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  Company Type Joint venture
  Foundation August 5 , 2004
  Location City New York City
  Location Country USA
  Location <br />see List Of Sony BMG Offices
  Key People <li>'''Andrew Lack'''<small><br>''Chairman of the Board of Directors''</small><br><li>'''Rolf Schmidt-Holtz'''<small><br>''Chief Executive Officer''</small><br><li>'''Tim Bowen'''<small><br>''Chief Operating Officer''</small><br><li>'''Kevin Kelleher'''<small><br>''Executive Vice President<br>Chief Financial Officer''</small>
  Industry Music & Entertainment
  Products Music & Entertainment
  Parent Sony Corporation (50%)<br> Bertelsmann AG (50%)
  Homepage wwwsonybmgcom


Sony BMG Music Entertainment, Inc. is the result of a 50/50 Joint Venture between Sony Music Entertainment (part of Sony ) and BMG Entertainment (part of Bertelsmann ) completed on August 5 , 2004 . It is one of the Big Four music companies, and includes ownership and distribution of Recording Labels such as Arista Records , Columbia Records , Epic Records , J Records , RCA Victor Records , RCA Records , Legacy Recordings , Sonic Wave America , and others.

Financial analysts covering the merger anticipated that up to 2000 jobs could be cut as a result, saving SONY BMG approximately $ 350 million annually.

The company's Chief Executive Officer (CEO) is Rolf Schmidt-Holtz , who succeeded Andrew Lack on February 10, 2006. In the first half of 2005 , the company's share of new releases in the United States (US) declined from 33% to 26% according to Nielsen SoundScan . This, and Lack's negotiation of what some called an "ill-conceived" deal with Bruce Springsteen led to Bertelsmann informing Sony that it would not renew Lack's contract. Lack now holds the position of Chairman of the Board, the position formerly occupied by Schmidt-Holz.

The company recently signed a content deal with the popular video sharing community YouTube . {Link without Title}


FUTURE OF THE MERGER

On March 27, 2006, the '' New York Times '' reported that Bertelsmann was in talks with Sony to possibly alter the current venture. Two executives close to SONY BMG have said that Bertelsmann may offer Sony its half of the company in order to raise money by leveraging some of its media assets. Executives close to Sony BMG have stressed that any such agreement will likely take months to conclude. {Link without Title}

On July 13 , 2006 , however, the European Union annulled the European Commission's clearance decision as IMPALA (a trade association for independent labels in Europe) had asked. This judgment may be appealed by the merging parties or the European Commission. In the meantime, the joint venture is now being examined by the European Commission again. A new decision is expected for 2007.

On June 26, 2007, the European Commission announced that it would look into the merger again after the initial re-examination was postponed in March 2007. The Commission is now expected to conclude it's position on October 10, 2007.

It was announced that SONY BMG will dismantle the Sony Urban Music label. All of the artists will now be assigned to Epic or Columbia . {Link without Title}


MANAGEMENT

  • Chief Executive Officer - Rolf Schmidt-Holtz

  • Chief Operating Officer - Tim Bowen

  • Chief Financial Officer and Executive Vice President - Kevin Kelleher

  • Chairman of the Board – Andy Lack


  • Chairman, Sony Music Label Group - Rob Stringer

  • Chairman, BMG U.S. Label Group - Clive Davis

  • President/COO, BMG U.S. Label Group - Charles Goldstuck


  • Chairman, Columbia Records - Steve Barnett

  • Chairman, Columbia Records - Rick Rubin

  • President, Epic Records - Charlie Walk



SONY BMG ARTISTS



SONY BMG AUSTRALIA-BASED ARTISTS



CONTROVERSY


2005


July


Sony BMG was fined 10 million dollars after the New York Attorney General 's office determined that they had been practicing Payola mostly in the form of direct payments to radio stations and bribes to Disc Jockey s to promote various artists including Franz Ferdinand , Audioslave , Celine Dion and mainly Jessica Simpson .

Epic Records , one of their labels, was specifically cited for using fake contests in order to hide the fact that the gifts were going to disc jockeys rather than listeners . ''Sony Settles Payola Investigation'' from the Office of the Attorney General of New York {Link without Title} ..


October and November

See Also: 2005 Sony BMG CD copy protection scandal


A controversy over Digital Rights Management (DRM) software that automatically installed itself on people's computers and made them more vulnerable to Computer Viruses that was produced and shipped by Sony BMG ensued. The scandal caused numerous lawsuits and Sony BMG ended up Recalling all affected CDs.


November


November 16 - US-CERT , the United States Computer Emergency Readiness Team, part of the United States Department Of Homeland Security , issued an advisory on Extended Copy Protection DRM, citing the XCP use of Rootkit technology to hide certain files from the computer user as a security threat to computer users and saying that one of the uninstallation options provided by Sony also introduced vulnerabilities to a system.

US-CERT advised, "Do not install software from sources that you do not expect to contain software, such as an audio CD." {Link without Title} In its "Top Flops of '05" issue, the enterprise newsweekly EWeek had to create a new category for the "Sony BMG root-kit fiasco." Peter Coffee , of EWeek Labs reported, "The Sony brand name was already in trouble—it lost 16 percent of its value between 2004 and 2005....

Now it has taken a body blow among tech-product opinion leaders. We've never done it before, and we hope we'll never have occasion to do it again but, for 2005, eWeek Labs awards a stupid tech trick grand prize to Sony." EWeek Vol. 22, No.50


LIST OF SONY BMG LABELS




Independent labels distributed by Sony BMG



LIST OF OFFICES

Sony BMG is present in many parts of the world:


Japan



In Japan, Sony's Japanese recorded music subsidiary continues to operate independently of Sony BMG due to the strength and size of its business. BMG's former Japanese subsidiary is part of Sony BMG.


REFERENCES


  • Leonard, Devin (Nov. 28, 2005). "Music Lessons". '' Fortune '', pp. 31–32.



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