Sony Music Entertainment's purchase of London-based independent record label AWAL has raised competition concerns as it may lead to worse terms for artists, a UK watchdog said on Tuesday.
The Competition and Markets Authority found that the wholesale distribution of recorded music in the UK is highly concentrated at present and if the deal had not gone ahead, Sony and AWAL could have competed more strongly with each other. "We're concerned that this deal could reduce competition in the industry, potentially worsening the deals on the table for many music artists in the UK, and leading to less innovation across the industry," CMA Senior Director Colin Raftery said.
Sony has five working days to address CMA's concerns, failing which it may face an in-depth investigation, the regulator said. "This decision by the CMA is perplexing and based on an incorrect understanding of AWAL's position in the UK," said Sony Music Entertainment, which is owned by Sony Group.Source: Reuters