Michaël Majster, founding companion 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, real looking, and rational evaluation”.
Throughout his profession, Majster has represented each multi-platinum and rising artists in France, plus outstanding unbiased document 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 workers of unbiased music corporations and commerce our bodies signed a letter citing knowledge considerations about UMG’s potential acquisition of Downtown subsidiariesFUGA and Curve Royalty Programs.
The letter contended that UMG’s possession of those subsidiaries would grant it entry to delicate knowledge from unbiased labels, similar to “distribution data – together with artists and tune traits, and efficiency on digital platforms [plus] important enterprise data similar to pricing, contractual phrases and strategic relationships”.
Majster argued that a lot of this knowledge is already “simply publicly obtainable or accessible” by present market intelligence companies.
“I don’t see how this Downtown knowledge offers 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 enable it to know the music market and all market traits,” Majster mentioned.
“Buying Downtown won’t change the state of affairs 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 considerations that the transaction could enable UMG to “scale back competitors within the wholesale marketplace for the distribution of recorded music within the European Financial Space by buying commercially delicate knowledge of its rival document labels.”
The unique November 26 deadline for the investigation’s completion was just lately prolonged to December 10.
Addressing particular considerations about UMG accessing artist royalty knowledge by way of Curve Royalty Programs, Majster questioned the sensible worth of doing so for the foremost.
“I don’t perceive how the info mirrored in artists’ royalty statements may very well be of any curiosity in anyway to a label [considering signing them],” he mentioned.
“Once you enter into negotiations with an artist — whether or not by their supervisor, their lawyer, or immediately with the artist — you possibly can merely request this data,” Majster mentioned, noting that competing labels often obtain the identical data concurrently throughout bidding wars.
“Negotiations are based mostly extra on what an artist needs to realize sooner or later, which isn’t essentially correlated with what they’ve already of their contracts.”
“I don’t perceive how the info mirrored in artists’ royalty statements may very well be of any curiosity in anyway to a label… Once you enter into negotiations with an artist, you possibly can merely request this data.”
Michaël Majster, Majster & Nehmé
Addressing fears about UMG utilizing Downtown or FUGA’s knowledge to determine rising artists and signal them forward of unbiased labels, Majster was skeptical.
“All the market has a lot entry to knowledge,” he mentioned. “They will all see the streams on a weekly foundation of each tune on the earth in each nation.
“I don’t see how this Downtown knowledge offers any perception that UMG doesn’t have already got.”
He pointed to present major-owned distribution companies – Sony‘s the Orchard, Common’s Virgin Music Group, and Warner‘s ADA – as proof.
“If the [internal partner label] knowledge from a distributor was so vital, then we’d have already seen the disruptive results on the enterprise of the majors utilizing their knowledge 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 its indie-servicing division, Virgin Music Group (VMG).
Earlier this 12 months, VMG co-CEOs JT Myers and Nat Pastor addressed inside knowledge safety considerations in a letter to workers, stating: “Betraying the belief our purchasers have bestowed on us can be self-destructive: they’d shortly, and fairly rightly, finish the connection. Which is why we’re proud to say that because the day we entered this enterprise, we’ve by no means had a single grievance of misuse of consumer data of any sort.”
Majster emphasised that any knowledge misuse by a Downtown-owning UMG would set off extreme penalties: “Any misuse of this knowledge would trigger important reputational injury and will end in extreme sanctions from the competent authorities within the numerous European international locations.”
He famous that such knowledge would sometimes fall below GDPR protections in Europe, and would doubtless be lined by confidentiality agreements between Curve and its purchasers.
Crucially, he famous the absence of documented instances of main labels misusing distribution or companies knowledge thus far. “By no means!” he acknowledged when requested about such cases over the previous decade, including that considerations round potential UMG knowledge misuse seem to lack particular examples of problematic practices.
“No particular instances 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 companies class.”Music Enterprise Worldwide
