Universal Spain Soars To 1st In Market

Universal Music Spain (UMS) has swept from fourth to first spot in market share in its first full fiscal year ending June 30, according to company president Jesús López.

López says that UMS' market share during that year was 20%, up from the 17% it claimed after the January 1999 merger of Universal and PolyGram, at which point the combined operation was only the fourth-biggest record company in Spain. He says his figures show that between January and June of this year, UMS' share rose to 23.3%, and he expects it to be around 25% by year's end.

López's claims are backed by industry estimates that now put EMI/Virgin second in Spain with about 18% market share, followed by Warner—including its wholly owned "indie" label DRO EastWest—at 17.5%, with Sony at 16%.

"When Universal and PolyGram merged," says López, "Spain was the only country in Europe where the two labels combined were not market share leaders, and in no other country was the combined share below 20%."

He continues, "When I came here from [Universal Latin in] Miami in January 1999, I said our biggest challenge was to become market share leader as in the rest of Europe."

López says that Universal's net sales in Spain rose 25% from fiscal year 1998-99 to 1999-2000 to 12.7 billion pesetas ($71.7 million); growth in earnings before interest, taxes, depreciation, and amortization was 60%. He says that the main key to that success was having three pop labels—Universal, Mercury, and Polydor—instead of the two that a market of Spain's size would normally have. "For that, we relied on the enormous support of [Universal Music International president/CEO] Jorgen Larsen and from the London office, because with two labels we would not have had this success," López says.

The executive insists that he is delighted with, but not surprised by, the results. "Even though the Spanish market fell in value last year [by 2%, according to International Federation of the Phonographic Industry (IFPI) figures], in line with the generally flat results in Europe, and Spain dropped from eighth to ninth in world rankings, I knew this company could grow as it has, and I expected these results."

UMS VP Carlos Ituiño says, "A philosophical change among all the staff, who shared an equal desire for