Friday, July 11, 2008

Sony BMG merger probably won't be settled for years

It's an indication of how bloody slowly these things move that we're probably going to see Sony complete a purchase of Betrtelsman's half of Sony BMG before the EU finally decides if the merger was legal or not. The European Court of Justice has rejected the Court Of First Instance's decision that the European Commission had been wrong to allow the merger in the first place. Yes, we know, it's a bit like those long stretches of Star Wars movies where they go on and on about intergalactic taxation. The crux is that the Lower Court only heard two of the five objections to the merger that had been raised by Impala, an indie producer trade group.

The lower court has now been directed to think again about what it's done:

"Since the Court of First Instance examined only two of the five pleas relied on by Impala, the Court of Justice considers that it is not in a position to give a ruling itself on the dispute. It is accordingly referring the case back to the Court of First Instance," the court said in a statement.

It should be noted that the higher court hasn't based its decision on the rights or wrongs of two major labels merging - this is purely procedural.

God alone knows what will happen if Sony is forced to demerge its wholly-owned subsidiary some point down the line. That would be more like the Spiderman reset.