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Essential's Mike Chadwick contacts US Senate to clarify position on EMI takeover

Essential's Mike Chadwick contacts US Senate to clarify position on EMI takeover

Chadwick was quoted in an extensive Music Week Q&A, in which he was asked his opinion on the proposed EMI takeover by Universal.

The Essential MD answered by saying, "I find these huge conglomerates a bit scary. If you're at EMI, you are at the home of The Beatles, you have this whole tradition and you probably feel part of something.

"But a combined company, with less staff? They might eventually feel lost in the ocean. Is it good for us? It's great for us: there are loads of middle-level artists who are perfect for us. If we sell 10,000 records, I'm happy - we don't have to sell a million records to make a profit.

Artists who are unhappy gravitate towards companies like us. These huge amalgamations or mergers are really good for the indies. Whether it's actually good for the music business as a whole is a different matter entirely."

Mike Chadwick's full statement to the US Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights can be found below:

"Lucian Grainge's testimony to the Subcommitee on Antitrust, Competition Policy and Consumer Rights last week contained a selective quote from an expansive interview I gave Music Week magazine in the UK earlier this year.

"Mr. Grainge suggested that I believed the proposed merger was a positive step for the business. In fact, my interview offered a view in which I questioned whether the merger would be good for the music business.

"To clarify further, my company is a sales, distribution and services company and tends not to compete on label or artist signings with Universal or EMI, however I nevertheless believe that the concentration of market power that would result from the merger would be a negative step for the industry and for independents.

"My considered view is the increase in market share and market power of the merged company would give it too much leverage with important gatekeepers such as radio, TV, music magazines and other media, as well as across retail.

"Therefore, although the transaction could free up certain artists, given Universal's enhanced market power, those artists would have significant difficulty in accessing media and commercial outlets on level terms. A merger would also enhance Universal's ability to abuse its dominant position in the emerging digital market and this would be certain to disadvantage independents in their ability to compete across the world."

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