming royalty distribution models to ensure fair access for all market participants and increasing subscription fees in line with inflation.
- Enhancing transparency in DSP practices, especially concerning play-boosting tools and content de-monetisation.
- Restricting and reversing market consolidation to maintain competitive diversity.
- Embedding consultation and impact assessment into any future industry changes to avoid unintended harm.
Acquisition of key independent players is also happening in key national markets across the globe. Sony bought Som Livre, Brazil’s biggest independent music company, in a deal that increased Sony’s power significantly in the region and as well as with digital players as brazil is one of the worlds’s leading digital markets. This inevitably impacts Europe given the importance of Som Livre’s repertoire worldwide as well as the strategic significance of this deal. In the same year Sony also acquired the music catalog of the Mexican independent regional label and management company, Remex Music, for an undisclosed fee.
When UMG sold 20% of its shares to Chinese tech giant Tencent, we also raised concerns, with Tencent Music Entertainment taking a stake in UMG’s China operations. In parallel, in China, the competition regulator started to become critical of Tencent’s exclusivity deals and ordered Tencent to relinquish any exclusivity rights it still has over music catalogue. (See more in the members note below).
Other market developments have also been flagged by IMPALA as a risk, including TikTok’s boycott of Merlin as flagged above. Spotify’s move to reduce royalty rates in return for alogrithmic plays, which IMPALA and others in the sector have described as basic pay for play, payola as it is know when it comes to traditional radio players (see point 9 of IMPALA’s 10 point plan on streaming, revisited in April 2023, two years after the release of our initial plan).
IMPALA was invited to contribute to the UK enquiry into streaming and this was the opportunity to flag our views on issues such as consolidation, vertical integration, etc. See our full response to their statement of scope here. The CMA published their first findings and recommendations, which we also commented on.
