The Tears of a Clown

Dec 12 2010

If the record business were a movie, the ad line would read:

Laugh till you cry. Cry till you laugh.

This comic tragedy reached a new peak this past week with a particularly unusual bit of December madness– the move by Barry Weiss, the chairman and chief excecutive of Jive/RCA Records within the Sony Music family to Universal Music, and even crazier, the rumors of Doug Morris, the aging and soon to be departing king of Universal, taking over the leadership of Sony Music.

http://mediadecoder.blogs.nytimes.com/2010/12/07/barry-weiss-joins-universal-music-group/

As if it weren’t enough to lose the one genuine record guy in the entire company, and the only executive who has been able to consistently deliver profits year after year even through the downturn, Sony is now contemplating elevating Rob Stringer, who has been the author of several disastrous decisions, and entrusting the whole enterprise to a 72 year old man who as far back as 2007 was happily revealing himself to Wired magazine as a complete technological Luddite. If it weren’t so sad, it would be funny, and vice versa.

The truth is, while the travails of EMI have been grabbing all the headlines over the past two years, Sony Music has actually been delivering an equally poor, or maybe even worse, performance of its own. Obviously, Guy Hands made an extremely imprudent purchase– paid way too much, took on far too much debt, and bought a company in worse shape than he ever anticipated. Clearly his management decisions have been ill-fated, with more turn-over than a washing machine, and a decision-making structure that makes the European Union look streamlined. But to his credit, EMI has created a few genuine stars, like Katy Perry, revitalized a few older ones, like Kylie Minogue, and is making a pretty impressive show on the UK charts at the moment.

Sony on the other hand has reeled from debacle to debacle– including the hiring and firing of Amanda Ghost as Epic’s president and the installation of uber-producer Rick Rubin as co-head of Columbia– while achieving next to nothing on an artist development level. When Amanda Ghost left the company, the list of her signings during the two years she was at the company was dumbfounding. “During her time at Epic, she (Amanda Ghost) signed artist’s like Denmark’s Oh Land, British born Thai artist Hugo Chakra, and the German and Nigerian artist known as Nneka” the press release stated. Rob Stringer called her “an important creative force”. Wow. Meanwhile, Rick Rubin’s biggest success at Columbia has been an album for Neil Diamond– not exactly a ground-breaking new discovery.

At this point, Sony survives on product with which they have almost no actual involvement, like “Glee” soundtracks, Susan Boyle records and American Idol releases. Labels like Phonogenic have supplied them with The Script and Natasha Bedingfield. But the only real artist broken out of 550 Madison has been Keisha, which was Barry Weiss’s project. Now he’s leaving. Hope he turns the lights out when he goes.

If you want to know more about how a disaster like this is perpetrated, check out a very insightful blog posting by Wayne Rosso:

http://www.waynerosso.com/2010/12/08/rob-stringer-rick-rubin-and-the-real-story-at-columbia-records/

With EMI awaiting its day on the chopping block and Sony’s future cloudier than the haze of pot smoke in Amanda Ghost’s office, that leaves Warner and Universal as the two islands of stability in the churning major label seas. Unfortunately, things haven’t been too rosy at The Bunny either. Warner recently threw out its under-performing A&R leader Tom Whalley and went back to the drawing board with Rob Cavallo, as Edgar Bronfman Jr. continues his on-the-job training program, about a decade in the making now, in how to lead a major music company. Certainly, it would have been cheaper to send Junior to Clive Davis’s school at New York University. But not nearly as entertaining. For an inside look at Bronfman’s already heartbreakingly funny career, check out the aptly titled “Fortune’s Fool” by Fred Goodman.

So that leaves one. While it’s been common knowledge that the record industry was almost inevitably going to consolidate down to 3 major labels by the end of 2011, it’s starting to look like we might be going down to a lot fewer than that. At this point, Universal has an A&R line-up that dwarfs the other major companies, with the undisputed king, Jimmy Iovine leading Interscope, David Massey rising at Mercury/Def Jam and now Barry Weiss moving over in the spring, and a batting order of artists that includes most of the heavy hitters in the industry. As virtually everyone in the industry acknowledges, Universal is the preferred home for any artist, and the first call for every manager, lawyer, and talent scout.

Given the players in question, there’s not much interest in how the ongoing horror story that is the record industry in the Internet Age is going to turn out. The real mystery here is why the larger corporations that own these music companies continue to indulge the madness. As the triumph of competent managers like Barry Weiss prove– this isn’t rocket science. You just have to do sensible things in sensible ways and execute effectively. Sure, it’s not as much fun, but it might actually keep everyone in a job. When it comes to turning the major label music business around, here’s a couple of obvious suggestions worth trying:

1. Make the Chairman someone with a technology background.
I don’t like it, and neither do most other old music guys, but the reality is that music and technology are now inextricably linked. We don’t just need someone running the show who knows where technology is at now. We need someone who understands where it’s going, and has his or her own network within the tech community.

2. Make the label president someone who understands the nature of a hit song.
The labels that consistently win are those with a “song guy” at the top: Syco with Simon Cowell, Phonogenic with Steve Kipner, and Interscope with Jimmy Iovine. Today, it’s all about hit singles. We need A&R leaders who can recognize a hit song.

3. Put someone in power who can do arithmetic.
Despite the ever-dwindling sales of the past five years, the spending levels at the major labels remain in the stratosphere. The obvious problems, like the midtown Manhattan office spaces and the contractual payouts to departed execs, are only the tip of the iceberg. The perks that go into the care and feeding of executive “talent” (dubious as that moniker may be) are even more problematic for being less visible. Here’s a reasonable observation: if a record label president needs to relocate the company offices, completely re-decorate the interiors, maintain a private jet or fly his or her colleagues out to LA or New York simply to have a meeting, he or she is probably not the leader we need for the music business in the 21st century. It’s not that business anymore.

A week ago, I had lunch with a great young A&R guy, who had recently been hired by one of the major labels to head up a new imprint. This kid was exactly what record label presidents look for: ambitious, personable, aggressive, and clearly possessing a great ear for new talent. Over our lunch he recounted to me how he arrived at the major label for his new position, worked his butt off…and then promptly left, less than six months later– giving up in frustration, without having signed or released a single thing. As he explained, not only could he not manage to get the Business Affairs department to finish any of the deals he put forward, he couldn’t even manage to track down the lawyer who was supposed to be doing the work. The system was so dysfunctional that he couldn’t even manage to put out reissues of product the company already owned. Expressing his frustration to the label president on the way out, he was promptly rehired– as a consultant.

Funny? Kind of. Sad? Only because the careers of artists, songwriters, producers, engineers and yes, talented A&R people, are involved. In the words of songwriter/artist Duncan Sheik, who wisely left the record world to strike it big in the theater business:

Who needs to join the circus
C’mon just look around
We are surrounded
By a bunch of f… clowns.

*”Good Morning” (Duncan Sheik)

    Eric, the more I read your work, the more I wonder when you will head up your own company! You know your stuff bro. Boggles my mind at how many people are still chasing the labels for a deal. This particular read was just as important to an artist only, and songwriters alike. We are the ones who get caught up in all the whirlwind decision making…or non-decision making. Makes me more confident when everything should be boiled down to it’s most simplistic form…”You just have to do sensible things in sensible ways and execute effectively.” I like that!

    Thanks so much for the encouragement– really appreciate your kind comments and your support of the blog. It’s funny– have been thinking of starting my own thing recently. The tough thing is that there’s a big advantage as an executive to working with a company that has an established catalog out there already, earning money all the time. It just opens up so many more opportunities and gives you more flexibility. Always a tough call.

    You’re right though– about artists and songwriters getting caught in the middle of the madness at these major music companies. I remember as a songwriter trying to make sense of it all, and constantly coming up empty. Now I see– it doesn’t make any sense. It’s just self-serving people taking care of themselves, at the expense of their company and all of the artists they represent. The one thing that hasn’t changed is that it still makes me mad as hell.

    Keep up the good work on your end– I suspect 2011 will be a big year for you. You’ve got all the pieces in place!

    Best,

    Eric

    We’ve got a Songwriter Sketchbook you might be interested in. If you can’t find it at your local Guitar Center, we apologize, but it’s always on sale at http://www.layflatsketchbooks.com.

    Joe:

    Thanks for reaching out. Took a look at the link– looks like a very cool product! I’m always in favor of any step toward a more orderly and organized existence for songwriters!

    Appreciate your support of the blog.

    Best,

    Eric

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