There’s a new music publishing leader in town
EMI Music Publishing owns the rights to over 2 million songs, including works by Kanye West, Alicia Keys, Queen, and Pharrell Williams.
Sony’s own catalog already includes 2.3 million tracks, including work by the Beatles. This $2.3 billion acquisition will bump their portfolio up to 4.5 million songs, making them the largest music publisher.
Sony had already owned a 30% stake in EMI, but this deal will bring that figure up to 90%, buying out Mubadala Investment Company’s stake. The final 10% is owned by The Jackson Estate.
Comparing this to other deals, $2.3 billion is comparatively high for this kind of deal, according to analysts.
However, this deal seems invaluable as the company’s first step in pursuing their new strategy. CEO Kenichiro Yoshida has stated that Sony will diverge from PC and TV manufacturing and focus more on entertainment.
This primarily includes music services, home entertainment systems, camera products, and gaming systems like the PlayStation 4.
The Japanese company has been thriving recently, posting a 380 billion yen net profit ($3.4 billion) in 2017 – a 568% increase (!!!) from 2017. This growth stems from almost all branches of its company, but the primary source is their PlayStation and home entertainment system sales.
While Sony may not be considered a major player in the music industry, as Spotify and Apple Music’s streaming services dominate the market, Sony is slowly pushing its way into the industry.
Sony has been around for a while, but that does not mean it doesn’t has room for growth. The company continues to expand annually, which is clearly seen by their gargantuan net profit growth. And while the buying price for EMI may seem high, it shows Yoshida’s confidence in the music industry which has recently flourished due to streaming services such as Spotify and Apple Music.
Featured image via Pexels/Johnny Mckane