Calls are intensifying for European regulators to halt Universal Music Group’s proposed $775 million acquisition of Downtown Music Holdings. In a lengthy open letter to European Commission Vice-President and Competition Commissioner Teresa Ribera, Noemí Planas, CEO of the Worldwide Independent Network, joins forces with fellow independent music organizations — IMPALA, AIM and UFi — urging a full-scale investigation. Echoing the concerns of other orgs, Planas warns that the deal would significantly undermine market competition, threaten cultural diversity, and jeopardize the long-term viability of the independent music sector.
In her letter, dated Monday, Planas emphasizes that UMG’s growing vertical integration across distribution, publishing, management and data services poses a structural threat to the industry. By acquiring Downtown’s assets — including CD Baby, FUGA, Songtrust and Curve — UMG would gain control over infrastructure vital to thousands of independent artists and labels, along with access to confidential data that could be used to undermine competitors.
“UMG’s control over data increases its anti-competitive potential in the other areas, as it can use its rival’s data to inform its investment decisions, develop other lines of business, structure deals to its advantage, and manipulate the market to outbid competitors, putting the balance of the music market at risk.” Planas writes.
She also points to UMG’s influence in shaping streaming revenue models, such as the “artist-centric” framework, as evidence of its disproportionate market power.
“One of its consequences is that streaming services stop paying artists who do not reach an arbitrary threshold of annual plays or listeners and reallocate revenues to those that have more popularity or financial backing, an anti-competitive policy that clearly hurts small artists and independent labels,” she writes. “This, coupled with high consolidation in the recorded music sector, is creating a two-tier market.”
The acquisition, although below typical EU antitrust thresholds, was referred to the European Commission by Dutch and Austrian authorities. The Commission must now decide by July 22 whether to approve the deal, launch a deeper investigation, or require UMG to divest parts of the business. UMG hopes to close the acquisition in late 2025.
Earlier this month, IMPALA executive chair Helen Smith and AIM CEO Gee Davy voiced Planas’ concerns, arguing that the consolidation would further entrench UMG’s dominance and reduce competition, limiting opportunities for smaller players and eroding consumer choice.
Critics argue the acquisition is another example of UMG’s strategy to absorb key parts of the independent ecosystem, following its recent investment in indie label group [PIAS]. The outcome of the commission’s review is likely to have lasting consequences for the future of the global music industry, determining whether it remains diverse and competitive or becomes further consolidated under a handful of major players.
A UMG spokesperson did not immediately respond to a request for comment.
Read Plana’s full letter to Ribera here.
