Sony Corp is to become the largest music publisher in the world following its decision to take over EMI for an investment of about $2.3 billion. Sony Corp said on Tuesday.
Since taking over as the CEO of Sony, for Kenichiro Yoshida this was is the largest deal that will see the company gaining control over 2 million songs from artists such as Kanye West, Sam Smith and Sia.
The deal would help Sony in the sphere of music streaming services, the new trend in the global music industry with companies like Spotify and Apple Music registering significant growth in the segment and helping in a resurgence of the music industry.
The acquisition also snugly fits into the latest strategy of Sony in looking out for revenue streams that are more stable. Earlier. the company shifted away from its strategy of dealing in low-margin consumer electronics towards entertainment content and image sensors.
“This investment in content intellectual property is a key stepping stone for our long-term growth,” Yoshida said at a news conference.
According to company executives, about 15 per cent of the global music publishing industry is commanded by EMI currently and when that is combined with the ATV business of Sony. The resultant market share would put the company in first place globally with a total market share of 26 percent.
Universal Music Group and Warner Music Group are among the other leading players in the market.
Sony will buy out Mubadala Investment Company’s holding and thus will increase its current 30 per cent holding in EMI Music Publishing to 90 per cent. Sony already runs EMI Music Publishing.
“The rise in digital streaming is also expanding songwriter royalty revenues, with Sony capturing value as manager of the copyrights backed by direct deals with the likes of Spotify, Apple Music, Google Play, SoundCloud and YouTube,” Macquarie analyst Damian Thong said in a report.
The aim of Sony is to focus on stable cash flow while attempting top reduce the volatility in the game consoles and other electronics gadgets market segment because of volatile sales cycles, Yoshida, who took charge of the company in April, said.
The company also announced a new three-year business plan but did not provide any forecast on operating profit target for the group.
Rather the company announced that its target was to a cash flow of a total of 2 trillion yen ($18 billion) or more in the next three years which would be 500 billion yen more compared top the same figure in the last three years.
The biggest profit contributors are slated to be its gaming and image sensors business.
(Source:www.reuters.com)
Since taking over as the CEO of Sony, for Kenichiro Yoshida this was is the largest deal that will see the company gaining control over 2 million songs from artists such as Kanye West, Sam Smith and Sia.
The deal would help Sony in the sphere of music streaming services, the new trend in the global music industry with companies like Spotify and Apple Music registering significant growth in the segment and helping in a resurgence of the music industry.
The acquisition also snugly fits into the latest strategy of Sony in looking out for revenue streams that are more stable. Earlier. the company shifted away from its strategy of dealing in low-margin consumer electronics towards entertainment content and image sensors.
“This investment in content intellectual property is a key stepping stone for our long-term growth,” Yoshida said at a news conference.
According to company executives, about 15 per cent of the global music publishing industry is commanded by EMI currently and when that is combined with the ATV business of Sony. The resultant market share would put the company in first place globally with a total market share of 26 percent.
Universal Music Group and Warner Music Group are among the other leading players in the market.
Sony will buy out Mubadala Investment Company’s holding and thus will increase its current 30 per cent holding in EMI Music Publishing to 90 per cent. Sony already runs EMI Music Publishing.
“The rise in digital streaming is also expanding songwriter royalty revenues, with Sony capturing value as manager of the copyrights backed by direct deals with the likes of Spotify, Apple Music, Google Play, SoundCloud and YouTube,” Macquarie analyst Damian Thong said in a report.
The aim of Sony is to focus on stable cash flow while attempting top reduce the volatility in the game consoles and other electronics gadgets market segment because of volatile sales cycles, Yoshida, who took charge of the company in April, said.
The company also announced a new three-year business plan but did not provide any forecast on operating profit target for the group.
Rather the company announced that its target was to a cash flow of a total of 2 trillion yen ($18 billion) or more in the next three years which would be 500 billion yen more compared top the same figure in the last three years.
The biggest profit contributors are slated to be its gaming and image sensors business.
(Source:www.reuters.com)