Senators concerned over Universal-EMI merger

A bipartisan group of Senators on the Anti-trust subcommittee have asked the FTC to examine the proposed merger between Universal Music, a division of Vivendi, and British-based EMI (now owned by Citigroup, which took over debt of around $4 billion).  Last November, Citigroup made deals to sell the music portion of EMI to Universal Music for $1.9 billion, and the music publishing arm to Sony/ATV for $2.2 billion.
  Prior to the sale/merger, EMI was ranked as #4 of the "Big Four" companies that dominate the retail music industry, and Universal Music Group was ranked #1.  The combination of the two labels would arguably dominate the US music industry, accounting for about 40% of the US market.  Artists signed to the two labels accounted for 51 of Billboard's Top 100 songs for 2011.
  The letter from the Senators express concerns that that level of dominance might give the merged labels the economic power to set prices or act as a gatekeeper for new online music services.

"The music industry has undergone a transformation in the last two decades as consumers access music through new online forms of distribution and as the market faces the challenge of piracy," the senators wrote. "Yet, in this as in other industries, robust competition remains the key to restraining prices, ensuring new and innovative forms of distribution, and maintaining diversity of choice available to consumers."

  Universal Music has argued that the online accessibility of music (legal and pirated), effectively limits the ability to manipulate prices; still they indicated that they were working with the FTC to address any concerns.
  The proposed merger is also under scrutiny from EU regulators, and Universal has given them indications that they might be willing to sell off some assets to reduce concerns.

Source -  Senators warn Universal-EMI deal poses 'significant competition issues,'  The Hill (Hillicon Valley blog)