WARNER Bros and BMG merging.
Music group EMI, battered by piracy and falling record sales, faces one of its greatest threats yet – the merger of two of its closest rivals.
German-owned BMG and America’s Warner labels are understood to be in talks that could bring together the talents of stars such as Madonna and REM (Warner) with Britney Spears and Avril Lavigne (bmg).
The two groups would be able to cut down to millions, the costs from manufacturing and distribution overheads.
Both are poised to join forces against EMI and market leaders Sony and Universal.
EMI boss Eric Nicoli has insisted he can remain independent but some analysts have their doubts, given the rate of contraction taking place in the music industry.