EMI changes tune on digital music

By Rhys Blakely
source: http://business.timesonline.co.uk/article/0,,9071-2142982,00.html

http://images.thetimes.co.uk/images/trans.gifEMI, the London-listed record label, expects to report a 12 per cent hike in annual profits after sales of digital music doubled and artists including Coldplay, Robbie Williams and The Rolling Stones released successful albums last year.

In a trading update ahead of its annual results, the world's third largest record company said both its record label and publishing arm, which sells music rights to film and television makers, outperformed the global industry last year.

"This strong divisional performance reflects successful releases from a broad range of artists including international superstars Coldplay, Gorillaz, Robbie Williams and The Rolling Stones ... and breaking artists KT Tunstall, Dem Franchize Boyz and Corinne Bailey Rae," EMI said.
Shares in the group rose sharply on the news, gaining 4.5 per cent to 267.75p in early trade. To track the stock click here (http://miranda.hemscott.com/servlet/HsPublic?context=timesonline&path=compfund&service=getSummaryDetails&companyid=625&onlyAnnualLatestResults=true).

EMI said that digital music revenues continued to show rapid growth, increasing by more than 150 per cent at constant currency rates over the past 12 months.

Record labels have been criticised for being slow to realise he impact the internet would have on their business. Industry bodies claim billions of pounds in revenues have been lost to online pirates who share tracks using peer-to-peer websites.

Online music sales still only account for around 5.5 per cent of EMI's music sales and about 4.5 per cent of revenues at its publishing business, it said.

EMI also said it would renew its focus on its Japanese business, "where new skills and a new organisational structure will be introduced to enable the re-allocation of resources into the key areas of A&R and marketing".

EMI Music also plans to enter into sale and leaseback agreements for its two Japanese properties and other property in the US.

Panmure Gordon, the broker, said restructuring of EMI Japan and some sale and leasebacks of property in Japan and the US could increase the UK-based record company?s earnings by about 5 per cent for 2007 and by about 12 per cent in 2008.

Across its busienss, EMI said revenues would be up 4 per cent in the year to March 31. The company added that had also identified an additional £30 million in annual cost savings to be fully realised by 2008.

This time last year, EMI posted pre-tax profits of £141.1 million on £2 billion in revenues.

EMI REJECT WARNER TAKEOVER 3 May 2006

Record giant Warner Music has turned down a $4.2 billion (GBP2.2 billion) buy-out bid by rivals EMI. EMI has long been courting the label which boasts an artist roster including MADONNA and JAMES BLUNT and hoped a merger would enable it to compete with Universal and Sony BMG - together they represent 25 per cent of the recorded music market. But its third attempt has been rejected and talks ended, just a day after EMI made a $28.50 share (GBP16.30) offer to Warner. EMI represents artists including COLDPLAY, ROBBIE WILLIAMS and NORAH JONES.


Source: http://contactmusic.com/

WARNED OFF
Edited By Clinton Manning
MADONNA'S record company has rejected a £2.2billion takeover bid from rival EMI. Warner Music, whose artists also include James Blunt and Sheryl Crow, said the offer was too low. EMI, which counts Robbie Williams and Joss Stone among its array of talent, has been pursuing its rival for almost two years.
EMI boss Eric Nicoli insists a deal would be "very attractive to both sets of shareholders". City experts believe a merger could produce savings of £140 million and think the two firms will soon be singing the same tune.
"This is disappointing," said Lorna Tilbian, expert at investment bank Numis Securities. "We believe the logic for combining the two businesses is quite compelling."

source: www.mirror.co.uk (http://www.mirror.co.uk)

Music giants in takeover tug-of-war

By Hugo Duncan, PA Published: 28 June 2006

www.new.independent.co.uk (http://www.new.independent.co.uk)


Music giant EMI and US rival Warner Music were locked in a takeover tug-of-war today as both companies battled to take control of each other.

EMI - home to Coldplay, Gorillaz and Robbie Williams - said today it had rejected a 320p-a-share offer from Warner which valued the company at £2.54 billion.

The Warner bid came in response to a £2.52 billion offer from London-based EMI, which the US firm rejected last night as the two companies traded blows with a series of takeover proposals.

The frenzied bidding activity sent shares in EMI 9% higher today to 309p.

A tie-up between the two music giants has long been regarded as a strong possibility as the pair have circled each other for years, with agreements almost reached in 2000, 2001 and 2003.

The combined music company would be the third largest in the world behind Universal Music and Sony, and would bring together EMI's stable of artists with the likes of Madonna from the Warner camp.
The latest takeover battle began in May when EMI launched a £2.31 billion bid for Warner, which was immediately rejected.

A month later, on June 14, Warner made an alternative bid for EMI worth £2.5 billion, but EMI said it was too low and it was unanimously rejected by the board.

On June 23 EMI went back to Warner with an improved £2.52 billion offer, which valued its shares at 31 US dollars (about £17) each.
This bid was rejected by Warner last night, and triggered the US firm's improved £2.54 billion offer for EMI.

Today, EMI said: "The board of EMI has unanimously rejected the revised alternative proposal from Warner Music at 320p a share and considers it to be wholly unacceptable.

"The board of EMI continues to believe that an acquisition of Warner by EMI at 31 US dollars a share in cash would be very attractive to both sets of shareholders."


Music giant EMI and US rival Warner Music were locked in a takeover tug-of-war today as both companies battled to take control of each other.

EMI - home to Coldplay, Gorillaz and Robbie Williams - said today it had rejected a 320p-a-share offer from Warner which valued the company at £2.54 billion.

The Warner bid came in response to a £2.52 billion offer from London-based EMI, which the US firm rejected last night as the two companies traded blows with a series of takeover proposals.
The frenzied bidding activity sent shares in EMI 9% higher today to 309p.

A tie-up between the two music giants has long been regarded as a strong possibility as the pair have circled each other for years, with agreements almost reached in 2000, 2001 and 2003.

The combined music company would be the third largest in the world behind Universal Music and Sony, and would bring together EMI's stable of artists with the likes of Madonna from the Warner camp.

The latest takeover battle began in May when EMI launched a £2.31 billion bid for Warner, which was immediately rejected.

A month later, on June 14, Warner made an alternative bid for EMI worth £2.5 billion, but EMI said it was too low and it was unanimously rejected by the board.

On June 23 EMI went back to Warner with an improved £2.52 billion offer, which valued its shares at 31 US dollars (about £17) each.
This bid was rejected by Warner last night, and triggered the US firm's improved £2.54 billion offer for EMI.

Today, EMI said: "The board of EMI has unanimously rejected the revised alternative proposal from Warner Music at 320p a share and considers it to be wholly unacceptable.

"The board of EMI continues to believe that an acquisition of Warner by EMI at 31 US dollars a share in cash would be very attractive to both sets of shareholders."

Record labels in major bidding war

Wednesday, June 28, 2006; Posted: 5:41 a.m. EDT (09:41 GMT)

http://img.photobucket.com/albums/v630/1madlady/story_warner_emi_artists_gi.jpg
Warner acts include Red Hot Chilli Peppers, Greenday; EMI can boast Robbie Williams and Coldplay.

LONDON, England (AP) -- EMI Group and Warner Music Group Corp. are again discussing a merger, but each has rejected a takeover bid from the other, EMI said Wednesday.

Warner Music on Tuesday tabled a cash offer of 320 pence per share for EMI, which was rejected, EMI said. That bid valued EMI at £2.5 billion ($4.6 billion).

The offer came four days after EMI bid $31 per share to acquire Warner Music, EMI said. That offer valued Warner at $4.2 billion.

"Since EMI's approach, announced on May 3, to acquire Warner Music, EMI has been continuing actively to explore the potential acquisition of Warner Music, including in discussions with Warner Music and certain of its shareholders," EMI said.

"The board of EMI continues to believe that an acquisition of Warner Music by EMI at $31 per share in cash would be very attractive to both sets of shareholders and would deliver value to EMI's shareholders which is far superior to Warner Music's revised alternative proposal," EMI said.

EMI and Warner attempted to merge in 2000 but the combination was vetoed by European authorities.

The companies saw a merger as a way to improve competition with Paris-based Universal Music Group and Sony BMG Music Entertainment, the joint venture of Sony Corp. and Bertelsmann.

A combination of EMI and Warner Music, which boasts artists including Madonna and Green Day, would control about 25 percent of the recorded music market, surpassing BMG in the rankings and moving into second place behind Universal, according to the International Federation of the Phonographic Industry.

EMI shares were up 9 percent at 308 pence $5.62 in early trading on the London Stock Exchange.

Source: http://www.cnn.com/2006/BUSINESS/06/28/warner.emi.ap/index.html

EMI enthuses over its releases
Rodney Hobson, 13/07/06 16:30

Music group EMI took time off from its bid battle with Warner Music to assure shareholders at the AGM that trading is going well.
The reassurance was needed after a European Court ruling regarding Sony dampened hopes of industry consolidation.

Chairman Eric Nicoli told the AGM of his confidence that the global music industry has excellent long term prospects driven by the rapidly expanding demand for digital music.

He enthused: ?We are enjoying impressive creative momentum, have exciting release schedules for both divisions, are generating very high growth in digital sales, and are on track to deliver the cost savings from our latest restructuring plan.?

He described the planned release schedule for the remainder of the financial year as broadly based, comprising a healthy mix of global and local artists and encompassing both long-established and newly emerging superstars.

The highlights include albums from The Beatles, Norah Jones, Robbie Williams, Janet Jackson, KT Tunstall, Joss Stone, Chingy, Stacie Orrico, Keith Urban, Trace Adkins, Dierks Bentley, RBD, Relient K and Renaud.
Nicoli repeated the company line that the most recent offer from Warner, 320p a share, was ?wholly unacceptable in the light of EMI's prospects, the potential synergy benefits of a combination of the two companies and the range of strategic options available to EMI?.

He said EMI?s own offer of $31 a share for Warner ?could be very attractive to the shareholders of both companies?. The stand-off continues.

Nicoli took a cautious view of a European Court decision this morning to block a Sony BMG joint venture. This overruled the European Commission, which had given the go-ahead..

?It will require detailed study before any wider conclusions can be reached,? he said.

Concerns that further consolidation in the industry, including a tie-up between EMI and Warner, would be clocked sent EMI shares sharply lower. Towards the close of trading they were down 26p to 280p.

Source: http://www.hemscott.com/news/comment-archive/item.do?id=10061

KKR joins EMI in the battle for BMG
By Dan Sabbagh July 20th, 2006

EMI and Kohlberg Kravis Roberts (KKR) have joined forces in the $1.5 billion (£822 million) auction for BMG, Bertelsmann?s music publishing business, and are through to the second round, The Times has learnt.
It is understood that Vivendi?s Universal Music arm and Warner Music have also passed the first hurdle, as has the venture capitalist BC Partners, but the final field is likely to be considerably larger. Other likely survivors are Sony and GTCR Golder Rauner, the Chicago buyout firm, assisted by the veteran record executive Charles Koppelman, who once sold his music publishing operations to EMI.

Bertelsmann is selling the business to help it to meet the ?4.5 billion (£3 billion) expense of buying out its minority shareholder, Groupe Bruxelles Lambert. The auction is being run by JPMorgan and Citigroup.

Music publishers own the copyright to songs, which earn the owner and the writer a fee when they are played or later covered. Publishing, which is highly profitable, is considered to be the most stable part of the music industry.

KKR is expected to provide most, if not all of the capital for the BMG bid, while EMI provides the management expertise, generating a modest stream of fees. The structure is intended to avoid competition concerns because EMI is already the world?s leading music publisher, with a share of about 20 per cent. BMG?s 13 per cent puts in in third place.

Warner Music, owner of Warner/Chappell, the No 2 publishing business, is prepared to bid on its own, confident that its private equity backers would take on more debt, but it is not expected to bid as fiercely as Universal, which, despite its strength in recorded music, is weak in publishing and keen to gain share.

Bertlesmann said that it had received 14 expressions of interest, including a management buyout, led by Nicholas Firth, chief executive, and backed by Bear Stearns. Viacom, the US media group, was also keen.

The private German company is ploughing on with the auction despite last week?s shock European court ruling overturning regulatory approval for its Sony-BMG recorded music joint venture. It has insisted that buyers take on any risk of dealing with European regulators and it hopes simply to take the highest price.

BMG last year generated revenues of ?372.4 million and unspecified double-digit sales. Bankers value it at between $1.5 billion and $2 billion.

BMG, built through 250 acquisitions over the past two decades, owns copyrights to songs by Coldplay and Robbie Williams, both of whom are also signed to EMI?s recorded music division. It also claims to be the world leader in contemporary Christian and classical music.


Source: http://business.timesonline.co.uk/article/0,,9071-2277630,00.html

EMI drops plans to buy Warner Music

Source : Reuters
27 July 2006

EMI Group, the world's third-largest music company, said it has abandoned plans for the time being to buy smaller rival Warner Music, sending its shares down as much as 7 percent Thursday.

The decision was expected by many following a European court judgment this month that annulled the 2004 approval of the merger between Sony Music and BMG, casting doubt on whether regulators would allow further consolidation in the industry.

EMI, home to Coldplay and Robbie Williams, and Warner Music, with artists including Madonna and the Red Hot Chili Peppers, had been seeking to buy each other, with both offering about $4.6 billion. The rival bids were rejected.

"Against this background, the board of EMI has decided not to pursue a combination with Warner Music for the time being," the London-based company said in a statement. "The board will review this position in the light of future developments."

New York-based Warner Music declined to comment.

The dueling takeover proposals were the latest of multiple attempts in recent years to combine the companies to create a rival on par with market leader Universal Music, owned by France's Vivendi, and Sony BMG, a joint venture between Japan's Sony and German media conglomerate Bertelsmann.

Despite EMI's talent-spotting capabilities and a strong music publishing business, DeGroote said the company's debt levels and poor cashflow generation will come back into the spotlight absent the deal prospects.

"The only saving grace has been the possibility of a merger or takeover of Warner," he said. "The intrinsic problems of the music industry mean it's totally unpredictable, and the piracy issue has never been resolved."

EMI said it was enjoying strong growth in digital sales and on track to deliver cost saving targets.

"EMI believes that it will, in this financial year, again deliver a strong operating performance, achieve its financial objectives and make good progress."

Musicbrigade secures EMI Licensing Deal

Stockholm-based Musicbrigade has now finalized a major licensing agreement involving EMI Music, an agreement that will boost its pan-European expansion. The company, which earned its stripes in streaming and downloadable videos, is now broadening into audio formats as well. The EMI relationship introduces a valuable catalog into mix, including tracks from artists like Coldplay, Gorillaz, Norah Jones, KT Tunstall and Robbie Williams. Musicbrigade will position the catalog across a number of delivery formats, including subscription-based streaming and downloads on PCs and mobile phones.


Musicbrigade offers its video and audio catalog to a number of partners, including access providers Bredbandsbolaget, Telenor, Chello, and Telewest/NTL. Other partnerships traverse the mobile and portal arenas, and the company also offers the assets on its own website. The latest catalog represents a major grab, and will boost its European expansion considerably. "This deal is a key part of our ambitious agenda to become a major, pan-European player in the European digital music market," said Simon Gooch, senior vice president of Content and Programming at Musicbrigade. In May, the company received a venture capital infusion of $4 million from IT Provider Funds.


Story by news analyst Alexandra Osorio.

Source: http://www.digitalmusicnews.com/#081106brigade

EMI pulls the plug, but there may yet be an encore
By Michael Jivkov

Published: 12 August 2006

EMI and Warner Music had to abandon their merger plans last month after a European court ruling annulled the 2004 regulatory clearance of the Sony/BMG music merger. The court move cast doubt on whether regulators would allow more consolidation in the music industry.

Nevertheless, the effect on EMI's stock market valuation looks excessive. Shares in the music group behind Robbie Williams and Coldplay slumped from 315p to close to 250p yesterday. However, EMI shares are unlikely to remain so cheap for very long.

The auction of Bertelsmann Music Publishing is heading towards its final stages and should be completed in the not too distant future. There is also a good chance that Europe will re-approve the Sony/BMG deal in the next six to 12 months. That would almost certainly lead to a resumption of merger talks. Buy.


Source: http://money.independent.co.uk/personal_finance/invest_save/article1218608.ece

Universal to buy BMG publishing

German media group Bertelsmann has agreed to sell its BMG Music Publishing Group to Vivendi's Universal Music in a 1.63bn euros ($2.1bn; £1.1bn) deal.
The division, which owns rights to artists including Coldplay, Robbie Williams and Justin Timberlake, is being sold to clear debts.

Vivendi chief Jean-Bernard Levy said the deal was "a unique opportunity to grow our music publishing business". The transaction requires approval from regulatory authorities.

Wider range

BMG Music Publishing, the world's third-largest music publisher behind Universal and EMI, made 81m euros in profits in 2005 by licensing songs for use in films, video games ringtones and other media as well as through records.

Other artists it owns rights to include Barry Manilow, Mariah Carey and The Beach Boys.

The deal bolsters the music catalogue of Vivendi Universal - which last week struck a deal with online music business Spiralfrog to make its tunes available as free internet downloads.

The sale of BMG Music Publishing has been approved by the supervisory boards of both companies.

Bertelsmann said the sale would help to clear some of the 4.5bn euros debt it took on when it bought out the 25% stake that Groupe Bruxelles Lambert (GBL) held in Bertelsmann.

The purchase was the only way Bertelsmann could stop GBL from forcing a stock market listing of the media group.

Source: http://news.bbc.co.uk/1/hi/business/5319050.stm

EMI joins war to tame iTunes

MUSIC by stars like the Arctic Monkeys and Primal Scream could soon be downloadable FREE from the internet.

Britain’s EMI, which owns copyright to these artists, has joined forces with giant music publisher UNIVERSAL MUSIC to take on APPLE’s paid-for service iTunes.


Universal is setting up a new free legal download service, Spiralfrog. Launching in December, it will make its money through adverts on the website.

Apple’s iTunes has long dominated the music download market — but users have to pay 79p per song. Spiralfrog is seen as the strongest way the record industry can fight piracy.

The argument is that if music fans can download songs legally, they will stop using illegal downloads.

EMI owns the world’s biggest music catalogue and its involvement in Spiralfrog is crucial. EMI shares rose 1.5p to 266.5.

VIVENDI, owner of Universal Music, is buying BMG Music Publishing from German media combine BERTELSMANN for £1.1billion.

BMG Music Publishing owns the rights to songs by artists like Coldplay and Robbie Williams.

SUN CITY COMMENT: We have long argued that Apple, which has 80 per cent of the legal downloads market, could not continue that level of dominance. Spiralfrog looks set to break it.

www.thesun.co.uk (http://www.thesun.co.uk)

EMI shortlists five agencies for £14m media.

by Daniel Farey-Jones Brand Republic 25 Oct 2006

LONDON - EMI has shortlisted The7stars, Starcom and MindShare to pitch against incumbents Carat and Media Campaign Services for its £14m media account.

The record company, home to artists including Coldplay and Robbie Williams, is expected to conclude its UK review by the end of the year. Carat handles television, outdoor and online while MCS covers press and radio. The pitch will pit The7stars' Gareth Jones, who used to head up Carat's EMI business, against his former employer. MindShare was also shortlisted recently for Warner Music's £18m account, on which MCS was the incumbent. Warner is believed to have appointed PHD but has not as yet confirmed this. If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the Forum .

Source: http://www.brandrepublic.com/login/index.cfm?fuseaction=Login&resource=BR_News&articleType=news&article=600339

EMI vs The Fanatics
http://p2pnet.net/story_images/10515.jpg
p2pnet.net News:- Big Four Organized Music cartel member EMI has again shown how low it can go with a petty attack against an Australian sporting fans group called The Fanatics.


The group's Ashes songbook includes parodies of songs such as Daydream Believer with lines such as, "Cheer up Michael Vaughan, How bad must it be, To a be a poor pommie whinger, And you're watching on TV?," says ABC Sport, going on:


The Ashes is international cricket's oldest and most celebrated rivalry between England and Australia, dating back to 1882.


Now, "Aussie sport diehards the Fanatics will find out today whether they must pulp 100,000 copies of a song book they created to help lift Ricky Ponting and his men to victory in the Ashes," says The Age.

EMI lawyers have met with Fanatics founder Warren Livingstone to, "thrash out copyright issues relating to six of the 15 songs printed in Six, Jugs & Rock n' Roll".


The Fanatics, one of Australia's largest sport tour companies had planned to distribute 100,000 free copies to Oz cricket fans during the Ashes series, which kicks off in Brisbane tomorrow.

It, "put the songbook together in a bid to get Australian fans to outsing England's Barmy Army during this summer's Ashes series," says ABCsports.

But it looks like The Fanatics are sorting things out with EMI.
“It appears that we’re going to get the green light, which I guess is a win for both common sense and Aussie cricket fans,” says Fanatics founder Warren Livingstone in The Telegraph.

"Our good friends at EMI have intimated, in light of our desire to get behind the Aussie cricket team, that they’re going to cut us some slack."


All that's needed is EMI gaining approval from the various artists in question, a task Livingstone doesn't think wil be too difficult, says the story, quoting him as saying:


"Our parody of Living Doll (by Cliff Richard) takes aim at British women but I don’t think this will bother Sir Cliff in the slightest. He doesn’t seem that keen on them himself.


"As for Robbie Williams, he’s a good times guy and would probably be right at home himself in the Fanatics Bay. Let’s hope he's an angel and gives us clearance before tomorrow.”


"There’s talk of some high profile Brit entertainers being at the Gabba tomorrow and I’m sure they’d be tickled pink to hear some of Australia's finest vocalists doing justice to their tunes."
source (http://p2pnet.net/story/10515)

Music publishing attracts EMI suitors

03 December 2006 By Dave Sambrook

EMI may be one of the four largest music groups in the world, with artists such as Robbie Williams, Kylie Minogue and the Rolling Stones on its books, but it was the stable cashflows generated by royalties from music publishing that prompted last week’s bid of stg£2.5 billion (€3.7 billion) from buy-out-deal specialists Permira and Apollo Management.

EMI directors have reportedly been sounding out private equity firms about a takeover for some time, and another consortium, comprising DLJ Merchant Banking, Kohlberg Kravis Roberts (KKR), Cinven and Apax, is believed to be interested in the British-listed business.

KKR has maintained a dialogue with EMI since working on the recent-failed joint bid for Bertelsmann’s music publishing business.

Only last month, analysts at Citigroup estimated that EMI Music Publishing could be worth stg£1.65 billion, compared with a possible stg£1.36 billion valuation for EMI Music. Potential bidders are already believed to have approached Warner Music with a view to selling EMI Music to them.

While the recorded music business is unlikely to fit in with the risk profiles of private equity investors, there is scope for aggressive cost-cutting within the division.

The move from costly CD production to digital suggests that a return to the 15 per cent margin the group enjoyed in 1997 – from its current level of 12per cent – is achievable.

Earlier this year, EMI rejected a 320p-a-share takeover bid by Warner Music before mounting its own bid for the US group.

Both approaches came to nothing after the European Court of First Instance decided that regulators should not have approved the merger between the music arms of Sony and Bertelsmann. This has prompted fears that an EMI/Warner deal would fall at the same hurdle.

News of the potential bid saw EMI shares rise over 10 per cent to 293p per share, well below Warner’s rejected valuation.

Source (http://www.thepost.ie/post/pages/p/story.aspx-qqqt=WORLD-qqqm=nav-qqqid=19346-qqqx=1.asp)

<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR><TD>EMI Tests Selling Unprotected MP3s
By Geoff Duncan
Staff Writer, Digital Trends News
Britain's EMI Music is conducting a tiny test of selling music in unencumbered MP3 format, using singles from songstress Nora JOnes and Christian rockers Reliant K.

</TD></TR><TR><TD height=5>http://news.digitaltrends.com/images/dt.gif</TD></TR><TR><TD><TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR><TD vAlign=top><TABLE style="FLOAT: right; MARGIN: 0px 2px 9px 9px" cellSpacing=0 cellPadding=0 width=350 bgColor=#e1e8f0 border=0><TBODY><TR><TD style="PADDING-RIGHT: 9px; PADDING-LEFT: 9px; PADDING-BOTTOM: 9px; PADDING-TOP: 0px">

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For years, the music industry has been adamant that they're only interested in selling digital music which can't be (easily) copied or shared amongst computer users. The argument goes taht releasing copyable music would only cannibalize record sales as users opt for byte-perfect, pirated music rather than purchasing songs—or albums&for themselves. And that's why music from major labels is available for sale only when protected by digital rights management technology, typically Apple's FairPlay or Microsoft's Windows Media (or, now, Zune DRM).

But Britain's EMI—one of the four major music distributors—is once again testing the idea of selling music in MP3 format without copy protection, experimenting with Yahoo music to offer the Norah Jones single "Thinking About You" and "Must Have Done Something Right" from Relient K for $.99. EMI is also offering U.K. customers an MP3 from pop singer Lily Allen, and Reliant K is selling a second MP3 via the band's Web site.

The two MP3-format EMI singles available via Yahoo Music are offered right alongside copy-protected offerings, and both are released from new albums by the artists: clearly, EMI is hoping offering unencumbered singles will draw attention to the albums and spark additional sales. But the advantage of unencumbered MP3s goes beyond mere promotion, since essentially every computer and portable digital music player on the market supports MP3 files, whereas songs purchased through iTunes famously only work on the iPod or via iTunes software, and protected WMA songs can't be played on iPods, making the proposition of purchasing digital music annoying and complicated for consumers. And self-proclaimed number two online music distributor emusic has made a splash by only selling music in the unprotected MP3 format…although major labels have never gotten on board.

The two tracks aren't the first time Yahoo has experimented with straight MP3 offerings: earlier in 2006 it offered a single from celebrity Jessica Simpson in MP3 format, and in September offered Jesse McCartney's <CITE nd="7">Right Where You Want</CITE> album for $9.99 in MP3 format.
While it's unlikely the availability of two unprotected music tracks is any sort of watershed event for the music industry, it may indicate that the major labels are beginning to reconsider their digital music business models.

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Yahoo! to offer EMI videos

http://img.photobucket.com/albums/v630/1madlady/22641.jpg

Monday December 11, 2006

EMI has struck a pan-European agreement with Yahoo! to offer music videos from artists such as Lily Allen, Coldplay and Robbie Williams. Under the deal, users of the Yahoo! Music service will be able to watch the videos for free via its streamed video-on-demand service.

The service also allows users to create their own "My Video" list which tracks recently played videos and those recommended by the user.

"As the digital music market grows, we must continue to look for new ways to offer consumers the opportunity to enjoy our artists' content," said the chairman and chief executive of EMI Music for continental Europe, Jean-Francois Cecillon.

The Yahoo! Music service is free with revenue derived from online advertising.

Tony Wadsworth, the chairman and chief executive of EMI Music UK and Ireland, said: "It's important to maximise the value of our artists' music in this rapidly changing market and the recent growth of advertising spending on line is just one of the many ways in which we seek to do this."

Article by Mark Sweney

Source (http://money.guardian.co.uk/businessnews/story/0,,-1969643,00.html)

That's cool. I have yahoo radio on my computer at work. I can create my own station or listen to one already made....and yes there is a Robbie Williams channel! It's not all Robbie All the time, there are some other great musicians on it too:wink3:

December 11, 2006

Music giant EMI 'ready to accept' offer from Permira

Music giant EMI is getting ready to waltz up the aisle with private equity firm Permira. After years of foiled bid approaches and merger attempts, EMI could finally be sold for more than 2.5bn.

The media group, whose artists include the Rolling Stones, Robbie Williams and KT Tunstall, is thought to be on the verge of accepting a bid from Permira. However analysts are not holding their breath, having been disappointed many times before.

Source (http://www.tmcnet.com/usubmit/-music-giant-emi-ready-accept-offer-from-permira-/2006/12/11/2157457.htm)

wow how many news!
thank u very much!

EMI shares fall as takeover talks end
The Associated Press
Shares of EMI Group PLC, whose artists include Coldplay and Robbie Williams, dropped more than 8 percent Thursday after the music company said it had ended takeover talks with an unidentified suitor.

EMI, which revealed that it was in talks late last month, said it had not received an offer that "fully reflects the prospects for and value of the company" that could recommended to shareholders.

EMI did not name the potential bidder, but it was widely believed to be European private equity firm Permira Advisors Ltd

EMI shares were 8.4 percent lower at 275 pence ($5.41) on the London Stock Exchange.

The company was in takeover talks earlier this year with U.S. rival Warner Music Group Corp. about a $4.6 billion deal, but those talks were clouded by a European court ruling annulling earlier approval of the 2004 combination of Sony Corp.'s Sony Music and Bertelsmann AG's BMG. That ruling cast doubt on whether an EMI-Warner deal would receive regulatory approval.

EMI calls off talks with Permira
By Nic Fildes
Published: 15 December 2006

EMI will face what looks to be a tough Christmas period alone after the music company said talks with the private equity suitor Permira had collapsed sending its shares crashing nearly 11 per cent.

It is the second tie-up to fall through this year after EMI's attempt to merge with rival Warner Music fell through in the summer. EMI has been courting Warner since 2000 but the latest set of talks were derailed after the European Commission annulled its clearance of the 2004 merger of Sony and BMG.

EMI revealed in late November that it had been approached about a potential offer for the business. Permira was behind the approach but the two companies have decided to abandon the takeover after failing to agree a price.

Permira was rumoured to be keen on a 320p a share deal that would value EMI at about £2.5bn and match Warner Music's bid earlier this year. EMI dismissed the approach, arguing that it had not received an offer that "fully reflects the prospects for and value of the company". Analysts said that EMI's management would have been pushing for a bid in the region of 350p a share.

Numis Securities analyst Paul Richards said that he was not surprised that talks with Permira had broken down as the private equity company could not justify a higher bid than Warner Music. It is estimated that a combination of Warner and EMI could yield up to $200m (£100m) in cost savings a year. "We are very much of the view that Warner and EMI will end up together," said Mr Richards.

EMI hopes that albums from the likes of Robbie Williams, The Beatles and Joss Stone will boost sales over the crucial Christmas period now that the takeover is off the agenda. However initial signs are not promising with a recent Woolworths trading update showing overall CD sales down 7 per cent in the months leading into Christmas despite lower prices.

Patrick Yau, an analyst at Bridgewell Securities, noted that Woolworths singled out sales of the new Robbie Williams album as being particularly disappointing and that January and February are historically weak months for CD sales. However arguments that weak trading over Christmas scuppered the Permira deal look wide of the mark as the company has not yet warned on profits.

EMI will face what looks to be a tough Christmas period alone after the music company said talks with the private equity suitor Permira had collapsed sending its shares crashing nearly 11 per cent.

It is the second tie-up to fall through this year after EMI's attempt to merge with rival Warner Music fell through in the summer. EMI has been courting Warner since 2000 but the latest set of talks were derailed after the European Commission annulled its clearance of the 2004 merger of Sony and BMG.

EMI revealed in late November that it had been approached about a potential offer for the business. Permira was behind the approach but the two companies have decided to abandon the takeover after failing to agree a price.

Permira was rumoured to be keen on a 320p a share deal that would value EMI at about £2.5bn and match Warner Music's bid earlier this year. EMI dismissed the approach, arguing that it had not received an offer that "fully reflects the prospects for and value of the company". Analysts said that EMI's management would have been pushing for a bid in the region of 350p a share.

Numis Securities analyst Paul Richards said that he was not surprised that talks with Permira had broken down as the private equity company could not justify a higher bid than Warner Music. It is estimated that a combination of Warner and EMI could yield up to $200m (£100m) in cost savings a year. "We are very much of the view that Warner and EMI will end up together," said Mr Richards.

EMI hopes that albums from the likes of Robbie Williams, The Beatles and Joss Stone will boost sales over the crucial Christmas period now that the takeover is off the agenda. However initial signs are not promising with a recent Woolworths trading update showing overall CD sales down 7 per cent in the months leading into Christmas despite lower prices.
Patrick Yau, an analyst at Bridgewell Securities, noted that Woolworths singled out sales of the new Robbie Williams album as being particularly disappointing and that January and February are historically weak months for CD sales. However arguments that weak trading over Christmas scuppered the Permira deal look wide of the mark as the company has not yet warned on profits.
Source (http://news.independent.co.uk/business/news/article2076173.ece)

<TABLE class=CommentTable width="100%" border=0><TBODY><TR><TD class=Header>EMI and Last.fm team up for music matching service
</TD></TR><TR><TD class=Date>December 15, 2006 by Alex Donohue
</TD></TR><TR><TD> source (http://www.uk.revolutionmagazine.com/News/index.cfm?fuseaction=ViewNewsArticle&newsID=609489)
</TD></TR><TR><TD class=Body>LONDON - EMI has agreed a deal with music search engine Last.fm to create an online recommendation service called tuneglue-audiomap, which they say will accurately match other listeners' new music preferences to a user's favourite artists.</TD></TR><TR><TD> </TD></TR><TR><TD class=Body>Tuneglue-audiomap (http://audiomap.tuneglue.net/) will recommend users to particular artists based on their listening preferences and by matching them to the choices made by other music fans.

EMI said its artist directory was not limited to EMI artists, such as Robbie Williams, Hot Chip, Sigur Ros and The Magic Numbers. The service would also provide website links, artist biographies, competitions and sign-ups for the label's bands.

Eric Winbolt, digital media manager at EMI Records, said: "Tuneglue-audiomap is tapping into the power of Last.fm's music recommendation engine and is connecting bands and artists based on what the Last.fm users have chosen to listen to.

Martin Stiksel, chief communications officer at Last.fm, added: "Last.fm's mission is to connect people with the right music and tuneglue-audiomap is helping people do just that in a very intuitive, visually interesting way.

"You can pick any band as a starting point and before you know it you are discovering artists you have never heard of before."
</TD></TR></TBODY></TABLE>

<TABLE cellSpacing=0 cellPadding=0 width=305 border=0><TBODY><TR><TD><TABLE cellSpacing=0 cellPadding=0 width=305 border=0><TBODY><TR><TD vAlign=top>Is Robbie Williams an angel for EMI?

Dan Sabbagh and Sarah Butler
</TD></TR></TBODY></TABLE></TD></TR><TR><TD height=5>http://images.thetimes.co.uk/images/trans.gif</TD></TR><TR><TD><TABLE cellSpacing=0 cellPadding=0 width=305 border=0><TBODY><TR><TD vAlign=top>Robbie Williams’s latest album Rudebox looks set to underperform last year’s 6.2 million-selling Intensive Care, in what is likely to be a significant disappointment for his record label, EMI.
In the week to December 21, Rudebox sold a modest 38,000 units at the tills of HMV, Britain’s leading specialist music retailer. A year earlier, the more popular Intensive Care sold 171,000 units, according to HMV.
<TABLE cellSpacing=0 cellPadding=0 align=right border=0 VALIGN="TOP"><TBODY><TR><TD id=mpuHeader name="mpuHeader"></TD></TR><TR align=right><TD align=right><SCRIPT type=text/javascript>NI_MPU('middle');</SCRIPT></TD></TR></TBODY></TABLE>Both albums were released at about the same time each year: Rudebox on October 25 this year; Intensive Care on October 24, 2005, making the comparison between the albums almost exact — and suggesting that the latest effort may struggle.
Robbie Williams is one of EMI’s most important artists. His albums regularly have sold above five million units and he is key to helping the British music publisher to meet its promise of revenue growth in its full year to March 31. EMI declined to comment, but the company pointed out that Rudebox sold two million units across Europe in the first fortnight after its release. The album was No 1 in Britain at the end of October, but first-week sales were only half that of Intensive Care.
However, since then sales appear to have slowed sharply — and the UK represents the former Take That singer’s most important market. Four of his albums have sold two million copies in his home market, while Williams has had poor sales in the United States, a market that he has failed to conquer. EMI’s other key releases in its second half are Love, a remix of the Beatles’ greatest hits, and, coming in the first quarter of 2007, new albums from Norah Jones and Joss Stone. The shares added 2¾p to close at 264¼p yesterday.

</TD></TR></TBODY></TABLE></TD></TR></TBODY></TABLE>source (http://www.timesonline.co.uk/article/0,,5-2520781,00.html#cid=OTC-RSS&attr=Business)

"a significant disappointment for his record label, EMI"

Really?

I dont think that EMI will be too upset this year & their profits will not be affected too badly, after they get a big scoop from the sale of over 3.6 million concert tickets this year . How many UK artists have achieved that in one year - Tell me - How many ??????????????. The papers forgot to mention that - did they not - as usual.
If the papers keep printing negative stuff about Robbie - he will go to other Countries where he is appreciated a hell of a lot more . I think that people dont realise this - a some stage or other Robbie is going to break with the UK as much as that would break his heart - but the guy can only take so much.

I still don't understand how they can base any figures on sales at a shop. Surely a large percentage of people buy their albums on-line now, either as a download or from places such as play.com or cdwow.

More and more people are realising you can buy cd's for almost half the price on-line, and in my opinion that must have some significance in HMV's reduced sales figures.

what a load of b******s !

EMI warns on profits, music boss goes

By Mark Potter Reuters
Friday, January 12, 2007; 3:33 AM


LONDON (Reuters) - EMI Group Plc issued a profit warning on Friday, blaming poor Christmas sales of new albums such as Robbie Williams's "Rudebox," and announced the departure of its head of music and plans to slash costs.

Shares in the world's third-biggest music group, which were boosted throughout 2006 by regular takeover speculation, fell almost 10 percent in early trading.

<TABLE cellSpacing=0 cellPadding=0 width=238 align=right><TBODY><TR><TD width=10></TD><TD width=228>



</TD></TR></TBODY></TABLE>"EMI Music's second-half performance to date, in terms of revenues and profits, has been below prior expectations," EMI said in a statement that also unveiled plans for 110 million pounds ($213 million) of annual cost savings, including an unspecified number of job cuts.

"This has resulted from weak market conditions, particularly over the Christmas period, and lower-than-expected sales from EMI Music's portfolio of second-half releases to date."

EMI, which is also home to Coldplay and holds the Beatles catalog, rejected a bid approach in December that a source familiar with the situation said was from private equity group Permira, and has been locked in a takeover battle with rival Warner Music on and off for the past six years.

"Yet again the company has embarked on a restructuring program, despite reassurances over the autumn that the business was strong and that the group felt sufficiently confident to reject a private equity bid for the business rumored to be in excess of the Warner offer of 310 pence over the summer," said Bridgewell Securities analyst Patrick Yau.

"These valuations now look like wishful thinking and leave management struggling for a plausible strategy," he said, slashing his full-year pretax profit forecast to 112.8 million pounds from 160 million.

EMI shares, which outperformed the DJ Stoxx European media sector by around 4 percent last year, were down 9.6 percent at 239 pence at 0810 GMT, valuing the business at about 1.9 billion pounds.

ALL YOU NEED IS LOVE

EMI, which had been pinning its hopes on new releases such as the Beatles' "Love" album, said annual revenues at its music business were likely to fall between 6 percent and 10 percent on a constant currency basis. The division's revenues fell 5.2 percent in the six months to September 30.

The firm said Alain Levy, chairman and chief executive of EMI Music since October 2001, and David Munns, vice chairman of EMI Music, would leave with immediate effect.

Eric Nicoli, who has been executive chairman of EMI Group since July 1999, becomes group chief executive officer and will take direct responsibility for managing EMI Music.

EMI said over half the 110 million pounds of planned annual cost savings would be delivered in the year ending March 31, 2008, and the full amount in the following financial year.

The savings, including an unspecified number of job cuts, would cost no more than 150 million pounds to deliver, EMI said.
A spokeswoman declined to give any further details.

(additional reporting by Robert MacMillan in New York)



source (http://www.washingtonpost.com/wp-dyn/content/article/2007/01/12/AR2007011200501.html)

EMI pays price of a fallen angel
By Tim Hall
Last Updated: 2:05am GMT 13/01/2007


Music giant EMI was counting the £200 million cost of Robbie Williams's ego and the digital revolution yesterday as it revealed an extraordinary slump in profits.

The label, which said sales for 2006 are likely to be 10 per cent lower than predicted, was immediately accused of being a dinosaur that had failed to adapt quickly enough to the era of digital music.

But the slump, which leaves EMI looking to make £110 million annual savings, is equally a result of the former Take That star's fall from grace.

Williams won the biggest deal in British pop history when he signed to EMI for £80 million in 2002. At the time he was selling millions of albums and producing era-defining songs, including Angels and Millennium.

However, when EMI needed him most, in the second half of last year, he released Rudebox, an album written by the singer and his band, and described most kindly as peculiar. Other critics were much more cruel and it bombed in the charts.

Rudebox came after Williams had fallen out with a series of song writers and had had problems with drugs and depression.

In the run up to Christmas, the album was selling just 38,000 copies a week, against 171,000 for his previous record, Intensive Care, which itself sold badly in relation to earlier efforts.

Robert Sandall, a music writer, said: "Robbie is a good performer and a decent singer but he is no musician. He needs support. To write an album by himself was pure hubris and EMI are now counting the cost."

EMI's other big hopes have also under-performed. Most surprising has been poor sales of Love, the George Martin-remixed Beatles album.

"It has never been more the case that the big record companies are sustained almost solely by their big stars," said Mr Sandall. "For EMI, in the second half of last year, big stars meant Robbie Williams and the Beatles. Neither lived up to expectations.

"These huge companies have huge overheads, and they need their stars to turn up with huge sales."

Experts say that EMI, which is also home to Coldplay, Gorillaz, Lily Allen and Norah Jones, has also suffered in the digital music revolution. File-sharing, podcasting, piracy and online radio have all eroded the CD sales of the big record labels.

Some experts believe the effect has been so profound that small labels will grow again and, by marketing themselves online and selling only downloads, avoid the vast overheads that have barred them from the market.

Although EMI, and other members of the '"big four" – SonyBMG, Universal and Warner – which control three-quarters of the world's music, are now making downloads a major part of their business, their stranglehold on the market has gone.

Last year, EMI issued a bullish half-year report and predicted strong sales. But it said yesterday: "EMI Music's second half performance to date, in terms of revenues and profits, has been below expectations."

Redundancies began immediately, starting with Alain Levy, the company's £3.5 million-a-year chairman and chief executive. He will leave with a package worth around £7 million

Mr Levy, 60, oversaw a major restructuring after joining in 2001. He drastically reduced the company's roster of artists, dropping the likes of Mariah Carey.

The changes, while making the business more efficient, left its hopes pinned more firmly than ever on Williams and the other big stars.

Source (http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2007/01/13/nemi13.xml)

I think that the unexpected release of Rudebox was a clear indication by Robbie that he personally is taking his music in a totally different direction whether EMI like it or not. Robbie is probably coming near enough the end of his contract with them anyway & then he will be totally independed to do what he likes . At this stage of his career that is exactly what he sould be doing - suit himself & enjoy the process . Im' sure he is totally prepared for a slump in Album sales ( but sales of albums have slowed for everyone ) & is willing at this stage of his career to accept that not everyone will like his new musical direction.I think this year will tell a lot & I certainly hope he sticks with his convictions.

Rudebox came after Williams had fallen out with a series of song writers and had had problems with drugs and depression

this is such lazy journalism, its unbelievable. I always thought the Telegraph were a fairly reputable paper, but I guess not.

The only songwriter I can think they are refering to is Guy Chambers and Rudebox is the second album to come out since he went. Rob has been free from drugs since 2001, and I cannot believe they resorting to the depression tag as well.

This country's journalism stinks, and I am thoroughly ashamed to be British at the moment.

And why is it always Robbie's fault. Do EMI not have any other artists on their books :mad3:

Robert Sandall, a music writer, said: "Robbie is a good performer and a decent singer but he is no musician. He needs support. To write an album by himself was pure hubris and EMI are now counting the cost."

For some reason, this part makes me a bit angry. :10b:

This country's journalism stinks, and I am thoroughly ashamed to be British at the moment.

Couldn't agree more. I am disgusted by all the negativity that's been thrown at Rob. It seems to have begun in the summer and snowballed.

Hopefully the spring will bring a thaw...

:no3: :no3: :no3: :no3: :no3: :no3: :no3: :no3: :no3:

Music giant EMI was counting the £200 million cost of Robbie Williams's ego and the digital revolution yesterday as it revealed an extraordinary slump in profits.

Eh, who offered whom an £80 million record deal?

Williams won the biggest deal in British pop history when he signed to EMI for £80 million in 2002. At the time he was selling millions of albums and producing era-defining songs, including Angels and Millennium.

2002 was 4 years after Angels you gobsh**e!

However, when EMI needed him most, in the second half of last year,

Well if ever something was written to reduce a human being to a robot money-maker this has to be it............

...........he released Rudebox, an album written by the singer and his band, and described most kindly as peculiar. Other critics were much more cruel and it bombed in the charts.

Robert Sandall, a music writer, said: "Robbie is a good performer and a decent singer but he is no musician. He needs support. To write an album by himself was pure hubris and EMI are now counting the cost."


Well, which is it? Did he write it with his band or by himself??? Make up your peabrain mind!


Redundancies began immediately, starting with Alain Levy, the company's £3.5 million-a-year chairman and chief executive. He will leave with a package worth around £7 million


£7 million redundancy package?! Jesus, I'm in the wrong job! Now, where's that CV I had?.........


Ah, so much bulls**t to pick apart so little time............

<CENTER></CENTER><CENTER>The Daily Telegraph (London)</CENTER><CENTER>January 13, 2007</CENTER><CENTER> </CENTER><CENTER> </CENTER><CENTER></CENTER><CENTER></CENTER>Analysis It's tough on Robbie - but he failed to deliver




DESPITE its fantastic British catalogue, which includes The Beatles and Pink Floyd, EMI has in recent years developed an over-reliance on a few multi-million selling acts with not enough investment in developing new talent.

It is a fragile business model that suffers if you don't have a roster of global superstars.

With no albums from EMI's established big hitters Coldplay and Radiohead in 2006, and none of its new stars, which include The Kooks, Lily Allen and Corinne Bailey Rae, yet making inroads in America, EMI's second half-year profits were dependent on performances from Robbie Williams and a remix album from The Beatles. EMI's only other real star, Norah Jones, resisted entreaties to bring her new album forward to bolster Christmas sales.

It would certainly be unfair to blame EMI's problems on Williams, but his 2002 deal for pounds 80 million, which was treated with scepticism at the time, now looks like a spectacularly bad piece of business. Williams ultimately had a poor relationship with EMI. He never made a serious effort to conquer America and insisted on following his own muse (up a blind alley, apparently) rather than being dictated to by commercial forces.

Now the deal is effectively at an end, it would be interesting to know where the balance stands. It looks worse when one considers that it was preceded by EMI buying its way out of Mariah Carey's contract for pounds 19 million.

While Williams's star has been waning, Carey went on to have one of the biggest-selling albums of 2005, re-establishing herself as a superstar ... with Universal.

The music business as a whole faces an uncertain future. In 2006, there was a sense that the long anticipated digital storm had finally hit the shores.

For a while, EMI's concentration of resources on a small group of superstars acts may have seemed like a bold move to shore up shaky share prices, but it laid itself open to accusations of focusing on business at the expense of music.

In difficult times, it makes sense to concentrate resources on developing talent, rather than simply relying on the past record of performers. A record company is only as good as its product, and EMI's product has not been good enough.

Neil McCormick is The Daily Telegraph's rock critic.

Now he makes some valid points here...............

The one thing that really gets to me is the constant bashing of Robbie for accepting the £80 million deal - who on this earth wouldn't?!!

Although, maybe now that he's due to be released from this contract, he'll look elsewhere for a deal that will allow him more freedom to record under his own rules and less pressure to tour etc....

Watch this space!

I’ve been shown a copy of his company’s latest accounts, which reveal Robbie paid himself £7.2million for the past year. In four years Robbie has raked in a colossal £40million.
this is a quote from the craploid report on Rob's earnings. Now I understood that as part of the 80million deal, EMI got a percentage of pretty much everything Rob did. So if he's managed to rake in £40 million in the last 4 years, I bet EMI have done pretty well out of him too.

The Kooks, Lily Allen and Corinne Bailey Rae, yet making inroads in America, I hate to say it but these artistis are better known in the US than Robbie. :( (and this is not a slight on their talent, just a fact)

this is a quote from the craploid report on Rob's earnings. Now I understood that as part of the 80million deal, EMI got a percentage of pretty much everything Rob did. So if he's managed to rake in £40 million in the last 4 years, I bet EMI have done pretty well out of him too.


Absolutely! After all, Robbie's only a small part of a bigger machine unfortunately so there's no way EMI did badly! Talk about putting the weight of the world on one man's shoulders!

I hate to say it but these artistis are better known in the US than Robbie. :( (and this is not a slight on their talent, just a fact)


Yeah I know NTLA! The thing is though, it seems every new artist is the next massive big thing, which is what CBRae was touted as and we haven't heard a peep out of her for months!

Yeah I know NTLA! The thing is though, it seems every new artist is the next massive big thing, which is what CBRae was touted as and we haven't heard a peep out of her for months!
This is also their initial launches lets see how long they hang on here..and if they conguer the rest of the world like Rob did, and now doesnt need the US.

This is also their initial launches lets see how long they hang on here..and if they conguer the rest of the world like Rob did, and now doesnt need the US.

You said it! The media are way too quick nowadays to be promoting new artists as the next whoever - we know who's been around for a decade and will be for many more to come! ;)

If RW gets dropped - good for him. He can put out his stuff without the middleman.

And to whoever said "too much s%$t to pick thru" - I agree. When they don't even freakin' look at the label to see all the other writers on Rudebox...

:mad3:

Although, maybe now that he's due to be released from this contract, he'll look elsewhere for a deal that will allow him more freedom to record under his own rules and less pressure to tour etc....

Watch this space!

I agree! A few surprises to come I'm sure! :wink3:

The Times January 13 2007

Levy found talent search too taxing
Adam Sherwin: Analysis


When Alain Levy declared last year that “the CD as it is right now is dead”, he correctly diagnosed the problem but the MBA-touting Frenchman was unable to offer a cure.
A failure to jump-start the American market — crippled by illegal downloading — with new EMI talent spelt doom for the veteran operator, who had presided over PolyGram’s market dominance in the 1990s. While acts including Coldplay and Norah Jones have secured global success, attempts to gain a foothold in the fast-moving R&B market, the source of vital digital revenues through phone downloads in the US, disappointed.

Jermaine Dupri, a hip-hop producer, was tasked with finding new R&B stars. He oversaw the relaunch of Janet Jackson, Mr Dupri’s girlfriend, but her latest album flopped.

Mr Levy installed rock producer Matt Serletic to revive EMI’s Virgin imprint. He had hits with Gorillaz and Joss Stone, but albums by Lenny Kravitz and The Rolling Stones delivered modest returns and Serletic was replaced.

However, EMI was already in poor shape when Mr Levy joined in 2001, losing 40 per cent of its market value in one year. He vowed to drop underperforming acts, even if it meant paying $28 million to extricate EMI from an $80 million contract with Mariah Carey. Under Mr Levy, EMI began exploiting the potential of MySpace and YouTube to break artists and achieved the biggest-selling US phone download with rap act Dem Franchize Boyz.

Yet EMI remains the grazing ground for veteran acts including Sir Paul McCartney, David Gilmour, Pet Shop Boys and Kate Bush, whose value lies primarily with their back catalogue.

The Beatles’ Love remix album is unlikely to be the last visit back to that particular well, with digitisation of the Lennon and McCartney catalogue finally on the horizon.

And while the US CD market slumped more quickly than expected, the balance of power between EMI and its reliable hitmakers changed to the detriment of executives.

Robbie Williams negotiated a revolutionary £80 million EMI deal incorporating live income and merchandising. Uncertainty surrounds the future of Radiohead, the Oxford group that topped the US charts. The band is out of contract with EMI and the company hopes it will extend a 15-year relationship.

An uninspired Christmas schedule led by Rudebox and Love did for Mr Levy — who is tipped to be replaced by Roger Ames, the former Warner chairman — but he can claim that the timing is unlucky.

EMI’s women could provide salvation this year — Kylie Minogue is ready to make an eagerly anticipated return and KT Tunstall’s debut album is approaching one million sales in the US with European markets ready for its successor.

Corinne Bailey Rae has followed in her wake and will be nominated for the Brit Awards next week.

At least the above article from The Times is a bit more even handed & Robbie is just not mentioned everywhere in it on his own.
The problem with EMI is that have not handled their investments very well. The writing is on the wall for EMI for the last number of years, they are just struggling on but they cant blame the Artists. Look how much of a return that they have got from Robbie alone over the last number of years, top selling albums & sell out tours of which they got 25%.
I dont think Robbie owes them anything, the sooner he gets away from them the better.
The papers unfortunately as usual have a go at Robbie but its nothing to do with the album sales. They are getting back at him for the comments he made about members of the Press taking drugs with him & those same journalists writing about Kate Moss.
The Press will never leave Robbie alone again & every time he has a new album out they will do the very same thing & will keep rubbishing his work in the papers - so we can look forward in the future to this S**T journalism time & time again.
At the end of the day Robbie needs support from his fans so its up to everyone themselves to support him & ignore the bad press.

I agree with you Tess.

The writing has been on the wall for a long time at EMI and most of the blame is down to bad management. The broadsheets will always give a more even handed view, rather than the tabloids whose policy is to create negative spin around the well known faces of the campany.

It's not going to be an easy year for Rob, but as we know, he's bounced back before and has had such a long run at the top, that he's not going to be that easily dismissed.

EMI management buyout 'a million miles away'
source (http://www.forbes.com/business/feeds/afx/2007/01/14/afx3327501.html)

LONDON (AFX) - A management buyout of UK music publisher EMI Group PLC is 'a million miles away' a source close to the company told AFX News.

That's despite a report in today's Observer which claimed executive chairman Eric Nicoli, who also took on the role of chief executive following the group's profit warning last week, could be planning such a move.

'It's a million miles away from the mark. Nothing the management have said suggests it's a possibility,' the source said.

The Observer cited analysts as saying Nicoli is pondering a number of options but that leading a buyout with support from private equity was a distinct possibility.

It added that an alternative scenario is that private equity comes in from EMI, but writes Nicoli, the former head of United Biscuits, out of the script following a successful takeover.

In a trading update Friday, EMI announced a boardroom shake-up and cost-cutting plan alongside a full-year profit warning after a weaker than expected second half, sending its shares sharply lower.

The world's third largest music group said Alain Levy, EMI Music chairman and chief executive, and David Munns, vice chairman of EMI Music, are to step down.

EMI pays price of a fallen angel
14th January 2007, 13:00 WST

Music giant EMI was counting the £200 million cost of Robbie Williams's ego and the digital revolution yesterday as it revealed an extraordinary slump in profits.



The label, which said sales for 2006 are likely to be 10 per cent lower than predicted, was immediately accused of being a dinosaur that had failed to adapt quickly enough to the era of digital music.

But the slump, which leaves EMI looking to make £110 million annual savings, is equally a result of the former Take That star's fall from grace.

Williams won the biggest deal in British pop history when he signed to EMI for £80 million in 2002. At the time he was selling millions of albums and producing era-defining songs, including Angels and Millennium.

However, when EMI needed him most, in the second half of last year, he released Rudebox, an album written by the singer and his band, and described most kindly as peculiar. Other critics were much more cruel and it bombed in the charts.

Rudebox came after Williams had fallen out with a series of song writers and had had problems with drugs and depression.

In the run up to Christmas, the album was selling just 38,000 copies a week, against 171,000 for his previous record, Intensive Care, which itself sold badly in relation to earlier efforts.

Robert Sandall, a music writer, said: "Robbie is a good performer and a decent singer but he is no musician. He needs support. To write an album by himself was pure hubris and EMI are now counting the cost."

EMI's other big hopes have also under-performed. Most surprising has been poor sales of Love, the George Martin-remixed Beatles album.

"It has never been more the case that the big record companies are sustained almost solely by their big stars," said Mr Sandall. "For EMI, in the second half of last year, big stars meant Robbie Williams and the Beatles. Neither lived up to expectations.

"These huge companies have huge overheads, and they need their stars to turn up with huge sales."

Experts say that EMI, which is also home to Coldplay, Gorillaz, Lily Allen and Norah Jones, has also suffered in the digital music revolution. File-sharing, podcasting, piracy and online radio have all eroded the CD sales of the big record labels.

Some experts believe the effect has been so profound that small labels will grow again and, by marketing themselves online and selling only downloads, avoid the vast overheads that have barred them from the market.

Although EMI, and other members of the '"big four" – SonyBMG, Universal and Warner – which control three-quarters of the world's music, are now making downloads a major part of their business, their stranglehold on the market has gone.

Last year, EMI issued a bullish half-year report and predicted strong sales. But it said yesterday: "EMI Music's second half performance to date, in terms of revenues and profits, has been below expectations."

Redundancies began immediately, starting with Alain Levy, the company's £3.5 million-a-year chairman and chief executive. He will leave with a package worth around £7 million

Mr Levy, 60, oversaw a major restructuring after joining in 2001. He drastically reduced the company's roster of artists, dropping the likes of Mariah Carey.

The changes, while making the business more efficient, left its hopes pinned more firmly than ever on Williams and the other big stars.

THE TELEGRAPH GROUP, LONDON

I am going to have to stop reading this sh*t. On the one hand they are blaming Rob for EMI's slump, and on the other they are claiming he is one of the highest paid musicians - the two stories just don't tally in my opinion :mad3:

I am going back to the RW Thread now - its much nicer there :laugh2:

I am going to have to stop reading this sh*t. On the one hand they are blaming Rob for EMI's slump, and on the other they are claiming he is one of the highest paid musicians - the two stories just don't tally in my opinion :mad3:

I am going back to the RW Thread now - its much nicer there :laugh2:
Here here !!!!!!!!!!!!

I keep coming back to this thread coz it annoys me so much. What really winds me up is that the press seem to ignore the fact that Rob's contract with EMI is not restricted to album sales. EMI get a percentage out of EVERYTHING Rob does.

Which means that last year, not only did they get a cut from the Rudebox sales, they would also have earned from his mega successful world tour and all the merchandise that went with it, plus there was also the DVD "And Through It All".

I would say that EMI probably did rather well out of Rob last year !!!!

EMI pays price of a fallen angel
14th January 2007, 13:00 WST

However, when EMI needed him most, in the second half of last year, he released Rudebox, an album written by the singer and his band, and described most kindly as peculiar. Other critics were much more cruel and it bombed in the charts. This is a lie. Rudebox got good reviews in for example NME and Music Week, and also in Sweden's biggest morning paper.:mad3:

Rudebox came after Williams had fallen out with a series of song writers and had had problems with drugs and depression. Another lie. He hasn't fallen out with a series of song writers and he has been sober for 6 years.:mad3:

In the run up to Christmas, the album was selling just 38,000 copies a week, against 171,000 for his previous record, Intensive Care, which itself sold badly in relation to earlier efforts. Wasn't Intensive Care his best selling album?:sad3:

Robert Sandall, a music writer, said: "Robbie is a good performer and a decent singer but he is no musician. He needs support. To write an album by himself was pure hubris and EMI are now counting the cost. Hubris? He has written all his albums by himself, but in cooperation with other people. Who is this Robert Sandall to talk like this?."


Why is the english press so eager to put Robbie down and write a bunch of lies?
Why are they so concerned about EMI's profits?
How can a huge company like EMI with a lot of big artists depend on only one artists sales?

:10b:

Why is the english press so eager to put Robbie down and write a bunch of lies?
Why are they so concerned about EMI's profits?
How can a huge company like EMI with a lot of big artists depend on only one artists sales?

:10b:
Easy.
EMI are money grabbing b*stards and the British gutter press are a bunch of w*nkers. :mad3: :mad3:

EMI announces two appointments for Music unit

source (http://business.scotsman.com)
LONDON (Reuters) - EMI Group <EMI.L>, which ousted its two top music executives last week after issuing a profit warning, announced on Thursday two key appointments to its EMI Music management team.
JF Cecillon will become chairman and chief executive of the newly established EMI Music International unit which will focus on EMI's recorded music business outside the UK and North America.

Cecillon, who was previously in charge of EMI Music for continental Europe, will now oversee Asia, Latin America and Australia and New Zealand.

Ian Hanson, previously senior vice president, chairman's office, EMI Music, has been promoted to the global role of chief operating officer of EMI Music.

The world's third-biggest music group said on Friday it had parted company with Alain Levy, its chairman and chief executive of EMI Music, and David Munns, his vice chairman.

Eric Nicoli, who has been executive chairman of EMI Group since 1999, has taken direct responsibility for managing EMI Music and the two new appointments, Cecillon and Hanson, will report directly to him.
The announcement to drop Levy and Munns came as the group warned its revenues from the music business were likely to fall between 6 percent and 10 percent on a constant-currency basis.

Numis media analyst Lorna Tilbian told Reuters she thought the two men had been brought in to bolster Nicoli as he takes over running the music unit of the business.

Some analysts have questioned whether Nicoli is the right man to run the music unit as his expertise appears to be on the business side, with Collins Stewart analyst Simon Wallis saying he should not retain the job long term.

"For the past two and a half years, JF Cecillon has led our continental European operations across 21 countries and delivered a major turnaround in that business," Nicoli said.

"During his tenure, EMI's market share in the region has grown by nearly three points, profits have tripled and new artists have been established.

"He is the ideal candidate to help me run our recorded music business outside the UK and North America."
"Ian Hanson is a proven deal-maker who has played a central role in developing and implementing new and innovative strategies across the business, from pioneering artist agreements with artists such as Robbie Williams, through to driving efficiencies."

EMI considering dropping DRM* from its CDs

http://i140.photobucket.com/albums/r21/sugarjay58/untitled.jpg

British record label EMI is investigating getting rid of DRM-laden compact discs as per the requests of many of its customers.
Even though the company hasn't made a disc with DRM "for the last few months," it's still quick to point out that no decisions have been made thus far.
One of the main reasons why it's looking into the matter is the iPod.
It seems that enough people b*tched and moaned that they couldn't (easily) transfer music from EMI CDs to their precious MP3 player of choice.
Sure, EMI never put rootkits on people's computers, but the sooner that companies realize that DRM is a dead-end, the sooner we can all listen to Robbie Williams uninhibited. – Nicholas Deleon

Source (http://gizmodo.com/gadgets/portable-media/emi-considering-dropping-drm-from-its-cds-229929.php)

*DRM = Digital Rights Management

<CENTER></CENTER><CENTER>Irish Independent</CENTER><CENTER>January 20, 2007 </CENTER><CENTER></CENTER><CENTER></CENTER>ROBBIE'S RUDE AWAKENING



How one star's flop record this week led to major redundancies at a legendary record company. And it's just the latest crisis to hit the music industry, says DAMIAN CORLESS

Seven years ago, after Oasis released the critically mauled and commercially feeble albumStanding On The Shoulder Of Giants, Robbie Williams sent a funeral wreath to the band's mastermind. The attached card said: "To Noel Gallagher RIP. Heard your latest album. With deepest sympathy, Robbie Williams." It was the latest dig in a public feud between the former drinking buddies which had begun with Gallagher describing Williams as "the fat dancer from Take That".

In 2005, Gallagher renewed the bickering, telling an interviewer: "I wouldn't walk a mile in Robbie's shoes. Nobody ever mentions his music." That cutting taunt, which was splashed across the press, may have indirectly cost Williams' record label untold millions and caused hundreds of lay-offs.

This week EMI sacked the head of its record division and announced a 160m cost-cutting plan which will result in substantial redundancies. The crisis management exercise follows dismal sales for the company in the crucial pre-Christmas period which generates 40% of all retail revenue in any given year. For the Christmas just past, EMI were banking on two major releases to fill the coffers.

While the Beatles'Love album of remixed classics was well-received, it failed to rack-up the anticipated sales, shifting just three million units worldwide. However, by far the greater disaster was the performance of Robbie Williams' latest album,Rudebox. In the run-up to Christmas,Rudebox was selling just 38,000 copies a week. Earlier efforts such asI've Been Expecting You andSing When Your Winning had flown off the shelves at 10 times that rate.

It takes no genius to work out why sales ofRudebox were so calamitous. It is beyond dire. One reviewer deemed it "so spectacularly misconceived that it will decimate his fanbase at a stroke". Another delivered the brutal verdict: "The worst record I have ever heard".

For a hugely successful decade, during which he'd sold 50 million CDs, Robbie Williams' calling card wasLet Me Entertain You. But with the recording ofRudebox, his motto becameLet Me Entertain Myself. Shortly after Noel Gallagher's put-down of his music, Williams went into the studio determined to stamp his songwriting ability and creative control all overRudebox. The dog's dinner which emerged confirmed suspicions that the real musical talent behind the singer's rise had been Guy Chambers, the collaborator Williams fired after Chambers refused to commit to a monogamous working relationship.

The panic alarms started going off in the corridors of EMI long beforeRudebox reached the ears of the public, and the King of radio-friendly pop began making abdication speeches such as: " Rudebox is loads of different things. Sometimes it could be a vibe delivered in a spaceship direct to the studio. Sometimes it's actually a box that tells you to piss off."

This was not what EMI expected from Williams when they tied him to a four-album deal in 2002 for a jaw-dropping 120 million. In terms of investment, the company had opted to put a large clutch of its eggs in the one basket. WithRudebox, Williams defiantly hatched a turkey. As a result, hundreds of low-level employees began job-hunting this week. Higher up, the company's chairman and CEO has been shown the boardroom door, but Alain Levy won't be joining the scramble down to the job centre. EMI's golden handshake to Levy will stack up to around 11m.

If the sacked Levy is not plagued with a damning sense of deja-vu this week, he should be. In 2001 he was brought in to restructure the company after a big-money deal strikingly similar to the Williams' one had also left EMI in the lurch. One of his first acts was to drop the diva of dressage warbling, Mariah Carey, with a severance payment of some 25m.

Throughout the 1990s, Carey had been one of the planet's blue-chip commercial acts, amassing platinum discs in the United States, which is by far the world's most lucrative market. In 2001, EMI signed Carey for 70 million, seemingly impervious to the fact that her career had been on the slide since her marriage break-up of two years earlier.

The downturn in her career curve was directly related to the fact that her husband, label boss Tommy Mottola, had also been her musical svengali. Under his expert guidance, Carey became the first recording act in history whose first five singles all shot to No.1 on the Billboard Hot 100. By the time they split at the end of the 1990s, he had helped make her America's most successful act of the whole decade.

But by the time EMI paid out an astronomical sum for Carey's signature, she was already caught up in the old syndrome of the actor who finds success in light comedy and suddenly wants to play Hamlet. Just like Robbie Williams in her wake, Carey demanded and was granted greater 'artistic control'. Her debut album for EMI, Glitter, was a critical and commercial flop, throwing the label into disarray.

Installed to sort out the mess, Alain Levy decided to cut the company's losses and drop the singer, who was clearly by then in the grip of a nervous breakdown. In addition to her 25m pay off, Carey kept her 20m advance, making her one album for EMI the most expensive in history. Incredibly, just a year after taking a devastating blow over the Mariah Carey affair, Levy exposed EMI to the vagaries of another huge ego by signing Williams for an even more astronomical sum.

In the light of Carey's mental meltdown, the decision to invest such a great deal in Williams seemed even more incredible. Never one to attract the label 'well-adjusted', he quit Take That after bitter bust-ups with his bandmates and management. His struggle with booze, drugs and depression was well-thumbed tabloid fare, and shortly before signing his deal he'd dished out abundant food for thought with a show of self-loathing on TV, complaining about the "branding" of his image and deriding his own Norman Wisdom-style stage antics.

Even before EMI's disaster with Carey, the damage which can be inflicted by stars with delusions of grandeur had been well-documented. Having made millions from stuffing shuttlecocks down his tennis shorts and making girls swoon, George Michael turned on his record company, Sony, for treating him as a sex symbol. When Michael went to court to protest against being treated as a commodity, he lost his case. In retaliation, he withdrew his labour from Sony for a period of years.

Another musician to teach his label that star-power can be a double-edged sword was Prince. Accusing Warner Brothers of cramping his style, he changed his name to an unpronouncable squiggle and inscribed the word 'slave' on his cheek. Escalating the dispute, he began recording rubbish albums in quick succession in a bid to eat up his contractual obligations.

But while Sony and Warners were able to absorb the financial damage caused by star tantrums 15 years ago, EMI put itself in a position where if Robbie sneezed, the label would catch cold.

In terms of today's music technology, 15 years ago is the Jurassic Age, and EMI has failed to meet the challenges of the download era. Sales of CDs have been in sharp decline for some years, with millions of listeners now downloading songs onto their iPods and MP3 players from the web.

While online stores are thriving, EMI remains dangerously wed to the old ways, with all the draining overheads associated with running shops, warehouses and shipments. It's a sticky situation which would have been once unthinkable for the cutting-edge enterprise which signed The Beatles and Beach Boys, snapped up Pink Floyd, and - ever alert to an opportunity - diversified with huge success into modern medicine by inventing the CAT scan.

For EMI, the costly courtship of Robbie Williams has turned into an embarrassing disaster, and a wake-up call that if it continues to behave like a dinosaur it will go extinct. For Williams, his departure from EMI is assured, but with three million fans paying into his recent tour, he won't overly despair about his future. For proof that there is life after both EMI and delusions of artistic grandeur, we need look no further than Mariah Carey.

After her deeply humiliating 45 million pay-off, she got back to basics, and has now resumed making multi-platinum discs - for someone else.

So firstly its his fault EMI lost its profits and someone has been sacked, and secondly they are predicting that Robbie will be leaving EMI.

Well to the first- whatever and secondly he has been saying that for a year. Maybe he could actually see what was going on at EMI.

New digital recruit is upbeat about reshaping EMI's future with downloads

Katie Allen, media business correspondent
Wednesday January 24, 2007
The Guardian

Robbie Williams disappointed, sales are falling and a top manager has just been axed but EMI's new digital guru says the future is full of opportunities for the world's third largest music group.
The group's global head of digital, Barney Wragg, believes EMI has huge potential to harness a rapidly growing market for music downloads.

"These are changing times. The good thing about the area of the business on which I focus is that I can hold a torch up and show people that the future is very bright for EMI," said Mr Wragg, who joined the home of Coldplay and Kylie Minogue at the end of last year from rival Universal. "Over the next three to six months, you're definitely going to see a change in EMI's profile in the digital music market."

Global digital music sales - downloads to computers and mobile phones - doubled last year to $2bn (£1bn), according to data last week from international music industry body IFPI. Despite the surge, the lobby group predicted growth was likely to slow this year and that it would be some time before downloads could make up for softer overall music sales, which have been declining for years.
Analysts say EMI will have to outperform the rest of the market if it wants digital to pick up the slack for slower CD sales any time soon. Mr Wragg is clear that things will have to move fast, but says EMI is in the right mindset and is signing digital deals all the time.

Describing his decision to join EMI after five years finding new revenue streams for Universal, he cites a willingness right up to chief executive Eric Nicoli to make the most of digital.

"I'd never seen anywhere where the whole company had this commitment," he said.

Still, times have been tough for EMI in recent months, and in the past three weeks its share price has fallen more than 20p. Less than a fortnight into the new year, the group axed the head of its music division, Alain Levy, and shocked the City with a profit warning. It suffered poor sales over the crucial Christmas period, including disappointing performances by Robbie Williams' new album.

Industry experts say Mr Levy's ousting was largely down to the group's failure to make much progress in the key US market. Others noted that although the French-born music veteran declared last year that "the CD as it is right now is dead", he had done little to fill the gap left by falling physical sales with digital downloads.

EMI's latest results showed digital revenues had jumped by 68% to £74m in the first half. They represented a growing share of total revenues at 8.5% but that is still lower than for the music market as a whole, where a tenth of global sales are digital.

Analysts say that a lack of detail has made it hard to predict how much new revenue streams from digital will compensate for softer CD sales. "EMI are never particularly good at disclosure anyway. Given the amount of information they do disclose, it's difficult to tell how powerful digital will be. There's an element of having to take their word for it," said one analyst.

EMI has signed agreements with internet music platforms around the world as well as a deal to offer advertising-supported videos on mobile phones in the US through Rhythm NewMedia.

For Mr Wragg, one of the big opportunities lies in China and he has already tied up a digital deal with its biggest web portal. The partnership with Baidu to launch an advertising-supported online music streaming service will mean Chinese consumers can legally access all of EMI's Chinese repertoire. The two have also agreed to explore developing advertising-supported music download services and Mr Wragg hints there is more to come. "Now we've got this changing middle-class in China," he said. "More people there study classical music than in the rest of the world put together."

Source (http://business.guardian.co.uk/story/0,,1997121,00.html)

... although the French-born music veteran declared last year that "the CD as it is right now is dead", he had done little to fill the gap left by falling physical sales with digital downloads.

Yay! So it WASN'T all Rob's fault!!! See, we knew that :tongue:

EMI merged its Capitol and Virgin Records divisions overnight. The new company is called The Capitol Music Group.

Virgin Records CEO Jason Flom as been announced as the head of the new company. Andrew Slater, President and CEO of Capitol Records has been removed from the company. Flom joined the company in November 2005. He will report directly to Eric Nicoli, CEO of EMI Group.

Although Capitol Records has a market share near double that of Virgin, Nicoli said in a statement "Jason Flom quickly demonstrated his leadership and artist development abilities since he has been at Virgin. I am confident that he will take us to new levels of success in the rock, pop and urban genres as leader of the Capitol Music Group."

EMI finished 2006 with a 10.2% market share in the USA, putting it last in the majors behind Universal, Sony-BMG and Warner. However, worldwide, the company is in third place.

The biggest weakness of EMI North America is its lack of local acts. The top 5 EMI artists of 2006 were four British and one Australia act. They were Coldplay, Robbie Williams, Gorillaz, K.T. Tunstall and Keith Urban.

The restructure has been designed to save the company $217 million annually and to do this, a staff reduction of 20% is expected.

EMI shares are down 9% so far this year.

coldplaying.com

seems they can't really get rid of their own trouble...

From The Sunday TimesFebruary 18, 2007

Broken in America
EMI's American business is crisis and its top performer in rehab. Paul Durman assesses whether its decline is terminal
You’ve got to hand it to Robbie Williams: he has a flair for timing. Although he wasn’t even at the Brits last week, and missed out on the award for best live act, the singer still managed to dominate the headlines surrounding Britain’s annual pop-music jamboree.

His decision to spend his 33rd birthday checking into an American rehab clinic made him the butt of jokes by Brits presenter Russell Brand, and earned him the sympathy of Joss Stone and the scorn of Liam Gallagher.

Eric Nicoli, the record-company boss whose eight-year reign at EMI is closely associated with the Williams soap opera, also displayed the art of timing last week — bad timing. Only hours before the rock stars and music executives gathered for the awards dinner in London on Wednesday, EMI issued its latest profit warning to the stock market, its second in two months.

Collapsing CD sales in America had prompted “an exceptionally high level of product returns” from distressed retailers, the company said. Even with the success of the new Norah Jones album, EMI now expects recorded music sales to be down by 15% in the current financial year. Only a month ago, Nicoli thought he could hold the decline to as little as 6%.

The news sparked a fresh slump in EMI’s share price and heaped more pressure on Nicoli — described as “a dead duck” by one shareholder.

Nicoli was EMI’s executive chairman until last month when he stepped down to become chief executive. He is accused of repeated overoptimism and of failing to grasp the scale of the industry’s trauma as consumers switch to listening to digital music on their iPods and mobile phones.

“There is no hope,” said Claire Enders, founder of the media and telecoms consultancy Enders Analysis. “CD sales will have halved by 2010. Virgin, HMV, all the multiples in the US, they’re reallocating space. They’re all selling mobile phones now.

“The total retailing space that will be lost in 2006 and 2007 is something of the order of 20%. EMI doesn’t actually understand the change which is going on, which is very, very rapid.”

Last April, EMI was hailing a turnround as the company achieved its first increase in group sales in five years. At the time, EMI was contemplating a merger with Warner Music Group, an on-again, off-again deal that has been under consideration for years.

Nicoli was still upbeat in July when he told shareholders: “We remain confident that the global music industry has excellent long-term prospects driven by the rapidly expanding demand for digital music. We believe that we will, in this financial year, again deliver a strong operating performance, achieve our financial objectives and make good progress.”

He was sorely mistaken. By October EMI was warning of a 3% decline in first-half sales, and its projections have just got worse and worse.

EMI was the talk of the Brits on Wednesday evening, but for all the wrong reasons. Nicoli, a big music fan who usually enjoys the awards, spent much of his time on the phone in his car, trying to avoid the hordes of journalists in attendance.

He didn’t have much to celebrate in any case. Artists signed to EMI, the only major record company run from Britain, won none of the awards on offer.

ROBBIE WILLIAMS has enough to worry about, but he exemplifies the problem that EMI has traditionally faced in America, the world’s largest music market. It lacks enough of the right sort of artists.

Enormously popular though he is in the UK, Williams’s British sense of humour — naming albums after football chants, for example — has kept him from cracking the American market. His US album sales are reckoned to be less than 1m.

EMI’s troubled American arm has long been “a massive weakness,” according to insiders. “It’s just failed year after year to turn round its American business,” said one. “Without America, it’s very hard to succeed as a global music company.”

With a world market share of about 10%, EMI is much smaller than the other major record companies: Warner (15%), Sony BMG (25.6%) and Universal Music (31.7%), according to Nielsen Sound Scan. That means the loss-making division, comprising Capitol Records and Virgin Records America, must struggle to support its overheads on a smaller revenue base.

EMI compounded these problems by missing the boom in “urban” or hip-hop music. Much of its American management is drawn from Capitol, which made its name with crooners like Frank Sinatra and Dean Martin — “about as nonurban as you can get,” said one executive.

Nobody doubts for a moment that the American market is extraordinarily difficult. The bankruptcy of Tower Records last year, store closures by Transworld and Circuit City, and Apple’s rapidly growing iPod/iTunes juggernaut (now America’s fourth-biggest music retailer) have hit CD sales for six.

Last week’s warning from EMI pointed to Sound Scan, which shows that all CD and other “physical” sales are down 20% so far this year. But some industry rivals suggest that EMI is making too much of six weeks’ data. “There’s no question that everybody is feeling market pressure,” said one expert. “But it’s only February.

The biggest hit that’s in the market is Norah Jones; it’s not like everybody has fired their big guns. It’s way too early to say the sky is falling.”

Some accuse EMI of making life worse for itself by overshipping, a practice for which it is allegedly “notorious” in America. Overshipping — supplying more CDs than retailers expect to sell — enables companies to book revenue early, but they run the risk of large numbers of costly returns.

EMI’s statement last week acknowledged the exceptional level of returns meant net sales had “been lower than anticipated and . . . the negative impact on gross margin has been higher than normal”.

Market sources said that EMI had shipped 1.6m copies of Norah Jones’s Not Too Late, which debuted at No 1 in America and has sold 642,000 copies after two weeks. A source familiar with EMI said retailers had expressed exceptional demand for the album.

The company rejects claims of overshipping. “Don’t confuse people gossiping with hard facts,” said a spokeswoman. “The exceptionally high level of returns are across the board. It’s affecting new releases and catalogue.”

EMI has already begun laying off hundreds of staff to slash overheads and focus on a narrower roster of artists. Much of the pain is being felt in America, where Virgin and Capitol have been brought together under the management of Jason Flom, who previously ran the Virgin business.

Nicoli has taken direct control of the recorded-music business himself, having forced out Alain Levy, its previous boss.

Although Nicoli continues to talk publicly about the music business’s “exciting growth potential”, the internal mood is much more gloomy.

Senior managers are now talking about working for a declining industry. Martin Stewart, the chief financial officer who was highly regarded when he held the same position at BSkyB, is said to be worried by the potential damage to his reputation.

“It’s a very difficult atmosphere,” said a senior executive this weekend. Managers have grown wary of Nicoli and Stewart as everyone tries to avoid the finger of blame.

Levy is being held responsible for moving too slowly to tackle costs, and failing to follow through on earlier initiatives. He could not be reached for comment.

One person familiar with the situation said: “They’re completely reengineering their cost base, recognising that the business has fundamentally changed. The previous cost structure is completely out of kilter with the business. They need to get rid of 25% of costs.”

This looks a more aggressive target than EMI’s stated plan to reduce costs by £110m by March 2009. This is understood to equate to 20% of the costs of the recorded-music business. EMI’s other big failing, according to its critics, is the slow progress it has made in developing its digital business. Although sales of mobile ringtones and downloads are booming, up 68% in the first half, they remain less than 10% of group sales.

Yet it is now eight years since the arrival of Napster, the original file-sharing service, forced the record companies to take digital music seriously. The industry’s defensive and litigation-led response has cost it the initiative, largely surrendered to Apple, and slowed the development of alternative business models.

One insider said: “In Levy’s day, there were dozens of signatures that were required internally before a digital deal could be done. EMI is going to have a much more aggressive approach in digital.”

EMI, like its major rivals, can point to a number of digital initiatives. It is setting up an online music service with Baidu, the Chinese equivalent of Google.

It has also been exploring the possibility of selling digital files without restrictive copyright protection, known as digital rights management. DRM, and the problems it causes for consumers when using their music players, is blamed by many for the modest scale of digital sales. A solution that will allow players from Apple, Sony and others to work with all available online stores is increasingly seen as a necessity.

The fear is that these initiatives are too little too late. Many critics believe the music industry has lost a generation of teenagers and twentysomethings, who have got used to taking free music from illegal file-sharing services. The record companies’ response — to sue many of the biggest consumers of music — has made it commonplace for the industry to be accused of hating its customers.

There are two more reasons why EMI may be wrong to believe the growth in digital sales will come to the rescue.

Downloading individual tracks makes it much easier to avoid what one former music-industry executive called “the bundling scam” where “we’ll put a bunch of average tracks on a CD with some good stuff. Now people are able to pick and choose what they want, their business model falls apart”.

Another problem, said Enders, is that as more people carry their music around with them, the demand for “best ofs” and compilations is diminished. “People are no longer buying any compilations,” she said. “They’re making their own.”

The dreadful irony, of course, is that music has never been more popular or more widely consumed — as one can see from the Brits awards, from the ubiquitous use of music in advertising, and from the boom in festivals and other live music.

This is an issue facing all the industry giants, not just EMI. There are no easy answers and that is why so few investors were publicly calling for Nicoli’s head last week. EMI investors had a chance to sell out last year when the price was above 310p and the group was in merger talks with Warner. They didn’t because they were confident there was further upside.

With the shares now down at 221p, investors still maintain there is huge value to realise. The problem is they still don’t know how to release it and that is the big frustration.

TIME FOR THE MUSIC BUSINESS TO THINK OUTSIDE THE BOXED SET

At the 3GSM mobile phone conference in Barcelona last week, Edgar Bronfman, chairman of Warner Music Group, said record companies would have to do much more than simply digitise their song catalogues if they were to succeed in the digital era.

In America, Warner has tried bundling videos, photos and other extras with digital albums, and selling them at a premium price. For example, last year’s Depeche Mode album could be bought with a digital booklet, and with a code that gave priority access to concert tickets. Warner is finding that the more expensive bundles typically sell much better than the album alone.

Tim Grimsditch, strategy director at Frukt, a music consultancy, said the industry, spoilt by the 1990s, had remained overreliant on CDs: “It’s like a car industry that only sells Vauxhall Astras. You can have one in any colour you like, but you can only have an Astra. It’s a one-format industry, which is pretty odd.”

While there have been small experiments - for example, with box sets and licensing music to online start-ups - these have mostly generated minuscule revenues.

Grimsditch said: “The experiments let them defuse criticism, but as a proportion of overall sales it does not really stack up. For all the boasted creativity of the majors, where’s their creativity in business?”

Source (http://business.timesonline.co.uk/tol/business/article1400204.ece)

His US album sales are reckoned to be less than 1m.

Perhaps if the cds were in the stores we could buy them and not go to digital or the internet sites to buy them.

EMI’s other big failing, according to its critics, is the slow progress it has made in developing its digital business.

So it isn't all Robbie's fault for EMIs troubles....thought not.

EMI receives Warner bid approach


Music group EMI says it has received an approach from US rival Warner Music that could lead to a takeover bid. The move is the latest twist in a battle which has seen both firms try to buy the other in the past seven years.

The new approach by Warner Music comes after EMI issued a profit warning last week - its second of the year. However, EMI - whose artists include Coldplay and Robbie Williams - said it had not received a firm offer and added there was no certainty one would come. News of the approach pushed EMI's shares up, and in early morning trade they were 15.75 pence, or 7.1%, higher at 237.25p.

Previous attempts to merge EMI and Warner Music - the first coming in 2000 with another in 2003 - have come to nothing.

Last year, both companies made attempts to buy the other, but the moves were scrapped following regulatory fears.

In June 2006, a European court annulled approval of Sony Music's 2004 merger with Bertelsmann's BMG, and worries over whether authorities would allow an EMI-Warners tie-up caused the firms to end talks.

Last week, EMI - the world's third-largest music group - said that profits for the year to March would be "significantly" below expectations.

It said sales in its recorded music division were expected to be 15% lower than the year before, with sales in its North American division down 20%.

Along with other music companies, EMI has been hit by the trend of consumers downloading individual songs from the internet rather than buying whole albums in physical form. The label has also seen disappointing sales of major releases such as Robbie Williams' Rudebox.
At the weekend, the Sunday Times reported that EMI was planning a financial overhaul which would see it borrow £1bn against its publishing business in order to pay off more expensive debt elsewhere in the group.


Source (http://news.bbc.co.uk/2/hi/business/6377857.stm)

The label has also seen disappointing sales of major releases such as Robbie Williams' Rudebox.
Maybe that's due to lack of promotion on their part? I dunno but they must have made a buck or two out of the tour (merchandising, sponsorship etc not to mention ticket sales), why's that never mentioned?

They say Rudebox is misconcieved, yet don't quote their sources.

OH GOSH, there a hundreds of artists (and their labels) who wish they could sell a fraction of what Robbie sold with Rudebox... damn people are never satisfied...

OH GOSH, there a hundreds of artists (and their labels) who wish they could sell a fraction of what Robbie sold with Rudebox... damn people are never satisfied...
:clap:

It went to No. 1 and went platignum for Gods sale. It was the 4th biggest seller in this country last year. and it wasnt even out till late in the year. I wish these people would stop talking inaccurate rubbish!

EMI responds to rival's overtures

Katie Allen
Wednesday February 21, 2007
Guardian Unlimited

EMI, the UK music group, responded last night to an approach from rival Warner Music about a possible takeover. The company is understood to have told Warner it would consider a bid depending on the price offered and regulatory issues.

It emerged earlier that a tie-up could see Warner and EMI hand over major artists to independent record companies under an industry deal to boost smaller labels' market share. US-based Warner confirmed renewed interest in its ailing rival this week and announced a controversial pact securing the support of independents' lobby group Impala. It is thought a bid could come as soon as March.

Impala has derailed music mergers in the past but will support Warner in return for market-boosting measures and funding for a new digital licensing initiative.

Patrick Zelnik, the president of Impala, said today that Warner had agreed to give independents first refusal on some of the combined group's subsidiary labels and the artists that come with them. Warner, home to Madonna and My Chemical Romance, could be willing to dispose of EMI's Robbie Williams but declined to comment for now on what might be sold. Impala said it was too early to say which labels and artists would top its wishlist but Mr Zelnik insisted such transfers would benefit consumers. "It's about catalogues that are badly exploited. It's about musical diversity. And the point is to reinforce the market share of the independents."

The agreement also commits Warner to pursuing greater market access for independents in negotiations with software players such as Apple and Microsoft, Mr Zelnik said. Offline, it would mean better access for independents in supermarkets and stores, accused of narrowing choice and squeezing out small record shops.

Mr Zelnik is meeting Neelie Kroes, the European competition commissioner, on Friday and is confident the deal could be a precedent for more cooperation. Mr Zelnik, who also heads the French Naïve record label, said: "We mustn't be arrogant and claim to be magicians who have found some great solution. We have to discuss things with the commission. All we ask is the regulators do their job."

The commission is due to rule on the Sony-BMG music merger on March 1 and is expected to open a further investigation lasting months. Last summer a European court upheld an Impala appeal and struck out the commission's approval of the 2004 merger. Competition lawyers questioned whether Impala's support will improve Warner's chances, but the Impala chairman, Martin Mills, said tonight: "I think this removes a lot of the problems for the commission. Three strong majors and a strong independent sector is a much better situation for the industry than the one we find ourselves in now."

Warner, which clarified today that any bid would probably all be in cash, has been trying for seven years to buy EMI.

· Email business.editor@guardianunlimited.co.uk

Music Chief at EMI to Join Sony Venture

<NYT_TEXT>Martin Bandier, the chairman and co-chief executive of EMI Group’s EMI Music Publishing unit, will take the reins of the music-publishing unit at the rival Sony corporation after his EMI contract expires at the end of next month.

As part of the arrangement, which was announced yesterday, Mr. Bandier is making an unspecified investment in the Sony unit, known as Sony/ATV Music Publishing, where he will become chairman and chief executive. His compensation will be linked to increasing the value of the unit, which controls more than 400,000 copyrights, including songs by Joni Mitchell, Brooks & Dunn and the Beatles. The unit is a venture with the pop star Michael Jackson.

Mr. Bandier’s future in the music business has been the subject of much speculation since he announced in October that he would resign from EMI, which he had helped transform into the industry’s biggest music publisher, with control of an estimated one million copyrights.
Mr. Bandier held talks with one rival, the Warner Music Group, about taking charge of its publishing division, Warner-Chappell, and also consulted with private investors about various possible ventures.
But Mr. Bandier said he was not interested in starting his own company. “I’m not about starting from scratch again,” he said yesterday. “I’m used to playing on a big stage.”

Mr. Bandier was recruited to the Sony job primarily by Robert S. Wiesenthal, the company’s chief financial officer, who has directly overseen Sony/ATV since 2004, when the Japanese electronics giant split off its recorded music division and folded it into a venture with Bertelsmann, the German media conglomerate.

Since then, Mr. Wiesenthal has moved to consolidate Sony’s control of the unit, in part by working out a complex arrangement that provides the company with an option to buy half of Mr. Jackson’s stake.
Mr. Bandier had been a top executive at EMI since 1989, when he and his business partners sold their music company, SBK Entertainment World, to EMI for $337 million.

nytimes.com

Music publisher calls bid value inadequate, sees regulatory delay
<!-- PUBLISH DATE -->
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LONDON–Music publisher EMI Group PLC said yesterday that it rejected a non-binding $4.8 billion takeover proposal from Warner Music Group.
London-based EMI, which announced last week that it had been approached by former suitor Warner, said that the offer was inadequate based on EMI's own value and the lack of benefits from joining with Warner.
Shares in EMI closed 4.5 per cent higher on the London Stock Exchange.
The company also said pursuing the deal would lead to ``prolonged regulatory uncertainty and unacceptable operational risk at a critical time for the company.''
Warner and EMI began talking in 2000, but called off discussions last summer when a European court scuttled another industry deal between the music units of Sony Corp. and Bertelsmann AG.
The EU this week asked for a more thorough look at that deal.
EMI has blamed the overall industry decline for its troubles, citing disappointing North American CD sales last month when it announced its second profit warning this year. But analysts point out that other music companies like Warner and Universal have weathered the storm better.
Analysts say EMI lacks promising new music, and has weak internal controls and a poor record in the United States.
A combined EMI and Warner Music would control about 25 per cent of the global recorded music market based on sales, ranking second to Vivendi SA's Universal Music, according to the IFPI.
Warner Music Group spokesman Will Tanous did not immediately return a call for comment

toronto star

Interesting. Thanks Shell. :)

Warner boss ready to resume overtures to EMI
Richard Wachman
Sunday March 11, 2007
The Observer (http://www.observer.co.uk/)



Edgar Bronfman Jr, head of US group Warner Music, is ready to meet EMI chairman John Gildersleeve to thrash out a fresh merger deal after an initial bid from the Americans worth 260p a share was turned down by the UK company's board two weeks ago.

Wall Street sources say that Warner's boss is ready to sweeten the terms of his offer, but that 'he has to get at least a wink' that a deal is a possible for talks to get under way with Gildersleeve and chief executive Eric Nicoli.

An industry executive in London said: 'This is a marriage that is going to happen at some point; they have talked so often in the past.' Some EMI shareholders are believed to be unhappy that it has failed to leave the door open to negotiations with Warner, which in June made a higher bid, worth 320p a share.


In December, another offer for EMI materialised, this time from private equity group Permira, pitched at 310p a share, but this was also rejected.

'What are EMI waiting for? If they let another nine months elapse, they will be lucky to get 160p a share,' said one analyst.

Nicoli and Gildersleeve are under intense pressure after two profits warnings in six weeks sent shares plunging.The British music major - which counts Joss Stone and Robbie Williams among its artists - last month gave warning that its recorded music sales would be down 15 per cent. But Warner is also facing difficult trading conditions .
EMI turned down Warner's latest offer on the grounds that it was too low and entailed excessive regulatory risk. A tie-up between Sony and BMG is being investigated by the European Commission. If that gets the green light, an EMI/Warner link is more likely.
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Cut-throat lobbying ahead of MEPs' online music vote

CREATIVE RIGHTS – A petition signed by more than 350 songwriters and composers – including Annie Lennox and Robbie Williams – urging European lawmakers to reject a report on cross-border management of online music copyright, has been withdrawn after signatories denied having signed such a petition

The International Federation of Music Publishers (ICMP/CIEM) sent a petition – seen by EUobserver – to MEPs on Thursday (8 March) ahead of a vote on the report on Tuesday (13 March).

The petition is one of many lobbying efforts lately. The amount of emails and phonecalls MEPs have received on the issue of collective cross-border management of online music have intensified over the last few weeks as interest in the report has increased in a last chance bid to influence the wording of the paper or the outcome of the vote.

"There has really been a lot of attention from all sides," a parliament official said. The EU digital music sector is set to become a €3.9 billion a year industry by 2011 and the parliament vote could have an effect on where the money goes.

The report – written by socialist Hungarian MEP Katalin Levai - has been delayed since November 2006 partly due to the heavy interest in the topic.

It fears a 2005 European Commission recommendation could lead to a "big-bang" style introduction of competition into the collective management of authors' rights and therefore damage cultural diversity in Europe, but at the same time it recognises a need for more - although restricted - competition in the area.

The ICMP petition said the commisssion recommendation on collective cross-border management of copyright and related rights – which could see a change in the way music copyright is managed across Europe - "supports and enhances our creative efforts which can only be good for our shared and diverse culture in our great Continent."

"The Commission recommendation on music on-line will result in our music reaching more consumers and we are committed to making this happen," the petition said and called for MEPs to "uphold the recommendation without change."

French singer and composer Dominique Pankratoff who himself is among the 350 on the list said "authors had been abused."

"I have not given any formal signature on the petition launched by ICMP," he said in an email on Friday (9 March).

English singer-songwriter Billy Bragg, whose name is also on the list, un-knowingly signed the petition, according to his manager.

The ICMP/CIEM has denied the existence of the petition to EUobserver, but in an email – also seen by EUobserver – to the European Composers and Songwriters Alliance on Friday (9 March), the federation apologises for the petition.

The "ICMP has withdrawn the proposal of circulating a petition and has asked anyone who has received a draft of it by mistake to delete it," the email said, adding they "apologise for any upset it may have caused."

www.euobserver.com (http://www.euobserver.com)

iTunes users can now share EMI songsRecord label announces new online deal that will allow Apple's customers unrestricted use of songs in its catalogue

The record label responsible for acts such as Coldplay and Robbie Williams has said that customers who buy its music online will be free to use it as they like - dropping a long-standing resistance to software that prevents copying.


EMI announced today that it is to offer a significant portion of its online catalogue without anti-piracy software – meaning that customers buying EMI’s music on iTunes will be able to play the songs on devices other than iPods and make multiple copies of their music.

The announcement, which came at a joint conference with Steve Jobs, Apple’s chief executive, will end a long-standing policy of employing a software known as DRM - digital rights management - which restricts the way customers can use the music they buy online. CDs contain no such software.

iTunes will offer all EMI's catalogue in a new premium downloadable form - 250k AAC compression instead of the current 128K AAC - for 99p per track, 20p more than the current fee and without copyright protection. Those who have already downloaded EMI music can upgrade the track for 20p.

The premium will not affect albums, which will be available in the new format for the usual price.

None of the Beatles tracks are yet included on the deal, but Mr Jobs - who launched the new deal in London with EMI's boss Eric Nicoli, said he wanted that to happen. Mr Nicoli said he was working on it.
As from tomorrow, a pilot album from rock group The Good the Bad and the Queen will be available from their website.

Mr Nicoli said: "When I told Damon Albarn (lead singer with the band) he used two words, the second of which was brilliant and the first of which was not jolly."

Mr Jobs said that by the end of the year half of the 5 million track on iTunes would be available in the new premium format. He said he would be talking with other record companies after the EMI announcement.

DRM has been a controversial issue in the music industry. Record companies have insisted that the software is necessary to prevent illegal copying, but Apple’s service has been criticised by several European regulators for being anti-competitive, prompting Mr Jobs to say in February that he would get rid of Apple’s system “in a heartbeat” if the labels agreed.

Edgar Bronfman, the chief executive of Warner Music, replied that Mr Jobs’s argument was “completely without logic or merit”.
Privately, however, labels have been exploring the possibility of dropping DRM, which is thought to be partly responsible for the disappointing uptake of online music sales.

Online music sales still account for only 10 per cent of the total market and are not yet growing at a rate which compensates for the decline in revenues from CDs – approximately 2 to 3 per cent per year.
EMI, which has previously released tracks by Norah Jones and Lily Allen without copyright protection, shelved plans to drop DRM on a more widespread basis after iTunes competitors refused to make “risk insurance” payments designed to offset potential losses that would result from the move. It is unclear whether Apple has made any such payment.

Other labels, including Universal Music and Song BMG, have experimented with offering music without DRM, but none has pursued the strategy as aggressively as EMI.

Times Online

Now if they would just sell more Robbie on US itunes..........

Why online music fans will soon be glad all over

Lower prices and more flexibility will add to the appeal of download sites, says David Prosser

Published: 07 April 2007

iTunes will offer digital music to customers with the option of paying a higher price for music that comes without digital rights management software Good news for music fans. Not only is the cost of digitally downloaded music set to fall, but you will also soon be able to make better use of many of the files you download.

Cheaper tunes are on the way courtesy of the European Commission, which on Tuesday announced it would investigate iTunes, Apple's online music store.

The watchdog is concerned because, while iTunes is the market leading download site in most of Europe, users in the UK pay around 18 per cent more for each track - typically 79p - than those in the Eurozone, where the usual price is 99c. The Commission also thinks that people in one country should be allowed to buy music from iTunes stores elsewhere, which Apple currently prohibits.

This week's second piece of positive news for music fans is a joint announcement from iTunes and the record label EMI, whose artists include stars such as Robbie Williams, Coldplay and The Beatles. The two digital music giants are to begin offering customers the option of paying a higher price for music that comes without digital rights management (DRM) software.

This computer code is supposed to prevent piracy but can also be a major irritation for music fans who want to listen to their downloads on different devices at different times.

The net effect of both these developments is that it may not be long before music from all download sites is compatible with all portable players and more easily movable between computers. If prices come down too, music fans will be even better off. For now, however, buying music online is not simply a question of finding the cheapest supplier of the tracks and albums you want.

As the table (below) shows, different sites supply music files in different formats, so you need to be sure that what you get is compatible with whatever device you want to play it on. In particular, not all MP3 players, or similar devices, support all formats - check what yours will play before you buy.

As part of this process, music fans also need to understand whether what they're buying has DRM software attached - and what type. The code is used in different ways by record labels and music download sites. And most independent record labels don't bother with the software at all, preferring to allow listeners to do what they want with downloads they have paid for legally.

The big record labels, however, tend to use DRM software to restrict the devices to which their music can be copied. You might be able to copy music to your home PC and a single MP3 player, for example, but not to CD or any other players.

At Apple's iTunes online music store, DRM software currently prevents people playing downloads on any music player other than Apple iPods. Napster uses a different model - it has a monthly subscription service that gives users unlimited access to songs, but DRM software prevents you playing this music at all once your subscription lapses.

If it's a record label's DRM software that worries you, EMI's initiative should offer access to software-free downloads on most sites from next month, with single tracks priced at 99p. But other labels have yet to follow its lead and you will still face other forms of the piracy software.

One option is to circumvent the software, which is relatively straightforward for computer-literate music fans. There are plenty of internet sites - many offering free software - that offer advice on how to turn files downloaded from iTunes, say, into formats that can be played on devices other than the iPod.

Strictly speaking, you may be infringing copyright law by changing the format of music you've downloaded. But it's extremely unlikely that a record label or download site would ever take you for task for doing so, just as no one has ever been prosecuted for transferring CD music onto their computers, which is also technically unlawful.

If the whole issue of DRM doesn't bother you at all, you still need to seek out the cheapest supplier of the type of downloads you want and ensure that the files are compatible with your players.

The table (below opposite) gives a snapshot of the prices charged by the leading online music retailers. Crucially, though, it only includes sites that operate legally within the UK. There are several unlawful operators that undercut these prices very significantly - AllofMP3.com, the Russian company, is the most notable.

If you choose to use these sites, however, you're supporting an illegal operator. You'll have no comeback if you encounter quality issues and no rights of any kind.

Don't believe these sites' claims that they are legal. AllofMP3.com, for example, repeatedly argues that it is not breaking the rules because it pays royalties to a Russian music organisation. But at best that would only cover sales in the Russian market.

"There is absolutely no doubt that AllofMP3.com is operating illegally," says a spokesman for the British Phonographic Institute (BPI), which represents about 400 music labels in the UK, including the big four - Sony BMG, EMI, Universal and Warner. "This site is about as legal as someone selling fake CDs on the street corner."

However, closing AllofMP3.com down is proving difficult. The BPI announced last year that it would take legal action against the site. But so far it has been unable to penetrate the Russian legal system in a way that poses a serious threat to AllofMP3.com and the company continues to operate - seemingly with impunity - in the UK.

The BPI continues to operate on the principle that it wants to take action against AllofMP3.com, rather than music fans who buy from the site. What that means in practice is that if you use the site in order to save money, you're almost certain not to face legal problems. But make no mistake - you will be breaking the law.

The sound of tills ringing: what music costs online

* Broadly speaking, most legal music download services now charge similar prices. But there are two different models in operation. Most sites charge you a fixed price to download each single or album. But Napster and Wippit also offer subscription services.

* At Napster, there are two services. For a premium of £9.95 a month, you are entitled to download and listen to as much music as you want on your PC; for £12.95 a month, you can subscribe to Napster To Go, which enables you to transfer files onto a portable device such as an MP3 player. At Wippit, the lower monthly fee only gives you free access to some tracks - for others, where Wippit doesn't have the full licensing rights, there may be additional fees to pay.

* The advantage of the Napster model is that music fans can download as much as they want without worrying about the cost. This can be particularly useful for trying out bands you don't know - if you don't like the music, simply delete it. The drawback, however, is that you can only continue to listen to Napster downloads for as long as you subscribe to the service, though this is not the case with downloads from Wippit.

* If you prefer to pay for each download separately, it's worth shopping around between the different sites. The table (below opposite) gives an idea of what the sites were typically charging for singles and albums this week, but prices for different acts do vary. You may find some bands cheaper on certain sites - and all of the sites run special offers and sales from time to time.

* Bignoisemusic is worth a particular mention because it is linked to Oxfam. The charity gets 10p of each £1 spent through its site, but its prices remain competitive, so there is no real premium to pay for supporting a good cause while you download.


Source (http://money.independent.co.uk/personal_finance/invest_save/article2426238.ece)

EMI Group Plc the world's third largest music company, said on Wednesday it would post forecast-beating annual earnings, but suspended its dividend payments after two profit warnings this year.

The British group, home to such artists as Robbie Williams, Kylie Minogue and Norah Jones, confirmed revenues at its recorded music division fell 15 percent in the year ended March, but said a cost-cutting programme was ahead of schedule.

The music industry has been damaged in recent years by Internet piracy and falling CD sales but EMI has also suffered from a lack of big hits recently and the poor performance of new releases such as Willimas's "Rudebox".

The group, which rejected a 2.1 billion pound ($4.22 billion) cash bid from Warner Music Group in March, said it had completed most of a 110 million pound restructuring programme it announced in January.

The company now expects at least 70 million pounds of savings by 31 March 2008 with the rest seen reflected in its results for the year ending March 2009.

EMI said it expected to report underlying group earnings before interest, tax, depreciation and amortization (EBITDA) before exceptional items of about 174 million pounds ($350 million) which it said was ahead of market expectations

At 0840 GMT, EMI shares, which have fallen around 17 percent this year, were up 5.2 percent at 226-1/4 pence, valuing the business at about 1.8 billion pounds.

Richard Hunter, Head of UK Equities at Hargreaves Lansdown, said the statement showed early signs EMI was turning a corner.

EMI also said it was examining a securitisation of its Music Publishing assets -- allowing it to borrow against revenues from the more reliable publishing side -- which it hopes to complete by the end of this financial year.

Bridgewell analyst Patrick Yau said while the EBITDA figure was ahead of his forecast the update was disappointing as there was no statement on current trading.

"Clearly the level of debt is becoming more of an issue with cash generation not obvious, underlining the potential securitisation of the music publishing portfolio," he said.

Yau also said securitisation would make any takeover deal more difficult.

EMI said the operating margin at the publishing business had continued to improve as a result of cost cuts and publishing revenue was expected to be broadly flat at constant currency.

EMI's digital music sales -- which are replacing some of the declining sales in CDs -- rose 59 percent and will represent about 10 percent of revenue

EMI moved to boost its digital sales recently when it signed a ground breaking deal with computer and iPod firm Apple to sell music online without anti-piracy protection in a bid to grow digital sales.

"Our industry is changing at an unprecedented pace," EMI Chief Executive Eric Nicoli said. "We have launched a number of significant digital initiatives ... which reflect our optimism about the digital environment.

"Such initiatives, coupled with tough management actions, position the group to make good progress in the future."

Last year Warner, the world's fourth-largest music company with artists such as Madonna and Red Hot Chili Peppers, offered 320p a share for EMI, but downgraded that to 260 pence per share at a second attempt after EMI issued its second profit warning in as many months in February.

The two music firms have made several attempts to strike a deal over the last seven years.

But it is not clear whether any merger would gain regulatory approval as the deal that created Sony BMG is being examined by the European Commission and could take months to be resolved.

Reuters

U.K. Music Artists Increase Share of U.S. Market (Update1)
By Aisha Phoenix

April 30 (Bloomberg) -- U.K. music artists, including the Beatles and James Blunt, account for almost one in 12 albums sold in the U.S., the world's largest market for U.K. music, the British Phonographic Industry said.

U.K. artists have increased their share of the U.S. market for the second straight year, the BPI said, citing an analysis of the top-selling 3,000 albums in the U.S. based on data from Nielsen, which compiles the SoundScan charts in North America.

The U.S. accounts for 34 percent of global music sales, while Japan's share is 18 percent and the U.K. accounts for 10 percent, according to the International Federation of the Phonographic Industry's 2006 Global Recording Industry in Numbers report. The U.K.'s share of U.S. sales was 8.2 percent in 2006, compared with 8.1 percent a year earlier and 7.6 percent in 2004, the BPI said.

``With the British music industry on a creative high, there has been a huge appetite at home and abroad for new home-grown talent in recent years; British record labels continue to show great strength in building significant U.S. success on the back of strong domestic sales,'' BPI Chief Executive Officer Geoff Taylor said in the statement.

Blunt's ``Back to Bedlam'' on Warner Music Group Corp.'s Atlantic label was the U.K.'s top seller in the U.S., followed by the Beatles' ``Love'' album on EMI Group Plc's Capitol and KT Tunstall's ``Eye to the Telescope'' on EMI's Virgin. ``Back to Bedlam'' was one of only seven albums to sell more than two million copies in the U.S. last year, according to the BPI.

U.S. album sales fell 17 percent in the first quarter of 2007 as rising online piracy and fewer new hits accelerated the music industry's decline. Retailers sold 117.1 million albums in the three months ended April 1, researcher Nielsen SoundScan said in a statement on April 5.

bloomberg.com

Band wants fans so it's giving its album away

May 1, 2007

A British indie band is giving away its new album for free online in a bid to create a fanbase that could make it easier to make money in the future. The Crimea is believed to be one the first established pop acts to offer a whole album for free, the latest example of how the Internet is changing the way pop music is distributed.

It also raises fresh questions for record labels, which are struggling to offset the steady decline in CD sales despite turning increasingly to the Internet for revenue.

"There are unsigned bands who give stuff away, but in terms of a band as big as this, to my knowledge it has never happened before," said Stephen Taverner, The Crimea's manager. "This is in order to reach a wider audience. They are hoping that because it's free it will open the band to a wider audience and make more money from live income.

"The other thing that's important is that all of this is irrelevant if the music isn't any good." The quintet, currently on a tour of China at the government's invitation, announced the offer for Secrets Of The Witching Hour on its website (www.thecrimea.net). It can be downloaded now.

Some of its members have experienced rejection by record labels before, most recently when Warner Music Group dropped them last year. "We were signed to the American [Warner] company and not the UK company and it was a classic thing of not selling enough records in America," said Taverner.

But he added that The Crimea's move to give away their album did not mean they were burning bridges with the industry. Taverner argued that there needed to be greater equality between artists and labels, and that by creating a sizeable fan base online, bands could improve the terms of record contracts.

The four major record labels - EMI, Universal Music Group, Sony BMG Music Entertainment and Warner Music Group - have long fought to battle illegal music downloads and make a profit from legal digital sales, but are finding the going tough. Last year saw global digital music sales almost double to around $US2 billion but the overall music market continued to shrink, by an estimated three percent.
Sunday's British pop chart was a reminder of how powerful the web can be in promoting acts. The Arctic Monkeys stormed to the top of the album rankings with Favourite Worst Nightmare, selling an estimated 250,000 copies in the first week. Although the Sheffield group is now signed to independent label Domino, it first rose to prominence through fans swapping early demos online and went on to have the fastest-selling British debut album ever in 2006.

More established acts have also turned to new technology to market their music. Robbie Williams and Madonna both used mobile phones for recent record releases, and U2 tapped the iPod boom to promote its hit album How to Dismantle an Atomic Bomb.

Elton John announced last month he would make his entire catalogue available for digital download for the first time. And the recent settlement of legal disputes involving the Beatles' Apple Corps have raised expectations that the Fab Four's music will finally be available to download online.

Reuters

LONDON (Reuters) - British music group EMI, home to Robbie Williams and Coldplay, said on Friday it had received a number of takeover approaches, after a report that private equity firm One Equity Partners had joined the list of suitors.



EMI Group Plc, which rejected a 2.1 billion pound ($4.2 billion) bid proposal from long-time suitor Warner Music in March, declined to say how many approaches it had received or who they were from.
Earlier on Friday, the Financial Times newspaper, without citing sources, said One Equity Partners had approached EMI with an offer that could value the world's third-biggest music group at more than $6 billion.


One Equity Partners, a unit of JP Morgan Chase and Co, could not immediately be reached for comment.


"Further to recent speculation, EMI Group Plc confirms that it has received a number of preliminary indications of interest to acquire the company," EMI said in a statement. "There can be no certainty that any offer will ultimately be made."


EMI has issued two profit warnings this year and is trying to revive its flagging music business with a far-reaching restructuring program.
The music industry has been damaged in recent years by Internet piracy and falling CD sales, but EMI has also suffered from a lack of big hits recently and the poor performance of new releases such as Williams's "Rudebox" album.


EMI and Warner Music, the world's fourth-biggest music group, have been in a tit-for-tat takeover battle for much of the past seven years.
EMI shares closed at 227-1/2 pence on Thursday, well below Warner Music's latest proposal of 260 pence a share, and valuing the business at about 1.8 billion pounds.


Yahoo news

(additional reporting by Deborah Haynes)

Am I the only one peeved off at Robbiw being singelhandedly blamed for the mess that is EMI at the minute....they have had many failures in the past year and have obviously forecast optimistic sales in a falling market and that is more the problem of the staff employed than the music produced....

Getting really sick of this now..

Am I the only one peeved off at Robbiw being singelhandedly blamed for the mess that is EMI at the minute....they have had many failures in the past year and have obviously forecast optimistic sales in a falling market and that is more the problem of the staff employed than the music produced....

Getting really sick of this now..
Me too, it's so stupid.

It is like Robbie has said; the journos are lazy. They just copy and paste. And the same "news" are repeated over and over while travelling 70 turns around the globe.

EMI starts sell-off process


Katie Allen, media business correspondent
Thursday May 17, 2007
Guardian Unlimited

EMI: home to Kylie Minogue and Robbie Williams.

Music group EMI has put itself up for auction by opening its books to a number of potential bidders including its rival and long-time predator Warner Music Group. EMI, home to Robbie Williams and Kylie Minogue, put itself up for sale earlier this month when it told the market it had received a number of approaches from potential buyers.

Industry sources say the struggling London-based group has now opened the door for due diligence and hopes to play bidders off against one another.


"The significant aspect of this is EMI was in a cat and mouse game with all the potential buyers. Now it has initiated a formal process to sell the company," said one industry source tonight. The private equity groups interested in EMI are believed to include One Equity Partners, a unit of JP Morgan Chase which has been linked in the past to EMI, has been rumoured to be considering an offer of about 255p a share. Other names in the frame are Cerberus Capital and Fortress, which this year became the first hedge fund and private equity group to be floated on the New York stock exchange.

They will face tough competition from Warner, however, which has been in a tit-for-tat takeover battle with EMI for years. Warner, home to Madonna, made its latest approach earlier this year, but its 260p a share offer was rejected by EMI as too low. EMI also highlighted the regulatory risk of a merger - despite a landmark deal by Warner to secure the backing of the powerful independent music lobby group Impala, which derailed the 2004 Sony/BMG merger.

Impala has pledged full support to a Warner-EMI merger in return for promises of better cooperation and funding for a new global licensing system. Some industry insiders also feel regulators will look upon another music merger more benignly given tumbling global CD sales.

Private equity bidders will struggle to justify a higher bid than Warner given they cannot cash in on the synergies a music merger would bring. Instead it is thought they will flag up the risk of regulators thwarting such a tie-up and will call into question the clout of Impala's support.

The auction takes place against the backdrop of a perilous global music market, which has hit EMI particularly hard. Those poring over its finances will want to know how the world's third-largest music group managed to put out two profit warnings just five weeks apart at the start of this year. The company reports results next week and said in a recent update that it expects full-year revenues from its record labels arm to be down 15%.

One Equity, Cerberus, Warner and EMI declined to comment. Fortress did not return calls.

Source (http://business.guardian.co.uk/story/0,,2082328,00.html?gusrc=rss&feed=24)

The auction takes place against the backdrop of a perilous global music market, which has hit EMI particularly hard. Those poring over its finances will want to know how the world's third-largest music group managed to put out two profit warnings just five weeks apart at the start of this year. The company reports results next week and said in a recent update that it expects full-year revenues from its record labels arm to be down 15%.


Sense at last - the downturn is global and was predictable and not ENTIRELY the fault of Robbie Williams.....Halle Bloody Luia! Amen.

EMI to be bought by Terra Firma
8:03 am, 22 May 2007 Print this story

EMI is to be bought by private equity firm Terra Firma for £3.2 billion including debt.

The UK music group, whose artists include Robbie Williams and the Beatles, has been the subject of bid speculation for the past year as its business has struggled.

EMI previously rejected a takeover bid from US industry rival Warner Music. It is one of the world's big four record companies.

EMI sales declined dramatically in the past 18 months and the group said on Thursday that it made a £260 million loss in the past year. News of the bid sent EMI's shares up 9%.

The deal values EMI as worth £3.2b including debt. It is unlikely to raise the same competition issues as if EMI was being bought by one of its rivals such as Warner Music and could take just months to be completed.

Sales have been hit by the trend for more digital downloading of music and a number of high-profile album releases have badly disappointed.

EMI announced a radical restructuring plan earlier this year, resulting in the loss of hundreds of jobs in both Europe and the United States.

Terra Firma is run by Guy Hands, one of the UK's leading financiers.

© NewsRoom 2007

Source (http://www.newswire.co.nz/main/viewstory.aspx?storyid=374052&catid=33)

For once they are not blaming only Robbie for EMI's problems.
That's always something.

Why EMI will no longer be indie

Julia Finch
Tuesday May 22, 2007
The Guardian

At 4.12pm yesterday music group EMI published its woeful full-year profit figures. Underlying group profits from the company whose artists include Coldplay, the Beatles, Lily Allen, Arctic Monkeys and Robbie Williams was down from £159m to £63m. The bottom line, after stonking exceptionals, was a loss of £264m, compared with a £118m profit last year. It wasn't exactly unexpected. EMI put out two profit alerts in four weeks this year after CD sales fell off a cliff, especially in the US.

Nevertheless, the company said, there was much to look forward to. Eric Nicoli, the chief executive, said he was "confident about our long-term future ... as we build a progressive music business which is truly consumer-focused and well-equipped for the digital age".
Mr Nicoli's idea of the long term is rather short. At 4.22pm another statement went out to the stock exchange confirming the EMI board was recommending a £2.4bn takeover bid from Terra Firma, the private equity group of financier Guy Hands.

The EMI chairman, John Gildersleeve, said that while the company's recent restructuring plans would work, there was still uncertainty and it was better to take Mr Hands' money, which was the best of several bids tabled yesterday morning.

Mr Nicoli and Mr Gildersleeve should be hanging their heads in shame. The 265p-a-share bid is an embarrassing 17% less than Mr Nicoli turned down from Warner Music last summer and 15% lower than the 310p evidently wafted under their noses by private equity rival Permira last December. At that time Mr Nicoli said it did not "fully reflect the value of the company". Just a few weeks later the wheels came off and 265p is evidently a handsome price now.

Three times he tried and failed to merge with Warner Music. He flirted with Bertelsmann's BMG. There have been cost cuts, boardroom firings and writedowns. This saga is unlikely to be at an end. The share price last night indicated higher offers are expected, but EMI's days as an independent quoted company are over.

Source (http://business.guardian.co.uk/story/0,,2085050,00.html)

HANDS SWOOPS FOR EMI IN £2.4BN DEAL

http://img.photobucket.com/albums/v630/1madlady/7689_1.jpg
NEW OWNER: Robbie Williams, among others

Tuesday May 22,2007

By Andrew Johnson, Associate City Editor

EMI, the struggling music group behind Lily Allen, Kylie Minogue and Robbie Williams, has agreed to a surprise £2.4billion takeover bid from Terra Firma, the private equity group run by Guy Hands. The firm’s 265p-a-share cash offer trumped approaches from rivals believed to include One Equity, Fortress, Cerberus and Warner Music.

Hands hit the headlines recently when he was thwarted in an £11billion Alliance Boots bid. The City is confident a bidding war is about to erupt, with EMI shares closing up 23p at 271p as around 20 per cent of the company chan*ged hands. “Terra Firma has got the auction going,” said one source.

Its offer values EMI at £3.2billion once debt worth £795million is taken into consideration and includes up to £300million to buy out shares promised to staff. At the heart of Terra Firma’s interest is EMI’s cash powerhouse, the music publishing business. This owns the copyright to songs by artists such as Beyoncé, Arctic Monkeys and Scissor Sisters, which generate royalties.

Terra Firma will raise debt against this part of the business to exploit the growth opportunities it believes exist in the other arm, recorded music. This signs up and distributes work on CDs or through the internet but has struggled to keep up with the digital revolution.

EMI was already planning similar moves but chairman John Gildersleeve said this was affected by “significant uncertainty”. He said: “Terra Firma’s is the most attractive proposal received and delivers cash now.”

Terra Firma believes EMI needs time in private ownership to get back on its feet. “We want to accelerate the development of its digital and online strategy,” he said. The company is in talks to retain EMI management, although chief executive Eric Nicoli’s future is uncertain.

EMI music publishing made underlying profits of £105million as the group slumped to losses of £263.6million, down from profits of £118million, for the year to March. The company blamed “difficult trading conditions” and restructuring costs for the downturn.

Warner Music offered 260p a share earlier this year, having made a 320p-a-share offer in 2006, but faced regulatory hurdles. EMI also rebuffed an offer, thought to be 310p a share, from private equity group Permira last year.

Source (http://www.express.co.uk/money/view/7689)

EMI
Like the final track on Sergeant Pepper, like the Beatles themselves, the end for EMI came with a sob and a sigh. At tea-time on Monday, the world’s oldest record company declared losses of £264 million and no hope of recovery. A sale was announced to Terra Firma, an equity firm which will strip the ship for early resale, probably to Hollywood rival, Warner. A century of record history and the heart of British music was tossed onto the auction block with no regard for public sentiment or the devastating cultural consequences that attend the destruction of tradition.

The sale price itself tells a large part of the sorry story - £2.4 billion is exactly half what EMI was worth seven years ago, when it sought an equal merger with Warner. Since then, CD sales have crashed – down 20 percent in the US in the first half of 2006 – and a succession of expensive signings, both artistic and executive, have ended in record payoffs. Maria Carey was sacked for £18 million after miserable sales, and the bosses who fired her were themselves chopped at Christmas. Eric Nicoli, the present chairman, will not depart unremunerated.

To survive in what Nicoli called ‘challenging’ conditions, a company needs luck and EMI’s had run out. Robbie Williams never came close to justifying his £80 million deal , the Beatles Love remix fell short of expectations and Coldplay’s Chris Martin revealed the pressures that EMI was putting on its artists when he attacked ‘the slavery we are all under to shareholders’.

Creative priorities had taken second place to share price and EMI’s technology was typically behind the times. The company almost went bust in 1954 by resisting long-playing records; it was the last label, in 1983, to adopt CD; and lately its download strategy has been sluggish. A Canute-like stubbornness was part of EMI’s charm, and of its innately British character. This was a company that made producers come to work in striped trousers; as late as the 1960s; George Martin remembers artists being sent home from Abbey Road for being improperly dressed.

The Beatles, however, were no fluke. Rejected by every other label, they flourished in the peculiar EMI blend of classical discipline and progressive experiment that spilled onto Abbey Road tea-tables as musicians of all types jostled for session-break refreshment. Nowhere else could a passing string quartet have been dubbed onto a pop ballad, as it was in Yesterday. Nowhere else could Yehudi Menuhin, who recorded the Bach double concerto as a lad with his teacher Georges Enesco, have turned up 50 years later (before my incredulous eyes) with a 12 year-old Chinese pupil, Jin Li, demanding to perpetuate the legacy. Nowhere else was music nurtured amid the somnolence of Victorian mansion blocks. EMI was a unique alloy of past and future, pull and push.

Ever since its foundation in 1898 as the Gramophone and Typewriter Company on Maiden Lane, behind the Savoy, it buried innovation behind a bluff façade. Head office forbade Fred Gaisberg to record Enrico Caruso; he went ahead anyway and created the first record star. The tempestuous Maria Callas could not have worked with any other label, valuing its sedateness as a counterweight to her furies. The Beatles did not call their album Abbey Road for nothing: it was the crucible of their art. The studio, a tourist shrine, was eerily quiet when I strolled past yesterday; it is locally rumoured to be up for development sale as soon as the parent company’s fate is settled.

The removal of EMI rips the heart out of British music. As our only major player on the world stage, the third or fourth largest label internationally, its very existence served as a fulcrum for indigenous activity. Indies flourished in London from the 1960s on, but they could not have come into being without the centripetal energy of EMI and they cannot now survive without its clout. OnceEMI is gone, opportunities wither and creativity wilts. New bands in search of a voice will head for Hollywood, where the deals are done.The British sound is relegated to the level of Denmark’s.

At EMI Classics, the writing is on the wall. Warner shut down its classical wing last year by means of an overnight email. If EMI falls into its clutches Simon Rattle, Nigel Kennedy and Ian Bostridge become homeless. Whatever the future holds for recording, this is the end of its island story.

Weep as we may for the burnt-out Cutty Sark, a ship can be rebuilt and its objects retrieved from storage. EMI is a piece of heritage that died this week without protest or lament. No government grant can replace the dual loss of experience and opportunity. One man could have saved the company with a small dip into his personal fortune, but Sir Paul McCartney is otherwise preoccupied and evidently disinterested.

EMI has gone the way of all stragglers in a cultural revolution. Its collapse was probably inevitable. But its extinction threatens to leave Britain a land without music – a culture without a musical voice in the coming download civilisation.

By Norman Lebrecht / May 24, 2007 & RWAP

What happens now to the singers

The End is the second last track on Abbey Road.
Sgt Pepper ends with A Day In The Life.
Robbie Williams has has two tours and four albums in a five album deal so there is still a way to go to see the STG£80 million spent.
This ushers in the predominance of the Bowie Era for all. Selling from the site. Myspace and iTunes will clean up. For classical artists who need genuine studio space it may become more difficult though.

Maria Carey was sacked for £18 million after miserable sales, and the bosses who fired her were themselves chopped at Christmas.After she had been sacked she made a hugely successful album, which shows EMI didn't know what they were doing.

Robbie Williams never came close to justifying his £80 million deal.According to formerly statements EMI has recouped years ago what they paid Robbie, so it must have been a good deal for them. But EMI wanted even more and the author to the article wanted, just like the tabloids, to bash Robbie.

But its extinction threatens to leave Britain a land without music – a culture without a musical voice in the coming download civilisation.Maybe I don't understand what they mean due to language barrier. But if they mean what I think they mean I find it a bit exaggerated. Should Britain be without a musical voice because of the end of EMI? It's obvious that the interest for music is higher than ever and there will still be good artistist when EMI is gone.

EMI paid ousted music chief £4.6m, report reveals


Katie Allen, media business correspondent
Monday June 18, 2007
The Guardian


An extraordinary pay package worth at least £4.6m that was handed to Alain Levy, the former EMI head of music who was forced to leave after a dire profits warning, has been laid bare in the company's annual report to shareholders. Mr Levy was given "compensation" for loss of office of £2.5m and a £1.1m "incentive remuneration" alongside his basic salary of £912,100, and his benefits have continued beyond him leaving the embattled company on January 11.

The annual report says: "Mr Levy is entitled to continue to receive for one year from termination the value of retirement benefits and benefits in kind provided to him under his employment agreement." A tough music market has hit EMI particularly hard and it has already issued two profit warnings since the start of 2007. At the time of the first, which followed disappointing Christmas sales for Robbie Williams' new album, it axed Mr Levy as part of the latest in a string of restructurings and cost cuts.

Mr Levy, who joined EMI in 2001, had been one of Britain's highest paid executives, enjoying access to a company pool car, driver and private healthcare.

Last year's extra £1.1m bonus - when fellow executives missed out on performance-related awards - is explained to shareholders as part of his contract, which states that "in the event of his termination without cause he would be entitled to a bonus in respect of the financial year in which the termination occurred, pro-rated down to the date of his termination, with the bonus being based on the average bonus achieved in the prior three years".

The terms of Mr Levy's severance package had been provided to shareholders but the annual report reveals the full extent of the payout in an industry that has been in decline for years.

Two years ago EMI brushed aside criticism to press ahead with a controversial pay scheme for Mr Levy which raised his salary by 43% to more than £1m. The company said it needed to pay Mr Levy well to prevent him being poached by a rival and wanted to keep him at least until 2009.

But as his confidence in the Christmas season failed to transform into the expected bumper takings, the French-born music executive and his deputy, David Munns, were pushed out. Perhaps unsurprisingly, the annual report reveals that Eric Nicoli, the chairman, did not receive any bonus. His basic salary at £778,600 was also lower than Mr Levy's.

Troubles at the recording home of Kylie Minogue have helped make the group a takeover target. Last month it accepted a 265p-a-share bid from Guy Hands and his Terra Firma private equity firm. Shareholders, who have seen their holdings pick up by 10% after Mr Levy's departure and talk of other potential buyers, are waiting to see if EMI's American rival Warner will come in with a counterbid.

Source (http://business.guardian.co.uk/story/0,,2105351,00.html?gusrc=rss&feed=24)

Music Week
June 30, 2007

Record company bypassed in ground-breaking deal

IE Music signs new-look deal for up-and-coming band with Ingenious

by Gordon Masson

The management company behind the revolutionary, multi-platform Robbie Williams deal with EMI is breaking the mould again as it looks to boost the fortunes of one of its latest acts.

IE Music, headed by Tim Clark and David Enthoven, has signed an imaginative deal for Brighton-based quintet Passenger with entertainment finance firm Ingenious Media, through which the conventional record label is removed from the equation.

It was Ingenious founder Patrick McKenna who helped IE broker the Robbie Williams deal in 2002, in which it was agreed the major would take a cut of the artist's income from publishing, touring and merchandising. But, as Clark explains, since then the relationship with the venture capitalist has moved another stage on.

"The three of us have had conversations about how expensive record company money is, especially given that the services they supply are generally often shoddy," says Clark. "When an act has a record deal, they are basically locked into using the label's services, no matter how second rate they might be."

On the back of those discussions, Clark and Enthoven started to deliberate how they could approach things differently, with a view to helping their artist clients - and therefore IE - to maximise earnings.

"We believe there needs to be a degree of separation between the investor and the service providers," continues Clark. "So the investor should be used to help us find and negotiate better service deals and, with Patrick now extending his VCTs into music, we have found the ideal investor."

Under terms of the pact, Ingenious is providing £ 1.35m to back the launch of Passenger's debut album Wicked Man's Rest, which will be released through IE's own label ChalkMark, while services such as promotion, PR, plugging and distribution are bought in. McKenna's fund will share in the revenues from all aspects of Passenger's career, including live, merchandising and, of course, CD and digital sales.

"It's a 70/30 split of revenues - 70% going to us and the members of Passenger," says Clark. "The Ingenious money will help regulate the cash flow through the cycle of the debut album, allowing the band to launch singles, the album, fund touring and build their name, so we have a basket of rights that we're sharing with Ingenious."

Ingenious commercial director Duncan Reid says its investment in Passenger is just one of many that the company now has in the music business, including deals with Independiente acts such as Blackbud, Embrace and Travis.

"We've done a mix of deals with record companies, management and direct with the artists themselves," says Reid. "Passenger is slightly different as we've done the deal with the management and the band.

"Each case is different, but when you boil it down, they're mostly 50/50 deals where we share the risk on the recording costs, marketing and all the other associated expenses."

On that score, Ingenious has nothing to fear, according to Enthoven. "Tim is the finest music marketing man in the country," he says of his business partner.

To that end, Passenger have already caused a bit of a stir among the critics, while their previous singles enjoyed airplay on BBC radio as well as a number of commercial stations. The band's next single Do What You Like is released on July 2. That will be followed by Walk You Home on August 27 and the album Wicked Man's Rest on September 3.

Clark says, "Having an investor like Ingenious has allowed us to shop around and choose the best services at the best possible prices. As a result, we've sorted out a really good distribution deal with Emap, who in turn has a deal with Universal, so that has let us tap into the best distribution channel possible, but at a more competitive rate than if we'd gone straight to Universal."

Other contractors working on the campaign include Heather Finlay at Sainted PR for national press; Alix Wenmouth at Starling Publicity, regional press; Jessica Bailey at Anglo Plugging, covering regional radio; Gareth Davies at Chapple Davies, national radio; Michelle Barrett at Blag Promotions, TV; marketing is managed by IE's Jim Williams and Network International's Eike Cummings; and Helen Jenkins at Helen PR is handling online plugging. The band's agent is Ian Huffam of X-Ray Touring.

"Having people we know that are experts working on the campaign is a real bonus," says Enthoven. "We sat everybody around a table to ping ideas off each other, which was an exciting process, as we were able to come up with really fresh ideas."

Indeed, the band themselves are integral in the planning process. "The artists are involved in all decisions," says Enthoven. "They are directors of the holding company, alongside Tim, myself and their manager Ari Millar.

Clark adds, "The whole idea about doing this is that, by using money more efficiently, the artist will get a bigger share of profits and the copyright for their material reverts back to them. In effect, this is like a licensing deal for one album and it's important that Passenger are in control of what they do."

At Ingenious, Reid explains the mechanics. "A joint venture company is usually created, with Ingenious funding that company," he says. "Our partners have to put up a guarantee that they will earn a minimum amount and in that respect it's a bit like an advance that kicks in further down the line."

As for the venture capitalist's exit plan, Reid says, "At the end of three years, we'll look to see what we can realise from our investment and our partner usually has the option to buy us out. On new acts, however, Ingenious will normally take an option on whether we want to remain involved for the second album."

With parallels being drawn to EMI's revenue-sharing Robbie Williams deal, Enthoven admits, "It is fortuitous for us that we had a global artist to cut our teeth on: this is the second cousin to the Robbie deal."

And Clark concludes, "This kind of set-up could be ideal for heritage acts, but we recognise it might not be the answer for all emerging acts.

"The thing is, when record companies are still charging packaging costs on digital, you're obliged to start looking around for different partners. So we're taking a stab at trying to make sense of the rapidly changing digital world and we hope that we're getting it right."

Ver interesting article!
This...
"The three of us have had conversations about how expensive record company money is, especially given that the services they supply are generally often shoddy," says Clark. "When an act has a record deal, they are basically locked into using the label's services, no matter how second rate they might be."
...sounds really great, thinking of homepages or ticket problems.

Rob's contract indeed has opened new doors - the concept is about to be extended!
Let's hope the outsourcing done carefully because in many earlier industries insourcing has become popular again, some nice disasterous stories in the books. Joint venture concept sounds logical and the way looks like it will open many new opportunites. Really cool :)

Yeah, that was interesting.
One can understand why Robbie wants to go independent.

thanks for that now i know why robbie want's to leave his label.

This heralds a new beginning in the entire industry and about time too....well done to IE...

Faced with shrinking profits, record labels are touting a new approach
Get article background (http://www.economist.com/background/displayBackground.cfm?story_id=9443082)

IT HAS become a familiar refrain. For years record labels, citing tumbling CD sales
blamed on internet piracy, have decried the decline of the music
industry. The reality is rather more subtle, as Edgar Bronfman, the
chairman of Warner Music, a big record company, pointed out last month.
“The music industry is growing,” he told an investor conference in New
York. “The record industry is not growing.”
Indeed. Seven
years ago musicians derived two-thirds of their income, via record
labels, from pre-recorded music, with the other one-third coming from
concert tours, merchandise and endorsements, according to the Music
Managers Forum, a trade group in London. But today those proportions
have been reversed—cutting the labels off from the industry’s biggest
and fastest-growing sources of revenue. Concert-ticket sales in North
America alone increased from $1.7 billion in 2000 to over $3.1 billion
last year, according to Pollstar, a trade magazine.
Frustrated
record companies have responded by trying to get their artists to spend
more time promoting records and less time touring and endorsing
products, says Jeanne Meyer of EMI, another big
record label. “Sometimes you’ve got a tug of war going on,” she says.
Yet the more labels spend on marketing pre-recorded music, the more
they raise their artists’ profiles and boost their other, more
lucrative, sources of income. Pre-recorded music, no longer the main
cash cow, increasingly serves merely as a marketing tool for T-shirts
and concert tickets. The best seats for The Police’s world tour this
summer cost over $900; the group’s entire catalogue on CD costs less than $100.
Record labels have come up with a remedy: the “360° contract”. Instead of settling for a cut of CD sales,
they increasingly offer artists broader contracts that encompass live
music, merchandise and endorsement deals. Such deals, also known as
multiple-rights or all-rights contracts, are particularly important in
regions with rampant CD piracy, such as Africa,
Asia and Latin America. “The market has made it necessary—we’ve got to
look for something else,” says Manuel Cuevas, an industry executive in
Mexico City. His company, the Mexican subsidiary of a major label,
decided earlier this year to adopt the 360° model. “It’s a discussion
you have with every new artist now,” says EMI’s Ms Meyer.
Although
record labels like the idea, artists are unsurprisingly less keen. Few
established artists have accepted 360° deals, though the labels trumpet
the exceptions, including Robbie Williams, the Pussycat Dolls and Korn.
It is more profitable, the artists say, to stick with artist-management
agencies, which have traditionally handled the job of cultivating
careers beyond the realm of recordings.
Management
agencies are also considered to have more respect for their artists’
interests. Record labels, for example, have been criticised for
obtaining rights to the names of artists and bands for use in internet
addresses. Some clauses stipulate that name ownership applies even
after contracts expire or artists die. This can prevent musicians from
launching websites to promote tours, sell merchandise, and communicate
with fans as they see fit. “Record companies don’t exactly give many
artists the warm, fuzzy feeling,” says Gary Bongiovanni, the editor of Pollstar.
Musicians
with small fan bases and little business experience are much more
receptive to the idea of 360° deals. There is no shortage of aspiring
artists, and some will become big names. Juha Ruusunen, the founder of TWU,
a small management agency for heavy-metal bands based in Jyväskylä,
Finland, says European labels have begun to sign up new talent with
360° contracts. As record labels move more aggressively into the
artist-management field, Mr Ruusunen worries that his agency might
struggle to compete.
Building a
roster of 360° talent, one deal at a time, is slow going. It is quicker
for labels to buy artist-management agencies. Last month Universal
Music made a £104m ($205m) offer for Sanctuary, a struggling British
label with a management arm that represents musicians including Elton
John and Robert Plant. Sanctuary also owns two other artist-management
companies and runs Bravado, a merchandising operation. Sanctuary’s
shareholders will decide whether to accept Universal’s offer, which is
considered generous, this month.
For its part
Warner Music has expressed interest in Front Line Management, one of
America’s biggest agencies. And last month Warner announced the
formation of Brand Asset Group, an artist-management joint venture with
Violator Management, a firm that negotiates roles for rappers in films,
advertisements, video games and TV programmes,
and licenses their names and images to promote drinks, books and
clothes. (Its clients include 50 Cent, Diddy and Busta Rhymes.)
The shift
away from recorded music is due in part to the recognition that touring
and merchandise are more lucrative. But it may also be a consequence of
internet piracy, as free downloads give music fans more money to spend
on other things. Jwana Godinho, the director of Música no Coração, a
concert promoter in Lisbon, thinks many music lovers have a “mental
budget” that they are prepared to spend on music, and have switched
their spending from CDs to tickets and merchandise.
The logical
conclusion is for artists to give away their music as a promotional
tool. Some are doing just that. This week Prince announced that his new
album, “Planet Earth”, will be given away in Britain for free with the Mail on Sunday,
a national newspaper, on July 15th. (For years Prince has made far more
money from live performances than from album sales; he was the
industry’s top earner in 2004.) Outraged British music retailers were
quick to condemn the idea. As far as the record industry is concerned,
it is madness. But for the music industry, it could well be the shape
of things to come.

source (http://www.warsystems.hu/?p=450)

New deadline for EMI offer
SHAREHOLDERS at troubled record label EMI were today given an extra week to accept a takeover offer. Private equity firm Terra Firma has tabled a £2.4 billion offer for the label, which is home to stars including Lily Allen and Robbie Williams.

It is thought that EMI shareholders are waiting to see if the company's rival Warner Music will table a higher offer, after it admitted last month it was considering a bid. A deadline of July 19 has now been set for acceptance of the Terra Firma offer.

[COLOR="Black"]SOURCE (http://business.scotsman.com/index.cfm?id=1093802007

Times Online July 17, 2007

Tempus: Note of caution

Warner Music has pulled out of a deal with EMI paving the way for Terra Firma to take over - but who will be the real victor? Dan Sabbagh, Media Editor

Warner Music's decision to pass up on EMI this time around looks a smart move. Since Terra Firma made its 265p a share offer for EMI, the outlook for the music market has worsened and the debt market tightened up.

Right now, Terra Firma looks like it could be overpaying at 265p; if Warner had come in at 300p and been forced to wait a year for regulatory approval, the risks would have shot up.

After all, Robbie Williams may go into rehab again.
( http://www.cheesebuerger.de/images/midi/boese/a150.gif Why are you so nasty http://www.cheesebuerger.de/images/midi/konfus/e014.gif )

Two scenarios now emerge: if the problems prove too great for Terra Firma, Warner may well get EMI's recorded business for a knock-down price; if Guy Hands et al prove to be a genius, then he might end up buying Warner — nice for its private equity backers.

Either way, a better deal is down the track.

Source (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article2091721.ece)

Warner drops out of race for EMI

Graeme Wearden
Wednesday July 18, 2007
Guardian Unlimited

After weeks of deliberation, Warner Music Group has ruled out a bid for rival music company EMI. Warner announced late last night that it had decided against making an offer for the UK firm, whose artists include Robbie Williams, Radiohead and Norah Jones. However, it could yet launch an offer if a bidding war breaks out over EMI.

EMI has already accepted a $4.88bn (£2.4bn) takeover offer from British investor Guy Hands, which chairman John Gildersleeve said was more likely to be approved by regulators than a merger with Warner.

Mr Hands' offer of 265p a share has only been accepted by a handful of investors, with most hanging on in case Warner trumped its offer. By last Friday his investment vehicle, Maltby, had only acquired 3.8% of EMI's shares. It has extended the deadline for shareholders to accept several times, and the latest deadline is tomorrow.

By lunchtime its shares had fallen 5p to 262p, indicating that investors see little chance of a rival bidder trying to steal Mr Hands' prize away. If that were to happen, under stock market rules Warner could yet step back into the fray. Warner revealed in early June that it was considering a bid for EMI, which rejected a 320p offer from its US rival last summer.

Source (http://business.guardian.co.uk/story/0,,2129012,00.html)

Posted to the web on: 21 July 2007
How the net is killing the CD and DVD stars

When fans can easily get the music for free, the future lies in a model that is not centred on album or even online sales, writes ANDREW EDGECLIFFE-JOHNSON.

SOME time in the next few months, the Sex Pistols will pass into the hands of private equity. EMI — home to the punk pioneers and The Beatles before them, as well as to contemporary stars such as Robbie Williams — seems certain to be sold to Terra Firma after Warner Music, its on-off merger partner for the past seven years, ruled out a counteroffer.

The end of EMI’s independence comes as the business model that had been coining it since the 1960s is breaking down. Recorded music sales have fallen 24% worldwide since 1999 as digital piracy presented the industry’s audience with unprecedented opportunities to access its products for free. A ttempts to create a legal alternative failed to catch on, allowing Apple to charge a low fixed price for tracks on its iTunes digital music store to boost sales of iPods. Until now, there was a similar consensus among the big record labels about the remedy. With the balance of power swinging in favour of the supermarkets and internet retailers as well as Apple, the fragmented industry would have to consolidate.

That logic drove Sony Music’s 2004 merger with BMG and EMI’s repeated attempts to combine with Warner, its US rival, which failed due to regulatory intervention, management truculence and disagreements over price. Now, however, there is a growing concern that selling more recorded music will not be enough. Several pieces of research have spelt out the reasons in recent weeks. The IFPI, the recording industry’s trade association, said sales fell another 6% last year. John Kennedy, its chairman, admitted: “We hoped the decline in physical (CD and DVD) sales would be offset by the increase in digital sales — giving us the ‘holy grail’. But while digital sales have grown as expected, physical sales have fallen more than expected.”

Within days, there was worse news. According to Nielsen Soundscan, a music business monitor, physical US album sales suffered a 15% collapse in the first half of this year — and PricewaterhouseCoopers estimated that physical sales in the US could halve between 2006 and 2011. As the fall in the CD market gains pace, digital growth is slowing. Digital music sales tripled globally in 2005 to $1,1bn, then nearly doubled last year to $2,1bn, but the IFPI expects growth this year to be no more than 50%.

“I think this is a tipping point,” says Phil Hardy, editor of Music & Copyright, a trade journal. Recalling a comment last December by Edgar Bronfman, chairman of Warner Music, that digital growth had “more than offset” lost CD sales in the previous year, he added: “No major executive would ever make a statement like that now.”

Research by Music & Copyright published this week shows that the company doing best in this uncertain environment is the one that has sat out the recorded- music mergers. Universal Music, owned by France’s Vivendi, is leading the physical and digital markets, with a nearly 26% share, compared with Sony BMG’s 21%, Warner’s 14% and EMI’s 13%.

As others have slashed costs, raising repeated questions about their investment in the businesses’ core artists and repertoire, Universal has discovered a string of new artists, such as Amy Winehouse and Mika. It has not ignored acquisitions, but has focused on two areas that analysts and executives are increasingly convinced represent the industry’s best hope for growth in the next five years.

Last year, it sealed the € 1,63bn purchase of Bertelsmann’s music publishing business, which manages the rights to songs by Britney Spears and the Spice Girls, among others. Now, it is pursuing a smaller but potentially equally significant acquisition.

Sanctuary Music, its new target, is valued at just £44,5m after a string of accounting problems and management missteps. However, it offers Universal a way into areas of the music industry that have been growing at a rapid rate but have until now eluded the big record companies.

Sanctuary’s divisions range from artist management to touring and merchandise. According to Hardy, the live music market has grown 25% in the period since the CD market began to crumble.

Artists themselves are recognising the declining importance of album sales compared with the revenues they can make from live performances and merchandising. One artist, Prince, recently agreed that 3-million copies of his new album could be given away for free in a UK newspaper promotion.

Music retailers protested that the 3-million units exceeded their usual total weekly sales. But other artists are adopting a strategy — made famous by the Grateful Dead — of not worrying what their CDs sell for, calculating that getting the albums out there will stimulate more interest in their tours.

Other companies are making efforts to broaden their business model. Warner last month formed a joint venture, Brand Asset Group, with Chris Lighty, founder of an artist management company called Violator Management.

“The music industry is growing. The record industry is not,” Bronfman told an investor conference, saying Warner would expand into “many other businesses”. Companies are chasing revenues from other sources. In the US, music publishers are trying to persuade radio stations to pay for songs they play. They have also made progress in raising the fees internet music radio services pay, in exchange for authorising more providers to use their content.

The industry has not seen the end of merger speculation. Warner is still hoping Terra Firma may sell on EMI’s recorded music business. Publishing assets are also coming on to the market as a result of European regulators’ review of Universal’s acquisition of BMG. But such alternative revenues will be vital. Record labels are trying to persuade new artists to sign deals covering the gamut of recording, publishing, management, performance and merchandising.

Robert Pfeiffer of Compass Advisors cautions that companies are locked into old business models through contracts with artists. “They’ve thrown out an anchor and now they can’t move from the place they’re in as the waves break over them. Financial Times. Prince, recently agreed that 3-million copies of his new album could be given away for free in a UK newspaper promotion”

Source (http://www.businessday.co.za/weekender/article.aspx?ID=BD4A520779)

Robbie Williams, Iron Maiden and Corinne Bailey Rae will shortly have their music available in a DRM-free format via retailers including Burger King.

The fast food chain is to distribute a series of codes offering its customers the opportunity to download a pre-paid, DRM-free EMI track from a campaign website. Links through to online retailers will offer customers the opportunity to purchase other EMI tracks.

EMI Music has agreed a deal with Chicago-based digital agency VerveLife to offer its client list, which includes Burger King, the opportunity to use DRM-free music for promotional purposes.

It follows the majors' decision to drop DRM protection of its digital music in order to ensure that consumers can play the track purchased on any device.

Source (http://www.nma.co.uk/Articles/34242/EMI+agrees+DRM-free+music+deal+with+VerveLife.html)

You want fries with that track?

Posted Jul 24th 2007 by Gordon Finlayson

Over the past few years mega coffee chain Starbucks has been active in selling music CDs through its stores worldwide, making the most of the promotional value of the association between its stores and music - and now it appears that Burger King wants to get into action too. Burger King has sealed a promotional deal with EMI that will see its Whopper munching customers in the United Kingdom receiving free and DRM-free downloads from artists such as Iron Maiden, Robbie Williams and Corinne Bailey Rae.

The codes will allow BK customers to download free sample DRM-free MP3 tracks from a BK branded microsite that will allow consumers to try out and download tracks from a variety of EMI artists. The promotion is the first launched through a collaboration between EMI and consumer marketing company VerveLife. So next time you go for a burger make sure you pack your iPod.

Reader Comments
(Page 1)
1. i guess the next step is coca-cola paying to produce your record... in exchange for brand affiliation for the rest of your life. kinda like selling your soul to the devil.

Posted at 2:22PM on Jul 24th 2007 by sean

2. Burger King was on this long ago -- when I was a little kid, they were giving away 45s. That's right: real vinyl records. Mine had Phil Collins' "Follow You, Follow Me" and Roberta Flack's "Killing Me Softly."

Posted at 5:02PM on Jul 24th 2007 by argotnaut

Source (http://www.downloadsquad.com/2007/07/24/you-want-fries-with-that-track/)

EMI, the music major that is home to Robbie Williams, Coldplay and Norah Jones, has finally fallen to a bid after private equity house Terra Firma triumphed with its £2.4bn offer.

Terra Firma, which is controlled by financier Guy Hands, said it had received 90.27pc acceptances for its 265p-a-share offer, enough to secure financing for the deal.

Shares in EMI rose 3.75 to 257p on the news.

Citigroup is providing £2.5bn of funding for Terra Firma, partly to cover EMI's £800m debts, but there had been fears it might withdraw its commitment in the jumpy credit markets unless Terra Firma had 90pc acceptances - enough to declare its purchase unconditional.

By Friday afternoon, Terra Firma had just under 85pc and was forced to go to the Takeover Panel to ask for the deadline for acceptances to be extended from Sunday to 1pm today.

For EMI the deal brings to a close a cacophonous period for the group that owns the Beatles' back catalogue, with investors treated to a seemingly relentless diet of failed merger attempts and profits warnings.

Having rebuffed a 310p-a-share takeover approach from private equity house Permira last December, EMI chief executive Eric Nicoli tested the City's patience with a string of profits warnings as EMI failed to find an answer to declining CD sales and the explosion of digital downloads.

In January EMI ousted its head of recorded music Alain Levy, with a £3m pay-off and moved Mr Nicoli from executive chairman to chief executive.

There were howls from the City only a month later when Mr Nicoli issued another profits warning - one that had shareholders calling for the group to find itself a buyer.

All this came after a series of attempted mergers with Warner Music, with the two groups bidding for each other. Each attempt fell down on either price or regulatory risk.

Warner's decision not to bid against Terra Firma left the way clear for Mr Hands, who now has the problem of resuscitating the music business, while potentially bringing his legendary securitisation techniques to EMI's more stable, and highly prized, music publishing wing.

Source: www.telegraph.co.uk

Therein lies the rub - there's going to be fireworks with this deal....they will probably sell off the recorded music section and hold on for dear life to the publishing wing.

Anybody who has been watching the recent legal attempt by artists to hold on to copyright will be alert to this one. All the old hits from the sixties are about to loose copyright and this lot will hoover them up.

Looks like EMI had really got an overinflated sense of their own importance....maybe the last dinosaur is on its knees.

What that means for the artists signed to the label and its subsidiaries I'd say there may be blood on the dancefloor by Christmas....hey Robbie, wanna buy yourself out of that contract - now might be the time to do it....

Oh and I am sure they don't owe the entire 800m because of the bloke from Stoke.

Weird how a so called artistic company fits into the City portfolio - wonder would they buy the BBC.

Step forward the self-styled Web Sheriff

Friday, August 03, 2007
By David Sinclair
Prince can afford to give his new album, Planet Earth, away thanks to the largesse of The Mail on Sunday. But the great majority of musicians cannot, and stars and their record companies are supporting increasingly tough action to curb the illegal downloading and bootlegging which has become rife in the wake of the digital and online revolution.






One of the biggest concerns is to prevent new albums being illegally circulated before they are available to be purchased. Nick Bracegirdle, the songwriter, producer and keyboard player better known as Chicane, knows how devastating this can be.


Bracegirdle found himself sucked into a piracy nightmare when 50 copies of Chicane's album, Easy to Assemble, were sent out, in advance of the release date, to the media, just before ownership of the major record company to which he was signed unexpectedly changed hands.


In the corporate shake-up that ensued, the album's release was put on hold. But, thanks to the review copies, the album was effectively released whether Bracegirdle or the record company liked it or not.


"Somebody uploaded it onto a peer-to-peer site," Bracegirdle says. "Next thing we discovered there was a guy in Russia selling it, all illegally downloaded and copied. Suddenly it was everywhere worldwide, available to anyone who wanted it." By the time Bracegirdle had resolved his position within the record company there was no one left to buy the album. "It was two years' work down the drain."

With Chicane's new album, Somersault, he has taken precautions. Like other acts, including Bloc Party, George Michael, the White Stripes and Travis, he has hired the services of a company called Web Sheriff, which specialises in monitoring and, where necessary, closing down sites that are engaged in the illegal distribution of copyrighted material.


"These days, any new album by a major artist tends to break on the internet anything between two and four months before its official release," says John Giacobbi, the managing director of Web Sheriff. "So if you do nothing about it, by the time the record hits the stores, you've lost half your sales."


To combat this, Web Sheriff has a team of 20 operatives, working in shifts, which monitors online activity round the clock. In recent campaigns on behalf of major-label acts they claim a 98 per cent "takedown rate" of websites offering unauthorised access to pre-release material. They also monitor the more specialist BitTorrent community – a couple of hundred sites utilising high-powered technology which enables users to download a whole album in a matter of minutes. The peer-to-peer networks such as Limewire – "vast and viral" – are also monitored and policed, as are online retail sites, the most prominent being eBay. The company charges anything from £1,000 to £7,000 a month to provide the service.


The days when Robbie Williams could blithely proclaim that internet piracy was a great idea and that "there is nothing anybody can do about it" are long gone. More typical nowadays are the comments of Jack White, who says: "I think it's a shame for generations coming up... that they're getting everything from a mouse click. I think everyone is like: 'Big deal, it's not my fault. Everyone's doing it. Everyone's downloading.' But it's about the rules and who chooses to follow them." Or, as the British rapper Sway puts it rather more succinctly in his song "Download": "How'm I gonna make my Gs/ If you've got my album before the release?"


"There's little doubt that attitudes within the industry are beginning to change," says Geoff Taylor, the chief executive of the BPI, which represents the British recorded-music industry. "There is now greater consensus... about the effects of file-sharing. The internet became a vehicle for mass copying rather than creativity. The vast majority of music downloaded from peer-to-peer networks has been commercially produced music, downloaded illegally without any payment to the people that collaborated in making and releasing it in the first place."


The BPI, along with the Record Industry Association of America (RIAA) has been waging its own campaign against illegal music on the internet, and has been somewhat stung by the acclaim that Web Sheriff is garnering. The suggestion that Web Sheriff may have been writing "weighty reports" and taking credit for shutting down websites when the BPI may, in fact, also have been instrumental in shutting them down is hinted at, but never officially voiced.


Although established artists accept the need to run a tighter ship, attitudes to file-sharing are still ambivalent. Arctic Monkeys are a classic example of an act apparently happy to have their cake and eat it. Having famously built up their fan-base by giving away CDs at gigs and encouraging fans to download their music for free, they subsequently (through their record company Domino) employed Web Sheriff to prevent any unauthorised copying and sharing of their second album, Favourite Worst Nightmare.


And while most acts are aware of the ruinous loss of earnings that can result from illegal trading of their music, nobody wants to put themselves in the position of Metallica, who suffered a public-relations disaster when they initiated legal action against Napster for trading Metallica songs illegally on their network, and against several universities in America for not blocking Napster from their campuses.


Bracegirdle even admits that a certain amount of pre-release activity on the internet is desirable. "You have to allow a little bit of it to go on, to get the buzz going," he says. "You don't want to completely eradicate all ways of people getting excited about stuff. It's knowing where to draw the line. The thing is I'm now fairly confident that there won't be any major breaches, which helps me to sleep at night."


'Somersault' by Chicane is out now on Modena/Absolute; 'Planet Earth' by Prince is on Columbia

The days when Robbie Williams could blithely proclaim that internet piracy was a great idea and that "there is nothing anybody can do about it" are long gone.
And that was not what Robbie said. He didn't say that "internet piracy was a great idea".
What he said was that the internet and the possibility to download music (legally) was great, meaning that this evolution couldn't and shouldn't be stopped.

Tuesday August 7, 2007
The Guardian


EMI's new owners face tough trading conditions
There has been no let up in the tough music market conditions depressing revenues at EMI, the company bought out last week by Guy Hands' private equity group Terra Firma. EMI, home to Robbie Williams and Norah Jones, said yesterday that a quiet release schedule and difficult trading were reflected in a 13.4% drop in revenues at its record labels division in the 18 weeks from April 1 to August 6. Revenues from downloads increased 26% but that was not enough to offset a drop in CD sales. The music publishing arm increased revenues by 11.9% which left revenues for the group as a whole down 5.1%.


Source (http://business.guardian.co.uk/story/0,,2143091,00.html)

EMI boss to quit ahead of buyout

EMI CD sales have been less than glittering of late.

EMI's chief executive Eric Nicoli will step down from his post before private equity firm Terra Firma completes its £2.4bn buyout of the UK music group.
EMI said that Mr Nicoli had agreed to resign by 18 September, the planned date of the company's delisting from the London Stock Exchange.

Chris Roling and Ashley Unwin, both managing directors of Terra Firma, will take seats on EMI's board. The board shake-up is the first action taken by EMI's new owners.

EMI, whose artists include Coldplay, Robbie Williams and Kylie Minogue, agreed to be taken over in May.

'Driving change'

Mr Roling will become chief operating officer of the EMI group under its new ownership and chief financial officer of both the company and its music division.

The appointment follows the resignation of Martin Stewart from his post as chief financial officer. Mr Unwin will take on a role as director of business transformation.

Guy Hands, Terra Firma

In addition, EMI said a new governance structure was being implemented which would involve the EMI board reporting into a new supervisory board chaired by Terra Firma's chief executive Guy Hands.

This new level of management will focus on EMI's strategic business relationships.

"The new management structure will allow EMI to benefit from Terra Firma's experience in strategically transforming businesses and driving operational change," said Mr Hands.

"The initial focus will be to maximise the value of the significant assets in EMI's publishing business and to realise the digital opportunity in recorded music."

The iconic British group has been struggling in the face of falling CD sales - particularly in the US market - but its digital sales have risen sharply.

Formerly chairman, Mr Nicoli became chief executive following a management shake-up in January. He first joined EMI as a non-executive director in 1993.


Source (http://news.bbc.co.uk/1/hi/business/6968276.stm)

It’s the end of an era at EMI, the home of the Beatles, as long-standing boss Eric Nicoli becomes a victim of the record label’s recent takeover. Terra Firma, Guy Hands’ private-equity vehicle, triumphed with a £2.4bn bid for the company earlier this month, and true to form it has wasted no time in ringing the changes.

Nicoli, who joined EMI in 1999 from United Biscuits, always seemed an unlikely boss for a label that housed the Fab Four, Coldplay and Norah Jones. But he clearly relished his leap from Hobnobs to hob-nobbing with the stars. In an MT interview back in 2004, he revealed that his car play-list included Joss Stone and Dire Straits' dad-rock classic ‘Brothers In Arms’. He also enthused about a recent Duran Duran concert and proudly announced that he’d seen Robbie Williams three times.

Guy Hands, meanwhile, has kept the volume right down when it comes to the question of his music taste. Knowing his take-no-prisoners approach to dealmaking we suggest it may lie somewhere between Motorhead (‘The Ace of Spades’) and the uber-capitalist gangsta rap of 50 Cent (‘Get Rich or Die Trying’).


Perhaps a bigger question is whether Terra Firma will give much-needed direction to the ailing label, which has had a massive question mark hanging over it for years. Takeover discussions during Nicoli’s tenure have involved AOL TimeWarner, Warner Music, and BMG, all of which came to nothing. And last December Nicoli knocked back a 310p-a-share takeover approach from private-equity house Permira, only to issue a profits warning the following month. Not a way to impress shareholders. Meanwhile the company has been slow to respond to digital downloads, and has recently failed to attract big name talent.

Hands, of course, could inject some cash into the business, attracting big-name artists and improving EMI’s digital distribution. Equally likely, however, is that there will be an attempt to revamp the business, and if that doesn’t work out then Terra Firma can employ EMI’s ‘get out of jail free card – its extensive back catalogue. Pop it on a website, charge a quid a pop and strip the company right down. Either way, EMI's private-equity future is going to mean less jollies for the A&R men, and more focusing on the dollar signs.



managementtoday.co.uk

Sony BMG Germany Positions For Broader Artist Contracts

By acquiring majority stakes in MTS, a management firm, and Bucardo, a booking agency, Sony BMG Germany has positioned itself for 360-degree contracts, broad artist deals that cover recorded music and services such as management and booking. The majors have traditionally been involved in recorded music and publishing. Broader contracts require additional services. Acquisitions are the best and fastest way for the majors to attain those services.

Universal Music Group has acquired Sanctuary Group, which has recorded music in addition to management, merchandise and publishing. Warner Music Group has a joint venture with artist management firm Violator. EMI has not moved toward similar 360 deals, though the company has does have a variation of a 360 deal. Its revenue sharing deals, with Korn and Robbie Williams, gives EMI a portion of revenues in exchange for an initial lump sum investment. The Korn deal gave the band $15 million up front in return for 25% of the band's publishing, merchandise and touring revenues, plus profits from the band's albums. EMI's model works better for superstar deals (due to lower risk) but Sony BMG, WMG and Universal are better positioned to offer broader deals to developing and middle-tier artists.

Additional reading:

• The Economist's July 2007 article on 360 deals. "Instead of settling for a cut of CD sales, they increasingly offer artists broader contracts that encompass live music, merchandise and endorsement deals. Such deals, also known as multiple-rights or all-rights contracts, are particularly important in regions with rampant CD piracy, such as Africa, Asia and Latin America."
• Billboard's article that broke down the economics of Korn's revenue sharing deal with EMI. "If its next album repeats the sales of the last (2 million units worldwide), and the band posts numbers on the road similar to 2006 (50 dates grossing around $11 million), it should come close to break-even by the end of this new album cycle. That's before any additional nontouring/non-CD revenue is factored in."

Source (http://www.coolfer.com/blog/archives/2007/08/sony_bmg_german_1.php)

Terra Firma brings EMI down to earth
By James Hall , Sunday Telegraph
Last Updated 02/09/2007

The party could soon be over at EMI. Terra Firma, the new private-equity owner of the record label, is to stamp out any signs of creative extravagance and financial excess at the company, which is home to artists such as Robbie Williams and Lily Allen.

Late last week Terra Firma said it is replacing Eric Nicoli, EMI's chief executive, and Martin Stewart, its chief financial officer, with three executives with no experience of the music industry. Chris Roling, until this year head of finance, procurement and logistics at ICI, the chemicals company, Ashley Unwin, a former management consultant, and Julie Williamson, a Terra Firma insider, will now set about reviewing the business from top to bottom.

An executive close to Terra Firma said the new management's remit is clear: "The assumption is that business discipline has been lacking in this industry. Yes, you need people who know Pete Doherty, but you also need discipline. This assumption could be wrong and arrogant, but the trio are going in to see if it is correct."

EMI insiders said although Nicoli and his predecessor Alain Levy went a long way cutting costs and cracking down on music industry excess, the company is still populated by record industry old-timers. The arrival of the distinctly un-rock 'n' roll management triumvirate has left some EMI executives quaking in their cowboy boots.

"EMI still has a quirky way of working. You are not viewed with credibility until you've served an apprenticeship standing in a North London pub with your arms folded watching some unsigned band," said one former record industry executive.

Even Nicoli, who joined EMI in 1999, was seen as an outsider by many in the industry because he trained as a physicist and spent most of his career in the food-manufacturing sector.

"Eric had been a non-executive before he became chairman but some in the business always viewed him with scepticism.

"He was seen as a man in a suit who occasionally put on a Johnny Cash-style black shirt to give himself credibility," said the former executive.

However, another source said most vestiges of music industry largesse have already been cleared out of EMI. "Had Terra Firma done all of this four or five years ago it would have found very rich pickings. But Nicoli grappled with the historic excess the industry had and instilled a more cost-focused, business-like approach. A lot of the low-hanging fruit has gone," he said.

The most notorious excesses were during the era of Ken Berry, the head of EMI's recorded music division until his departure in 2001, and his wife Nancy, who headed Virgin Music, which was bought by EMI. Berry left with a £6.1m payoff on top of his £3.7m salary.

Media figures have always tended to be larger than life because they need to be risk-takers in a hit-driven industry where most films and most albums lose money. But the Berry's reign at EMI was also commercially chequered. As head of Virgin, his wife signed Mariah Carey, the US diva, on a rumoured £50m five-album contract. However, in January 2002 EMI ditched Carey after her much-hyped album Glitter sold just 2m copies. EMI paid £19.6m to terminate Carey's contract and wrote off the £18.5m it had spent promoting her.

The media world has had clear-outs of creatives before. Just after the millennium a raft of high-profile showmen bosses such as Steve Case at AOL Time Warner, Tommy Mottola from Sony Music and Jean-Marie Messier at Vivendi left their positions. They were replaced by "suits" such as Andrew Lack at Sony and Jean-Rene Fourtou at Vivendi, neither of whom had worked in the record industry before.

Source (http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/09/02/cnemi102.xml)

EMI's new owners back their firm favourites
Overview: Terra Firma hopes to put flagging EMI on a firm footing

Kevin Reed, Accountancy Age, 06 Sep 2007

After years of failing to pull off a mega-merger, EMI has found itself bought up, with chief executive Eric Nicoli and FD Martin Stewart stepping down as a result. New owner Terra Firma has come on board with a swathe of executives, including COO and CFO Chris Roling.

Roling, who has only served with Terra Firma for a few months, according to reports, now has to help turn around a company that operates in an industry facing major concerns about how to make money out of music.

What’s happened...
EMI has faced years of missing out on merger deals. Back in 2000, the music producer was lined up to link with Time Warner at the time of its own AOL transaction. But pressure from the European Commission over the creation of a musical superpower was believed to have led to the EMI deal collapsing.

The company went through a series of board changes in 2002 as part of an attempt to cut costs, but even with its impressive back catalogue including The Beatles, Kylie and Robbie Williams, music file-sharing over the internet eroded sales figures. A prospective takeover by former executive Jim Fifield, understood to be advised by PricewaterhouseCoopers, never materialised.

The group’s latest results, a £264m loss compared to a £118m profit a year earlier, was the final straw. Along with the results announcement it revealed Terra Firma’s successful bid for control for 265p per share * significantly less than bids for EMI by Warner Music and Permira last year.

Along with Nicoli, CFO Stewart lost his job, although Stewart has his role as chair of the audit committee for 2012 Olympics organiser LOCOG to look forward to, along with a £1m payoff.

What's going to happen...

A new supervisory board has been formed, with Terra Firma’s boss Guy Hands as its chair. The move reportedly leaves Roling as effective chief of EMI.

Roling, who has worked at ICI and photo library Getty Images, might well expect to live the high life in his new role.

But it seems that his appointment, as someone with no experience of the music industry, is an attempt to have business people in charge that will not ‘live it up’. And he has plenty to keep him busy. Allegedly Hands has emailed management to tell them to prepare a business plan for the company by October.

‘The initial focus will be to maximise the value of the significant assets in EMI’s publishing business and to realise the digital opportunity in recorded music,’ said Hands.

Of immediate concern will be persuading its artists that EMI is still the place to
make music, while making money from digital music.

Source (http://www.accountancyage.com/accountancyage/analysis/2198083/firm-favourites-3447683)

New owner pledges to invest in artists at struggling EMI



· 'Big, but small enough to care' is mantra for change
· Dictatorship over, says News Corporation chief

Owen Gibson and Chris Tryhorn
Saturday September 15, 2007 The Guardian (http://www.guardian.co.uk/)</B>

The head of the private equity owner of EMI, the home of Robbie Williams and Coldplay, yesterday unveiled his vision for turning around the famous music label amid challenging industry conditions.Guy Hands, chief executive and founder of Terra Firma, vowed to retain the group's recorded music division and to invest in artists big and small to restore the company's fortunes following its £2.4bn buyout.

The deal ended months of speculation over the future of EMI - which had endured a rollercoaster period of several years - and had led to the departure of chief executive Eric Nicoli.

Some analysts predicted Terra Firma would sell the recorded music side and retain EMI's profitable publishing division, but yesterday Mr Hands said that he was confident of overhauling EMI's model to make it less reliable on huge selling artists. "We're determined to keep that part of the business and we're determined to make it viable," he said, following a speech at the Royal Television Society media convention in Cambridge.EMI was a "classic example" of Terra Firma's strategy to "look for the worst businesses we can find in the most challenging sector", and the firm was "just hoping EMI is as bad as we think it is".

Terra Firma made its name with several high profile turnaround stories. Its plan for EMI is expected to create a structure in which lower selling artists with more niche appeal can still be profitable. "The independent record labels are a lot livelier," said Mr Hands. "The vision of EMI is to be big enough to do everything we can for every artist, but small enough to care for every artist."

Mr Hands, who attended the Mercury Music prize and has been touring artists and their managers, added: "What you've got is an incredible history. It's extraordinary. They have a real love for EMI. But they need EMI to serve their artists in a way that is better than any of the other majors."

As well as the general malaise surrounding the industry due to the increase in digital piracy, EMI was hampered by a poor release schedule in 2007 and an over-reliance on a handful of big name artists.

Earlier at the RTS convention, Rupert Murdoch's most senior lieutenant had warned British broadcasters they must adapt to the digital landscape or wither on the vine.

Peter Chernin, the News Corporation chief operating officer who oversees large swathes of the company's media empire, told senior executives they must be willing to undergo a huge cultural shift and not be afraid of failure.

"There are huge rewards for those who innovate, and death to those who do not," he told delegates in Cambridge. The age of "dictatorship" was over for major media groups.

"Right now there are more than 300 million people around the world watching video content online. It's a fundamental shift that completely democratises our business. And democracy can be scary, especially when we've been used to living in a totalitarian state," he said.

Broadcasters have been wrestling with the challenge of maintaining revenues and viewers in the face of exploding choice and fragmenting media options. But, said Mr Chernin, media groups were well placed to benefit from an unprecedented period of technological change.

"The kneejerk reaction is to take potshots at what you don't understand. To dismiss user-generated content as crap, and blogs as unauthoritative, is not only unproductive but a waste of time," he said.

Fragmentation was having a positive effect on creativity, he believed. "The middle is dead, and that's the greatest thing that has ever happened. The bland, safe, central middle is never coming back."

And Mr Chernin echoed Mr Hands by saying companies should concentrate on big blockbusters at one end of the market and high quality niche offerings at the other.

Times, September 25, 2007

EMI’s former finance chief walked away from £1m in severance pay
Dan Sabbagh, Media Editor

Martin Stewart, EMI’s former finance director, missed out on a payoff worth £1 million when he left the British music company after its £2.4 billion acquisition by Terra Firma, the private equity firm.

The fate of Mr Stewart contrasts with that of Eric Nicoli, his chief executive, who was entitled to an £2.8 million severance when his contract was terminated by Guy Hands, Terra Firma’s owner. Both left the company this month. It is not clear why Mr Stewart did not get any cash. EMI said that he had resigned and therefore was not entitled to a payout, whereas Mr Nicoli was asked to leave. However, it is unusual for an executive who knows that he may be dismissed to risk losing the opportunity to receive severance.

Martin Stewart earned £764,300 last year, which included a base salary of £551,200 and a £192,900 bonus. The company’s most recent annual report states that his contract could be terminated “on one year’s notice” – the only exceptions being resignation or “gross misconduct or other circumstances justifying summary dismissal”.

Payments due to Mr Stewart for a routine termination of employment would comprise £551,200 of base salary, benefits worth £229,405 and half his maximum annual bonus, £275,600. The total sum due would have been £1.05 million.

Mr Stewart joined EMI in January 2005 and as recently as January of this year was given the task of restructuring the finances of the company’s struggling recorded music unit. He previously had held the same position at BSkyB, the satellite broadcaster 39.1 per cent owned by News Corporation, parent company of The Times, but left after he lost out in a battle with James Murdoch for the chief executive’s job.

Terra Firma took control of EMI at the beginning of September and has brought in its own team of managers to try to rescue EMI Music. The only executive director to survive the cull was Roger Faxon, who runs the company’s market-leading music publishing division – the half of the business that manages songwriter copyrights.

EMI is now run by a team reporting to Mr Hands, who is the chairman of a holding company that sits on top of EMI. The day-to-day responsibilities of both Mr Nicoli and Mr Stewart are being undertaken by Chris Roling, who is both chief operating officer and chief financial officer.

A group of other executives from Terra Firma are working alongside Mr Roling, who has no experience of the music industry but has worked at ICI in logistics.

This month, Lord Birt, the former strategy adviser to Tony Blair (when he was prime minister) and director-general of the BBC, joined the supervisory board at EMI. Lord Birt has been working for Terra Firma on a variety of portfolios since leaving his political advisory position in 2005.

Terra Firma’s purchase of EMI came after seven years of EMI and Warner Music circling each other. A deal between EMI and Warner would have created the second-largest music company, after Vivendi’s Universal Music Group.

Mr Hands said at a media convention this month in Cambridge that Terra Firma planned to retain EMI’s recorded-music unit. Mr Hands was speaking for the first time since Terra Firma’s takeover was accepted. He said that EMI was not focusing enough on smaller artists and was too dependent on hits. EMI artists include Robbie Williams, Janet Jackson, Joss Stone and Norah Jones.

Addressing the convention, Mr Hands had joked that he hoped EMI was “as bad as we think it is”, so that Terra Firma could help to turn the struggling company around.

Martin Stewart, Terra Firma and EMI declined to comment.

Source (http://business.timesonline.co.uk/tol/business/industry_sectors/leisure/article2525282.ece)

The first DRM-free music video only download website launches today, having inked deals with EMI Music, Domino, XL and many more.


LONDON, 1st October 2007: ilovevideo (www.ilovevideo.com (http://www.ilovevideo.com/)) today announced it has launched the first DRM-free(Digital Rights Management-free) music video retail store. Brought to you by the creators of the award-winning music portal Video-C, ilovevideo offers consumers ownership of high quality music videos for playback via handheld devices, Macs, PCs and media centres.


Ilovevideo already has agreements with the majority of independent UK record labels including Domino, XL Recordings, Beggars Banquet and Ministry Of Sound to distribute DRM-free music video content. These agreements enable ilovevideo access to the large back catalogues of high calibre artists including the Arctic Monkeys, The Pigeon Detectives, Gossip, Kate Nash, The White Stripes and Franz Ferdinand.

Users of the music video download site will also have complete access to all digitised music videos from EMI Music, the only major music company to be able to strike a deal with the service following its recent move to make its entire catalogue available in the DRM-free format. Music videos will be available from seminal artists such as Queen, The Rolling Stones and John Lennon, right through to Coldplay, The Chemical Brothers, Kylie and Gorillaz.

Graeme Rogan, Head of Digital Sales, EMI Music UK, comments “We were keen to partner with ilovevideo in order to extend the reach of our digital products to consumers, offering them DRM-free audiovisual as well as audio content. It gives music fans greater access to our extensive music video catalogue and provides them with the freedom to play our videos across all available portable digital devices and online platforms.”

Visitors to the new ilovevideo.com download store will benefit from the following:


DRM-free music video downloads to own forever
Access to a constantly growing number of titles from major and independent labels 30 second previews and access to multiple download formats, including Apple QuickTime (.m4v) and Windows Media (.wmv)
A choice of ‘Portable device’ (30fps, 750Kbits/sec, 320x240) and ‘TV / DVD/full screen’ (30fps, 3200kbits/sec, 720x576) quality downloads
Coming soon – an exciting new range of exclusive content, including live gigs, artist interviews, music tutorials, director’s cuts and behind the scenes footage
Top 10 video chart feature based on UK sales
www.ilovevideo.com (http://www.ilovevideo.com/)



- ends -


For further info contact: Charlie / Dani / Griff Firstname@presscounsel.com (Firstname@presscounsel.com) 020-7792-9400 – www.presscounsel.com (http://www.presscounsel.com/)

About EMI Music
EMI Music is the recorded music division of EMI Group, the world's largest independent music company. Its EMI Music division represents artists spanning all musical tastes and genres. Its record labels include Angel, Astralwerks, Blue Note, Capitol, Capitol Nashville, EMI Classics, EMI CMG, EMI Records, EMI Televisa Music, Manhattan, Mute, Parlophone and Virgin. Artists on EMI labels include Lily Allen, The Beatles, Coldplay, Corinne Bailey Rae, The Good The Bad & The Queen, Gorillaz, Norah Jones, The Kooks, Korn, Kylie Minogue, Pink Floyd, Rolling Stones, Joss Stone, 30 Seconds To Mars, KT Tunstall, Keith Urban and Robbie Williams, as well as international artists such as Amaral (Spain), Diam’s (France), Utada Hikaru (Japan), LaFee (Germany), Radja (Indonesia), RBD (Mexico) and Vasco Rossi (Italy).

EMI has been at the cutting edge of the rapidly growing digital music marketplace since it released David Bowie’s ‘Hours’ as the world’s first ever album to be offered as a digital download in 1999. EMI has signed agreements with hundreds of digital partners to distribute its music across the globe. It continues to facilitate the development of a growing range of new digital business models to enable fans to experience and purchase its artists’ output through a number of different platforms including advertising-supported online music streaming in China through Baidu, legal peer-to-peer agreements with QTrax, Mashboxx and GNAB, and a deal to offer advertising-supported videos on mobile phones in the US through Rhythm NewMedia.

For further information on EMI, please visit: www.emigroup.com (http://www.emigroup.com/).
Contact: Cathy Cremer 020 7605 5308
Samantha Holderness 020 7605 5487





Samantha Holderness
PR Manager
EMI Music UK & Ireland
T: 020 7605 5487
www.emimusic.co.uk/press (http://www.emimusic.co.uk/press)
Join the biggest online peace demonstration - www.IMAGINEPEACE.com (http://www.imaginepeace.com/)





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Music from EMI

This e-mail including any attachments is confidential and may be legally privileged. If you have received it in error please advise the sender immediately by return email and then delete it from your system. The unauthorised use, distribution, copying or alteration of this email is strictly forbidden. If you need assistance please contact us on +44 20 7795 7000.

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Registered in England No 229231.


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EMI AND VIRGIN CLASSICS LAUNCH CLASSICS CLUB



LONDON, 1st October 2007: EMI and Virgin Classics have announced the launch of the groundbreaking EMI and Virgin Classics Club, an exclusive online environment through which classical music lovers can gain access to a range of audio and visual material. Members can strengthen ties with their favourite music and musicians, stream pre-release works and more, all as they earn Club Points redeemable for music downloads.

The Club, administered by ‘Opendisc’, is part of EMI and Virgin Classics’s strong focus on consumer relations, creating connections between artists and audiences. It will be open to purchasers of all EMI and Virgin Classics recordings released from September 2007 marked with the ‘Opendisc’ logo. This is the first time that a record company has offered exclusive content to CD buyers on a label-wide scale.

Purchasers of EMI and Virgin Classics ‘Opendisc’ CDs will be invited to place the disc into their internet-connected computer, where they will have the chance to create their membership profile. This straightforward process will grant them exclusive access to the Club without any software or copy protection systems being installed ontheir computer. Participants can opt out of the registration process at the click of a button. Pilot schemes have indicated that consumers value this free and optional access.

Members will be rewarded with exclusive content including pre-release listening sessions, mini-documentaries, artist interviews and photo shoots. Material will be refreshed regularly to ensure a truly rewarding experience for Club members, adding value to their CDs at no extra cost.

Members will be given the opportunity to address questions to a panel of experts and to EMI and Virgin Classics artists themselves. Answers to selected questions will be posted in the Club each month.

In a scheme administered by ‘Opendisc’, members can collect Club Points by buying EMI and Virgin Classics CDs or by engaging in surveys. The 100 Club Points allotted to each purchased CD will entitle members to download a free track from the available Club catalogue.

In September, Club members will have the choice to sample future releases by Nigel Kennedy, Martha Argerich and Antonio Pappano; preview mini-documentaries on Kennedy and the Choir of King’s College Cambridge; join exciting young British soprano Kate Royal in the first episode of an exclusive new video podcast series; pose questions to the artists that they most admire; exchange Club Points for free music downloads.

William Benthall, Director - Digital for EMI Classics, said, “The Club adds a fresh dimension to EMI and Virgin Classics CDs. It gives music fans an unprecedented opportunity to engage with great artists and recordings and it gives artists the chance to further strengthen relationships with their audience.”

As EMI and Virgin Classics continue to embrace the digital age, both music lovers and artists alike stand to benefit. There is every good reason to join the Club!


Forthcoming ‘Opendisc’ releases that give access to the EMI/Virgin Classics Club:

· Evgeny Kissin: Mozart & Schumann Piano Concertos
· Kate Royal: Kate Royal
· Zbignew Preisner: Silence, Night and Dreams
· Sabine Meyer & Emmanuel Pahud: Nielson Concertos
· Choir of King’s College, Cambridge: I Heard a Voice
· Sarah Chang: Vivaldi Four Seasons
· Martha Argerich: Shostakovich Concerto for Piano, Trumpet and Orchestra
· Nigel Kennedy: Polish Spirit
· Fabio Biondi: Vivaldi Concerti per viola d’amore
· William Christie: Haydn, The Creation
· Jonathan Biss: Beethoven Piano Sonatas
· Antonio Pappano: Respighi Roman Trilogy
· Renaud & Gautier Capucon: Brahms Double Concerto
· Emmanuelle Haïm: Handel Dixit Dominus, Bach Magnificat
· Philippe Jaroussky: Carestini, The Story of Castrato

From the Rolling Stones to Joss Stone, PlayPhone Distributes EMI Music Ringtones
Thursday October 4 2007

PlayPhone Offers Mobile Phone Users Access to Downloads of EMI's Legendary Catalog of Artists

SAN JOSE, CA--(MARKET WIRE)--Oct 4, 2007 -- Mobile entertainment company PlayPhone, Inc. (http://www.playphone.com) has entered into an agreement with EMI Music to distribute music ringtones from its extensive catalog to PlayPhone.com and the far-reaching network of mobile entertainment destinations that are powered by PlayPhone (http://www.playphone.com/Company.aspx). Starting today, consumers can customize their mobile phones with all kinds of music ringtones -- from classics such as The Beach Boys and David Bowie to current chart-topping artists such as, Coldplay, Norah Jones, KT Tunstall, MIMs, Lenny Kravitz and Robbie Williams.

About EMI Music

EMI Music, the recorded music division of EMI Group, one of the world's largest independent music companies, represents artists spanning all musical tastes and genres. Its record labels include Angel, Astralwerks, Blue Note, Capitol, Capitol Nashville, EMI Classics, EMI CMG, EMI Records, EMI Televisa Music, Manhattan, Mute, Parlophone and Virgin. Artists on EMI labels include Lily Allen, The Beatles, Coldplay, Corinne Bailey Rae, The Good The Bad & The Queen, Gorillaz, Norah Jones, The Kooks, Korn, Kylie Minogue, Pink Floyd, Rolling Stones, Joss Stone, 30 Seconds To Mars, KT Tunstall, Keith Urban and Robbie Williams, as well as international artists such as Amaral (Spain), Diam's (France), Utada Hikaru (Japan), LaFee (Germany), Radja (Indonesia), RBD (Mexico) and Vasco Rossi (Italy).



Full article and Source (http://biz.yahoo.com/iw/071004/0310686.html)

Wake up — or die, EMI told

p2pnet news | Music:- UK band Radiohead are showing Warner Music, EMI, Vivendi Universal and Sony BMG which way is up, big time. And they’re now getting support from a new and unexpected quarter.

Guy Hands, CEO and founder of Terra Firma, the private equity group, which bought EMI in August, told staff in a confidential email, “the industry had been too slow to embrace the digital revolution,” says The Telegraph, going on:

Hands’ letter followed the decision by Radiohead, “nurtured by EMI but now out of contract with the label, ” to release their latest album online.

In the email, Hands called Radiohead’s action “a wake-up call which we should all welcome and respond to with creativity and energy,” says the story.

“The recorded music industry … has for too long been dependent on how many CDs can be sold,” it has Hands saying, going on: “Rather than embracing digitalisation and the opportunities it brings for promotion of product and distribution through multiple channels, the industry has stuck its head in the sand.”

EMI was the first of the Big 4 organised music companies to drop DRM (Digital Restrictions Management) consumer control,.

Adds The Telegraph:

“Hands suggests moving away from the model of paying large advances – Robbie Williams signed an £80m deal with EMI in 2002 – in exchange for the label’s right to keep the majority of the takings from new releases. Instead, labels could simply subsidise the making of an album or the beginning of a tour in exchange for a share in the profits – or losses.
“Hands is understood to have been impressed by the inventiveness of EMI’s music publishing division, which owns the copyright to songs, in making money from new sources. It has licensed lyrics to be printed on jeans and posters and music videos to be played on YouTube.”

Radiohead is telling fans, “Pay us what you think our music is worth!”

Will Hands now advise the other three members of the cartel to abandon the bizarre sue ‘em all marketing plan (also enthusiastically implemented by EMI) under which music lovers such as Minnesota mother Jammie Thomas are being hauled into court to be accused of being massive online distributors of music owned by the labels?

Source (http://www.p2pnet.net/story/13578)

Madonna Quits Warner
by Paul Cashmere - October 11 2007

Madonna is the latest artist to quit a major label.

Following Radiohead's move to digital independence, Madonna is reported to be quitting Warner Music to sign a ten year agreement with Live Nation.

The Wall Street Journal reported today that Madonna is on the verge of leaving her long-time label for a $120 million, three record and touring deal with Live Nation.

The deal would commence as soon as she delivers her next album to Warner. It is the last album she owes the label under her current contract.

Under the Live Nation deal, Madonna will be given stock in the company in return for the company controlling her tours, merchandise and recorded music.

A shift of this caliber first presented itself when Robbie Williams became the first artist to sign over his merchandise and ticket sales to his record label EMI in exchange for a wad of cash.

The Madonna deal tips the Williams/EMI deal on its ear, with that deal paving the way for artists to withdraw from a major record label completely, as the case with the Live Nation deal. By making the live performance the central revenue stream, the recorded music can be used for promotional purposes to promote the gig.

The model is being adopted at a rapid rate. This week Radiohead released their new album 'In Rainbows' independently via digital download. Oasis have also indicated that their next album will be delivered to fans the same way. The Eagles also control the distribution of their next album.

In the UJ, Prince gave away over 3 million copies of his last album to promote his tour. Snow Patrol have included the CD as part of their ticket sales.

Source (http://undercover.com.au/News-Story.aspx?id=3088)

The Associated Press is asking a question that is practically blasphemous -- the outcome of which could change the face of the music industry: Are record labels really necessary, especially for established artists?

With acts including Madonna and Radiohead forgoing traditional record deals, and international superstar Robbie Williams signing a complicated deal guaranteeing him 80 million pounds over four albums, including some revenue from live events, it's clear that the the traditional concept of labels signing artists and paying them royalties is changing. Radiohead has decided to make its album available online only and let fans decide how much to pay.

Some argue that these are exceptions -- traditional record labels are still a must for all but the most established acts. Yet even lesser-known acts can promote their music on sites like MySpace and Facebook, which allow users to feature the songs they like on their pages. A lot of young people get introduced to music this way, forgoing outlets like MTV and the radio, which are seen as too commercial and passe.

The shift probably will be gradual, with better-known acts making the leap first. But as the methods of music distribution and hit-making change, so too will the role of the record label. Long term, I think that role will become a lot less relevant.



Source (http://www.bloggingstocks.com/2007/10/13/are-record-labels-really-necessary/)

The Times
October 30, 2007

Hundreds of jobs at risk amid review at EMI
Amanda Andrews, Media Business Correspondent

Hundreds of jobs at EMI are at risk as Terra Firma, the music group’s private equity owner, considers cuts in the workforce and a sell-off of its CD distribution unit. A spokesman for Terra Firma said that it was conducting a strategic review of EMI’s operations and would announce the outcome in January or February.

No firm decisions have been taken on what could be a radical restructuring, but the spokesman refused to rule out significant job cuts and said that “anything and everything is a possibility”, including a sale of the physical music distribution business.

Not all of EMI’s units are at risk of being sold. Guy Hands, the chief executive and founder of Terra Firma, said recently that he planned to retain EMI’s two key units – recorded music and music publishing.

The spokesman reiterated yesterday that Terra Firma had no plans to sell either of these divisions. However, it is understood that job cuts at both are being considered.

It is also understood that Mr Hands is looking to dilute Terra Firma’s equity stake in EMI and has met representatives of a number of private equity firms and hedge funds. As part of Terra Firma’s £2.4 billion acquisition of EMI this year, the group poured in £1.5 billion of equity.

The spokesman confirmed that the group had held talks with the financial community, but said that this was not unusual for private equity deals of this size: “This is normal course of business - all major private equity deals are syndicated in this way.”

Sources close to Terra Firma said that there had been considerable interest from the private equity and hedge fund communities. The spokesman said that Terra Firma intended to retain a majority stake. The British-based music company’s artists include Coldplay, Robbie Williams and Norah Jones. It also owns back-catalogue rights for The Beatles and the Rolling Stones.

Terra Firma has said that it plans to exploit the opportunity to develop EMI’s publishing catalogue, while streamlining its recorded music business and making it more focused on digital revenue streams.

EMI has come under pressure this year because of its poor release schedule and ongoing problems within the industry such as internet piracy.

Source (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article2767226.ece)

Interesting article Mon - looks like a carve up is on the cards...

I guess that EMI might have a poor release schedule this year as their main artists all released albums last year....

Fed-Up Music Boss Fires Warning Shot
Friday November 02, 2007

The music giant behind Kylie Minogue and Robbie Williams has warned it will drop artists who don't work hard enough. Robbie is one of EMI's stars. EMI has also reportedly threatened to withdraw stars' lucrative advances if record sales are disappointing.

The warning has come in an internal memo by the head of the private equity firm which bought EMI in August. Terra Firma boss Guy Hands told staff it would dump artists who don't spend enough time promoting their work.

He added the company would in the future be "more selective in whom we choose to work with". While many artists worked hard, he wrote, some "simply focus on negotiating for the maximum advance...advances which are often never repaid."

EMI was bought by Terra Firma in August in a deal which valued the company at £3.2 million. The deal was completed just before the world credit crunch, which analysts fear may put the company under pressure to cut budgets.

EMI sales fell 10% last year as - like many firms - it was hit by competition from the internet.Highly-paid music industry executives also face losing their lucrative bonuses in the shake-up. Robbie Williams is one of EMI's most highly-paid stars, having signed on for £80m in 2002.

Source (http://news.sky.com/skynews/article/0,,30400-1291273,00.html)

He added the company would in the future be "more selective in whom we choose to work with". While many artists worked hard, he wrote, some "simply focus on negotiating for the maximum advance...advances which are often never repaid."

Me thinks it could be the other way round http://www.cheesebuerger.de/images/midi/frech/a036.gif

Who does he think he's kidding....

And why are they insinuating that Robbie doesn't work hard enough...hello people he nearly worked himself into an early grave last year whilst on tour...

Get a grip mister big shot boss - wonder how long you'll keep your job when the going gets tough.

EMI have only themselves to blame. The biggest artisits on their label, Robbie, Coldplay, Kylie (though her new album is out soon) have all been away from the music scene for over a year. Its their own fault for letting their biggest artists all take time away from music at the same time.

I think its fair to say that perhaps Robbie did not promote Rudebox at all, however he was in the middle of a year long world tour and EMI hardly pulled out any effort themselves into promotion.

EMI should be very careful with the wording of their documents as a lot of artists will start to follow in Radiohead, Madonna, Paul McCartneys footsteps and take control of their own career. Can you imagine if Robbie, Coldplay and Kylie all left EMI at the end of their contracts!! Who would they be left with then? Record companies need to get into this century and embrace the change in the music industry, stop blaming the artisits and get their own house in order or they will indeed go under!!

I've read different versions of this same article today and am staggered that they even dared to mention Kylie in it - her 'time off' has hardly been her choice, and she probably came back way before she should have done. I hope the whole lot of them dump their record labels, they don't need them in this day and age anyway

Sorry for mentioning Kylie in my last post. Of course she had a very sad reason for being away from the music industry last year and I for one am super chuffed she is well healthy again!!

Sorry for mentioning Kylie in my last post. Of course she had a very sad reason for being away from the music industry last year and I for one am super chuffed she is well healthy again!!

Oh, I hope you weren't apologising to me! :rose:

The media have mentioned both Robbie, which they were going to do in this Robbie bashing age, AND Kylie, my comment was directed solely towards them :)

Thats ok Gwennie, in my original post I forgot to mention Kylies illness and when I re-read it, it sounded like she'd been on holiday!!!!!!

I know what you mean about EMI though. Hopefully Robbie will get out there as soon as his contract is up!!

I know what you mean about EMI though. Hopefully Robbie will get out there as soon as his contract is up!!


I agree ..

:slow:


Its not about him its about how much money he can make them ... that's never a good place to be.

:noway:

What a cheek. EMI are widely considered the worst of the big record companies. They are unquestionably the most useless record company there is when it comes to putting the work in to promoting their artists, and they have the cheek to say their acts are not working hard enough. Seriously, it justs proves how they clearly have no idea. I am so glad they are going downhill finacially and have been for many years. They deserve to as they are utterly appauling. Sony BMB seems to be the best tbh., although I can see Rob releasing music independently after the contract is up.

What a cheek. EMI are widely considered the worst of the big record companies. They are unquestionably the most useless record company there is when it comes to putting the work in to promoting their artists, and they have the cheek to say their acts are not working hard enough. Seriously, it justs proves how they clearly have no idea. I am so glad they are going downhill finacially and have been for many years. They deserve to as they are utterly appauling. Sony BMB seems to be the best tbh., although I can see Rob releasing music independently after the contract is up.

Yes - I have to admit that I don't know much about how the industry functions - but with Robbie on tour at the time, wouldn't the promotion of Rudebox been down to them? And there was no promotion of note at all

LILY ALLEN, COLDPLAY, ROBBIE WILLIAMS and KYLIE MINOGUE are among a number of acts under threat because of radical plans by British music label EMI to drop recording artists who are "not working hard enough" for their label. New boss Guy Hands, who took over the company in August (07), has slammed greedy singer/songwriters signed to any of the company's subsidiary labels - including EMI records and Parlophone - for requesting huge advances and giving little in return. In a leaked memo obtained by British newspaper the Financial Times, staff are warned that no star is safe under the new regime. Hands writes, "Some (artists) unfortunately simply focus on negotiating for the maximum advance. "There is no reason why we should not be more selective in whom we choose to work with." No specific artists were named in the memo. In 2001 EMI forked out $39 million (GBP19 million) to get out of a contract with Mariah Carey, just one album into a five album deal. The singer went on to have one of the top-selling albums of 2005 with EMI's rival, Universal.

03/11/2007 14:47


- Whatever you do...dont drop Robbie you will regret it forever and ever!! Oh God.......

YES you will regret it forever and ever!!

:angry:

Drop any of those artists, Lily Allen, Coldplay, Kylie or Robbie and that will weaken EMI even more. I'm sure none of those artists will like this and perhaps when ther current contracts run out they will all leave. What would EMI be left with then. Between those four artists they sell millions of records and make EMI a fortune.

The £80 million record contract they gave Robbie was paid back within the first two years and they have made a massive amount of money from him during this contract. He has recorded and toured almost none stop up until this year (which by the way he bloody well deserves a year off!!!), Kylie has been very ill as we all know, Lily Allen is just getting started in her career and Coldplay have also made EMI mega money so they too deserve time off.

EMI may regret ****ging their biggest artists off as I believe this may come back to haunt them if they all leave. By the way this has only confirmed my thoughts on what a crap record compnay EMI are, the artists can only do so much, EMI have to promote as well and lets face it, they did nothing to support Rudebox whilst Robbie was on tour!!

'Greedy artists need to work harder'

Yeah sure.. and greedy record bosses need to shut the f*** up. :fury:

EMI to axe unproductive musicians

Guardian Unlimited

Music group EMI, home to Robbie Williams and Lily Allen, has suggested it will axe artists that are not working hard enough as it takes a fresh approach to the music business under new private equity owners.

Guy Hands, head of buy-out group Terra Firma, said in a memo to EMI staff that his initial views on overhauling the recorded music division included more rigorous demands on artists.

"I do see a need for fundamental change in how we approach the music business and how we deliver the interconnected triangle of the consumer, EMI and the artist," he said in the memo, obtained by the Financial Times and posted on its website.

He did not mention any specific artists at EMI, whose roster also includes Kylie Minogue, the Rolling Stones and Gorillaz, but slammed the focus by some on upfront money rather than album sales.

"There has been a lot of talk about what labels offer to artists and to the consumer. However, there is not much talk about how artists should work with their label. While many spend huge amounts of time working with their label to promote, perfect and endorse their music, some unfortunately simply focus on negotiating for the maximum advance ... advances which are often never repaid," he said.

"However, once EMI has the best products and services in music and the best culture for working together then, as already exists within some of our labels, it will be open to us to choose which artists we wish to work with and promote."

His comments on a music group's role follow Madonna's widely publicised decision to leave her long-time label Warner in favour of concert promoter Live Nation. The move prompted music industry doomsayers to prophesy the death of the record label.

Like all the big music groups, EMI is battling falling sales against a backdrop of rampant piracy and fast-changing consumer habits. In its final months as a listed company, EMI issued two profit warnings in quick succession after disappointing Christmas sales for Robbie Williams' new album.

One of the first moves by EMI's new owners was to draft in Tony Blair's former adviser and notorious cost-cutter John Birt to its supervisory board, tasking him with reviewing how it treats its artists.

Mr Hands also said in his letter to EMI staff that the company must "focus on how we can develop a direct relationship with consumers and not rely on or blame others".

He gave a clue to his overall view of the music industry by revealing that in looking for new staff, Terra Firma had talked to executives currently and formerly at the "major labels" but "while we have interviewed and seen many people, we have not seen many who, in our view, add anything over and above those we already have in EMI."

Source (http://business.guardian.co.uk/story/0,,2204384,00.html?gusrc=rss&feed=24)

''There's only one of me
Single-handedly raising the economy
Ain't no chance of the record company dropping me '' http://www.cheesebuerger.de/images/midi/frech/d010.gif

Go ahead Mon....

Can you kick it?

Yes you can....

Up the rear end to the big shots who think they know everything about making music...

[QUOTE=RobsIsTheBest]LILY ALLEN, COLDPLAY, ROBBIE WILLIAMS and KYLIE MINOGUE are among a number of acts under threat because of radical plans by British music label EMI to drop recording artists who are "not working hard enough" for their label. New boss Guy Hands, who took over the company in August (07), has slammed greedy singer/songwriters signed to any of the company's subsidiary labels - including EMI records and Parlophone - for requesting huge advances and giving little in return. In a leaked memo obtained by British newspaper the Financial Times, staff are warned that no star is safe under the new regime. Hands writes, "Some (artists) unfortunately simply focus on negotiating for the maximum advance. "There is no reason why we should not be more selective in whom we choose to work with." No specific artists were named in the memo. In 2001 EMI forked out $39 million (GBP19 million) to get out of a contract with Mariah Carey, just one album into a five album deal. The singer went on to have one of the top-selling albums of 2005 with EMI's rival, Universal.

03/11/2007 14:47

Oh, new boss in the chair, and if he wants to remain in that chair, he must make some big changes and turn the ship around. So this is really no big surprise. Of course he would expect his artists to work harder, but I would also think his artists could demand something in return. For example that he looks at the way they do the marketing at EMI. Maybe he should also send around a memo that no one is safe in marketing.
As for Rob - the article says No specific artists were named in the memo - and I doubt that this has anything to do with Rob. He is one of EMI's biggest incomes I would think, name me one other artist or band who has put out 9 albums in 10 years (and succesful albums too) and has done so many tours and sold so many tickets. That is hard work.
I know that Rob often claims that he does not work hard at all, but I think that is not true at all. He says he has a lot of time off, but in his time off he always writes and records songs. He calls that his hobby. I call that work!
I would guess he is one of the hardest working artist in showbiness today, and the most selling, so why on earth would the above article apply to Rob. I guess the only thing EMI could have on Rob is that he has not worked hard enough on cracking America, but I guess that is as much their fault as his (marketing again). I guess Rob did not want it enough and EMI did not market him god enough. But that's the thing when you are "selling" human beings and not pot plants or tomatoes or whatever, you sometimes have to accept that humans have a mind of their own, and in this case I guess Rob wanted someting else than EMI. So I don't think we should worry. Anyway, Rob only has one album left to do for EMI, and he has hinted that he won't resign to them.

http://www.cheesebuerger.de/images/more/schilder/n010.gif DJ

I don’t care a monkey about EMI’s falling profits. Nor about their shareholders and top executives, whose annual salaries beggar’s belief! For decades, their emphasis has been on making money by exploiting artists and consumers. Now that the tables have turned on them with the digital market and websites like My Space, they are looking for scapegoats, someone to blame. It makes them feel better and shifts the focus of them onto the artists http://www.cheesebuerger.de/images/more/schilder/g023.gif

I do believe the future is in small labels which can focus more on artist than making money. It`s a good thing that music is so available. Cds are much cheaper now and they still make money(as I believe). Profit should go to the ones who work hard on it(artists) not someone who thinks only about grabbing the most of it for themselves for doing God knows what.
And if Robbie, Lilly or whoever wants to take a year break, they so damn deserve it!

03/11/2007 14:47

Oh, new boss in the chair, and if he wants to remain in that chair, he must make some big changes and turn the ship around. So this is really no big surprise. Of course he would expect his artists to work harder, but I would also think his artists could demand something in return. For example that he looks at the way they do the marketing at EMI. Maybe he should also send around a memo that no one is safe in marketing.
As for Rob - the article says No specific artists were named in the memo - and I doubt that this has anything to do with Rob. He is one of EMI's biggest incomes I would think, name me one other artist or band who has put out 9 albums in 10 years (and succesful albums too) and has done so many tours and sold so many tickets. That is hard work.
I know that Rob often claims that he does not work hard at all, but I think that is not true at all. He says he has a lot of time off, but in his time off he always writes and records songs. He calls that his hobby. I call that work!
I would guess he is one of the hardest working artist in showbiness today, and the most selling, so why on earth would the above article apply to Rob. I guess the only thing EMI could have on Rob is that he has not worked hard enough on cracking America, but I guess that is as much their fault as his (marketing again). I guess Rob did not want it enough and EMI did not market him god enough. But that's the thing when you are "selling" human beings and not pot plants or tomatoes or whatever, you sometimes have to accept that humans have a mind of their own, and in this case I guess Rob wanted someting else than EMI. So I don't think we should worry. Anyway, Rob only has one album left to do for EMI, and he has hinted that he won't resign to them.

:clap4: Well said

From The Sunday Times

November 25, 2007

Birt to shake and rattle ‘lazy’ pop stars

EMI calls in former BBC chief to review underperforming singers

HE is an unlikely candidate to become the saviour of rock’n’roll. But Lord Birt, the former BBC director-general once ridiculed as a “croak-voiced Dalek”, has resurfaced at EMI, the troubled music group, to help knock artists such as Robbie Williams and Lily Allen into shape.

Birt, who also served as Tony Blair’s “blue skies” strategic thinker for four years, has been drafted in by EMI’s new private equity owners as they embark on a mission of “fundamental change” that could see big stars being dropped if they fail to pull their weight.

Like other big music groups, EMI, which was bought by Terra Firma for £2.4 billion this year, is battling against falling record sales prompted by piracy and ever-changing consumer buying habits.

Birt, who joined Terra Firma as an adviser in 2005, has been asked to review how EMI treats its roster of artists, raising the prospect of him rubbing shoulders with the likes of Pete Doherty, the drug-addled frontman of Babyshambles.

Birt, 62, will consider the best means of promoting stars and disseminating their music, whether it be through conventional CD sales, internet downloads or live concerts.

Insiders insist that Birt — who gained a reputation for cost-cutting and unintelligible management-speak at the BBC — will not be involved in wielding the axe.

In a leaked memo sent to EMI staff last month, Guy Hands, the head of Terra Firma, said: “There has been a lot of talk about what labels offer to artists and to the consumer.

“However, there is not much talk about how artists should work with their label. While many spend huge amounts of time working with their label to promote, perfect and endorse their music, some unfortunately simply focus on negotiating for the maximum advance . . . advances which are often never repaid.”

Hands said that once EMI had raised its standards “it will be open to us to choose which artists we wish to work with and promote”. Although the memo did not include names, it has triggered speculation about which artists EMI’s new owners might have in their sights.

Williams, who has sold more albums in the UK than any other solo artist, was reportedly paid £80m when he signed to EMI in 2002. However, his last album, Rudebox, has been a relative flop.

Hands has singled out Birt’s expertise in technology as “invaluable” and his assessment will feed into a company-wide strategic plan.

Despite his unpopularity with BBC staff, one of Birt’s main achievements at the corporation was to prepare it for the multi-channel digital age.

Yet his calculating, mechanical demeanour may prove uncomfortable for creative types. It was Dennis Potter, the late playwright, who gave Birt the “croak-voiced Dalek” epithet.

Birt’s familiarity with today’s music scene may also prove problematic. His closest friend from the world of pop is thought to be Cilla Black.

A fellow Liverpudlian, Black was a guest of honour when Birt tied the knot in December 2006 to Eithne Wallis, a former head of the probation service. The wedding followed Birt’s divorce from his ex-wife Jane after 40 years of marriage.

One EMI group that has crossed paths with Birt is the Rolling Stones. As a young editor on World in Action in the late 1960s, he was offered a fleeting glance of the “sex, drugs and rock’n’roll” lifestyle when he got Mick Jagger, in the wake of the infamous drugs raid on Keith Richards’s country home, to appear on a live television debate about the state of youth.

Birt was unavailable for comment this weekend.

source (http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/music/article2937090.ece)

John Birt: The return of Mr Blue Sky

He has interviewed Mick Jagger, brought his own brand of management-speak to the BBC, and thought the unthinkable for Tony Blair. Now John Birt is helping EMI get the most out of Robbie Williams and Lily Allen. Ciar Byrne reports.

Published: 27 November 2007

http://i149.photobucket.com/albums/s49/MarianneStockholm/Diverse/LordBirt.jpg
Lord Birt brought sharp, strategic
thinking to Downing Street

In his autobiography, The Harder Path, John Birt recalled how, in 1962 at the tender age of 17, he earned overtime by working as a bouncer at Southport's Cambridge Hall where a little known band called the Beatles was playing. He was "electrified" by the sound: "I felt the sharp shock of the new." But, to his shame, the young Birt abused his newfound position of power. The Fab Four were already attracting crowds of young female fans and one of them was known to Birt and his fellow bouncer as "the most beautiful girl in Formby". When she pleaded to be let in to see Paul McCartney, Birt's friend agreed in return for "a snog and a feel". Birt admitted: "I participated in the encounter despite her inert response."

There is a kind of poetry in the fact that the once oversexed young Beatles fan has now been charged with reviewing how EMI, the Beatles' record label, treats its roster of artists – including Lily Allen, Pete Doherty, Robbie Williams and Kylie Minogue. In the age of internet piracy and talent using the Web to bypass traditional record companies, Lord Birt's task is to compare the way in which pop stars are marketed, promoted and looked after on all of EMI's different labels – and to report on it all in the new year.

His appointment follows the buy-out of EMI by Guy Hands' private equity group, Terra Firma, which Birt joined 18 months ago as a general adviser. It is just one of many hats he has worn since he quit as the BBC director general in 2000, including working as an adviser to companies ranging from the consulting firm Capgemini to the Waste Recycling Group.

But it is Birt's role as a visionary "blue skies" thinker and special adviser to Tony Blair from 2001 to 2005 that has attracted the most interest and, all too often, derision. Blair, by all accounts, found Birt's advice invaluable. One insider commented that the reason the former prime minister got on so well with the ex-director general was that Birt would present him with papers on various subjects that were "a statement of the bleeding obvious", providing clarity the Civil Service had failed to deliver.

Among certain members of the cabinet, however, Birt was held in slightly lower regard. In 2005, when the ceiling of his Downing Street office collapsed, leaving the taxpayer with a bill for nearly £3,000, the Cabinet Office minister John Hutton joked to fellow MPs in the House of Commons: " I'm afraid Lord Birt's ceiling fell in at his office in No 10 and I suspect that will probably help him in his blue skies thinking."

As a special adviser rather than a civil servant, Birt was under no obligation to appear before House of Commons select committees – Gwyneth Dunwoody, the chair of the transport select committee, was one of those who tried in vain to call the peer to give evidence, despite the fact that he had been asked to come up with a long-term transport strategy.

Lance Price, a former BBC correspondent who worked in political communications for Downing Street and the Labour Party, believes that despite the distrust of some in government, including the present Prime Minister, there was no doubt that Lord Birt brought sharp, strategic thinking to Downing Street.

"He was certainly held in very high regard by the [former] prime minister, although he was treated with suspicion by some other members of the cabinet," said Price. "Gordon Brown had suspicions of what he was about, but he was there to do some very radical thinking on behalf of Tony Blair. He [Blair] was concerned that the second half of his premiership should be more radical and Birt was a guy who always knew how to get things done."

It was certainly unusual for a former BBC director general – and one dubbed a "croak-voiced Dalek" by the playwright Dennis Potter at that – to enter politics after leaving the broadcaster.

"It was surprising that he should go from the BBC into government, when most people go into the commercial broadcasting arena, although it was obvious from his previous career that he was interested in politics," said Price. "It says something about what drives him, which is to get things done and make his mark. He's very, very smart, but not terribly good with people. He wasn't very good at inspiring people at the BBC. People who worked closely with him respected him enormously, but the majority of staff were suspicious of him."

Born in Liverpool in December 1944 into a family which straddled the city's sectarian divide, Birt was raised a Roman Catholic, following the religion of his father's family. Perhaps explaining the supreme self-confidence for which he is renowned, in his autobiography he writes: "When I was born – the first grandchild on either side of the family – I was the centre of attention for the numerous women I was surrounded by." His father worked for the Pru, but his wages were barely enough to cover the mortgage of the family's semi in Formby. The young Birt was educated by the Christian Brothers at St Mary's Senior School, before winning a place at St Catherine's College, Oxford, to study engineering.

Two weeks after his arrival at Oxford, Birt met a young American artist called Jane. By Christmas of his first year, he had proposed marriage. Jane became his first wife and the couple went on to have a son and daughter. But in 2005, their 40-year marriage was brought to an abrupt end when he admitted an affair with Eithne Wallis, the former head of the National Probation Service and a divorced mother. Birt went on to marry his mistress in a low-key ceremony at Islington register office in December 2006, which was not attended by either set of children. Peter Mandelson, a long-term friend of Birt from his days at London Weekend Television, and Trevor Phillips, the head of the Commission for Equalities and Human Rights, both attended the reception at the fashionable St John restaurant near London's Smithfield Market, but many former colleagues refused to attend when their wives were not invited.

Upon leaving Oxford, Birt applied to work at the BBC and made it through " to the last 10 or so", but was turned down. Instead, he won a job on Granada's flagship documentary strand World In Action in Manchester. Here he secured his first scoop, persuading Mick Jagger, who had just spent three nights in Brixton prison for possession of drugs, to be filmed in conversation with the editor of The Times, William Rees-Mogg, for a programme hailed as a "dialogue between generations".

Birt was poached from Granada by David Frost to work at London Weekend Television, where, together with Peter Jay, he published three articles in The Times, arguing that television news and current affairs should have a " mission to explain". In his review of The Harder Path in The Observer, the former chief creative officer of Big Brother creator Endemol, Peter Bazalgette, described the pieces as "possibly the most misguided articles ever written about the practice of television", adding: " The basic error they made was that the amount television can 'explain' is limited by the number of spoken words you can fit into a one-hour slot."

In the late 1970s, Birt took leave of absence from LWT to work with David Frost on The Nixon Interviews. In the recent film version of Peter Morgan's play Frost/Nixon, based on those interviews, Birt is played by the former Spooks star Matthew Mcfadyen who was obliged to strip for the role – Birt was allegedly so thrilled by the success of the interview dealing with Watergate that he took off all his clothes and dived into the Pacific Ocean.

In 1986, Birt was poached from LWT to become deputy director general of the BBC, where he headed news and current affairs. No sooner had he arrived than he entered into a row with Michael Grade, an old friend from his LWT days, who was campaigning for Birt's deputy Ron Neil to be appointed controller of BBC1. Birt won the argument, but "a chasm had opened up between two old friends".

Within six years, Birt had succeeded Michael Checkland as director general and set about implementing unpopular policies including "producer choice ", which required BBC producers to use outside suppliers when it was cheaper to do so – an initiative which led to crazy anomalies such as it being more expensive to borrow a CD from the BBC library than to buy one from a high-street shop. He also split broadcasting and production, meaning that programme-makers within the BBC had to sell their programmes to commissioners.

Controversy arose when it emerged that Birt was employed as a freelance consultant, which meant he paid less tax, and he came under political pressure to become a BBC employee. His memos were infamous, using management-style language that was soon satirised by Private Eye as Birtspeak.

In his favour, during his tenure, Birt oversaw negotiations with the government which secured a long-term increase in the licence fee. He is also widely acknowledged to have pioneered the BBC's online and digital strategies, developing BBC News 24 and BBC Parliament, as well as the early prototypes of BBC3 and BBC4 – BBC Choice and BBC Knowledge.

One former associate said: "John is clearly a hugely talented man, especially when it comes to analytical and strategic work on policy and business problems. His thinking is rigorous, and he is very determined to pursue solutions, once he has figured out what to do. In fact, he is relentless, once he has made up his mind. Sometimes this means that there are human casualties, but he regards this as an inevitable consequence of necessary change."

In August 2005, Lord Birt (he had been knighted in 1998) delivered the annual James MacTaggart Memorial Lecture at the Edinburgh International Television Festival. In an attack which did not go down well with the audience of TV executives, Birt bemoaned the "tabloidisation" of British intellectual life and said the media had become too hung up on " the desire to humiliate".

In Armando Iannucci's political satire The Thick of It, a former business guru turned "blue skies" thinker, Julius Nicholson, played by Alex MacQueen, descends on the fictional Department for Social Affairs as part of an investigation into the structure of all government departments. It bears an uncanny resemblance to a planned shake-up of Whitehall which Birt worked on but which never went ahead. One acquaintance commented: "He was willing to attack embedded problems which governments usually ignore in areas like crime and transport, but he was not able to get many of his policy ideas actually implemented."

Perhaps, at EMI, Lord Birt will have better luck.

Granada to EMI: John Birt's CV

* 1944: Born at Walton Hospital, Liverpool, 10 December

* 1963-1966: Takes degree in engineering at St Catherine's College, Oxford

* 1965: Marries Jane Lake in Washington DC

* 1966: Production trainee at Granada Television, Manchester

* 1967: Makes World in Action with Mick Jagger and William Rees-Mogg

* 1971: Leaves Granada for London Weekend Television

* 1974: Becomes head of current affairs at LWT

* 1977: Produces the Frost-Nixon interviews on leave from LWT

* 1981: Appointed head of programmes at LWT

* 1987: Joins BBC as deputy director general

* 1992: Becomes 12th director general of the BBC

* 2000: Leaves BBC in January

* 2001-2005: Works as "blue skies" adviser to Tony Blair

* 2006: Joins the private equity firm Terra Firma as an adviser

* 2007: Asked to review how EMI treats its roster of artists

Source: The Independent (http://news.independent.co.uk/media/article3198883.ece)

Paul MacInnes
Thursday November 29, 2007
Guardian Unlimited


EMI head Hands thumbs his nose at excess, fingering candles that cost an arm and a leg

Guy Hands. What a great name. It could belong to a baddie in Robin Hood, a mime artist or an assassin whose specialism is strangling his victims. With his feet. In reality, the name belongs to the chairman of EMI, a private equity financier who bought out the formerly esteemed record label earlier this year and has since set about making bold pronouncements about his company and the state of the industry at large (all the while being sniped at by city bods who reckon he paid faaaarrrr too much for the ailing company). The latest strategy in Hands' crusade to turn things around? Declaring war on candles.

According to this morning's Times, Hands is set to take a big sharp scimitar to any corporate waste he finds at the label, home to such illustrious acts as Coldplay, Robbie Williams and Vincent Vincent and the Villains.
Among the excesses Hands has fingered:

· A three-bedroom mews house in London's not-trendy-but-expensive Mayfair that was used by former chair Eric Nicoli and is worth £5.6m;

· £20,000 on candles to decorate a Los Angeles apartment used to entertain guests; and

· The estimated £200,000 annual budget on fruit and flowers for EMI offices.

In order to reinforce the idea of this being a war on waste, the Times quotes a source who rather inappropriately draws Iraq into it. "It has been like the Americans in Iraq," says the source (see?). "They discovered it was worse than they thought. So now there is the surge and they are pouring more people in."

That surge apparently involves Hands asking the advice of such noted rockers as John "Dalek" Birt and Allan "Post Office" Leighton.

We hope you enjoyed our serious, industry-based opening to today's In the News.

Source (http://music.guardian.co.uk/news/inthenews/0,,2218998,00.html?gusrc=rss&feed=39)

Radiohead loss to affect EMI CD sales
By Dominic White
04/12/2007

EMI has just six albums in the top 75 as the struggling record company prepares for the crucial Christmas CD sales rush.

The UK music major's performance in its home market during the crucial quarter has weakened dramatically over the past two years. The drop in performance highlights the scale of the challenge facing the company's new private equity owner Terra Firma.

In the first week of December 2005, EMI had 11 albums in the top 75 Official UK Charts, helped by smash hits from Robbie Williams and Gorillaz. In the same week last year, that number had fallen to eight, including Robbie's commercial and critical flop Rudebox at number 24.

This week, Kylie Minogue entered the charts at a disappointing number four with her comeback EMI album X. She heads a list of six EMI artists that include the Spice Girls at number 12 with their Greatest Hits, and KT Tunstall at 54 - the only other charting EMI acts under 40. Other EMI artists on the chart are hardy perennials Cliff Richard, Phil Collins and Genesis.

Paul Williams, acting editor of Music Week, said: ''Fourth-quarter sales tend to be dominated by superstar acts, big greatest hits and big albums from earlier in the year which have continued to sell. EMI is struggling in all three categories."

Terra Firma is not expected to blame EMI's current management for the dire performance, however. ''It takes at least 18 months to bring an album this far so if there's blame to be apportioned it goes back to the Alain Levy regime," said a source close to the company, referring to the former EMI music boss ousted in January as it reported the latest in a series of profit warnings.

EMI chairman and Terra Firma boss Guy Hands hopes to appoint a chief executive by the early New Year. At the weekend Radiohead guitarist Ed O'Brien blamed Terra Firma for the band's decision to leave the music giant earlier this year. ''EMI is in a state of flux," he said. "It's been taken over by somebody who's never owned a record company before, Guy Hands and Terra Firma, and they don't realise what they're dealing with."

Source (http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/12/04/cnemi104.xml)

EMI executives face losing bonuses

By Dominic White
07/12/2007

EMI's new owner Terra Firma has told executives at the music group they will receive no bonuses unless the music company hits a £150m underlying earnings target by next June.

http://i149.photobucket.com/albums/s49/MarianneStockholm/Robbie/ConcertCal.jpg
Terra Firma are to study artist returns, from international stars such as
Robbie Williams [pictured] to breaking stars and local acts


The private equity giant has also imposed a hiring freeze and told EMI to slash its £250m marketing and promotions spend by more than 10pc between now and the end of June.

Terra Firma has also asked EMI to present a sample of around a dozen different artists - from international stars such as Robbie Williams, Coldplay and Norah Jones to breaking stars and local acts - to study which type of artists produce the best returns.

Terra Firma is striving to impose private equity-style management on the company and is working on a strategic review.

Separately, Terra Firma boss Guy Hands has told EMI staff that they should ''not try to be or act like artists themselves" and that Terra Firma plans to display ''leadership" which in the past had been "confused".

EMI's previous bonus scheme ran from March to March, but managers are being set new targets for the year to June. Even if they achieve divisional targets they will get nothing unless the group profit target is achieved.

Sources close to Terra Firma insist that EMI's £150m earnings before interest, tax, depreciation and amortisation (ebitda) target does not relate to the private equity group's banking covenants with Citigroup, which loaned £2.5bn towards its surprise acquisition of the company this summer.

In the year to March 31, 2007 EMI saw ebitda slump from £276m to £174m on revenues down 16pc at £1.75bn. However, Terra Firma is comfortable it can beat £150m, helped by its clampdown on costs.

The cuts in marketing spend are expected to target parties and other discretionary spending.

Terra Firma has parachuted approximately 45 people into EMI to help its review but has imposed a ban on replacing any leavers unless exceptional cases can be made.

It is also clamping down on overshipping. It is understood that EMI had 65m unsold CDs returned to it by retailers last year at a cost of about £1.50 per unit, almost £100m in total.

In the letter to his staff, Mr Hands writes that Terra Firma is ''driving value-added changes" in several ways. These include: ''Making the people in the business understand what it is they are supposed to be doing, that is, that they are there to serve the customer and the artist and not to try and be or act like artists themselves; and changing the culture and displaying leadership where previously there was little and, what little there was, was confused."

The Telegraph (http://www.telegraph.co.uk:80/money/main.jhtml?xml=/money/2007/12/07/cnemi107.xml)

Sir Paul McCartney puts his disillusion with EMI on record

Dan Sabbagh
December 14, 2007

Sir Paul McCartney has accused EMI, his former record company, of becoming boring and taking him for granted. The former Beatle, speaking to The Times, complained that the British record company had become too bureaucratic – and how he had “dreaded going to see them”.

“Everybody at EMI had become part of the furniture. I’d be a couch; Coldplay are an armchair. And Robbie Williams, I dread to think what he was. But the most important thing was, I’d felt [the people at EMI] had become really very boring, you know?”

Last summer, after 4½ decades, Sir Paul left EMI to join the start-up Starbucks-owned record label Hear Music, which released Memory Almost Full. The album, which attracted positive critical reviews, has sold more than a million copies worldwide since its release this summer.

Sir Paul accused EMI of being unimaginative, telling him that he should “go to Cologne” to market a new record. “This idea became symbolic of the treadmill, you know? You go somewhere, speak to a million journalists for one day and you get all the same questions. It’s mind-numbing. So I started to saying: ‘God we’ve got to do something else’.”

EMI owns the rights to all the Beatles albums, which were released on its Parlophone label or the group’s Apple label. Although Apple was owned by the Fab Four, EMI retained the distribution rights in an agreement struck in the late 1960s and continued to distribute Sir Paul’s material after the band split up.

He also complained about the long marketing lead times demanded by EMI, the so-called process of “setting up a record” in an attempt to enhance sales, recalling that John Lennon was able to force EMI to release Instant Karma a week after he had written it in 1970.

Sir Paul said that he would ask EMI to release a song “next week”, to which executives would reply: “You can’t do that these days.” When told that EMI wanted six months “to figure out how to market it”, Sir Paul asked: “Couldn’t some bright people do that in two days? Jesus Christ, I said, ‘Look boys, I’m sorry, I’m digging a new furrow’.”

The comments are a further embarrassment for Eric Nicoli, the former EMI chief executive who left the music major after its takeover by Terra Firma, the venture capital group led by Guy Hands. But Mr Hands is unlikely to be quite so concerned, as he is thought to agree with Sir Paul’s criticisms of the previous regime.

TIMESONLINE (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article3048895.ece)

McCartney slams 'boring' EMI after split

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LONDON (AFP) — British rock legend Sir Paul McCartney criticised his former record label EMI for its "boring" approach, and accused it of taking him for granted in an interview Friday.

Speaking to The Times daily, McCartney said he also became frustrated with the amount of time it took for EMI to release a song -- while he wanted them released within weeks, record label executives expected to take months.

"Everybody at EMI had become a part of the furniture," McCartney told the newspaper.

"I'd be a couch; Coldplay are an armchair. And Robbie Williams, I dread to think what he was ... But the most important thing was, I'd felt (the people at EMI) had become really very boring, y'know? And I dreaded going to see them."

Asked what he meant by accusing the record company of being "boring", McCartney responded: "Well, because I could guess what they were going to say."

He added that he became frustrated with what he described as the "treadmill" approach of the company when it came to marketing music: "You go somewhere, speak to a million journalists for one day, and you get all the same questions. It's mind-numbing.

"So I started saying: 'God, we've got to do something else'."

McCartney split with EMI earlier this year, and released his latest album "Memory Almost Full" with coffee giant Starbucks's newly-launched Hear Music label.

He lamented the amount of time it took for EMI to develop a marketing strategy for his songs, telling The Times he would ask the label for a song to be released the week after he wrote it, only to be told by executives that it would take six months instead.

"I said: 'Wait a minute, are you sure you need six months for that? Couldn't some bright people do that in two days?"

Source (http://afp.google.com/article/ALeqM5iuUb16lRCrQ4SknN-UDI-AdDIBCw)

Well, isn't that what we have been saying all along on this site - EMI are good at criticising their artists for being lazy, but their marketing people are really not that clever. Finally an artist who speaks up - good on Paul :thumbup: But I am a little confused about his remark on Rob, I am not quite sure what he means, does he mean that Rob could have been marketed better, that they somehow have destroyed his career - what do you think?

Well, isn't that what we have been saying all along on this site - EMI are good at criticising their artists for being lazy, but their marketing people are really not that clever. Finally an artist who speaks up - good on Paul :thumbup: But I am a little confused about his remark on Rob, I am not quite sure what he means, does he mean that Rob could have been marketed better, that they somehow have destroyed his career - what do you think?
I agree it's great someone speaks up. Until now the media reporting has all been focused on blaming the artist's for EMI:s problems. Robbie can't say anything as long as his contract with EMI is running, but I wonder what he'll say when he's left them (which I'm sure he'll do). David Enthoven has hinted at what he thinks about them.

Regarding Paul's remark on Robbie, I'm not sure what he means. But since he mentions Robbie along with himself and Coldplay, some of EMI:s biggest selling artists, I would like to believe he's not negative towards Robbie. If he calls himself a couch and Coldplay an armchair, I wonder if what he was thinking about for Robbie was that he's a bed? I mean in an exploiting way. Just what came up in my mind, and probably wrong. Other suggestions?

Robbie Williams may quit EMI

Dominic White
17/12/2007

Robbie Williams's manager has raised the prospect that the star could quit EMI after he completes his final studio album for the struggling record company.

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Moving on: Williams’s management sees
the internet potential to go directly to fans

The singer, who is also contracted to release a best-of compilation, has been with the company for a decade and remains one of its biggest selling acts.

But his manager Tim Clark, co-founder of IE Music, told The Daily Telegraph: ''I would be very wary about signing him to any major at the moment."

Clark refused to comment on the star's current contract terms but said ''all options" were open once he has completed his obligations. That raises the possibility that Robbie could follow Paul McCartney and Radiohead, which have left EMI in the past two years and released new albums without a major label.

Last week EMI extended its 28-year recording relationship with heavy metal band Iron Maiden, in a deal that includes revenues such as touring, merchandise and sponsorship.

Williams is set to be the first major pop act to come up for renegotiation under EMI's new owner, the private equity giant Terra Firma.

Mr Clark said the internet offered opportunities for artists to reach their fans direct without the need for major labels. ''What concerns us with old ways is that we take overpriced and shoddy services, particularly now when we have a fantastic opportunity of getting to a fanbase direct. What we really don't want is the dead hand of multinationals throttling these brilliant opportunities," he said.

EMI's historic £80m 2002 contract with Williams pioneered the so-called 360-degree deal through a joint venture which manages the star's recording, writing, touring and performing activities.

He has yet to release an album since checking into rehab following his 2006 critical flop Rudebox. Terra Firma declined to comment.

EMI's rival Warner Music recently saw Madonna quit in a $120m (£59m) deal to join concert promoter Live Nation.

Telegraph (http://www.telegraph.co.uk/money/main.jhtml?view=DETAILS&grid=&xml=/money/2007/12/17/cnemi117.xml)

Robbie Williams 'could quit EMI'

17 December 2007

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Robbie Williams last album, Rudebox,
was released in 2006.

Robbie Williams may quit his record label EMI after he completes his final studio album for the company, his manager has suggested.

The singer signed a record £80m deal with the label in 2002 to produce four albums for the company.

"I would be very wary about signing him to any major label at the moment," Tim Clark told the Daily Telegraph.

The singer has been with the company for a decade and remains one of the label's biggest-selling acts.

Mr Clark refused to comment on the performer's current contract terms, but said "all options" were open once Williams has completed his obligations.

Negotiations

The singer is also contracted to release a best-of compilation.

Since 2002, Williams has released three albums: Escapology (2002), Intensive Care (2005) and Rudebox (2006).

A fourth album, Let's Swing Again, is due for release in February 2008.

Williams will be the first major pop act to come up for renegotiation under EMI's new owner, private equity giant Terra Firma.

Mr Clark's comments suggest Williams could follow in the footsteps of Paul McCartney and Radiohead, who have both left EMI in the past two years.

He said the internet offered artists opportunities without the need for record labels.

"What we really don't want is the dead hand of multinationals throttling these brilliant opportunities," Mr Clark said.

'Devaluing music'

Radiohead's Thom Yorke criticised EMI last week on BBC Radio 4's Front Row.

"When you're in a situation like this with shareholders, private equity firms, it looks at music as something to buy and sell on, that it's inorganic, that it's something that can be valued and devalued," he said.

"Companies buying and selling themselves and seeing the artists work as simply part of their stock is devaluing music - if anybody's responsible for devaluing music, it's them."

Sir Paul McCartney also branded his former label "boring" last week in a newspaper interview, citing it as a reason for why they parted company.

EMI declined to comment.

BBC News (http://news.bbc.co.uk/2/hi/entertainment/7147828.stm)

Robbie Williams Eyeing Free Agency

December 17, 2007

First Radiohead had problems with EMI's new management, leading the Brit rockers to go their own way, and now Robbie Williams is considering the free agent route. The reason is apparently the same as what drove Radiohead away - the new owners Guy Hands and his investment company Terra Firma. While the old EMI regime had a former biscuit maker at the top, he was at least surrounded by music people. Terra Firma, is being run by executives whose specialities include airports and shopping malls.

Unlike Radiohead, Williams' superstar status in the U.K. is matched by consistently strong sales, but has only been a blip in the U.S. He is the perfect example of a singer who truly needs a record company, domestically at least, to work a single through a multitude of avenues. His success in the U.S. has been song-based; there is a very small core of fans attracted to the personality and/or style, one that is not large enough to generate buzz similar to what he creates in the U.K. with each release.

If he goes the indie route, he will do something that catches the eye and penetrates the American consciousness - an iTunes commercial for example - that connects a song's hook and an artist's image in a commercial package that helps expand the fan base. He has been one of the great import mysteries of our time - a Cliff Richards like tale for the 21st century.

For anyone wanting a true test of a star performer side-stepping the major labels, Williams would be a far more intriguing case study than Madonna, Radiohead or Paul McCartney: He is more commercially viable, he is arguably at or near his peak; and his universal breakthrough has yet to occur despite the fact that his name is well known

Source: The Set List (http://weblogs.variety.com:80/thesetlist/2007/12/robbie-williams.html)

The Set List is written and compiled by Variety associate editor Phil Gallo. Gallo, based in Los Angeles, writes about the music business for Daily Variety and reviews concerts, television shows and theater.

Further lack of harmony between EMI and top acts

From The Times
December 18, 2007
Amanda Andrews

The relationship between EMI and some of its leading artists soured further yesterday as the record label suggested Robbie Williams’s potential departure would not be a great loss, and a source close to artist Joss Stone said the 20-year-old had become “disillusioned” with the company.

The record label, recently bought by Guy Hands’s Terra Firma private equity company, played down the significance of Williams's possible departure, saying he represented a tiny percentage of worldwide revenues, as the singer considers his future with the label. Mr Williams signed a record £80 million deal with EMI in 2002 to produce four albums for the company.

“Robbie Williams is clearly an important artist but only represented in his best year less than 1 per cent of the worldwide revenues of EMI,” EMI said in a statement to The Times.

A source close to Joss Stone said the singer, who resigned with EMI earlier this year in a long-term deal, has more recently had concerns about Terra Firma’s commitment to music and the private equity group’s long-term investment in the business. Joss Stone and her spokesman were yesterday unavailable for comment.

Some industry sources have raised concern that private equity investments are rarely for more than five or six years, although Terra Firma has said its investments are often for longer periods than this.

Williams’s manager Tim Clark said the artist may leave the record label after he completes the final studio album of his contract for the company, which could come as early as 2009.

“While record companies used to provide finance, manufacturing and distribution, in today’s digital music market artists just need finance to fund marketing costs,” said Mr Clark. “There is no need to go to a major record label to fund purely marketing costs, especially now the internet has reduced marketing costs dramatically.”

Williams, who has been with the company for a decade, has been one of EMI’s most successful artists in Britain, but has been unable to break the lucrative American market.

TimesOnLine (http://business.timesonline.co.uk/tol/business/industry_sectors/leisure/article3065747.ece)

Tempus analysis: Off key

Robbie Williams is thought be considering his options, another blow for EMI

December 17, 2007
Amanda Andrews

If Robbie Williams decides to leave EMI, it would see yet another big name questioning the need to be backed by a major label.

Paul McCartney and Radiohead have left EMI in the past two years and released new albums without a big backer, and Madonna recently quit Warner Music in a $120 million (£59 million) deal to join the concert promoter Live Nation.

Although news of big acts leaving record labels after long contracts has been viewed as a tragedy for the industry, the truth of the matter is this move is often symbolically, rather than commercially, important to a label.

The real money for record labels comes from new talent, not from the heritage acts.

The likes of Robbie are not cheap to hold on to, and the loss of such artists is unlikely to prove a catastrophe for labels, as long as they are able to hold on to their back catalogues — which is more than often the case.

However, one risk to labels that are blasé about losing such acts is that new talent may be reluctant to sign with a label that has lost its biggest names.

TimesOnLine (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article3063067.ece)

EMI under scrutiny as former artists offer harsh criticism
Posted Dec 20th 2007 by Richard Driver

December has not been very kind to music company EMI Group PLC (OTC: EMIPY) and its new owners, the private equity group Terra Firma, led by Guy Hands. The company has come under fire from former artists like Paul McCartney and Radiohead, and it is now rumored that current artist Robbie Williams is looking to go elsewhere after the release of his next album.

Paul McCartney, that famous Beatle, recorded with EMI for 45 years before ditching the label earlier this year to sign a one-album deal with Starbucks Corporation (NASDAQ: SBUX) Hear Music label, then a new creation. McCartney came out last week and vented his dissatisfaction with EMI, though his comments were about the company before Terra Firma bought a majority holding. In an interview with The Times, the former Beatle "accused EMI of being unimaginative" in the demands that he market the album by speaking to multiple journalists and giving EMI at least six months to market the album. McCartney also bashed the excessive time for marketing by comparing his situation to former band mate John Lennon's success at releasing a song in 1970 within a week of recording it. Reportedly, Guy Hands agrees with these sentiments about EMI under former CEO Eric Nicoli, but that does not change the fact that artists since the takeover have voiced similar concerns.

In the same queue, Radiohead has now come out slamming Terra Firma's policies and pushes at EMI since the takeover. If you remember, Radiohead created quite a stir in the music industry, the blogging world, and news outlets, after announcing in early October to immediately release In Rainbows, the band's seventh album, as a digital download first. Since then, the band has signed deals to release the album physically as a CD, but not with the band's longtime label EMI. The band's guitarist Ed O'Brien recently gave an interview to BBC "claiming that [Terra Firma] do not understand the music industry." Apparently, EMI was the band's first choice to release the album, but the new owners were unwilling to give the band what they wanted, and "didn't understand where a band like us sat on a label like EMI, so they weren't able to give us what we needed." Front man Thom Yorke mirrored these sentiments commenting, "now you're in a situation with private equity firms, [Terra Firma] looks at music as something to buy and then sell on."

It is that statement that speaks directly to the disarray the music industry seems to be trapped in, and that is not because all the companies are owned/managed by private equity firms. The connection between that sentiment and the delay in the music companies realizing that anti-piracy software may have injured sales is obvious. The Digital Rights Management technology is an apparent harmful tactic the labels have taken to prevent consumers, fans from enjoying and sharing music. Unfortunately, that aspect of music is probably the one that the labels should have tried to exploit, rather than selling tracks that consumers could not easily share with one another.

Therefore, the success of Radiohead's ploy is very meaningful. Not only can fans easily share the new album, but the band effectively shared the album with its fans, giving it to them via the "pay-what-you-want" scheme long before the CD before available. If that is not instant gratification, or acknowledgment of the importance of fans, I don't know what is.

Although it is a shame to see EMI under attack like this, especially in light of the fact that the label was the first to fully drop the use of DRM technology, it is not impossible to overlook the statements by major artists. They may have more options in the record industry, but if they can push change and succeed, it opens more doors for emerging and potential artists in the future.

Source (http://www.bloggingstocks.com/2007/12/20/emi-under-scrutiny-as-former-artists-offer-harsh-criticism/)

Robbie Williams Management Not Planning To Renew With EMI

18 December, 2007 Words By CMU

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Robbie Williams

More bad press for EMI generated by the artist community.

Following negative comments about the London based major from former EMI signed artists Radiohead and Paul McCartney, now the manager of one of their biggest current artists - Robbie Williams - has indicated they may look to end their relationship with the record company once their current contractual commitments are done and dusted. And that should be pretty soon because the fourth album of Williams' current four album deal with the major - a second swing album aimed to appeal to the mainstream Robbie fan who was perhaps not so keen on last album 'Rudebox' - is due out in February. A greatest hits album will then follow, before the singer's recording commitments to the major are done.

Speaking to the Daily Telegraph, the co-boss of the company that manages Williams, ie:music's Tim Clark, said: "I would be very wary about signing him to any major label at the moment". Confirming that "all options" were open once their current deal with EMI was complete, Clark added "The internet offers artists opportunities without the need for record labels. What we really don't want is the dead hand of multinational [record companies] throttling these brilliant opportunities".

It's pretty unprecedented for three high profile artists to lay into their record company quite so soon one after the other, though it would be unfair to conclude that the comments made by Radiohead, McCartney and now Williams (albeit him by proxy) are a sign of an artist rebellion against new EMI owners Terra Firma.

True, Radiohead's recent criticism of EMI seems to be aimed very much at the major's new owners. However McCartney was criticising practices at the major pre the arrival of the new top guard, while Clark's recent comments on the artist/label relationship are consistent with what he has been saying for years - and indeed was saying even at the time Williams' last EMI deal was signed. That is that as digital distribution of music becomes the norm artists rely less on the global CD distribution networks that major record companies offer, and therefore become a less integral partner in global recording ventures - especially for those major artists who can secure initial funding from other sources like brand sponsors or venture capital types.

All the recent comments from Radiohead, McCartney and Williams/Clark really stem not from Terra Firma's arrival at EMI but from the power shift currently going on in the music industry between record labels and artists/management. To be fair to Terra Firma chief Guy Hands, his comments since arriving at EMI seem to suggest he recognises that shift more than most and is determined to introduce radical changes at the company to cope with it. Whether those changes will be successful, of course, remains to be seen.

Musicrooms.net (http://www.musicrooms.net/rock_and_pop/robbie_williams_management_not_planning_to_renew_w ith_emi_710.html)

Ninety per-cent of people who download music don't pay for it.

In 2007 more than 750,000 albums were released worldwide (by mostly independent artists via the Internet), compared to 38,000 in 2002.
The Eagles' Long Road Out Of Eden, is available exclusively at Wal-Mart and on the band's website. It has sold two million copies in the U.S. since its release Oct.30, and 1.5 million elsewhere.
Ninety-six per cent of all music revenues worldwide still come from traditional retail sources.


Sources: Billboard Magazine, Canadian Recording Industry Association, Recording Industry Association of America

EMI 'to launch cost cutting regime'
The Press Association

December 31, 2007

EMI's new private equity owners are believed to be planning to impose strict rules on artist signings and make sweeping budget cutbacks at the music group, a has report said.

Terra Firma, which took EMI private in a 2.4 billion deal in September, is said to be launching a cost clampdown, which could see a number of its 5,500 employees axed next year.

The Financial Times reports that the buyout group is also planning to cut marketing budgets by 28 million over the next five years.

The move risks sparking anger among EMI's artists, including stars such as Lily Allen, Robbie Williams and Joss Stone, who could fear that marketing spend reductions would affect record sales.
But the move is thought to be vital for Terra Firma to meet ambitious targets set when the firm bought EMI earlier this year.

Mr Hands is expected to unveil the plans in the new year, according to the FT.

He has already reportedly told staff to submit business plans and secure senior executive approval before signing new artists.

Terra Firma announced a new management line-up at the music label soon after acquiring the firm, with former boss Eric Nicoli and chief financial officer Martin Stewart quitting before the September de-listing.

Terra Firma's Chris Roling took on the post of chief operating officer, while Ashley Unwin was appointed director of business transformation.

Mr Hands also launched a new supervisory board to help steer EMI's 'strategic business relationships'.

Copyright © 2007 The Press Association, All Rights Reserved.

EMI gets ready to ring the changes

EMI's new owner Terra Firma, the private equity firm run by City tycoon Guy Hands, is about to make sweeping budget cuts at the world's third-largest music company in a move to meet ambitious turnaround targets.

The venture capitalist, which took EMI private in a £2.4bn deal in September, is understood to be launching a massive cost clampdown, which could see a sizeable chunk of its 5500 employees lose their jobs next year.

EMI is the only major music label based in the UK and is home to a roster of artists that includes the Black Eyed Peas, Robbie Williams, Norah Jones, KT Tunstall and the Rolling Stones. However, the company's music sales have been hit hard by the rapid rise of digital downloading, the internet and piracy.

The group's last set of annual results showed profits before tax and adjustments fell from £118.1m to a loss of £263.6m.

Terra Firma is also understood to be planning to cut marketing budgets by £28m over the course of the next five years and - in classic venture capitalist fashion - it has reportedly told staff to submit business plans.

Hands, who announced a strategic review a month after completing the acquisition, remained tight-lipped on the options under consideration, but is expected to unveil the plans in the new year.

Terra Firma regards this new plan as vital in its efforts to meet the ambitious targets it set when it bought EMI.

Among the changes to be wrought, the struggling music giant is understood to be set to impose strict new rules on artist signings, all of which are now likely to require senior executive approval.

Meanwhile, Terra Firma announced a new management line-up at the music label soon after acquiring EMI, with former boss Eric Nicoli and chief financial officer Martin Stewart quitting before the September de-listing.

The private equity firm's Chris Roling took on the post of chief operating officer, while Ashley Unwin was appointed director of business transformation.

Hands also launched a new supervisory board to help steer EMI's "strategic business relationships". Meanwhile, as EMI's music sales have suffered, its publishing business saw an increase in full-year underlying earnings, up 4.2% to £105.6m.

The division - which oversees EMI's ownership of song rights - is headed by Roger Faxon, who has remained in place despite the boardroom clear-out.

The company was not available for comment yesterday.

The Herald (http://theherald.co.uk/business/news/display.var.1935296.0.EMI_gets_ready_to_ring_the_c hanges.php)

Terra Firma tightens belts at EMI

It's a harsh start for bands and staff at EMI, where Terra Firma are putting on the pressure in a bid to make its takeover numbers work. The FT is reporting that budgets are going to be cut again.

Part of the new regime will involve business plans being submitted before new artists are signed to the label - which, while sounding sensible, seems a spurious endeavour. How can you produce a business plan that accurately reflects likely business for a band which may or may not chime with public taste? Could someone really perform a meaningful SWOT analysis on, say, Power Of Dreams? Would a business plan for Robbie Williams have suggested moving forward with "the fat dancer from Take That"?

Marketing budgets are going to be tighter, too: the EMI source who spoke to the FT was optimistic this might be a positive move:

However, the person close to Terra Firma said the new approach would benefit artists, many of whom share the cost of publicity.

Well, that's true, of course, but it's not as if there's been much evidence of artist management companies calling for their products to be made less visible in the market place - and for established bands, the marketing of albums is a vital part of their brand value.

So, in effect, EMI is going to make it harder for itself to sign new bands while, simultaneously, pissing off its established acts by reducing support to them. Is that such a very good idea?

In not-entirely-unrelated news this morning, Depeche Mode are considering quitting EMI label Mute, who they've been with since they came out of Basildon with haircuts and Vince Clarke.

Source (http://xrrf.blogspot.com/2008/01/terra-firma-tightens-belts-at-emi.html)

January 4, 2008

Radiohead say OK computer to iTunes
Adam Sherwin, Media Correspondent

Radiohead asked fans: “How much is our new album worth?” when they released their record as an “honesty box” download. The answer appears to be £7.99 after In Rainbows made a surprise appearance on the iTunes digital store.

One of the last important bands not to allow their music to be sold through iTunes, Radiohead have now agreed a deal with the Apple computer giant to release their new material. The deal comes two months after they shocked the record industry by leaving EMI and asking their fans to pay whatever they wanted to download their long-awaited new record. Radiohead refused to release figures for the experiment and denied industry reports that 1.3 million people had taken up the offer, paying an average of £4. The band did confirm that 15 fans had paid the maximum £99.99 ( http://www.cheesebuerger.de/images/midi/konfus/a018.gif) Many more, including Thom Yorke, Raidohead’s lead singer, elected to pay nothing.

Controversially, tracks from In Rainbows can be bought at the standard iTunes price of 79p. Radiohead were one of several bands unhappy that their albums, which they intended to be heard as a body of work, could be sold piecemeal.


At the band’s insistence, their iTunes tracks are in a higher audio quality than most files on the store. The tracks are also free from copying restrictions, so they can be played on almost any digital device and shared on the web. The full album comes with a free podcast and a 15-page digital “booklet”.

Radiohead cut a deal with iTunes after leaving EMI, their long-term record company, in acrimonious circumstances. The group received no payment for digital downloads under their EMI contract. Yorke said: “In terms of digital income, we’ve made more money out of this record than out of all the other Radiohead albums put together.”

Last year Led Zeppelin added their hits to the iTunes catalogue. The solo works of Paul McCartney and John Lennon are also available and a deal to offer the Beatles catalogue through the store is expected this year.

Radiohead, from Oxford, have released In Rainbows as a CD this week, saying that they wanted to see it in the city’s branch of Sainsbury’s. They are on course to top the album chart with first-week sales of 50,000 copies. They have also sold 80,000 boxed sets, with extra tracks, at £40 each.

The band have licensed their music to the online stores 7 Digital and ateaseweb.com, which is releasing In Rainbows as 320kbps MP3 files. This means audio quality will be twice as high as most tracks sold on iTunes .

Yorke used Radiohead’s blog to respond to a report in The Times that the band’s demands for renewing their EMI contract would have cost the company £10 million. He denied that they were seeking a large cash advance and criticised EMI, now under the control of Terra Firma, a private equity company, for “airing [its] dirty laundry in public”. The band had been seeking to regain control of their hit recordings from EMI, a demand that the label refused to discuss.


Have your say

EMI must be made of the most incompetent people. They pay "stars" like Robbie WIlliams 10s of millions for absolutely no meaningful results and they aren't willing to have meaningful negotiations with a band that have 2 albums critically acclaimed to be amongst the best 10 albums in history. Radiohead have a rightfully loyal fan base and I think being outside of a mainstream contract will enhance their work. I love In Rainbow and can't wait til their London concert. Good riddance to EMI!

Aimee Jeans, Oxofrd, England

Good for them. In Rainbows is an amazing album - and if I were a record exec the outright success of this move would make me very nervous.

Ben Morrison, Los Angeles, CA

No matter how high the bitrate is, mp3 isn't the highest available digital quality. That would be a lossless format, such as FLAC, which is exactly bit-for-bit identical to the CD, and can even be better quality than that.

The only reason I paid so little for the digital release is because the format was mp3. If I had a lossless FLAC option i'd have paid more.

Sean Keeney, Cheltenham, Gloucestershire

Source (http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/music/article3126839.ece)

COLDPLAY are the next big-name act expected to join the mounting EMI records exodus.

The quartet’s upcoming fourth album could be their last proper studio effort for the struggling label, who have seen Sir Paul McCartney and Radiohead leave in the past year.

Chris Martin, 30, right, and Co can fulfill their current five-album deal with EMI /Parlophone by issuing a Best Of collection in 2009, thus making the multi-platinum selling act free agents.

A source close to the band said: “There’s so much uncertainty in the record industry right now. The boys don’t necessarily need a label anymore. They aren’t even considering putting pen to paper on any type of new contract until they see what happens.”

EMI endured a tough 2007. As well as losing key acts, the label made cutbacks across the entire company following a takeover.

A label insider said: “They’re not even replacing the staff who have moved on.
“Nobody seems to know what’s happening.”

Last year Sir Paul McCartney, 65, took a parting shot at the company he spent his entire career with, comparing EMI’s reluctance to move into the digital age to “the dinosaurs sitting around discussing the asteroid”. Thom Yorke, 39, also took a swipe at EMI head Guy Hands who claimed that they did not re-sign Radiohead because they wanted too much dosh.

Yorke, 39, said: “We did not ask for a load of cash from our old record label EMI to re-sign. That is a lie. Seems a very strange way for the head of an inter-national record label to be proceeding.”

Even Robbie Williams, 33, is said to be considering other options when his current EMI deal expires. Coldplay are the jewel in EMI’s rusting crown.

They are so important to the company that when the band delayed the release of their last album, X&Y, EMI’s share price dropped.

But with Coldplay’s last two albums each selling well over 10 million copies around the world, just like Radiohead, they have a loyal and big enough fanbase to allow them to go it alone should they quit EMI.

Coldplay’s new album, whose working title is Prospekt, is due out in May or June.
The boys are plotting a major world tour to accompany what they believe will be their career-defining record.
Drummer Will Champion, 29, described the new Brian Eno-produced record as: “The start of something fresh.”

EMI will certainly be hoping so.

Source (http://www.dailystar.co.uk/playlist/view/25893/Coldplay-to-quit/)

EMI U.K. names new A&R topper
Ames to take over for Wadsworth

By GORDON MASSON
Tue., Jan. 8, 2008

http://i149.photobucket.com/albums/s49/MarianneStockholm/Diverse/RogerAmes.jpg
Roger Ames

Roger Ames will take over EMI's A&R operations in the U.K. and Ireland, replacing Tony Wadsworth, chairman-CEO of EMI Music U.K. and Ireland, who is ankling.
The unit has long been viewed as the backbone of the recorded music company as its U.K. signings have far outperformed U.S. acts.

Wadsworth has been with EMI in a variety of jobs over the past 26 years.

His departure is "part of the ongoing restructuring of EMI Music," according to a statement from the company, which has been undergoing a shakeup since Guy Hands' Terra Firma took over last year.

Ames, who has previously run Warner Music and Polygram, was appointed head of EMI's North American units late last year.

Mike Clasper, a Terra Firma exec, will assume control of all non-A&R operations that previously reported to Wadsworth.

Wadsworth was named chairman-CEO of EMI Music U.K. & Ireland in 2002. He had been president of EMI Records U.K., where he oversaw the signings of Robbie Williams and Coldplay.

In 1993, he was managing director of Parlophone, and during his tenure, the label enjoyed success with acts such as Blur, Radiohead and Supergrass.

Wadsworth joined the company in 1982 and two years later took charge of EMI's entry into the compact disc biz. From 1987-93 he was marketing director at the label.

Wadsworth was chairman of the Brit Awards from 2000-03 and last year became chairman of the British Phonographic Industry. He will relinquish that role.

Source (http://www.variety.com/article/VR1117978680.html?categoryid=19&cs=1&nid=2562)

Artists' ally makes his exit from EMI

· UK chief goes after new owner angers musicians
· Venture capital group determined to cut costs

Owen Gibson and Katie Allen
The Guardian, Wednesday January 9 2008

EMI's UK chief parted company with the troubled record label yesterday in the first stage of a wholesale shake-up by its venture capital owners, becoming the latest victim of the turmoil that has gripped the industry in recent years.

Tony Wadsworth, chairman and chief executive of EMI Music UK & Ireland since 2002, was closely identified with some of its biggest-selling artists including Coldplay, Robbie Williams and Damon Albarn of Gorillaz and Blur.

After 25 years at EMI, he stepped down ahead of an expected restructure, which is likely to spell the loss of other long-serving executives, as Terra Firma's chief, Guy Hands, races to transform the business.

Roger Ames, head of EMI in North America, will take responsibility for A&R in the UK and Ireland, while Mike Clasper, the former BAA chief executive who sits on Terra Firma's board, will assume Wadsworth's other responsibilities.

Hands is expected to announce his strategy for EMI this month, as well as appointing a new chief executive to replace Eric Nicoli, who left in August ahead of the completion of Terra Firma's £2.4bn takeover. He has complained of profligacy in several areas, including over-generous advances for artists, and claimed some stars were not working hard enough.

"The industry, rather than embracing digitalisation and the opportunities it brings for promotion and distribution...has stuck its head in the sand," he said in an email to staff.

Like its rivals, EMI was hit by the impact of digital piracy at the turn of the century and failed to move quickly to take advantage of new revenue streams in live music, which is booming, and merchandising.

While digital sales are now rising, they are not doing so fast enough to make up for the global fall in CD sales. The label was also damaged by an underwhelming 2007 release schedule and has been hit by defections of artists including Radiohead and Paul McCartney.

The former Beatle signed a deal to sell his music through Starbucks coffee shops and complained EMI had become "really very boring". Radiohead released their recent album, In Rainbows, via a download and allowed fans to pay what they liked. Rather than re-signing with EMI for the conventional release that followed, they signed with independent label XL.

The group's singer, Thom Yorke, accused EMI's new management of acting like a "confused bull in a china shop".

"What we wanted was some control over our work and how it was used in the future by them - that seemed reasonable to us," he said. "Mr Hands was not interested. So neither were we."

Coldplay, who will this year release their fourth album of a five-album deal, could be next to consider their future.

Hands is convinced he can dramatically cut costs at EMI while boosting profits with new revenue streams and remodelling its relationships with artists. Shortly after buying the company, he said EMI was a "classic example" of Terra Firma's strategy to "look for the worst businesses we can find in the most challenging sector".

Terra Firma is clamping down on costs by limiting new signings and spending on marketing. It is expected to cut jobs.

Paul Williams, editor of the industry magazine Music Week, said Wadsworth's departure was a "sad loss" for the UK music industry. "Tony Wadsworth is somebody who is very, very well liked by the artist community and they see him as a decent, honest bloke. So anyone else coming in, particularly somebody from outside the music industry, has got to establish a trusting relationship and obviously that is not there at the moment."

GuardianUnlimited (http://www.guardian.co.uk/media/2008/jan/09/digitalmedia.ventureproduction?gusrc=rss&feed=networkfront)

Shake-up starts at EMI with departure of UK chief
Amanda Andrews and Adam Sherwin
January 9, 2008

Guy Hands began his expected shake-up at EMI yesterday when the music group announced the departure of Tony Wadsworth, the chairman and chief executive of EMI Music UK & Ireland.

Mr Wadsworth’s fate was sealed after a disastrous performance for EMI’s domestic roster last year. The company’s share of the albums market slumped from 16 per cent to 9 per cent. Universal Music, its rival, secured almost 50 per cent of sales through artists including Mika and Amy Winehouse.

Further announcements from EMI on the restructuring are expected within weeks. Significant job cuts are expected to be high on the agenda.

Roger Ames, EMI’s North America boss, is set to take over A&R, which involves finding, signing and promoting music acts, while Mike Clasper, appointed by Mr Hands’s Terra Firma private equity firm, which took over EMI in a £2.1 billion deal last year, will handle operations.

Sources close to Terra Firma said that Mr Ames’s “deep international outlook” made him a clear candidate for the role. EMI has struggled to make a number of its British acts, including Robbie Williams, a success in the lucrative American market.

Mr Wadsworth’s departure could have wide repercussions. He has been a key link between artists and the company’s corporate structure, nurturing long-term relationships with stars such as Williams, Damon Albarn and Coldplay. Tim Clark, Williams’s co-manager, has said that the star, who has sold 55 million records, may leave the label when his present contract ends.

Mr Ames began his career at EMI in 1975, before running the PolyGram and Warner labels. He was appointed head of EMI Music North America in April 2007.

In a declining market, no new album by an EMI artist released in 2007 made the top 50 sellers of the year, an unacceptable performance for the new regime at the music group, already concerned at the expenditure lavished on artists.

EMI’s hopes for this year rest on new albums by the Verve, Corinne Bailey Rae, the Kooks and an expected return by both Coldplay and Williams.

Mr Clark paid tribute to Mr Wadsworth, saying: “Tony was a real music fan and his support for the artists he signed to EMI was whole-hearted.”

From The Times (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article3156308.ece)

McCartney shows support for Wadsworth
Friday January 11, 2008

By Paul Williams

Paul McCartney has exclusively revealed to Music Week he has sent a note of support to Tony Wadsworth following the announcement this week he was leaving EMI.

The pair have had a working relationship stretching back more than 20 years, which included solo McCartney albums such as All The Best, Flowers In The Dirt and Flaming Pie, and Beatles projects including the launch of their entire catalogue on CD, the Anthology series and the hugely-successful 1 best of.

“He’s a mate, Tony,” says McCartney who discloses to Music Week he sent a note to Wadsworth on Thursday, two days after it was announced by EMI the executive would be exiting his role as UK and Ireland chairman/CEO. He would not reveal the contents of the note, but said they were supportive.

McCartney, part of EMI in the UK since The Beatles’ first single Love Me Do was released in 1962, last year put out an album through another company – the Starbucks affiliated Hear Music – for the first time in his career. The album in question, Memory Almost Fall, become a top five hit on both sides of the Atlantic and has subsequently been Grammy nominated.

“It’s not the most comfortable thing to be working in a company when people you know are losing their jobs, so you might as well just look around for something kind of better,” says the former Beatle whose catalogue remains with EMI where he also remains signed for classical projects. “But a lot of the guys [EMI] understood what I was doing.”

After more than 25 years at the major, Wadsworth leaves today, just days before new owner Terra Firma unveils its vision for the company.

MusicWeek (http://www.musicweek.com/story.asp?sectioncode=1&storycode=1032864&c=1)

EMI needs love: does it need Hands?
With a roster of mutinous artists and file-sharing threatening profits, the label's owner may struggle to turn it around, writes Richard Wachman
Richard Wachman The Observer, Sunday January 13 2008

Even as a youngster growing up in Kent, Guy Hands, one of Britain's most successful private equity barons, was interested in what made people tick.

Every Christmas, he would receive the latest edition of the Guinness Book of Records from relatives who sought to sate his curiosity. It didn't work. 'The book was never a wholly satisfying read,' he says. 'The records were good for holiday trivia, but I never learnt the answers to the really interesting questions: what drove these people to achieve their records and how did they achieve them?'

Just because Hands is inquisitive about the human psyche, however, doesn't mean he is itching to submit himself to scrutiny. But the 49-year-old multi-millionaire is in the spotlight as never before following his £3bn acquisition of music giant EMI, a record label that boasts such British stars as Coldplay, Robbie Williams, Gorillaz and Blur.

Hands has closed 25 deals since 1994, and only one has failed to make money - the Meridien hotels group purchase, which he completed just weeks before 9/11. However, even friends admit buying EMI was a huge financial gamble. Could it go horribly wrong?

It is probably still too early to say, but Hands is investing in an industry that is reeling from the impact of internet piracy and illegal file-sharing. Digital sales are rising, although not fast enough to offset the loss of income from the global slump in CD sales. And all this in the middle of a credit crunch.

What most intrigues commentators about the deal is whether a hard-headed venture capitalist like Hands can cope with a business in which volatile creative types are vital to future prosperity.

Critics warn that ruthless cost-cutting, staff reductions and the 'bean-counter' approach employed by venture capitalists in other sectors may not work in the music industry. Few other areas of the corporate world are so dependent on a limited number of individuals for generating such a large chunk of cash flow. If artists don't like what is happening they can simply walk - and EMI could end up suffering the media equivalent of a run on a high street bank.

Hands says: 'There is no doubt that EMI is a tremendous challenge, but it is also a huge opportunity, and our success or failure will not be correlated to the markets, but to our ability to effect change, quickly and decisively.'

Well, maybe. Just months after completing the highly leveraged deal, which saw Hands's investment firm Terra Firma borrow £1.5bn from Citigroup, not everyone is singing in tune. Messages from the new boss that artists should work harder, and in some cases for less money, have gone down badly. The label has already been hit by the high-profile defection of Radiohead, who are rumoured to have baulked at being offered a re-signing deal worth just £3m, well below their initial target of £11m. The group have now signed with independent label XL.

Paul McCartney, after describing EMI as 'really very boring', has agreed a deal to sell his music through Starbucks coffee shops. Robbie Williams and Coldplay are reviewing their positions after the resignation of artists' favourite Tony Wadsworth, head of the company's UK music division. A leaked letter records Hands complaining about over-generous advances and contains inferences that not everyone is pulling their weight.

His supporters say he is right to clamp down on the company's lavish spending. They cite the example of executives in the US splashing out £20,000 for candles used in a company-owned LA apartment. One says: 'Artists might sing about the downfall of capitalism, but they like money. And they know that to get it, we must have a viable business plan.'

Hands made his name in the mid-Nineties at the private equity arm of Japanese bank Nomura. A financial whizz kid, he perfected the art of securitisation, a technique he learnt as a trader for Goldman Sachs that involves raising funds against predictable streams of income from an acquired company, allowing the buyer to pay down debt and boost profits.

But what makes him tick? A friend describes him as a 20-hour-day workaholic. 'He doesn't sleep much and often calls employees while on his way to work at six o'clock in the morning. A few years ago, I asked him why he didn't give it all up, as he had made a pile and could easily retire. But he responded: "What on earth would I do?"'

At Oxford he studied politics and philosophy and met William Hague, the former Tory leader who was best man at his wedding. Hands married his teenage sweetheart Julia, who is chief executive of a small hotel chain that they run together. He owns an estate and vineyard in Tuscany, and a comfortable home in Sevenoaks, the town where he grew up.

His father was a reasonably successful solicitor, but Hands was not privately educated: he went to grammar school in Tonbridge. The experience is said to have set him apart from his ex-public-school colleagues in finance; an acquaintance says: 'He is definitely not part of the Mayfair private equity set.' What motivates him more than anything, say friends, is his severe dyslexia. He still reads and writes with considerable difficulty. 'I think that makes Guy feel he still has something to prove,' says one friend.

'He hates people who say "dyslexia is no bad thing, look at all the famous people who have got it". He will not shirk from saying: "I really wish I could read".'

Next week is a big one for Hands as he is due to set out his vision for EMI's future, which could involve job cuts among the 5,500-strong workforce.

Turning the music company's fortunes around will be tough. Its publishing arm, which consists of a huge back catalogue including acts such as the Rolling Stones and Beatles, makes up half of the business and is by far the most profitable arm. But plans to raise money against it via securitisation are impossible while the credit markets are seized up. As a consequence, the scope for financial engineering is limited.

Hands is clearly worried about the state of the world, as illustrated in a letter to Terra Firma employees in which he says: 'There is the very real question of how much this financial crisis will spill into the US and UK. My view is that these economies have been driven by the consumer, who is now up against a brick wall, over-leveraged and with no room for manoeuvre.

'The ensuing reduction in consumer expenditure will mean recessions are inevitable, but will probably be delayed until after the US elections by the lowering of interest rates.' The tone is hardly upbeat.

The CV

Name Guy Hands

Born 25 August 1959

Education Judd's grammar school, Tonbridge; Mansfield Hall, Oxford

Career Trader at Goldman Sachs; head of Nomura's principal finance group; chief executive of Terra Firma private equity

Biggest deals Angel Trains, Odeon, Threshers, Radio Rentals, William Hill

Family Married with four children

Interests Art collecting, wine, Chinese restaurants, Japanese gardening

Source (http://www.guardian.co.uk/business/2008/jan/13/4?gusrc=rss&feed=media)

2000 to go from EMI (http://undercover.com.au/News-Story.aspx?id=3833)
Australia

EMI plans to cut jobs (http://www.thestreet.com/s/emi-plans-job-cuts/newsanalysis/media/10398432.html?puc=_dm)
US

EMI reduces workforce by 36% (http://mashable.com/2008/01/13/report-emi-records-to-cut-workforce-by-36/)
US

EMI restructuring (http://www.paidcontent.org/entry/419-emi-restructuring-job-cuts-dropped-artists/)
US

EMI set to axe 2000 jobs (http://news.sky.com/skynews/article/0,,30400-1300470,00.html)
UK

Tension builds among artists as EMI prepares to cut third of jobs (http://music.guardian.co.uk/news/story/0,,2240520,00.html?gusrc=rss&feed=39)
UK

EMI staff wait (http://www.digitalmusicnews.com/stories/011307emi)
UK

EMI reportedly cutting 2,000 jobs (http://www.iht.com/articles/2008/01/14/business/14emi.php)
Asia

Hands in 200m GBP bid to get EMI on song (http://www.thisismoney.co.uk/investing-and-markets/article.html?in_article_id=429362&in_page_id=3&ito=1565)

Marketing to suffer at EMI (http://www.brandrepublic.com/login/News/776399/)
US

Kylie Minogue threatens to quit EMI -It's turning into a terrible year for the major label (http://www.soundgenerator.com/viewArticle.cfm?ArticleID=18424)

Music Firm EMI Reportedly Cutting Jobs (http://www.npr.org/templates/story/story.php?storyId=18067875&ft=1&f=1004)
US

EMI to trim workforce (http://www.smartmoney.com/bn/index.cfm?story=20080114090436)
US

EMI slashes 2,000 jobs (http://www.p2pnet.net/story/14639)

EMI job cuts to be revealed
15 jan 2008

Staff at music giant EMI are expected to discover how many jobs will be lost as part of a restructuring by the label's new private equity owner.

Terra Firma, which bought EMI for £3.2 billion last summer, is reportedly planning to cull up to 2,000 of the firm's 5,500 workforce.

Also reportedly included in the revamp are cutbacks in marketing, administration and artists' advances and the closure of some of the group's 40 labels.

EMI - whose artists include Coldplay, Robbie Williams and Joss Stone - has been struggling with falling CD sales across the industry due to the rise of digital downloading and piracy. The company made pre-tax losses of £263.6 million last year.

Terra Firma's chief executive, financier Guy Hands, has indicated the job losses at the company were likely to fall mainly in the company's recorded music division, which employs around 4,400 people.

He has signalled plans to cut back around 400 middle managers and hundreds of other marketing and administration staff.

Mr Hands will reportedly reveal the plans at a meeting at the Odeon cinema in Kensington - not far from the record company's Hammersmith headquarters.

Staff as well as artists and their representatives have been invited.

The plans to cut costs across the business have angered many of the group's artists, who have gone public with their complaints.

Radiohead have since quit the label and existing artists such as Robbie Williams are understood to have have threatened to withhold new records and demanded assurances over marketing and distribution.

The Press Association (http://ukpress.google.com/article/ALeqM5hOMZHIxzVY7kK1gzaX9xsRLZOjNg)

The Verve threaten to withhold next EMI album
By Elizabeth Hopkirk, Evening Standard 15.01.08

The Verve are to follow Radiohead, Coldplay, Robbie Williams and Sir Paul McCartney in a protest against their record label EMI.

The band is threatening to withhold its next album until it receives assurances about the troubled company's financial health and a commitment that the record will be marketed competitively.

A delegation of band managers led by Jazz Summers - representing The Verve and Snow Patrol - is due to meet Guy Hands, the new boss of EMI, in Kensington today.

Mr Hands's private equity firm Terra Firma bought EMI for £3.2billion last year and has threatened to slash marketing budgets and cut 2,000 jobs from the 5,500-strong workforce.

He is expected to unveil his plans to staff and the industry at the same meeting. But his approach has angered many of the label's top bands.

Radiohead and Sir Paul McCartney have already walked out in protest, Coldplay are thinking about doing the same and Robbie Williams is on strike.

Now The Verve - who reformed to create their first album since 1997's Urban Hymns - may not deliver it in June as scheduled.

Mr Summers said he would advise the band to do the same as Robbie Williams when he meets them later this week.

"Why would we deliver a record when EMI is cutting back on the marketing and is in financial difficulty? I am going to tell Guy Hands I want assurances," said Mr Summers.

He was angry that Mr Hands wants to reduce the advances paid to artists, saying: "He has not got a clue of what this business is about. You only have big advances because you are not getting any royalties."

He said performers could sell as many as three million albums without seeing a single royalty payment because the value of CDs has fallen while marketing and distribution costs have risen.

Yesterday it emerged that Mr Hands had sent a placatory note to EMI artists and agents but failed to conceal their email addresses in the "bcc" blind copy box. Consequently they can all now co-ordinate their protests. :D

Hands accused the music industry of "burying the creative process in bureaucracy" and pledged to move away from a reliance on CD sales from a huge roster of artists, many of them loss-making.

Yesterday he managed to secure another £250 million from investors in return for 16 per cent of the equity.

It also emerged that he had pumped £200 million more of Terra Firma's money into buying EMI than originally intended.

As the credit crunch began to bite in the summer, Citigroup asked him to increase his equity stake from £1.3 billion to £1.5 billion.

ThisIsLondon (http://www.thisislondon.co.uk/music/article-23432450-details/The+Verve+threaten+to+withhold+next+EMI+album/article.do)

January 15, 2008

EMI to cut 2,000 jobs in £200m savings drive

EMI's new owner, Terra Firma, confirmed this morning that it will cut between 1,500 and 2,000 jobs and strip out many of the functions previously given to the company's record labels, including Parlophone in Britain and Capitol in the United States.
The private equity firm's plans, which will see nearly a third of the music major's workforce lose their jobs, are aimed at eliminating "significant duplications" to save £200 million a year.

One-off costs of achieving the savings were not detailed today. These could amount to £100 million, assuming an average severance cost of £50,000 per employee.

Terra Firma will spend today selling its plans to the company's artists after this morning meeting with its employees to discuss today's announcement.

Guy Hands, chief executive at Terra Firma and chairman of EMI, said today: "We believe we have devised a new revolutionary structure for the group that will improve every area of the business".
Terra Firma bought EMI for £2.1 billion last year, at a time when the company was losing market share in a weak market. The private equity owner now wants the record labels to focus on finding new acts and handling artists, while marketing, sales and other functions are centralised on a country-by-country basis.

It hopes that the new structure will be more artist-friendly. The company also wants to help develop as yet unspecified "enhanced digital services" and corporate sponsorship arrangements.

Source (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article3189593.ece)

EMI to axe 2000 jobs (http://www.yorkshirepost.co.uk/businessnews/EMI-to-axe-2000-jobs.3673292.jp)
Yorkshire Post

Extracts:

"The restructuring is also expected to lead to a worldwide headcount reduction within the group of between 1,500 and 2,000."

Financier Guy Hands, Terra Firma's chief executive and EMI group chairman, has already signalled that around 400 middle managers faced the axe, as well as hundreds of other marketing and administration staff.

He said today: "We have spent a long time looking intensely at EMI and the problems faced by its recorded music division which, like the rest of the music industry, has been struggling to respond to the challenges posed by a digital environment. "We believe we have devised a new revolutionary structure for the group that will improve every area of the business.

"In short, it will make EMI's music more valuable for the company and its artists alike. The changes we are announcing today will ensure that this iconic company will be creating wonderful music in a way that is profitable and sustainable."


EMI to axe jobs (http://news.independent.co.uk/business/news/article3339738.ece)
The Independent, UK

EMI to cut jobs (http://www.mirror.co.uk/news/topstories/2008/01/15/emi-to-cut-2-000-jobs-89520-20286764/)
The Mirror

EMI to axe up to 2000 jobs (http://www.24dash.com/news/Communities/2008-01-15-EMI-to-axe-up-to-2-000-jobs-to-save-200m)
24dash

Many more links but all the same http://www.cheesebuerger.de/images/midi/frech/a048.gif

EMI In Staff Cut Drama…..Blame The Downloaders!
January 15, 2008

EMI have just announced the loss of around 2,000 jobs due to restructuring after a takeover, which will force the sales, distribution and marketing divisions together. According to the official spokesperson this is, ‘to allow EMI to focus on uncovering new talent’.

As one of the major record companies in the UK with a pay roll of 4,500 staff, the loss of these 2,000 will bring huge problems to the industry. As is often the case with all problems in the music industry, it is apparantly our fault for downloading illegally. This isnt the first time EMI have been in trouble however. Last year Radiohead quit the label after claims the management was acting like, ‘confused bulls in a china shop. Sir Paul McCartney also quit the label over bad management. Is this just the latest in a series of errors that could ultimately condemn EMI? It certainly looks like it!

High profile bands such as Coldplay, The Verve, Robbie Williams and Snow Patrol are all threatening to hold back material until EMI prove they are financially stable. Snow Patrol manager, Jazz Summers, is leading the protest and has lashed out claiming EMI, ‘has not got a clue what this business is about’.

Its bad enough that these bands cannot get the support that they need to fuel their material, but the record industry blaming consumers of killing them off when they are blatantly ripping us off? Currently in the UK we pay 35p a track more than American downloaders when buying off Itunes, CD’s costing £3 to make are being sold to us at up to £15 upon release and the smaller bands aren’t getting any support in publishing themselves so it is impossibvle to find their music. Maybe if the music industry looked after the consumers a bit better, the consumers would look after them.

1 response so far
becky20 // January 15, 2008 at 2:29 pm
If they lowered the prices of CD’s to about £3 i’d buy them even if i could download them for free. Sometimes us silly teenagers get obsessions with collecting and owning things from our favourite artists, that just cant be satisfied the same by downloading.

Wordpress.Com (http://glamjournos.wordpress.com/2008/01/15/emi-in-staff-cut-dramablame-the-downloaders/)

Terra Firm's Hands Confirms EMI Cutbacks

January 15, 2008

As expected, Terra Firma head Guy Hands announced today in a webcast that major cuts are coming to EMI Music, as one of the big four record labels will lay off between 1,500 and 2,000 employees, pull back on marketing and drop a number of its artists.The Wall Street Journal reports that Terra Firma hopes to save up approximately $391 million a year via the cutbacks.

EMI will consolidate its marketing, sales and distribution divisions into one department over the next six months. "We have spent a long time looking intensely at EMI and the problems faced by its recorded music division which, like the rest of the music industry, has been struggling to respond to the challenges posed by a digital environment," Hands said, according to Reuters. "The changes we are announcing today will ensure that this iconic company will be creating wonderful music in a way that is profitable and sustainable."

In an internal memo from Hands acquired by FMQB, he outlines his concepts for the new strategy at EMI, focusing on A&R, music services ("delivering music products and services for today's consumer") and support/operational services.

According to the memo, Hands has created a Music Management Board, dividing duties into those three categories. For A&R and the label end of things, Roger Ames, head of EMI Music in the U.S., has already added the U.K. to his duties. Jean-François Cécillion will oversee the rest of the globe. Global Creative Officer Billy Mann and Caryn Thompson, SVP of Artist Relations, will fall under this division as well.

Mike Clasper will head up the "music services"/business aspect of EMI, with Mark Hodgkinson as EVP of Global Marketing. Ronn Werre, President of EMI Music Marketing, will also add Global Sales duties. David Kassler, EVP of Artist Projects will be a part of this division, as will Stephen Alexander, in the Studios and Archives department.

Under "support/operational services," Chris Roling remains Group CFO and will oversee regional CFOs. Pat O'Driscoll will oversee program management. The Music Management Board will meet with Hands, who will be Chairman of the Board, on a monthly basis.

In the memo, Hands calls the board appointments "a first step in a wave of re-organization and re-appointments which will move through EMI Music over the coming weeks and months." He adds that "detailed plans regarding the impact of the restructuring at an individual level are not yet finalized, although these plans are being progressed as a matter of priority."

Hands is expected to spend more on artist development, but less on overall marketing. One anonymous EMI executive told the Los Angeles Times, "The status quo hasn't exactly worked. We can put the emphasis on a good-quality record that doesn't sell a million, but a profitable quarter of a million." EMI will also focus on creating more profits from their massive back catalog, as it has been reported that half of the label's profits come from acts such as The Beatles and the Rolling Stones.

It is also expected that Hands will eliminate EMI's current incentive plan for managers, which is based on album shipments instead of sales, with a new bonus plan based on company profits.A number of EMI acts' managers are unhappy with Terra Firma and the changes at the label, and planned to meet with Terra Firma today to discuss their complaints, according to the Journal. The managers, including U.K. superstar Robbie Williams', are worried about plans to "centralize" marketing of artists, which could affect international promotion.

Source (http://www.fmqb.com/Article.asp?id=549918)

EMI to Cut Up to 2,000 Jobs

By JILL LAWLESS – 15 jan 2008

LONDON (AP) — Paul McCartney has gone on the run, Radiohead has fled and Coldplay is getting cold feet.

EMI, the storied home to The Beatles and The Rolling Stones that was taken over by a private equity firm last year, announced Tuesday it would cut about a third of the company's jobs in a restructuring plan aimed at reassuring its restless artists, countering plummeting CD revenue and saving 200 million pounds ($400 million) a year.

London-based EMI Group PLC said sales, marketing, manufacturing and distribution would be combined in a single global division as part of a "fundamental restructuring" of its recorded music unit. The changes will entail the loss of 1,500 to 2,000 jobs from the current work force of 5,500 over the next six months.

"We believe we have devised a new revolutionary structure for the group that will improve every area of the business," said Chairman Guy Hands, who led the 2.4 billion pound (then $4.9 billion) takeover of EMI last August.

EMI said the overhaul would allow its labels, which include Capitol and Virgin, to spot and sign new artists and better handle existing ones.

The company has a lucrative music publishing division that owns the rights to 1 million songs, and a roster of recording artists that includes the Beastie Boys, Norah Jones, the Spice Girls, the Rolling Stones and Kylie Minogue. But McCartney and Radiohead, two of its biggest acts, have left in the past year, while others — including Coldplay — have expressed unhappiness with the label.

In part, the artists' unease reflects an industry reeling from the long-term decline of CD sales and the rise of digital and online music distribution. Hands acknowledged that EMI, "like the rest of the music industry, has been struggling to respond to the challenges posed by a digital environment."

But industry experts say the other major labels — the Sony Corp. and Bertelsmann AG joint venture Sony BMG Music Entertainment, Vivendi SA's Universal Music Group and Warner Music Group Corp. — have weathered the storm better than EMI, which reported a net loss of 288.5 million pounds for the year ending March 31, 2007.

One problem is EMI's persistent weakness in the United States. Many of the label's big British acts, including Robbie Williams and Lily Allen, have failed to make a splash in the U.S.

"If you have got a company unable to break acts at all in the biggest market in the world, then you are going to be struggling," said Paul Williams, editor of Music Week magazine.

Musicians' discontent with EMI has grown since it was bought by Terra Firma Capital Partners, which snapped up the company when a deal with its recurrent suitor Warner Music Group fell through. Hands — a financier with no music business background who made his fortune investing in everything from pubs to waste management — has rebuffed suggestions that he overpaid, telling the Financial Times this week that Terra Firma was a "contrarian investor" with a history of proving its critics wrong.

But he won few friends among musicians by suggesting that he would drop artists who were not working hard enough. In a November memo to staff, Hands said that in the future the company would be "more selective in whom we choose to work with."

Radiohead ended its long-term contract with EMI in the fall, releasing its latest album, "In Rainbows," through the band's Web site. Guitarist Ed O'Brien told The Observer newspaper in an interview published last month that Terra Firma executives "don't understand the music industry."

Coldplay reportedly is considering leaving EMI after the band releases its fourth album later this year, and the manager of British star Robbie Williams said last week that Williams might not deliver his new album to the label.

"We have no idea how EMI will market and promote the album," manager Tim Clark was quoted as saying by The Times of London. "They do not have anyone in the digital sphere capable of doing the job required. All we know is they are going to decimate their staff."

EMI promised to focus more resources on A&R — artists and repertoire, the company's talent-spotting division — and to help artists "monetize the value of their work by opening new income streams such as enhanced digital services and corporate sponsorship arrangements."

Some analysts have suggested that EMI's turmoil reflects a permanent change in the industry, and that the digital revolution — with its myriad ways of buying, selling and sharing music — has made traditional record labels increasingly irrelevant.

McCartney left EMI last year after more than four decades, releasing his latest album, "Memory Almost Full," through Hear Music, the label backed by the Starbucks coffeehouse chain. Traditional labels, the former Beatle said in October, were "boring and jaded."

Also in October, Madonna left her longtime label at Warner and signed a $120 million recording and touring deal with concert promoter Live Nation Inc.

But Peter Ruppert, who runs music consulting group Entertainment Media Research, said record labels still had a future.

"There is a lot of talk about artists looking for a new approach, going on their own," Ruppert said. "That is great for artists that are established — they have a completely new world in front of them. But that is not how you get there. There has to be a music company that takes care of you and helps you to get there."

Associated Press (http://ap.google.com/article/ALeqM5hKyPnljuQ5iBHC41oVE0QaCPBWNgD8U6G94G0)

From The Times
January 18, 2008

The Guy to save the music industry?

The new boss of EMI is arrogant and cackhanded; but the record labels need to be shaken up

Pete Paphides

It might just be that there's a side to Guy Hands that, so far, has yet to be represented in the reports about his takeover of EMI. As the beleaguered record company attempts to manage a freefall in morale, you find yourself attempting to squeeze out a teaspoon of sympathy for the venture capitalist from Terra Firma. In these difficult times for the music industry, Mr Hands's business acumen surely can't hurt, can it? Well no. But without an understanding of the main commodity - musical talent and the egos and insecurities that go with it - EMI's new owner has landed himself a far bigger task than he may have imagined two months ago.

But he must surely be learning fast. Radiohead and Sir Paul McCartney have left EMI. Robbie Williams and the Rolling Stones appear to want out. Coldplay are said to be closely watching the situation. Only superannuated metal relics Iron Maiden have taken the opportunity to assure everyone that they would be pledging their support to the company - a declaration that sounded suspiciously like a plea for mercy from the new regime.

At Mr Hands's recent powerpoint presentation to staff, sources say that the frosty reception was accentuated by the half-hearted applause of “maybe four or five people at the front”. Nevertheless, once you had decoded the corporate jargon it was hard to deny that Mr Hands's presentation touched on a few key truths. In words that will surely have tumbleweed of portent blowing through Iron Maiden's tresses, he said: “One of the issues we will be addressing is the sheer size of our roster. In the past, we have followed the industry model of signing up as many artists as possible, while taking huge bets on a few.”

Big labels have been working to a business model left over from the days when even their unsuccessful artists could expect to sell 50,000 copies of an album. These days, any singer-songwriter who shifts that amount is doing well. But major labels still like to invest big if they think they stand any chance of recouping that investment. Once a band makes it, the label maximises its profit, preferably by making them tour one album for three years rather than having them release two more, potentially unprofitable, albums annually. But CD sales are in such decline that even this way of doing things doesn't work.

Whatever anti-piracy measures a record company implements before an album's release, people can still get a decent counterfeit copy from illegal file-sharing sites. Once, the enemy was the T-shirt vendors outside the venues or the record fair bootlegger. Now, by selling freshly burned official “bootlegs” as soon as a gig has finished (usually £15 a throw), the companies are moving in on this patch.

The music industry knows it needs a new business model. The current buzzphrase is the 360-degree deal, the direction that EMI is likely to take. Instead of record companies just making recording deals with artists, a 360-degree deal is one in which the label gets a share of the more lucrative merchandise and tour revenues. Whether it is resourceful or mercenary, Mr Hands will tell you that an extant business is better than no business at all.

Budding artists looking for their big break, need to ask themselves what they feel about this stuff before crossing the corporate threshold. They also need to ask what do they want? Fame - or merely the chance to get their music heard, without the ego-fluffing paraphernalia that goes with it? If Simon Cowell can be said to have had one genius idea in his life, it's to realise that, at their crudest, big record companies are stardom brokers - milking the novelty value from a never-ending stock of fame-hungry young singers. And as long as people want to be pop stars, these labels will adapt, not disappear.

Perhaps that's how EMI will proceed: as a fame factory. But if it did it would lose something important. The reason to sign the money-spinning pop acts - if necessary, on 360-degree deals - is that they help to subsidise the acts that set a label apart as an art-based enterprise rather than a run-of-the-mill company.

In the 1960s, Polydor had both James Last and the Velvet Undergound. In the 1980s, Columbia had both Bros and Leonard Cohen. What is Mr Hands going to do with prestigious loss-leaders such as Kraftwerk, who for 20 years have been turning up to their Düsseldorf studio to work on material that may never see the light of day?

On any big label, there are artists that are kept to show other would-be musicians that this is a good place to be creative. Mr Hands's PR gaffes have been bad enough, but when key EMI staff such as the CEO Tony Wadsworth - arguably Britain's most proven nurturer of musical talent - start to walk, a tough job becomes almost impossible. (At Mr Wadsworth's leaving party earlier this week, Radiohead revealed their allegiances by showing up.)

Once a big company loses those acts, it also loses any remaining reason for new artists to consider signing with it. That's why artists are already turning to smaller labels to manage their music. Domino - home to Arctic Monkeys and Franz Ferdinand - is a good example of a label that cuts its cloth according to realistic expectations of what an artist is likely to achieve. Low-selling artists are encouraged to hold on to their day jobs, but have their modest recording costs paid for; while a group such as Arctic Monkeys has a global marketing strategy mapped out for it.

Perhaps Guy Hands has something similarly flexible in mind for EMI. If so, he has a funny way of showing it. In his presentation, he said that “the most important thing we can do as an organisation and as an industry is to...get consumers to pay [for music].” The madness is that, more than any other band over the past decade, Radiohead built up trust with their fans by making music that meant a lot to people, music that fans were willing to purchase. That's why they were worth the millions that Mr Hands didn't give them.

It's not that all of his ideas are awful. Rather, it's the arrogance of their execution that seems set to trigger an exodus.

Pete Paphides is chief rock critic of The Times

TimesOnLine (http://www.timesonline.co.uk/tol/comment/columnists/guest_contributors/article3207048.ece)

The music industry knows it needs a new business model. The current buzzphrase is the 360-degree deal, the direction that EMI is likely to take. Instead of record companies just making recording deals with artists, a 360-degree deal is one in which the label gets a share of the more lucrative merchandise and tour revenues. Whether it is resourceful or mercenary, Mr Hands will tell you that an extant business is better than no business at all.
I think someone needs to remind The Times that EMI has already taken that direction with Rob's contract way back in 2002. He is the one that started this whole 360 degree deal that every major artist is signing today. Give credit where credit is due. Rob once again was waaaaay ahead of his time.

EMI made one HUGE mistake and that's letting Tony Wadsworth go. With that they lost any trust and credibility they already had very little of from artists and others.

'Dyslexia has driven him ... he is forced to look at the key points of the business and the way the numbers work '

Richard Wray The Guardian, Friday January 18 2008

When Guy Hands arrived at the Odeon cinema in Kensington, west London, earlier this week to unveil his plans for his latest acquisition, EMI, to staff he found himself surrounded by TV camera crews and reporters and had to be manhandled into the building by security. "That was all rather rock'n'roll," remarked his minder.

It also seemed a long way away from the sombre world of the City's moneymakers in which the 48-year-old normally moves as head of his investment group Terra Firma. But that is Hands, who has amassed a personal fortune estimated at more than £200m from buying up underperforming companies; he has never shied away from publicity.

His rotund 6ft frame, untidy hair and often unkempt appearance give him the air of an over-stuffed Winnie the Pooh. But he is a bear with teeth and much more than a little brain. A workaholic - he often works 18-hour days, clocking up further hours at weekends, and expects no less commitment from his staff - he is driven and occasionally ruthless. "He is very tough, you have to get things right and when you don't you are told about it," says a long-term colleague.

Some of his friends believe the fact that he is quite seriously dyslexic has both driven him to succeed and helped to develop his investment strategy. It caused him to be written off in his early school days in Berkshire as stupid - he proved his detractors wrong by gaining a place at Mansfield College, Oxford.

"At the risk of dropping into amateur psychology, the dyslexia has driven him," says one friend. "He cannot read very long papers setting out investment rationales, so what he is forced to do is look at the key points of the business and the way the numbers work - which he can read very well.

"Then, rather than think things through to the 'nth' degree, there's something in him which instinctively sees things differently from other people. If there is a genius in there it's seeing things that other people don't. Now whether that's the dyslexia or just that he's a very clever man, who knows."

One of his first deals, when he worked for the Japanese bank Nomura in the 1990s, was to buy Angel Trains, a rolling stock company, from British Rail. He was the only external bidder and his move was greeted with incredulity in the square mile. He sold it at a £390m profit.

He then started buying pubs when the rest of the market would not touch them and changed the way the industry works, briefly becoming the UK's largest pub landlord. He missed out on one of his most headline grabbing stunts, a £105m bid for the Millennium Dome, but all told, during his time as head of Nomura's Principal Finance Group from 1994 until he set up Terra Firma in 2002, he made his bosses an estimated £1.5bn profit and several investments have rolled over into his new venture.

"If Guy had gone on to become a politician enjoying the success he has as a private equity investor, he would surely have become prime minister by now," according to William Hague, who became friends with Hands at university and was his best man when he married his childhood sweetheart, Julia, in 1984.

Hands, who has four children, now has an estate in Tuscany that produces wine and olive oil, a hotels business, and Winston Churchill's former house in Sevenoaks. But some of his business acumen appears to have failed him when it comes to personal investments. A £50m investment in the Rockingham motor racing circuit in Northamptonshire turned sour, while a bizarre project to make a movie about a pub owner who finds a giant shrimp washed up on the beach and teaches it to box led him to sue his financial advisers.

The fight which Hands now has is with some of the leading figures in the music business. As he looks to cut costs at EMI - axing 2,000 staff or a third of the workforce in the process - he also has his eyes on slashing the huge advances paid to artists. He made similar cost-cutting moves after he bought the cinema chains Odeon and UCI, stopping executives from attending glitzy film premieres with the admonition that they worked in the popcorn-selling business, not Hollywood.

Tension between the acts and "the suits" is rising. Robbie Williams is withholding his next album and his manager, Tim Clark, recently compared Hands to a plantation owner. Yesterday, the Rolling Stones , who signed with EMI in 1977, announced that their next album, a live album to accompany Martin Scorsese's Shine A Light concert documentary, will be released by EMI's rival, Universal.

Radiohead have also left EMI, amid arguments over the control of their digital rights, with their frontman, Thom Yorke, accusing Hands of behaving like "a confused bull in a china shop".

"We are not a bull in a china shop," retorts Hands. "What we are doing is trying to build a business that gets back to its former glory. To do that we are clearly going to upset a few people, but we are not in a popularity contest."

Music industry insiders complain about Hands's lack of experience in the industry. His own tastes are confined to the usual rock acts beloved of the middle-aged: he is a fan of Meat Loaf, for instance.

His teenage daughter, however, recently got him into Lily Allen and he was at the O2 arena for the first night of the Spice Girls reunion and could be seen singing along. He is rumoured to have the largest karaoke collection in the UK. "I don't know whether that's quite right," says a friend. "But he does have a bloody great big karaoke machine." And his favourite tune? "He likes singing My Way." Naturally.

The CV
Born August 27 1959 in Kent to Christopher and Sally Hands

Family Married Julia Caroline Ablethorpe in 1984; has two sons and two daughters

Education Judd School, Tonbridge; Mansfield College, Oxford

Career Head of Eurobond Trading, Goldman Sachs, 1982-94. Founder and MD of Principal Finance Gp, Nomura International plc, 1994-2001, where he made his name and set up the Principal Finance Group

Source (http://www.guardian.co.uk/business/2008/jan/18/privateequity.musicnews?gusrc=rss&feed=media)

Guy Hands' EMI challenge: A new spin on the business of selling music

ERIC REGULY
January 18, 2008

ROME -- Guy Hands, the British private equity baron, could monetize anything. He effectively did with urine.

In 2004, his Terra Firma Capital Partners, one of Europe's biggest private equity shops, bought Autobahn Tank & Rast, the German highway service station operator. The first thing Mr. Hands did was plow a fortune into toilet refurbishment. Motorists "are much more likely to stop at a service station if the toilets are clean," he told his investors, which include some of Canada's top pension funds.

The plan didn't stop with gleaming porcelain. He charged motorists a small fee to use the new toilets. In exchange, they received a coupon that could be used against purchases of food, coffee, maps and the like in the store. This amounted to a triple win: Terra Firma got a revenue stream from the urine stream, boosted store sales and increased overall customer traffic.

Terra Firma paid £1.1-billion ($2.23-billion) for Tank & Rast. Last year, it sold half of the company for about £909-million. It's an impressive return for three years' work.

The question is whether Mr. Hands, 49, can work the same magic on EMI Group, the ailing British music company he bought last year for £3.2-billion, including debt. He first considered buying EMI in 1995, when he left Goldman Sachs to join Nomura (Terra Firma was spun out of Nomura in 2002). Beware what you wish for, as they say.

EMI, the former Electric and Music Industries whose roster included the Beatles, Queen, Sex Pistols, Coldplay, Robbie Williams and Gorillaz, is a mess and no one would agree more than Mr. Hands, who loves music, maybe because he's dyslexic and has trouble reading. This week, Terra Firma announced a "fundamental restructuring" of EMI. The highlights include the elimination of as many as 2,000 of the company's 5,500 jobs and a cost reduction goal of £200-million.

The turnaround plan goes beyond blowing bodies out the door. EMI's CD sales, which are so poor that it has been scrapping 20 per cent of the discs it produces, point to a music market battered by piracy and illegal downloads. Over all, EMI lost £288.5-million in the year to the end of March, 2007. Its British market share fell to 9 per cent last year from 16 per cent, and its global ranking, measured by market share and revenue, fell to fourth spot (behind Universal, Sony BMG and Warner) from third in 2006.

Mr. Hands wants to reinvent the music-selling business model. But what will work?

He gave a few clues this week to EMI's frightened employees. Some of what he said made sense; the rest fell into the vague "trust me, I know what I'm doing" category.

What made sense was the plan to refocus the company on the relatively few money-making artists. Incredibly, EMI has 14,000 artists in its roster. Just 200 account for more than half of the sales. More than 30 per cent have never produced an album and EMI spends £70-million a year on artists who make no money for the company. The dud-to-hit ratio is high, Mr. Hands thinks, in good part because only one in 20 employees for the EMI labels works in A&R (artists and repertoire). The new EMI will devote many more bodies to scouting and musician development, many less in other services.

So far, so good. Now for the vague bits. Mr. Hands said EMI needs to develop "a new partnership with artists" to help them "monetize the value of their work by opening new income streams such as enhanced digital services and corporate sponsorship." All intriguing, but isn't that what all music companies want to do? As for corporate sponsorships, that's not exactly a new idea. In 2006, American Express sponsored the Rolling Stones' Bigger Bang tour. Maybe Mr. Hands wants a tighter relationship between the sponsors and the bands. The Amex Rolling Stones? Coldplay by Maytag?

Some of the big-name EMI artists were not impressed. Where Mr. Hands saw a "new partnership," they saw bloody-minded cost cutting. Robbie Williams said he would not record an album in 2008 because he didn't think EMI would market it. Radiohead, which had already left EMI, said Mr. Hands and his Terra Firma buddies were "like confused bulls in a China shop." Paul McCartney left EMI last March, just before Terra Firma took over. The Stones revealed yesterday that their next album, Shine a Light, will be released through Universal, and reports suggested the band and its catalogue of music could leave EMI when the current contract expires this year.

More bands may vote with their feet. Based on the reaction from EMI's artists, Mr. Hands looks doomed. He should not be counted out. Since 1994, he has invested £11-billion in equity in deals worth £42-billion. The vast majority were success stories (the stand-out blunder was the £1.9-billion takeover of the Le Meridien hotel chain in 2001).

Mr. Hands knew EMI was a company in turmoil when he bought it. EMI is failing and there is no doubt the business model has to be overhauled to reflect a market where the CD is not the only way to get to the customer. Just because the plan lacks detail doesn't mean it is a fiction. Remember, this is the man who turned toilets into gold.

globeandmail.com
(http://www.theglobeandmail.com/servlet/story/LAC.20080118.IBREGULY18/TPStory/Business)

From The Times
January 18, 2008

EMI's private equity boss bids for Chrysalis

Amanda Andrews

Guy Hands, the chairman of EMI, the music company, has tabled a bid for Chrysalis, one of Britain’s last big independent music groups.

The audacious move by Mr Hands, whose private equity group, Terra Firma, bought EMI for £3.2 billion last year, follows a tumultuous month for the country’s best-known music company.

Mr Hands announced this week that he was cutting nearly a third of the firm’s 6,000-strong workforce as part of a cost-cutting drive that is aimed at saving the company £200 million a year and creating a “new revolutionary structure” for the business. However, the restructuring of EMI under Mr Hands and his management team has been attacked by some of the group’s best-known artists. Radiohead, the Rolling Stones, Robbie Williams’s management and Sir Paul McCartney have all criticised the company.

The Rolling Stones confirmed yesterday that they had signed an album deal with Universal, a rival music company.

Mr Hands had hoped that he could announce the appointment of a new chief executive at EMI as early as this month, but said this week that he wanted to wait until the cost-cutting drive had been completed before installing a new leader to develop the business.

EMI’s indicative bid for Chrysalis, which owns the music publishing rights to artists such as Blondie, David Gray and much of David Bowie’s early work, follows a decision by Chris Wright, its founder of 40 years, to carry out a review of the business, which could lead to a sale.

Mr Hands, who has also faced personal criticism, with many claiming that he does not understand the music business, said in a memo to investors last year that he saw “potential for consolidation” in the industry.

However, he is facing competition in his bid for Chrysalis. Jefferies International, Chrysalis’s adviser, has also received an indicative bid from Warner Chappell, the music publishing unit of Warner Music. An offer is also thought to have come from Sony/ ATV.

Sources said yesterday that private equity firms and specialist music publishers have also shown an interest. It is understood that Chrysalis received a lot of early-stage interest last month when it held preliminary discussions with a number of parties.

Analysts have said that the group could be valued at more than £150 million.In addition to its music business, Chrysalis also has a struggling CD distribution arm called Lasgo. Chrysalis sold its radio business to Global Radio for £170 million in July and the group has said that it expects to return £96.5 million to shareholders.

Mr Wright said in November that he was sitting on a “jewel of a business” but added that he was sceptical about the prospects of receiving an attractive offer in the present climate.

Marty Bandier, the chief executive of Sony/ATV, is aggressively pursuing deals, although the group refused to comment yesterday.

Others believed to have shown interest in the company include private equity funds Saban Capital Group, GTCR Golder Rauner and Apollo Management, and music publishing specialists Primary Wave and Cherry Lane. However, it is not known if any of these have made a bid.

TimesOnLine (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article3207443.ece)

Man in the News: Guy Hands

By Martin Arnold and Andrew Edgecliffe-Johnson
Published: January 18 2008

http://i149.photobucket.com/albums/s49/MarianneStockholm/Diverse/GuyHands.jpg

After completing his £3.2bn ($6.3bn) buy-out of EMI last August, Guy Hands flew 7,000 miles to Hawaii for a week’s holiday with his family. The deal was sealed only after a tense stand-off with Citigroup as credit markets seized up – and Mr Hands’ beach house might have seemed an inviting place to relax.

Yet hardly anyone could tell he was gone. A round-the-clock team kept him informed of calls to his office as he maintained his pace of working 18 hours a day, staying up to ensure he was awake during European hours.

The 48-year-old’s near-maniacal obsession with work has been a feature of his life since his schooldays. It has rarely been more needed than now. As one of Europe’s last big leveraged deals to be signed before the credit squeeze stalled cheap debt, Terra Firma’s purchase of EMI is being closely watched. Critics believe they already know how the song will end. Mr Hands is the classic example of private equity overpaying in a boom, they say, and then resorting to crude cost-cutting when times get tough.

Indeed, Mr Hands told staff this week that a third of them – up to 2,000 people – will be gone within six months. The news provoked alarm from managers of some EMI artists, such as Robbie Williams and Coldplay, who have threatened to delay albums.

Headlines about Radiohead’s earlier defection and managers’ comments have irritated Mr Hands, but he is adamant that he knew what he was getting into. Terra Firma, he says, is a contrarian investor, which deliberately looks for investments which others have written off. This quest for returns above market growth is more volatile, more elusive and “more scary”, he admits, but has generated internal returns of more than 40 per cent over 13 years.

“EMI looks very risky from the outside,” says Jon Moulton, the Alchemy Partners boss who worked with Mr Hands on several deals including one of his few failures – the buy-out of Le Meridien hotels. “But Guy is a risk-taker and that is to be encouraged. He will either get it right and deserve a knighthood, or lose a lot of money.”

Mr Moulton was Mr Hands’ neighbour in Sevenoaks “until his house started to block out all the light”. Mr Hands, who says his only extravagances are fine wine and CDs, bought the property for £10m in 2001 (his wealth is estimated at £200m). Once owned by Winston Churchill, it now features two swimming pools, a fitness centre and a sauna. Current neighbours say the family’s annual fireworks party outstrips the town’s official bonfire night event. Some of the wine comes from the vineyard on his 1,700-acre Tuscan estate. His other great hobby is photography, yet he has a curiously unsentimental, restless bent. He has said he has taken at least 15,000 slides, got them processed, then never looked at them again.

Mr Hands’ language is peppered with jargon about “monetising” music, yet he is not the slick-suited financier EMI’s staff and artists might have expected. His work ethic and dishevelled blond curls have earned him a spartan image which has helped his case as details leaked out of the excesses of the old EMI.

Mr Moulton sums up these apparently contradictory traits by describing him as “sometimes quite an extrovert and at other times quite an introvert”. Another veteran buy-out boss who has known Mr Hands for many years says the Terra Firma boss is “likeable but mercurial”.

His showmanship was on display this week in a presentation where he appears to have won over some doubters to his view that urgent change is inevitable at EMI and in the music industry. His decision to make his case publicly marks him out. While others in private equity prefer the shadows, Mr Hands has chosen to operate in the limelight.

Those who have known him longest say his personality was forged at The Judd School in Tonbridge, Kent, where he overcame dyslexia to win a place at Oxford university. “I think [this] made him extremely driven, feeling a little like ‘Screw you guys, watch me now’,” one says.

Mr Hands admits that has been a chief motivation in his career, telling the FT: “I am often trying to prove people wrong. EMI is a classic example ... I spent so much time at school either being bullied when I was younger or ridiculed when I was older that I have got pretty thick skin.”

At Oxford he read philosophy, politics and economics and shared a flat with William Hague, former leader of the UK Conservative party and later his best man. He met his wife, Julia, when he was 18. She now runs Hand Picked Hotels and they choose anniversary destinations in alphabetical order. (This year the location will start with “X”.)

His early City career started in 1982 at Goldman Sachs as a trader in floating rate notes before moving to Nomura where he ran the Principal Finance Group. At Terra Firma there are echoes of his trading background: everyone in the dealing-room style office is visible from his desk. Employees are expected to match his work ethic and keep their mobile phones on at all times. “I expect dedication from my team. I start work at six, I get to the office at seven and I leave around midnight. I work weekends too,” he admits.

“He is a tough negotiator and has a hell of a temper,” says a senior banker who has worked closely with him. “He can blow hot and cold really quickly.”

Mr Hands has an impatient manner, interrupting meetings to answer calls about other deals. Someone who has seen him work says: “He rules Terra Firma with a rod of iron, so no one else speaks in negotiations, even if he is accompanied by a team of people, which is unusual in private equity.” Mr Hands describes his leadership style as “blunt, direct and not very tactful”.

Mr Hands’ track record earns respect among his peers. Terra Firma’s maiden €2bn ($2.9bn) fund was rated the top performing European fund raised in 2002, on the back of successful investments in waste management and cinemas. But he has had setbacks, such as a seven-year attempt to transform off-licences, which ended when he sold Thresher for almost no profit.

At EMI, he faces a different waste management job. Although he has long had a love of rock music (and has an enormous karaoke collection) the closest he has come before to applying his skills to a creative business was financing a Crocodile Dundee film. Rival executives remain divided over the EMI deal, yet one says: “Anyone who can get Robbie Williams on the front pages saying ‘This is terrible’ must be doing something right.”

The Financial Times (http://www.ft.com/cms/s/0/77dd10a4-c5f2-11dc-8378-0000779fd2ac.html?nclick_check=1)

Mica Paris: 'When they are gone, I'll still be doing my thing'
The soul singer was reborn as a surprising TV fashion guru. Now she reveals she has quit that job for her first love, music. But did she have a choice?

Interview by Cole Moreton
Published: 20 January 2008

Mica Paris has got a big laugh. She's a big woman with big eyes and big hair that shakes as she laughs out loud at the memory of the day she walked out on EMI Records in a big rage. "I was like, 'Let me tell you something, yeah? When this building's gone, I will still be here. When there's no EMI, I will still be here, doing my thing. Fuck off!'" http://www.cheesebuerger.de/images/midi/froehlich/a023.gif

The laughter is loud because even as we speak – in a recording studio in the Surrey countryside – EMI appears to be imploding. The new owners are holding a meeting with staff in London. It's not funny that 2,000 people will lose their jobs. It's not funny that artists such as Robbie Williams are apparently on strike because of the way a band of venture capitalists has decided to run the label. But for the former teenage soul sensation Mica (pronounced Meesha) Paris, the troubles afflicting her old bosses – and many others in corporate music – must feel like delightful revenge. "Oh my God, honey, hello? It's all going off!" she booms. "The music industry has been ripping off artists for years, ruining our lives. It's time for it to be rebuilt in a clear, correct way." http://www.cheesebuerger.de/images/midi/froehlich/a013.gif

She stormed out of EMI 10 years ago instead of being sacked. "I got up," she recalls. "I walked out. Then I went home and cried. I said, 'Fuck, I've lost another record deal. What am I going to do?'"

Reinvent herself, was the answer. The teenage soul sensation who'd had a massive success with "My One Temptation" in 1989 was seen as past it. The American stardom that had seen her duet with Prince was over. There was bankruptcy and a breakdown to come ... but now, at last, she is just about able to laugh about it all.

She has a sell-out residency at Ronnie Scott's jazz club in London, next show a week today. A comeback single with the soul star Alexander O'Neal out tomorrow will get a lot of air play. Even if it doesn't reach number one, she will be OK. She is famous again at 38. So famous that the tabloids recently reported she had been out for dinner with a friend. That was all. The friend wasn't well known, and nor was the restaurant. The fact was reported anyway, because Paris was deemed worth a story. Why?

The telly. She has been wobbly on Strictly Come Dancing and cooked in the kitchen with Gordon Ramsay two nights ago along with old boyfriend Max Beesley; but the break that led to all this was being picked – from nowhere – with her friend Lisa Butcher in 2006 to host one of the BBC's biggest shows, What Not To Wear. "When I rang my family to tell them, they said, 'Nah! There must be a mistake. Black people don't get that stuff.'"

She only auditioned because Butcher put her up to it. Now, she says, "some of the kids are like, 'Music? She does clothes, doesn't she?'" A silky black blouse with sleeves flapping like wings today, in case you care. A black satin skirt and bare legs. And a whole lot of confidence. The first series trounced former hosts Trinny and Susannah (who had defected to ITV) in the ratings. The critics pounced on the second. The Sun was savage about her size (14), naming the show What Not To Weigh. Others called the new hosts "charmless" and "unpleasant" and said they didn't know about clothes or women's bodies. So what is her response? "I really don't give a damn about what people say, honey. The ratings were good. That's what counts."

Maybe. But a third series has yet to be commissioned. The BBC says it is resting the show for at least year. Paris insists she has quit. So let's be as blunt as a clothes guru in a changing room: she's been sacked, hasn't she?

Oh boy. The look on her face would make one of her dowdy fashion victims weep. "What?" She sits up straight on the leather sofa we're sharing, smoothes down her skirt and stares. "Nah," she says, with a shrug that's pure Lewisham High Street. "It's five months, 14 hours days, five days a week. It's a killer schedule. I can't do it, babe."

She begins to plunge into corporation politics, saying, "Peter Fincham [controller of BBC1 until last year] left and everything changed after that..." Then she backs off. "It's got nothing to do with that. It's me. I was writing a book [called Beautiful Within], doing the music, doing my second baby. I nearly died. It's been a great show, it was good to me, but it's not my future."

People on the street tell her she was great, apparently. "It was never about my fashion sense. It was about the fact I have empathy for people who feel shit about themselves. If you say my clothes look rubbish I don't care, it's just frivolous nonsense," she says, smiling. "I'm a singer." Then the look returns. "If you tell me my voice is shit, I'm going to kill you."

There has never been any question of that, not since the then Michelle Wallen appeared with the Spirit of Watts gospel group as a teenager. She was raised by her strict, devout grandpa, a minister in a Pentecostal church in south London. But music took her away, at just 17, to sign for Island Records. "You had Bono running up the stairs, Grace Jones running down. I just sat there, this little girl, going, 'I like it here!'"

The £100,000 advance bought a flat in Hackney. "They threw loads of money at me." The big hit came straight away. "There were people outside my flat screaming. That's when I realised I was famous and it was too much. I flippin' shit meself.'"

The days of big advances like that are over, the new head of EMI, Guy Hands, said last week. Mica Paris knows what they do to people. "You start thinking, 'They must be right. Why would they be wrong? Yeah, I'm the best. Come on, follow me!'" With that she leaps up and sashays across the studio control room like a hip-swinging, bolshy teenager. "You call all the shots... and you make all the mistakes."

She struggled, away from her mother and sister. "I'm 19 and I'm alone in this amazing apartment in New York, overlooking the Hudson. I'm doing the Letterman show. And I'm the loneliest I have ever been in my life." Her relationship with the record company went bad. Sales dropped. She drank to ease the pressure, put on weight and was told she looked like "somebody with two bodies". Attempts at a return with EMI were frustrated by delays.

The record industry eats its young, it always has – until now. Self-sufficient performers using the internet are scaring the daylights out of big labels. Back in the day though Mica, weren't you supposed to get advisers? "You do, darling," she says. "They end up screwing you over."

The tax bills came in. "I was broke," she says. "Proper." She went bankrupt at 30. "I had a nervous breakdown. I lost my home. I couldn't eat, couldn't think, couldn't talk, but I survived."

Her daughter Monet, is now 16 and at boarding school. The second, Russia Mae, is not yet two. She lives in Chelsea with her mother, who is in a newish relationship she hopes will be the long-lasting one she craves. But she was still in a pretty bad way when something really terrible happened on Valentine's Day seven years ago: her brother Jason was shot dead by a man who had been hassling his girlfriend. "He was 21, so young and handsome. The family was ripped apart."

Broke, grieving and ill, Paris was saved when the singer Chaka Khan – godmother to Monet –asked her to take over as the lead in a West End show. Next a guest spot on Radio 2 led to a series on soul. Then came the telly. Did she mind being voted off Strictly Come Dancing in the second week? "It was a lovely paycheck, baby."

What she really cares about is the new record. The producer is Brian Rawling, who has had hits with Cher and Tina Turner. But it is being bankrolled by a group of fans who are hedge fund managers – in other words, a bit like Guy Hands. And "Secret Lovers", the duet with Alexander O'Neal, is being released by... yep, EMI. Mica Paris can laugh, but if it's a hit then so will her old adversaries. The singing voice may be glorious, but it is still money that talks.

Source (http://news.independent.co.uk/people/profiles/article3353637.ece)

Kylie at the centre of label bidding war

Sunday, January 20 2008
By Daniel Kilkelly

Kylie Minogue has received offers from a number of record companies following claims that she is set to leave EMI.

Last weekend, a report suggested that Kylie was set to ditch the label due to disappointing sales of her comeback album, X.

Now Minogue is believed to be at the centre of a bidding war, with the Starbucks record label and Live Nation Inc. among the companies who are interested in signing up the Aussie singer.

"Once the rumours started she was approached by a number of very interested parties with a number of big offers," an industry insider told the Daily Star Sunday. "Things are moving - fast."

The Rolling Stones turned their backs on EMI this week. Coldplay are also believed to be unhappy with the label, while Robbie Williams has announced that he is on strike.

Digital Spy (http://www.digitalspy.co.uk/music/a86407/kylie-at-the-centre-of-label-bidding-war.html)

Is this the end of the music industry as we know it?

By Nick Kelly
Saturday January 19 2008

The music industry is in a state of meltdown. That's the view shared by most observers after the Irish Recorded Music Association confirmed this week that album sales fell by 10 per cent for the fourth year in a row in 2007, with revenues down 13 per cent.

Such statistics are bound to send a shiver down the spines of our record company execs, who will be anxiously looking over their shoulders at the ruthless job cuts announced by EMI in London last Tuesday.

The new owners of the once-venerable institution, the private equity firm Terra Firma, plan to sack 2,000 staff at the label, including the company's much-loved CEO Tony Wadsworth. Many industry watchers in the UK fear that these new number-crunching suits have no feel for music or musicians. Think Alec Baldwin in Glengarry Glen Ross.

Robbie Williams' manager even accused Terra Firma's axe-wielding boss, Guy Hands -- whose background is in the Japanese banking sector -- of acting like "a plantation owner". One Irish victim of the label's new austerity is The Thrills, dropped after the poor performance of their Teenager album.

However, some would see the restructuring at EMI as an inevitable reaction to what was a particularly dismal year for the company -- Paul McCartney terminated his long-standing relationship with the label, calling it "boring", and released his album Memory Almost Full via Starbucks; Radiohead refused to re-sign to EMI, preferring first the web and then the indie label XL instead. And now the Rolling Stones are jumping ship - rivals Universal are releasing the soundtrack to Martin Scorsese's rockumentary on the band.

But have the cutbacks backfired? EMI stalwarts Robbie Williams and Coldplay are threatening to withhold their new releases over fears that the company no longer has the capacity to market them properly -- a ploy which won't go down well with management, who view Coldplay's forthcoming album, Prospekt, due in May, as the company's most sacred cash cow.

If Coldplay don't play ball,the label faces the prospect of a repeat of the ignominy of last year when no new album by an EMI artist made the top 50 sellers of the year.

The crisis in EMI and the domestic sales slump is being blamed on the rise of digital downloads on the internet. IRMA's Dick Doyle told this newspaper this week that for every album bought here, 20 are downloaded illegally.

The trend is a global one: the biggest selling album of 2007 in the US was Josh Groban's collection of Christmas standards, Noel. It sold 3.7 million copies. Rewind seven years and we find that the top-seller of 2000 Stateside -- by 'N Sync -- sold 10 million copies: a drop of over 60 per cent.

But if the major labels, with all their financial muscle, are feeling the pinch, whither the smaller record companies, who operate on much tighter margins?

One has only to look at the fortunes of storied London-Irish indie imprint Setanta, which in its heyday in the 1990s had a staff of 15 in its office and basked in the success of Irish bands like Divine Comedy (who later signed to EMI ... only to be dropped last year) and the Frank and Walters as well as nurturing the likes of A House, Brian and Catchers. It also released Edwyn Collins' big hit A Girl Like You as well as Richard Hawley's first two albums.

But now, after 20 years in the business, founder Keith Cullen operates the label on his own from his living room. Though still looking after the odd band like The Chalets, Cullen is busy exploring other career options, and is currently writing his second novel.

"The industry is totally f**ked," says Cullen. "It was all going pear-shaped anyway but the major labels accelerated it by their tactics.

"The majors all approach the business with the attitude that my co*k is bigger than yours. It's schoolyard politics."

Cullen laments "the death of A&R" -- how the major labels don't allow their artists to develop. If an artist isn't successful with their debut, they tend to get dropped, he says.

Cullen says that the model for success has changed: albums are now promo-tools for their live shows, which is where they now make their money. Before, touring was what a band did to make punters buy the album.

The Setanta boss also points out that, even with the decline of traditional record shops, the availability of music in the global coffee chain Starbucks has actually increased the amount of outlets open to artists trying to reach the public.

Damien Rice is one star who has made a buck from having his music available in their stores -- according to one source, the singer/songwriter has increased his sales by tens of thousands.

So it seems rock'n'roll is merely an accessory now: 'can I have a regular latte and the new Joni Mitchell album to go, please'.

One positive development of the internet for Cullen is that, by having his artists' music available on web platforms like iTunes, fans from Tuam to Tokyo can buy it -- and without him having to keep any physical stock. "I haven't had a record player in my house for 12 years," he says, "because CDs take up too much space."

Yet the MySpace phenomenon with its DIY ethic has reduced the need for small labels like Cullen's: "Why would a new band starting out need me?" he asks. "Only the majors can wave cheque books around."

Unless they're EMI...

Independent.ie (http://www.independent.ie/entertainment/music/is-this-the-end-of-the-music-industry-as-we-know-it-1269238.html)

Guy Hands: EMI must dump artists to survive

By Adam Sweeting and Juliette Garside
19/01/2008

Guy Hands wants to save the music business - but his slash-and-burn plans are anathema to the pampered rock stars who are threatening to quit his EMI record label. Adam Sweeting and Juliette Garside hear his defence

The model of Nipper, the gramophone-fixated dog, remains in the chairman's office - but that is about the only piece of EMI's 77-year history that looks likely to survive under the ownership of Guy Hands.

Since Hands, a titan of the private equity world, paid £3.2 billion for the record company last summer, the former bell-wether of the British music industry has been rocked by an artists' revolt, with Paul McCartney and Radiohead already gone and Robbie Williams, Coldplay, Kylie, Snow Patrol, Damon Albarn's Gorillaz and The Verve threatening to follow suit.

The press has resounded with lurid tales of excess, after Terra Firma, Hands's company, unearthed a supposed £200,000-a-year slush fund to buy sex and drugs for artists (disguised as "fruits and flowers" in the company accounts), bizarre bills of £20,000 for candles, and revelations of a £5 million company house in Mayfair for the use of senior executives.

This week, Hands stunned staffers with proposals to slash 2,000 jobs worldwide, bulldoze the management and turn a blowtorch on the sprawling roster. EMI has more than 14,000 acts under contract, an absurd total, and one that no company could hope to promote effectively.

In an interview with The Daily Telegraph, the new owner reiterates the point: "About a third of the artists who sign with EMI never make an album," he says. "We're going to drop a fair number of them. You've got to get them to a level where you can provide a super service."

Hands's operations are usually only reported in the business pages, but the intoxicating mix of big money, outraged superstars and internecine warfare has guaranteed him front page headlines.

When he presented his job-cutting proposals to employees this week, he was surrounded by minders to protect him from the paparazzi. Terra Firma finds itself cast as a villainous asset-stripper, ram-raiding the family jewels and crushing delicate artistes underfoot.

But when the smoke clears, it has to be acknowledged that Hands has faced the facts that EMI had tried to hide from.

The firm paid lip service to the new era of digital downloading without ever giving up hope that CDs could somehow be made profitable again. Instead, the pace of technological change has cruelly exposed the company's wastefulness and sluggishness.

One bright spot had been its £80 million "multi-streamed" deal with Robbie Williams in 2002. Hailed as a daring innovation, it covered not just album sales, but also tours and merchandising.

But now, as the news trickles out that a million surplus copies of Williams's last album, Rudebox, are being shipped to China to be recycled for use in road surfacing, the artist is threatening to go on strike, and his manager, Tim Clark, has accused Hands of behaving like a "plantation owner".

The refusal of the best-selling band Radiohead to sign a new deal last year has also been seized upon as a symbol of the short-sightedness of the new regime. But the most significant comments came from Paul McCartney.

When a sixtysomething knight of the realm complains that working for his record label has become "mind-numbing" and "a treadmill", it is clearly time for radical surgery.

The 48-year-old Hands has no music industry experience, but he tells the Telegraph that he shares more of the innovative spirit that helped build the record business than his detractors would allow.

"I've always been an entrepreneur," he says, "and I invest my money alongside that of others, rather than being a fund manager. I will continue to use my money to invest in businesses where I can make a positive difference to how they are run."

Even when he was a student at Oxford, Hands showed his flair.

"If you were a student and you needed a few pounds, you went to Guy and he would give you an opportunity to sell paintings door to door, that had been bought directly from the artist. That was partly how we got through university financially," recalls his close friend William Hague, who was best man at Hands's wedding in 1984.

"By the end of it, he owned the house and the shop down the street."

Today, Hands owns houses in Hawaii, California and Spain, along with his estate and vineyard in Tuscany. This is thanks to a gift for buying poorly run companies, replacing management, and extracting underlying value.

Analysts gasped when he paid British Rail £700 million for the Angel Trains rolling stock company during the Nineties, but he sold it for a £390 million profit, and has since added the Odeon and UCI cinema chains to his portfolio. However, he still appreciates the scale of the EMI challenge.

"It's probably the most difficult thing I've done in my life, from a business perspective," he admitted after his presentation to staff on Tuesday. "People were excited about a new vision for EMI, and a number of people said this should have been done years ago, but clearly they were nervous for their own jobs. They clapped and applauded, which was very nice of them."

One of the chief obstacles, apart from the artists' managers lined up against him, under the sobriquet of The Black Hand Gang, is the perception that people like Hands don't belong in the business.

There's still a sense that it ought to be populated by free-thinking bohemians who value artistic adventure over profit. Surely a rapacious venture capitalist, even a Bunterish and dishevelled one like Hands, shouldn't be allowed?

"No disrespect, but the question's irrelevant," says Ed Bicknell, the former manager of Dire Straits and Bryan Ferry and a founder of the Music Managers Forum.

"Record companies are just like anything else - everything's for sale. Whether it's a Saudi prince or Guy Hands, it's just a matter of who's got enough money to buy a majority of the voting shares. It's very rare these days that I hear anybody in the business talk about music - they're all talking about 'synergy', 'branding' and '360-degree business models'."

Hands insists that "unless the industry finds a way to provide something that the consumer is willing to pay for, there is not going to be any music. If the industry doesn't want to move, it will die."

Some EMI insiders have been outraged by his claims of waste and inefficiency, but Bicknell suspects he's right. "When I dealt with them, which was before the era of Tony Wadsworth [the ex-chief executive], EMI was like the Civil Service of the record business.

"It was uninspired and uninspiring. It was so much like a government department that a tea lady would come round with a trolley every afternoon."

Hands sees the industry as an entrepreneurial opportunity rather than a calling. When he expresses admiration for Mick Jagger, it is not for musical reasons: "He is creative, very intelligent, realistic and focused. He is a real gentleman and would make a super chairman of a FTSE company."

Unfortunately, Sir Mick has repaid the compliment by turning his back on EMI to sign a one-off deal with Universal for the next Rolling Stones album, the soundtrack to Martin Scorsese's documentary Shine a Light. Although Hands is scheming to bring him back, his most pressing problem is to persuade managers like Tim Clark that swingeing cuts won't damage their artists' releases.

"Whenever you restructure something, you have a lapse before the new model hits its groove," says Bicknell. "It could take him two years to get this where he wants it, and Tim and everybody are concerned about falling into that void."

There are signs, though, that Hands' message is not falling on deaf ears. After a meeting with the Black Hand Gang, The Verve's handler Jazz Summers felt Hands was "beginning to understand the industry".

Jonathan Shalit, who manages Jamelia, was almost euphoric: "The way the record industry has been going in recent years is to bury their heads in the sand. EMI was going nowhere, and EMI has now got the balls to make changes."

Even if his plans fail - and much of the responsibility will fall on Roger Ames, one of the industry's smartest executives and now in charge of signing artists in Britain and the US - observers suspect that Hands's long-term goal may be to keep the highly profitable music publishing part, and sell the troublesome recording bit.

Hands's bid for Chrysalis, which includes the publisher Chrysalis Music, supports the theory that he's building a publishing empire.

"If Terra Firma was just thinking about making a profit, they should dump all new releases, reduce overheads to a minimum and just resell back catalogue," says Bicknell. "It wouldn't be exciting, but it would be much more profitable."

It's not exactly a rock'n'roll attitude, but it might have got the thumbs-up from the Beatles, when in 1963 they sang: "The best things in life are free/But you can keep them for the birds and bees/Now give me money."

Thirty-five years later, the man who owns their record company could find himself singing along.

Telegraph (http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2008/01/19/nemi119.xml)

Hands in challenge to music industry

From The Sunday Times
January 20, 2008
James Ashton

GUY HANDS is throwing down the gauntlet to the rest of the music industry to match his much-criticised turnround plan for EMI.

“I would like to be as big as the big three [music groups] and bigger,” he said, after visiting EMI staff in New York and Nashville to explain his scheme to strip out £200m of costs and reengage with music-buying consumers.

“We have a sensible plan to survive. The other labels need to have a plan to do that. They haven’t put anything forward yet. I would hate to find that we are the largest simply because the others have died.”

That seems unlikely for some time because Universal dwarfs EMI, particularly on its home British turf, where it has been losing market share. Hands’s Terra Firma is also fighting a rear-guard action to hold on to top-selling artists such as the Rolling Stones and Robbie Williams.

Hands is adamant that he won’t pay “ludicrous sums” to retain talent. “People move from label to label over time. The thing we are doing differently is that we are being realistic with what we are willing to pay in advances,” he said.

He is talking to artists at other labels to try to persuade them to defect to EMI, which announced last week that it was cutting up to 2,000 jobs and stripping record labels of their traditional sales and marketing role. He has told investors he wants recorded-music profits to soar from £60m to £528m by 2012.

But Hands remains at odds with the music-industry trade bodies, including the piracy-fighting International Federation of the Phonographic Industry, and is set to cancel EMI’s membership by March. He claims the issue is not the annual cost, but more to do with how the industry has bullied consumers into buying music on its own terms.

“The trade bodies need to change the way they operate,” he argues. “If they change, EMI will remain a member. If not, EMI will leave. I have a very, very strong view that we can’t cajole and sue our customers into buying music.”

Many artists from EMI’s 14,000-strong roster will be kept on but have their releases distributed only digitally in future to make them economically viable. The company is also examining plans to pair some performers with corporate sponsors. Hands, who is also bidding for the music publisher Chrysalis, hopes to line up a new chief executive by the end of June.

TimesOnLine (http://business.timesonline.co.uk/tol/business/industry_sectors/media/article3215561.ece)

The Private Equity Rebel at EMI

Adam Piore

The private equity financier who has initiated a huge overhaul of music giant EMI is playing down concerns that artists like the Rolling Stones will leave the label, attributing reports of a musician backlash to "headlines created by the British press."

"No artist has made any statements," Guy Hands, the founder of the British private equity firm Terra Firm, told Portfolio.com in a rare interview today on the sidelines of the Wharton private equity and venture capital conference in Philadelphia.

"Some artists managers have chosen to speak out prior to finding out what changes will mean to them and their clients. But we haven't had those discussions yet. We will be having discussions about those changes over the next several months."

Hands' comments came at the end of a tumultuous week for EMI, home of Norah Jones, Coldplay, and the Beatles. Hands, whose firm acquired the label last year, announced on Tuesday plans to cut as many as 2,000 of EMI's 5,500 jobs amid slumping music sales.

But it is Hands' approach to talent management that is feeding talk of an artists' revolt. Among other statements, Hands has promised to shed recording artists who are not "working hard enough," and reduce advances by replacing them with royalties on sales.

Earlier this week, the manager Robbie Williams told a British newspaper that Hands was behaving like a "plantation owner," and that his singer was going on strike.

On Thursday, rival Universal Music Group announced a one-album deal to produce the Rolling Stones' next album, prompting speculation the super group would bolt EMI when its contract expires in March.

In the interview today, Hands said he hoped the Stones would stay, but added that there are limits on the amount EMI will pay to keep them.

"We very much hope we keep the Stones, but we will offer a reasonable contract and then they will need to determine if it's in their best interest and make a decision like everyone else."

Hands predicted the owners of other labels will eventually follow the restructuring techniques employed by Terra Firma. He maintains that despite this week's layoffs, "within the company, the major response has been, 'I wish somebody had done this years ago.

"The strong will be now be able to go forward knowing we run a sustainable business without fear of further cuts," he said. "The whole industry needed to change for some time and needed somebody to put their head above the parapet and go first."

"Change is always unsettling and it will take some time to get used to," he said. "Change is positive."

The actual restructuring will be done over the next six months, he said. But "the change in the relationship with the consumer is going to take some time."

"The consumer needs to be persuaded free music is not a victimless crime," he said. "Teenagers are reasonable people like everybody else. They just need to feel they're not being ripped off or bullied and that they are getting the music for a reasonable price."

In his speech at the private equity conference, Hands compared his restructuring of EMI to the restructuring of pharmaceutical companies in previous decades. Pharmaceuticals, he noted, used to be run by scientists.

"Private equity got involved and said the scientists should still be involved, but that's research and development," he said. "The equivalent in the music business is A&R. The business skills are the same."

Most of Hands' address, however, focused on the market conditions and their impact on private equity.

His assessment for the future was considerably more pessimistic than his view on EMI.

Hands predicted that private equity would "take a long time to return to the heady days of 2003-June 2007.," and he outlined a wide array of gloomy variables looming on the horizon. More than $1.3 trillion of leverage buyout funding needs to be refinanced over the next three years, he noted, which will ensure that even when the capital markets become more liquid "lending is going to remain sparse."

"My view is that recessions in the United States and U.K. are inevitable, even as they may be delayed by interest rate cuts and other measures," he said.

Portfolio.com (http://www.portfolio.com/views/blogs/daily-brief/2008/01/18/the-private-equity-rebel-at-emi)

Hands Can Save EMI by Making Music Free on Web

Commentary by Matthew Lynn
Jan. 23 (Bloomberg)

No one can deny that U.K. businessman Guy Hands has guts. At a time when most of the private-equity industry is battening down the hatches, and trying to survive the storm in credit markets, Hands has just embarked on his most ambitious venture yet.

He is trying to transform the music industry.

When his private-equity firm Terra Firma Capital Partners Ltd. took control of the British music label EMI Group last year for 2.4 billion pounds ($4.7 billion), many people assumed he would strip the company's assets. He could have forgotten about new recordings, sold the music division, fired most of the staff, and used some clever financial engineering to make money out of its valuable publishing business.

That would be the easy option.

Instead, he is attempting a root-and-branch overhaul of the industry, bringing him into conflict with artists such as the Rolling Stones, Robbie Williams and Coldplay.

The trouble is, Hands must get more radical if he is to have any chance of success. The music industry needs a new direction, there is no question about that. Digital distribution has smashed up the old business, so something has to replace it.

The only future for recorded music - as bands such as Radiohead have already discovered - is to give it away free on the Internet. But whether a private-equity firm like Terra Firma can be that bold is open to question.

So far, his stewardship of EMI, which discovered groups such as the Beatles, couldn't be looking much worse.

Job Cuts

The company has already said it plans to eliminate more than 2,000 jobs, or about 36 percent of the workforce, to save 200 million pounds. EMI "has been struggling to respond to the challenges posed by a digital environment," Hands said in a statement. "We have devised a new revolutionary structure for the group that will improve every area of the business."

His problem is that the talent doesn't like the sound of all that cost-cutting. They are worried about their advances and marketing budgets. And if they aren't happy, they won't stay.

Radiohead declined to re-sign to EMI last year, and decided instead to put their latest album on the Internet, where fans could decide for themselves how much they wanted to pay for it. Coldplay have said they are in "no hurry" to deliver a new record. Tim Clark, manager of Robbie Williams, said Hands was acting like a "plantation owner." Williams's future on the label must now be in doubt.

And the Rolling Stones have given their latest record to Vivendi SA's Universal Music Group, and are now considering what to do with their back catalogue once the existing contract with EMI expires.

Out the Door

None of that is promising for EMI. Hands may be smart with money, but so are the Rolling Stones, and if they aren't sticking around, EMI will be in more strife. Hands paid 2.4 billion pounds for what was basically a roster of talent, which is now walking out the door. The deal is already shaping up to be one of the worst of all time.

And yet Hands is right about one thing: The old rulebook needs to be torn up. But he is wrong to think he can fix EMI with cost cuts. He needs to dig a lot deeper into his pockets.

In a world where digital distribution has made pirating music possible at the touch of a button, there is little point in trying to charge for it. Instead, why not acknowledge that reality and make all EMI's music free on the Internet?

Crazy? Well, consider this. Making music freely available needn't be commercial suicide. Almost four out of 10 listeners chose to pay for a download of Radiohead's new album, chipping in $6 each on average. You can view that as being a glass that's half-empty or half-full, according to preference. When the record was released in a physical version this month, it went to No. 1 in the U.S. album charts, selling 122,000 copies in a week.

Realistic Prices

Just because it's free doesn't mean lots of people won't pay for the compact disc. So long as you price them realistically - $5 to $10 - buying a CD is a lot less hassle than downloading and burning an album. You get better sound quality and a picture on the cover as well.

Next, there are opportunities for sponsorship and advertising. Free tracks could come with a sponsored message attached. Songs can be licensed to advertisers and film producers. Then there is touring revenue, which is soaring even as CD sales decline. Record labels can demand a share of that money.

When you consider the multiple revenue streams, "free" music makes more sense than trying to bully people into paying for songs by threatening legal action.

Slashing costs at EMI might work for Hands if it is part of a strategy to create a business that can survive the switch to a free system. But if it is just about saving money while the business declines, and if he can't take the artists with him, it simply won't work. Just attacking the music industry isn't enough.

Hands needs to lay out a genuinely innovative strategy now. Given the rate at which the stars are heading for the exit, he doesn't have much time left.

(Matthew Lynn is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: Matthew Lynn in London at matthewlynn@bloomberg.net

Bloomberg.com (http://www.bloomberg.com/apps/news?sid=aECFx9Ako770&pid=20601039)

Rolling Stones Shop Catalogue

by Paul Cashmere - January 24 2008

The Rolling Stones are after a new home for their back-catalogue from 1970 onwards.

The Observer reports that band management is in negotiations with both Warner Music and Universal Music, for the catalogue starting from 'Sticky Fingers' onwards.

'Sticky Fingers' was the first album in the Stones owned label Rolling Stones Records. All previous albums, including 'Beggars Banquet' and 'Let It Bleed' were recorded for Decca Records, which is now owned by Universal.

The Warner negotiations are said to be "in a state of advance". However, a deal with Universal would be the Stones catalogue in the one place for the first time.

Mick Jagger is rumored to be unhappy with EMI ever since the company was taken over by Terra Firma. Since then, the company has lost Paul McCartney and Radiohead. Coldplay and Robbie Williams have publicly stated that they could be the next to go.

The Stones recently did a one-off deal with Universal for the soundtrack to their forthcoming movie 'Shine A Light'.

The catalogue is thought to be worth around £3 million to EMI.

Undercover.com.au (http://undercover.com.au/News-Story.aspx?id=3938)

On Music: EMI will struggle to win the trust of its stars

24/01/2008

Neil McCormick explains how the future might look for EMI

Guy Hands, the venture capitalist who took over EMI, has been getting a lot of bad press lately.

The gist seems to be "Who is this philistine with terrible hair and drab suits who has upset Radiohead?" I mean, is it possible that a man who lists Meatloaf's Bat Out of Hell as his favourite album and likes to sing karaoke versions of My Way could really have concocted a "revolutionary new structure" for the music business?

Reports of how Hands intends to turn Britain's ailing music giant around have been skimpy on technical details. If all the plans amount to are staff cuts, streamlining, and a vague intention to release better music while disgruntled superstars desert the ship, then EMI are in big trouble. But Hands has got to be smarter than that, and I am beginning to suspect that he might have something up his sleeve that could really shake up the business for everybody.

As far as I can establish, the thrust of changes at EMI will be threefold. The first part is simplification. Along with shedding almost 2,000 staff (one third of the workforce) and a good portion of the 14,000 artists currently signed to the company (85 per cent of whom make a loss), he intends to amalgamate the 70-plus labels EMI houses, so that in the UK there will (most likely) be Parlophone, while in America there will be Capitol, and they will release all EMI's mainstream recorded music.

The next part of the plan is to increase resources to A&R (artists and repertoire), the department responsible for signing, developing and nurturing the talent, which currently accounts for just six per cent of EMI's staff. Under the guidance of Roger Ames, a veteran music boss (with a mixed record from recent stints at Warners and EMI in the US), scouts will snap up the finest bands, singer-songwriters, skateboarding multi-instrumentalists, knitting grannies, or whatever they deem will be the next big thing.

And this is where it gets interesting, because why should anyone want to sign to EMI, a label in obvious difficulty, especially when the boss says he wants to put an end to large advances and expects his artists to work harder for their money? The answer is, I hope, that he intends to offer fairer contracts.

Most major-label record contracts are unfair to artists, grotesquely so. Instead of viewing the relationship as a business partnership to make money out of musical creations for mutual benefit, a ridiculously inefficient system of huge advances and over-complicated contracts has evolved out of sheer antagonism between artist management and record companies.

It is basically this: when an artist signs to a record company, they are advanced a sum of money to cover recording, touring and living costs. They are supposed to earn this back through royalties, which are paid only after the company has recouped expenses. But the artist is deemed responsible for all expenses: recording, promotion, artwork, packaging, manufacturing, distribution, breakages, pretty much anything the record company can add in there, for which they receive a royalty of less than 20 per cent.

Unless they sell multi-millions, the vast majority of musicians will never pay back the initial advance (long after the company has gone into profit), and, even if they do, the company still owns the recording.

Given the iniquities of the system, it becomes in the interests of canny managers to get as large a non-recoupable advance as possible for their charges, on the assumption that this is the only money they are ever going to see.

It is a mad system, and it only worked for so long because the profits from manufacturing and distributing CDs were disproportionately high. In the digital era, it makes no sense at all. EMI can shake it up radically by constructing an alternative contract model in which risks and profits are shared, royalties become meaningful again, and there is greater transparency.

There is much talk about "360-degree deals", in which the artist and record company become partners in every aspect of musical careers, which should encourage moves to develop career longevity. Fairer deals might even discourage charlatans who are just in it for a quick buck.

First, of course, EMI have to persuade their established artists that smaller advances are in their interests. I suspect that when it comes to superstars used to big pay days, Hands is about to discover just how little musicians trust record companies.

Telegraph.co.uk (http://www.telegraph.co.uk/arts/main.jhtml;jsessionid=ST2JN2ZD4V12LQFIQMGCFFOAVCBQ UIV0?xml=/arts/2008/01/24/bmneil124.xml)

SendMe Strikes Strategic Mobile Content Deal With EMI Music

Jan 24, 2008
SAN FRANCISCO, CA

SendMe, Inc., the premier mobile media company, and EMI Music, one of the world's largest independent music companies, today entered into a strategic agreement that gives SendMeMobile.com members access to EMI's full catalog of mobile content. With the touch of button, members will be able to choose from over 4,000 ring tones, and download some of the hottest songs and artists available worldwide.

"Partnering with a premier record label like EMI enables our fans to access whatever music they're craving -- whether it is Latin, hip-hop, rap or rock music," said Russell Klein, co-founder and CEO of SendMe. "Our content library makes it easy for members to quickly find not only their favorites, but also new artists and songs that they didn't even know existed. The addition of EMI's catalog to SendMeMobile.com builds on our commitment to give our members the best and broadest premium content out there."

"With SendMe's mobile media platform, we're establishing avenues for fans to discover and rediscover their favorite music, anytime, anywhere," said Lauren Berkowitz, senior vice president, digital for EMI Music North America. "SendMe is another innovative way for us to strengthen the bond between our artists and fans. We look forward to collaborating with SendMe on promoting our artists and delivering some of the best music to fans worldwide."

Among current artists and catalog works from EMI Music that are now available at SendMeMobile.com include 30 Seconds to Mars, A Fine Frenzy, Lily Allen, Corinne Bailey Rae, Belinda, Beastie Boys, Dierks Bentley, Chemical Brothers, The B-52's, Coldplay, Daft Punk, Norah Jones, Lenny Kravitz, J. Holiday, Dean Martin, Bob Seger, Frank Sinatra, Joss Stone, The Rolling Stones, K.T. Tunstall and Keith Urban.

SendMe brings the best of mobile media to the palm of your hands. With its unique mobile platform and first-class content partners with EMI Music, Universal, Glu, Telcogames, Sony Pictures, The Orchard and more, SendMe grants members access to award-winning games, the hottest hits from the most popular and independent artists, and one-of-a-kind prizes. Plus SendMe's built-in community allows members to create and share their favorites with friends and family on-the-go.

About EMI Music

EMI Music is the recorded music division of EMI Group Limited, one of the world's largest independent music companies. Its EMI Music division represents artists spanning all musical tastes and genres. Its record labels include Angel, Astralwerks, Blue Note, Capitol, Capitol Nashville, EMI Classics, EMI CMG, EMI Records, EMI Televisa Music, Manhattan, Mute, Parlophone and Virgin. Artists on EMI labels include Lily Allen, The Beatles, Coldplay, Corinne Bailey Rae, The Good The Bad & The Queen, Gorillaz, Norah Jones, The Kooks, Korn, Kylie Minogue, Pink Floyd, Rolling Stones, Joss Stone, 30 Seconds To Mars, KT Tunstall, Keith Urban and Robbie Williams, as well as international artists such as Amaral (Spain), Diam's (France), Utada Hikaru (Japan), LaFee (Germany), Radja (Indonesia), RBD (Mexico) and Vasco Rossi (Italy).

EMI has been at the cutting edge of the rapidly growing digital music marketplace since it released David Bowie's 'Hours' as the world's first ever album to be offered as a digital download in 1999. EMI has signed agreements with hundreds of digital partners to distribute its music across the globe, including most recently its premium DRM-free, higher-quality offering sold through partners including Apple iTunes, Amazon.com, Passalong Networks, Hip Digital and more. It continues to facilitate the development of a growing range of new digital business models to enable fans to experience and purchase its artists' output through a number of different platforms including, legal peer-to-peer agreements with QTrax, Mashboxx and GNAB, as well as via new models such as YouTube and iMeem. For further information on EMI, please visit: www.emigroup.com.

About SendMe

SendMe, Inc. turns any mobile phone into a portable playground. As the premier mobile media company, SendMe's family of destination sites lets you take the fun from the Web to your mobile phone with the broadest and best content, entertainment and community out there. SendMe's three properties -- SendMeMobile.com, SoLow.com and mbuzzy.com -- deliver content from today's pop culture sensations, niche independent creations, stuff from our own community, and one-of-a-kind mobile games that will keep you coming back for more. So whether you're looking for new ways to show your personal style, eager for some mobile gaming excitement, or trying to stay connected to the people and things you love most, SendMe brings it all to you -- how you want it, when you want it. Founded in 2006 by three veteran online and mobile entrepreneurs, SendMe is funded by Spark Capital and True Ventures.

Marketwire (http://www.marketwire.com/mw/release.do?id=813858)

Music industry trying new ways to profit from downloads

Sunday January 27, 2008
By Peter Griffin

It's been a tumultuous start to the year for the digitally down-at-heel global music industry.

First Robbie Williams went on strike from his label, protesting at the "EMI bean counters"' plans to restructure the ailing company.

Then the figures came in from international music body, the IFPI, revealing CD sales fell about 10 per cent last year, a decrease only partially offset by the 40 per cent increase in digital music sales.

In Britain, the industry attacked internet providers who they accuse of allowing the public to download pirated music willy-nilly.

It's pushing for EU law to make internet service providers responsible for monitoring traffic on their network and to cut off members downloading music illegally.

Amidst the acrimony, there are some companies trying to come up with innovative ways to stave off the collapse of the music industry, although it's far too early to tell if they'll be successful.

A significant deal went down last week when web radio station Lastfm.com, bought last year by American broadcaster CBS for US$280 million (NZ$361.7m), signed a deal with major music labels to allow Lastfm to stream their songs on the web, free to access worldwide.

It's a big move for Universal, EMI, Sony BMG and Warners, who favour paid-for digital downloads along the iTunes.com model over emerging business models - such as advertising-supported downloads and on-demand streaming services.

There's also the risk software will become widely available that will allow people to record high-quality versions of the tracks being streamed from Lastfm, making music piracy even easier than it is now.

But the labels have built some conditions of use into the service to avoid making it too sweet for free-riding listeners.

When the labels' 3.5 million tunes become available "in the coming months", you will only be able to listen to each song three times.

Lastfm says it will make a premium service available for people who want to pay for repeat playback of songs. The premium service and advertising on the Lastfm website will provide revenue and is immediately available to listeners in Britain, the US and Germany.

Taking a different tack is rock icon Peter Gabriel with We7.com, his music download venture which has just received a US$6m injection of venture capital.

We7.com lets you download music tracks for free - but there's a catch. Each song has an advert at the start. You have to listen to the ad for the first eight times you listen to the song. I gave it a go, downloaded a zipped-up version of Ocean Colour Scene's single Make the Deal and ran it in Windows Media Player.

A five-second advert played before the song, a not very memorable melodic rock number. I like the model, but Gabriel and his fellow financiers have a bigger battle making We7.com work than getting people to listen to these short ads.

None of the big labels are on board. So you can't even download Gabriel classics such as Solsbury Hill from the website he helped found.

But the key to the long-term future of Lastfm and We7.com may lie in a generation of emerging musicians. They comprise a good deal of the listings on We7.com. They share in advertising revenue, while Lastfm has a system so unknown artists can upload their songs to the website and receive a tiny royalty each time the song is played.

Small steps, then, towards tackling issues facing an industry that grew fat on the CD.

The New Zealand Herald (http://www.nzherald.co.nz/topic/story.cfm?c_id=137&objectid=10489025&ref=rss)

Christian music group launches digital store

FRANKLIN -- EMI Christian Music Group (CMG), the world’s largest Christian music organization, and media distribution developer PassAlong Networks(TM) today announced the launch of ChristianDigitalStore.com, a white label digital music service provider and store powered by PassAlong Networks that features content from major and independent labels including EMI CMG, Warner Music Group’s Word Entertainment, Sony/BMG’s Provident Music Group and independent labels. ChristianDigitalStore.com provides retailers, brands, radio stations and organizations a turnkey way to offer consumers an easy-to-use digital music discovery and buying experience without having to invest in creating their own infrastructure and fulfillment system.

The first retailer to sign on to ChristianDigitalStore.com is Grand Rapids, Mich.-based Family Christian Stores(R), America’s leading specialty retailer with over 300 locations and over 5,000 employees in 37 states dedicated solely to the $4.3 billion Christian retailing market. The retailer sells Christian products and church supplies through its chain of stores and via the Internet. Merchandising categories include Bibles, Books, Music, Childrens, Gifts, Apparel, Software, Cards, Church Supplies and DVDs.

“ChristianDigitalStore.com is a strategic partnership between EMI - a leader in Christian music - and PassAlong, with our proven digital music retail platform. Together, we are taking a significant step forward in providing digital music for the Christian market,” said PassAlong Networks’ co-founder and CEO Dave Jaworski. “EMI CMG is already well established in the Christian market and together we can offer retailers, radio stations and other associations a powerful, easy and effective way to offer a good value proposition for consumers.”

Under the arrangement, EMI CMG will serve as liaison between PassAlong and US-based retailers, radio stations, brands and other companies and organizations, and PassAlong will power the digital retail experience. The end result offers established Christian companies who are part of what the Christian Booksellers Association estimates is a $4.3 billion retail category an easy way to offer a digital music discovery and buying experience to fans of Christian music.

“EMI CMG is delighted to offer the Christian retail market PassAlong’s proven, scalable platform - one that is already working well for many retail powerhouses,” said EMI CMG President and CEO Bill Hearn. “We worked with PassAlong to create ChristianDigitalStore.com to offer the Christian market an easy way to give consumers a great digital music buying experience without having to invest in creating their own infrastructure and fulfillment system.”

“Family Christian Stores is excited about the opportunity to enter the digital download business through our partnership with EMI. We are pleased with EMI and PassAlong’s efforts to launch this venture,” said Brenda Lugannani, Vice President Merchandising for Family Christian Stores.

EMI CMG will create custom versions of ChistianDigitalStore.com for each company’s unique Web environment, and will also offer promotions like physical music download cards that retailers, radio stations and other companies can give to consumers in physical stores or as part of marketing programs.

Participating retailers can sign up for ChristianDigitalStore.com in minutes. EMI CMG and PassAlong will work with retailer partners to integrate the digital music retail technology into their existing websites.

About EMI Music

EMI Music is the recorded music division of EMI Group Limited, one of the world’s largest independent music companies. Its EMI Music division represents artists spanning all musical tastes and genres. Its record labels include Angel, Astralwerks, Blue Note, Capitol, Capitol Nashville, EMI Classics, EMI CMG, EMI Records, EMI Televisa Music, Manhattan, Mute, Parlophone and Virgin. Artists on EMI labels include Lily Allen, The Beatles, Coldplay, Corinne Bailey Rae, The Good The Bad & The Queen, Gorillaz, Norah Jones, The Kooks, Korn, Kylie Minogue, Pink Floyd, Rolling Stones, Joss Stone, 30 Seconds To Mars, KT Tunstall, Keith Urban and Robbie Williams, as well as international artists such as Amaral (Spain), Diam’s (France), Utada Hikaru (Japan), LaFee (Germany), Radja (Indonesia), RBD (Mexico) and Vasco Rossi (Italy).

EMI has been at the cutting edge of the rapidly growing digital music marketplace since it released David Bowie’s ’Hours’ as the world’s first ever album to be offered as a digital download in 1999. EMI has signed agreements with hundreds of digital partners to distribute its music across the globe, including most recently its premium DRM-free, higher-quality offering sold through partners including Apple iTunes, Amazon.com and more. It continues to facilitate the development of a growing range of new digital business models to enable fans to experience and purchase its artists’ output through a number of different platforms including, legal peer-to-peer agreements with QTrax, Mashboxx and GNAB, and a deal to offer advertising-supported videos on mobile phones in the US through Rhythm NewMedia. For further information on EMI, please visit: www.emigroup.com.

EMI Christian Music Group, established in 1994, is the world’s largest Christian music organization and includes EMI CMG Distribution and EMI CMG Publishing in addition to EMI CMG Label Group and EMI Gospel. Led by President and CEO Bill Hearn and a strong executive team of long-time Christian and Gospel music veterans, EMI CMG is characterized by a commitment to artists and songwriters, its customers and to community service. For further information, please visit www.emicmg.com.

About PassAlong Networks

PassAlong Networks works to empower artists and fans by enhancing the Connected Consumer(TM) ecosystem. PassAlong’s suite of services includes StoreBlocks(TM), OnTour(R), freedomMP3(TM) and subsidiary Speakerheart(TM); current initiatives include advertising premium incentive programs, ad-supported revenue models, variable-pricing programs, in-car music downloads, mobile devices, media place-shifting and device-shifting, digital video libraries and social networks. Founded in 2002, PassAlong Networks is privately held and based in Franklin, Tennessee. For more information, visit http://www.passalongnetworks.com.

OnTour, StoreBlocks, freedomMP3, Rostr, PassAlong, Connected Consumer, Passing-and-Points and Speakerheart are trademarks of PassAlong Networks. All other brands are trademarks of their respective owners.

Source (http://www.dnj.com/apps/pbcs.dll/article?AID=200880128022)

Kylie Minogue: an EMI loyalist (for now)

Jan 30, 2008, by Shirley Halperin

Despite the recent drama at EMI (massive lay-offs and restructuring), which resulted in at least one marquee artist — Robbie Williams — threatening to hold his album hostage, not all of the label's major acts are considering a walk-out. Fellow international superstar Kylie Minogue tells Hollywood Insider she has no plans to seek out a deal like Madonna's LiveNation pact. "I don't like to commit myself for however many years," she says. "Rather than take a big chunk of the cake, I go slowly." But with a new album to promote (X, due out in March), Minogue does admit the label turmoil has affected her world. "It's so demoralizing for the team. At the rate we're going, I'll be the only one at the record company!"

EW.com (http://hollywoodinsider.ew.com/2008/01/kylie-minogue-a.html)

Give Up the Ship
EMI and the other majors are foundering, but should the artists care?
By Miles Raymer

January 31, 2008

Last April EMI made headlines worldwide with its decision to allow Apple’s iTunes music store to sell its songs without the anticopying measures called DRM (digital rights management) that had become more or less standard for major digital retailers. Industry pundits had long considered DRM a dead end in the evolution of online retail because it punishes legitimate consumers by restricting what they can do with music they’ve bought but doesn’t have any effect at all on pirates trading in unlocked files. It’s also a waste of money, since DRM schemes are expensive to develop and implement and every one so far has been hacked, sometimes within hours of its introduction. Going DRM free was a coup for EMI—it could recast itself as forward looking, tech savvy, and consumer friendly. At the time it seemed a good sign, but other big players quickly followed suit, stealing EMI’s thunder—and since then there’s been nothing but bad news for the label.

This summer the private equity firm Terra Firma acquired EMI for $6.25 billion, capping a year in which the label lost more than $500 million. This development provoked mixed reactions in industry circles. On one hand, it was heartening that someone—anyone—was feeling confident enough about the ailing mainstream music biz to invest in it. On the other hand, Terra Firma’s experience was in renting jets, managing natural gas pipelines, running pub and hotel chains—seemingly everything but music. It was assumed that, because the company wasn’t part of the culture that tolerates the notion of “nurturing” talent (that is, taking a loss on new artists), its bean counters would have no compunction about cutting costs and slashing jobs.

It was a well-founded fear. Two weeks ago Terra Firma head Guy Hands announced that, among other changes, signing bonuses for artists would be capped and as many as 2,000 EMI employees—about a third of the label’s staff—would be laid off. He painted a dreary portrait of an industry where failure is the norm, complaining in the Financial Times that EMI loses money on 85 percent of its artists and routinely overships by 20 percent, requiring the outlay of nearly $50 million a year to scrap unsold inventory. Just days after news of the layoffs broke, Hands acknowledged that more than a million unsold Robbie Williams CDs had been bought by a firm that intended to recycle them into paving materials in China—surely a bitter pill for the label that reportedly paid more than $150 million to sign Williams in 2002.

Historically EMI has had lousy luck developing top-tier acts and a downright terrible time breaking its biggest artists in the States. For every Coldplay, it signs dozens of bands like the Good, the Bad & the Queen, which may attract superlative reviews but don’t succeed by major-label standards. Even while EMI was getting love for ditching DRM, many commentators pointed out that the move was a mixed blessing given the label’s mediocre roster—its biggest asset, the Beatles catalog, wasn’t part of the deal.

Radiohead, Scotch Mist
EMI’s stock, which had fallen to about $8.50 a share before the buyout, briefly peaked at around $11.50 afterward—investors love to hear about layoffs. Now it’s sagging again. But investor confidence, or the lack of it, may not turn out to be EMI’s biggest problem. Artist confidence was dipping even before Terra Firma showed up—Radiohead went feral in 2004 after declining to renew their deal, and in March Paul McCartney signed with Starbucks’ Hear Music label—and it’s plummeting now. Robbie Williams, the Verve, and Coldplay have all threatened to withhold their next albums, citing the layoffs and concerns about the new management. The Rolling Stones announced earlier this month that they’re taking their next record to Universal. And Radiohead, who released In Rainbows online via a paradigm-shattering pay-what-you-want program, said last fall that Hands and company were the reason TBD Records and XL Recordings—rather than EMI—were granted the privilege of pressing the album as a physical CD.

If EMI folds, it’ll cede a chunk of market share (and probably a few orphaned marquee acts) to the surviving majors. But that advantage will do them about as much good as a few extra deck chairs on the Titanic. EMI may be especially vulnerable to artist defections right now, but the root cause of the label’s ills—the decline in major-label CD sales due to a proliferation of viable alternatives to the established business model—affects everyone who’s playing that high-stakes game.

Sony BMG will make some money from In Rainbows because TBD is one of its many subsidiaries, but a huge chunk of the band’s fan base is already out of the market for a CD thanks to the download. And while nobody is publicizing the details of Radiohead’s deal with TBD, the bidding war that preceded it almost certainly earned the band an extraordinarily generous percentage. It’s becoming clear that decisions about the future of the music biz won’t be made by the majors but by consumers and artists, and the big labels are getting uglier as they get more desperate. They’ve tried to scare the public away from new markets and technologies, using the RIAA as an attack dog to bring tens of thousands of file-sharing lawsuits. Artists who buck the system can hardly expect to be treated graciously either—EMI punished Radiohead by putting out deluxe editions of albums from the band’s back catalog without their approval after the release of In Rainbows.

In October Madonna ended her relationship with Warner Brothers to sign with concert megalith Live Nation for a ten-year “360 deal,” which covers not just new music but merchandising, touring, sponsorships, film appearances, and the like. Other big artists who aren’t on EMI, like Trent Reznor, have joined the chorus of acts vowing to “pull a Radiohead.” And even if no other heavy hitters walk away from the system, it’s likely that in the next couple years tens of millions of albums that once would’ve put money in the majors’ pockets are going to be sold without them. The Big Four should be worried about their obsolescence, not about losing prestige acts. Universal made a lot of cash off Soulja Boy, but they must know they lucked out—he was a phenomenon that happened through YouTube, MySpace, and file swapping rather than the traditional channels, and Universal was just in the right place at the right time. It’s not hard to imagine the next smash ringtone single coming from someone savvy enough move a million units without a major label. If EMI and the other majors want to exist in ten years, they’ll have to change radically—and seriously downsize their sense of entitlement. They might end up virtually unrecognizable, but I know lots of bands—and lots of fans—who think that’d be a good thing.

Source (http://www.chicagoreader.com/features/stories/sharpdarts/080131/)

I had already uploaded the picture to the article above, "Give Up the Ship", so I thought I could post it. It's a bit funny. :)

Thom Yorke and Mick Jagger
http://i149.photobucket.com/albums/s49/MarianneStockholm/Diverse/JaggerYork.jpg
Kurt Mitchell

Hands On

Posted by JeremyS on February 2, 2008

I did not intend that this blog should only be about EMI. I do think about other things and I promise I will write about them. Love, death and the future of the planet spring to mind.

Meanwhile though, a few current thoughts about where optimism has gone. The takeover of EMI by Terra Firma caused me some optimism last year. Their pronouncements about their strategic direction, their desire to completely rebuild the model and to adopt a clearly digital approach, connect artists directly with fans, work closely with social networks, expand participation into other areas of musical activity, all seem to be essential elements in the creation of a new paradigm (sorry about that word - but it is sometimes justifiable) for an entire industry. Who knows, they might even begin to consider the clear need for blanket licensing of ISPs in order to monetise all that P2P - certainly telling the BPI and RIAA to stop suing the customers on their behalf seemed like positive moves.

And, although it’s painful, the need to let a lot of people go from the organisation seems almost inevitable. It’s very hard to turn a super-tanker when it’s fully laden. It may even be momentarily justifiable to scare a few artists off to lighten the load. What’s being done at EMI is only what is required at each of the major labels if they are to be transformed and survive - and although they are hated in their current form - and are never likely to be perceived as benign - major industries probably need some very big, major players as well as a healthy indie crowd too.

But things don’t seem to be turning out so well at NEW EMI and it’s interesting to observe.

Rumours circulating at Midem last week suggested that the new management team may have started to discover some royalty and accounting issues in the precious publishing side of the business which may lead to assets being written down by as much as 30%. A certain naivety in due dilligence about the significance of royalty structures or a certain obscurity to contracts that are only now becoming more clear? No doubt time will tell - my lips are sealed.

More apparent however, is the inevitable culture clash that’s taking place between the private equity, pure rationality approach and the music business, the people are the business approach. This does not have to be unproductive. But unfortunately it seems to be damagingly the case with Terra Firma and EMI currently.

You can probably discount the defection of a few major artists - Radiohead I’ve already talked about - The Rolling Stones never sell any records and haven’t done for years. Coldplay and Robbie Williams are rather more significant - although many say the latter is nearing the end - I suspect he is a world-class entertainer who will continue to carry a major audience for a very long time to come - and Coldplay continue to straddle the line between mainstream accessiblity and some vestigial, credibility among the more musically literate. If EMI can’t retain acts of that stature not only is it damaging to their bottom line and revenue projections, but it sends a massive message to the rest of the artist community.

The tone and stance of Terra Firma to the artists of EMI has not been well received. At a meeting of some 200 managers, the atmosphere was allegedly chilly to say the least. Critical comments by Tim Clark (Williams’ manager) in the FT have led to threats of litigation from Hands. According to Clark, “he’s gone rock’n'roll - he’s got blacked out limo’s, body guards, the lot”. There is a history of top level execs in a similar position going “native” in some way and making themselves embarrassing and absurd in the process. It doesn’t usually happen this fast though!

Meanwhile, an idea of centralised marketing seems to be emerging from the company which is also worrying. It seems to display a lack of understanding of the value of cultural positioning and the uniqueness of individual artist’s fanbases that require to be addressed in different ways - not with a single voice emerging from a single marketing team.

The degree to which marketing music is an inexact art is hard to underestimate. Of course some would argue that it’s therefore some kind of law of probability that if you throw enough of it at the wall then some of it will stick. But in this day of individuated artists and differentiated fans, the law of the long tail says “talk to me with an individual voice and treat me as an individual”. Commercially, you might say that to all the girls but culturally you’ve got to be smart and sensitive to artists’ needs and what fans are in to, to hope to get this right. The grass roots is where it’s at now - online the great levelling is happening - and some very finely honed tools are needed to reap what you sow here, dedicated applications which are currently not in the hands of the majors at all.

At the heart of this is a question which is almost about the cultural credibility of the organisation. Now, as we know, this has little or nothing to do with commercial success - on the face of it. There is a big area of music that doesn’t worry about cultural credibility at all - the reality TV, X Factor swathe of MOR pop does reach big audiences. BMG in particular has been pretty successful in this area. If that’s what Mr Hands is thinking of in the transformation of EMI, then perhaps he is doing the right thing.

It’s hard to read though. Certainly the legacy of catalogue (which presumably is what he invested in) is not about that area of music at all. EMI, Virgin, Parlophone, Capitol, Blue Note - these are labels who grew up with particular flavours, tastes, and acquired significance. Although they may have dabbled in the ephemeral pop tastes of the moment, they also had a sense of quality, a sense of responsibility to their artists to nurture their careers - but also to steer them - sometimes meaningfully sometimes misguidedly in some musical direction. Lots of artists famously complain about the labels’ A&R folk not understanding them and not trusting their directions, but as many great records made it out into the world with the help of the label as despite them.

It’s not clear where this kind of sensibility is on Mr Hands’ agenda. But, no matter which part of the market you target - and as a major - presumably these days you’re targeting all of it - having some credibility among the artist community and their quixotic managers is a primary ingredient - that seems to be missing from the new EMI. It’s nowhere near a lost cause yet - but the question that needs asking now is how will Electro-Magnetic Industries - get their magnetism back?

Source (http://jeremy1.wordpress.com/2008/02/02/hands-on/)

I think the writer has an interesting background, so here is some information about him:

About Jeremy Silver

Jeremy Silver has worked for the last twelve years in digital media businesses as they have become increasingly online, wireless and mobile. He was director of media affairs for Virgin Records, UK where he worked with artists such as Massive Attack, Brian Eno, Genesis and Bryan Ferry.

In 1994, he created Virgin Records’ first web site the-raft.com - named after the famous raft in Neal Stephenson’s novel Snowcrash. The website launched on Sun Microsystems sponsored servers with a dark fibre connection to the UK academic internet backbone called Superjanet. The following year he was appointed vice president, interactive media for EMI International. He then promptly had the streets of London dug up to lay a high speed network between the various Virgin EMI locations around the city. Later he took on the newly created role of vice president, new media for EMI Recorded Music, Worldwide, based in Los Angeles, California where he was responsible for negotiating many of the new media deals that EMI became known for.

In May 2000, Silver left to form his own company, Uplister Inc., based in San Francisco. Uplister was the pioneer of playlist sharing, offering the first ever playlist-based music subscription service. In September 2001, he returned to Europe to set up MEDIACLARITY which numbered a growing list of media and investment companies amongst its clients, including Shazam Entertainment, Streamwaves, and the24.com. In May 2002, he took on his current role as Chief Executive Officer of Sibelius Software Ltd. In July 2006, Silver managed the sale of Sibelius to Avid Technology Inc and the company now continues to operate as a separate business unit within the the Avid Audio division.

Silver is also Deputy Chairman of Futurelab - the educational innovation think-