Warner Music Group sold for $3.3 billion – is EMI next?

Warner Music Group

It’s no secret that the music industry is struggling to stay afloat after years of plummeting CD sales, taildragging failures to convert to digital media distribution, pervasive music piracy, and a diverse marketplace where many performers eschew labels for a DIY Internet-based business model. So someone would have to be crazy to invest serious money in a major music label, right? Billionaire Len Blavatnik is hoping that means “crazy like a fox”—his company Access Industries has inked a deal to buy all of Warner Music Group—including all recordings and music publishing—for $3.3 billion in cash.

“We are delighted that Access will be the new steward of this outstanding business,” said WMG chairman and CEO Ed Bronfman Jr., in a statement. They are supportive of the company’s vision, growth strategy and artists, while bringing a fresh entrepreneurial perspective and expertise in technology and media. Most importantly, Access supports Warner Music’s commitment to our recording artists and songwriters who are the foundation of our current and future success.”

The deal calls for WMG shareholders to receive $8.25 in cash for each share of WMG they own, amounting to a 34.4 percent premium over the volume-weighted average share price for WMG over the last six months. Once the deal is completed—expected in the third quarter of 2011, pending regulatory approval—WMG will become a privately-held company, with no stock traded on any exchange. However, it will continue to be called Warner Music Group and operate out of its current facilities.

Warner Music Group is the third largest of the “Big Four” major music labels, Warner, EMI, Sony Music, and Universal Music Group. Some industry watchers expect that Blavatnik’s acquisition of Warner Music Group is just a prelude, however, with EMI the next major label in his sights. Although EMI is the smallest of the Big Four labels, in business terms Warner and EMI could be quite complimentary: where Warner is strong with American acts and new artists, EMI is strong is Europe and has a deep back catalog of highly valued, top-selling artists like the Beatles and Pink Floyd.

EMI is widely expected to be offered for sale by owner Citigroup later this year.

It’s not entirely clear why Blavatnik believes buying Warner Music is a strong business decision, although he is a long-time member of the company’s board. Overall, WMG posted a 6.7 percent decline in revenue for its most recent fiscal year, and its net loss for the year increased to $143 million. Blavatnik’s personal wealth stems mainly from natural resources and oil trading; he also has stakes in other media companies, including the largest Russian television producer, an Israeli television firm, and Los Angeles’ Icon Group, partially owned by controversial star Mel Gibson. Whatever Blatvatnik’s plan might be, however, you can bet it is going to involve digital music distribution.

Mobile

Rekindled yet again, Nokia’s next-gen phones offer more than just nostalgia

HMD Global, a startup that designs and builds Nokia Android smartphones, wants to put the Nokia brand name back “where it belongs.” It helps that it’s made up of ex-Nokia employees. We go behind the scenes to see how HMD formed.
Web

Switch up your Reddit routine with these interesting, inspiring, and zany subs

So you've just joined the wonderful world of Reddit and want to explore it. With so many subreddits, however, navigating the "front page of the internet" can be daunting. Here are some of the best subreddits to get you started.
Music

Tidal faces legal jeopardy over fake stream numbers accusation

In another challenging chapter for music subscription service Tidal, Norwegian authorities have begun a formal investigation into charges that the company faked millions of streams for artists such as Kanye West and Beyoncé.
Movies & TV

The best shows on Netflix, from 'Haunting of Hill House’ to ‘Norsemen’

Looking for a new show to binge? Lucky for you, we've curated a list of the best shows on Netflix, whether you're a fan of outlandish anime, dramatic period pieces, or shows that leave you questioning what lies beyond.
Home Theater

Not chill: Netflix is hiking prices across all its tiers

Netflix has to get the billions of dollars it's spending on new content from somewhere. The streaming giant announced price hikes across the board, raising its monthly rates between $1 and $2 per tier in the next few months.
Home Theater

From the Roku Ultra to the Fire TV Cube, these are the best streaming devices

There are more options for media streamers than ever, so it’s more difficult to pick the best option. But that’s why we're here. Our curated list of the best streaming devices will get you online in no time.
Movies & TV

NBCUniversal will launch its own streaming service in 2020

NBCU is prepping a streaming service filled with its original content for a debut sometime next year, meaning that Michael, Dwight, and the rest of the Scranton crew might be moving to a new home.
Home Theater

Sling TV offers free shows, a la carte subscription channels to Roku users

If you are among a select group of Roku users, Sling TV has added free TV shows and the option to subscribe to individual channels without having to subscribe to the company's base level of channels.
Gaming

Break out the Wii: ‘Just Dance’ movie reportedly in the works

Sony's Screen Gems has reportedly acquired the film rights to the Just Dance video game series from Ubisoft, which previously helped bring the game Assassin's Creed to the big screen in 2016.
Movies & TV

Apple’s first original feature film reunites Bill Murray, Sofia Coppola

The Lost in Translation team of Sofia Coppola and Bill Murray will reunite with their A Very Murray Christmas collaborator Rashida Jones for On the Rocks, Apple and studio A24's first official feature together.
Movies & TV

You can get a screaming deal on LG OLED TVs just in time for the Super Bowl

LG is offering steep discounts on its critically acclaimed OLED TV models just in time for the Super Bowl, letting discerning viewers watch their favorite athletes with higher picture quality than ever.
Movies & TV

Jason Reitman’s ‘Ghostbusters’ sequel already has a creepy teaser trailer

Jason Reitman, son of Ghostbusters director Ivan Reitman, has secretly co-written a follow-up to the 1984 supernatural comedy. Filming begins this summer, but it's not clear if the original Ghostbusters will reprise their roles.
Movies & TV

From premiere date to footage: Here's all we have on 'Game of Thrones' season 8

With the eighth and final season looming, Game of Thrones fever has officially become a pandemic. Our list of all the relevant news and rumors will help make the wait more bearable, if you don't mind spoilers.
Movies & TV

Netflix recruits Steve Carell for the Trump-inspired comedy ‘Space Force’

Steve Carell, Netflix, and The Office showrunner Greg Daniels are teaming up for Space Force, a workplace comedy poking fun at the Trump White House's plans to establish a sixth branch of the U.S. military.