EMI plans US distribution sell-off, report

Distributors of physical music are suffering in the current climate, with news yesterday that Pinnacle has gone into administration followed by new revelations that major label EMI is looking to exit physical distribution of its products altogether.

Seems the major is speaking with other major labels in the US with a view to letting go of its warehouses and distribution network there for a sum of up to $30 million. Instead of handling physical product in an ailing market, EMI will have its music ferried about the United States by a competitor.

There’s more news: EMI has gone so far as to consider “getting out of the distribution of compact discs and digital music in the US altogether,” the Financial Times reports. EMI would continue to engage in sales and marketing activity for its artists, however.

Also revealed are some of the steps EMI’s new owners, Terra Firma, have considered in order to reduce the $2.6 billion they owe Citigroup for the acquisition of the major label.

EMI has considered selling most of its Japanese business, divesting itself of its Christian, country music, classical and jazz labels and more, though talks on such steps stopped when the label appointed Elio Leoni-Sceti as chief executive of its recorded music division, EMI Music.

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