EMI Might Sell, New Strategy In Store?
New York, NY (May 30, 2008) – EMI chief Guy Hands released his quarterly letter to investors and the report was not all sunshine. While Hands reported growth on the publishing end, EMI’s admitted debt appears, according to analysis by NY Post’s Brian Garrity, “unsellable.” More insight from The Coolfer Blog:
Such a sale would result in three major music companies that would account for about 80% of all recorded music sales in the U.S. Economic efficiencies, yes, but this has got to be close to the point at which regulators become too uncomfortable with the concentration of market share. It would be bad for sales, too. Labels merge, bands dropped from contracts, fewer acts developed, fewer titles released, fewer units sold. Good for catalog sales, but at that rate the majors would be in jeopardy of becoming archivists rather than creators.
I might be delusional, but I think EMI is simply going through the initial trailblazing stages of being the first major to shed itself of the old business model. No one can say for sure what the right course is at this point, but they’re not looking to quit; they will work to right the ship with new and innovative strategies. I suppose the distressing thing is that there is little chatter about what those strategies might actually be, but this candid announcement could simply be part of it. The good thing about the digital space is that, assuming you can handle the technology, there is an unlimited field on which to create your vision.
Hands is no dummy, but moves like licensing their catalog to MediaAnywhere kiosks will only tide them over for so long; especially if those kiosks don’t catch fire. Overseas retailer HMV is banking that they do, however. They’re creating a whole new feel to their stores with download stations, free wi-fi, and I’d assume, a stage for live shows. Would you go and hang out at your nearest Virgin megastore? Or is this an opportunity for the Mom & Pop shop to reinvent itself?