Well here is a turn up for the books in the world of major label mergers and acquisitions. Rumour has it Apple Computer is in discussions to buy Universal Music off struggling media giant Vivendi Universal. As you know, Vivendi have been selling off constituent companies in a bid to cover giant debts that crippled the company after alleged financial mis reporting last year.
Although the French media-giant said it wasn't actively considering selling off its music assets (which include Mercury, Polydor and Island in the UK), speculation grew with regards the future of the group's American based entertainment division after its boss, Barry Diller, quit the company last month. The latest reports, unconfirmed by either side, suggest Apple Computers is willing to pay up to $5bn-6bn to buy Universal's music assets. Presumably the deal would be part of Apple's move into online music – they recently signed deals with all five majors to distribute music via a new online music site designed for use with Apple's iPod MP3 player.
Although those contracts give the Apple network access to more or less every major artist, ownership of one of the majors may offer certain levels of exclusivity. That said, one analyst the BBC spoke to didn't see a purchase of Universal as a particularly logical step for the computer company – "the deal would make little sense for Apple and it wouldn't change our recommendation on Apple stock. But since we were already recommending clients to sell, things couldn't get much worse."
Some feel an outright purchase of a major label would be an extreme measure to simply enhance an online proposition, especially by a company that has had its own financial woes over the years. But competition authorities would probably be more enthusiastic about a computer firm entering the music industry than Universal's music assets merging with those of another major record company.
On a different note, if Apple did buy Universal Music there might be some naming issues. When Apple launched their computer business back in the early 80s Beatles label Apple Music gave them permission to use the name on the condition they never went into the music business!