A Universal EMI merger could rescue the music business For 12 years at Impala, an association representing independent record labels in Europe, I have fought concentration in the music industry. However, as Universal Music awaits regulators" verdict on its £1.2bn bid for EMI's recorded music division, I think it could be just what the sector needs. Universal Music's bid was met by disbelief. The Vivendi subsidiary is the largest player in the industry and an astute competitor. Everything it does is watched with concern and envy. And yet, as I contemplate EMI's fall from grace and the way it was ravished by private equity, I can see that in the right circumstances this merger could create a more competitive industry, while offering stability to EMI's artists. How could that be? Since 2000, there have been three investigations by the European Commission, two court cases, one blocked merger, another merger approved after much litigation, two large publishing acquisitions - and yet the market has collapsed. The industry has lost more than half of its revenue. EMI was seized by its bankers, other big companies cut staff and artists and the independents are, with few exceptions, fighting for their lives. Compared with Apple, Google and Facebook, all music companies are small and independents minuscule. These digital giants need to redouble their efforts to create affordable offerings that fairly remunerate artists, record companies and other rights holders, while respecting artistic integrity. Music entrepreneurs, small or big, need to recoup their investments and make profits, or cultural diversity will become cultural uniformity. Music, film and television are to internet players what the piano stool is to the piano: inseparable. And the music industry must act to bring back a generation that stopped paying for content because legal ways to do so were seen as expensive or boring. This can be done if the Universal/EMI deal serves as a model, giving entrepreneurial platforms access to label repertoires on a non-discriminatory, transparent basis - in return for a commitment to direct traffic towards legal and affordable services. None of this should deprive Universal of power in the digital marketplace. A combined Universal/EMI can play a huge role. Moreover, we can use Universal's acquisition as a model to create online competition that reflects music retailing when it was healthy - when specialists, independents and mass merchants had easy, non-discriminatory access to all repertoire. Emulating this online could give a huge boost to digital sales, streaming options and choice. For the deal to aid growth and competition, however, Universal should commit to the following. First, to transparent, non-discriminatory, easy licensing to new platforms. This should encompass Universal, EMI and independents representing the majority of the market - the rest would soon follow. Second, Universal should make targeted, surgical divestitures to independents instead of to hedge funds, private equity or pension funds. Independents reinvest their profits better in signing new artists and developing new genres, and are instrumental in musical and technological innovation that is the lifeblood of music. Third, there should be direct financial support for industry groups that aid in levelling the playing field between small and large labels, so that the innovations of entrepreneurial labels are quickly adopted by the rest of the industry. Some will disagree with this. Yet Sony has suffered from its refusal to find a solution to the challenges of the digital age: it is now no larger as a merged entity than it was before it acquired BMG and Jive. The independents" opposition to past mergers led to pension funds and private equity overpaying and in some cases mismanaging assets. The consumer lost and the pirates won. Today, we can change this. I call on all sides to create a new pro-growth industry forum - without the vested interests of the current bodies - to balance the market between majors and independents and ensure that content owners, creative entrepreneurs, artists and consumers all benefit from the opportunities created by the internet. I call on regulators to bring Universal and the independents to the table to redress competition concerns and show the world they are capable of vision in transforming troubled industries. The writer is co-president of Impala and president of Naïve Records