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French regulator approved Warner Music’s owner taking a controlling stake in Deezer, new documents confirm

By | Published on Friday 9 September 2016

Deezer

The French competition regulator gave the all-clear earlier this summer to Warner Music owner Access Industries taking a controlling stake in that there streaming whatnot Deezer, it emerged earlier this week. So well done Len.

Access Industries seemingly increased its stake in Deezer beyond 50% as a result of the streaming music company’s previously reported 100 million euro investment round back in January, which was led by Len Blavatnik’s US-based conglomerate. Although previous majority shareholder Orange still has a stake, it’s thought the tel co’s shareholding is now around about 10%.

The deal took majority ownership of Deezer out of French control for the first time, and also raised a few competition concerns, mainly because of Access owning Warner Music outright. It was suggested that Access having control of Deezer could result in the streaming service giving preferential treatment to Warner labels, or vice versa.

However, the French competition regulator concluded that neither Warner nor Deezer had sufficient market share to justify those concerns. While Deezer may be a major player in the French streaming market, it’s global market share is much smaller and, anyway, a mainstream streaming service couldn’t compete without music from at least the other two bigger major record companies, so the streaming firm couldn’t afford not to keep them sweet.

It also seemed unlikely that Warner would want to offer especially preferential terms to Deezer, given how much of its streaming income worldwide actually comes from Spotify and Apple Music. Some suggested Warner might start providing Deezer with a steady stream of artist exclusives, given such exclusives are how rivals Apple Music and Tidal have been building up their subscriber bases this last year, though again the regulator said that neither Warner nor Deezer had sufficient market dominance to create concerns.

Finally the French regulator stated that Deezer’s turnover was not big enough for this to be a matter for the European Commission, and thus it gave the all clear to Access taking its controlling stake in the streaming company. In addition to Warner and Deezer, Access also has interests in ticketing via Songkick and artist management via First Access Entertainment, as well as stakes in businesses working in film and television.



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