I.B. BAD OBSERVES A GAME OF MUSICAL CHAIRMEN

The Aug. 19 announcement that Edgar Bronfman Jr. is being replaced as CEO of Warner Music by turnaround gunslinger Stephen Cooper (MGM, Enron, KrispyKreme), who’d been Chairman of the Board—a job that now belongs to Bronfman—has resulted in widespread confusion. The source of the confusion appears to be semantic in nature, resulting from the announcement’s carefully worded statement that Cooper would be running WMG’s day-to-day operations. But according to those in the know, Cooper was brought in by Len Blavatnik and his brother Alex, Access Industries’ EVP and Vice Chairman, specifically to further cut costs and help with the financial restructuring for a possible EMI acquisition. Insiders have already dubbed him “Len’s man to watch the store.” Concurrently, the Blavatniks are depending on Recorded Music Chairman Lyor Cohen to continue to assemble and lead a team that can grow the company. Wonderers are wondering whether the brothers have bought into Cohen’s continued championing of the 360 deal, which has many detractors but has also accounted for a handful of success stories, including Bruno Mars and Paramore. These two acts are the poster children for Cohen’s pitch, having made millions for WMG through the ancillary income they’ve generated… Big questions now surround Bronfman’s next chapter. Could he be coming to the end of his run after buying and selling the company, and making tens of millions of dollars along the way? Will Bronfman even be around to see his longstanding dream of a merged WMG-EMI come to fruition? And what of his mantra that the digital revolution would be the key to the financial success of the business? What will happen to the dedicated staff of employees Bronfman has brought in to deepen Warner’s digital footprint? Will Bronfman continue to oversee this sector, which is accruing sizable costs for the company? Now that he’s been removed from day-to-day oversight of WMG, will the digital initiative be Bronfman’s primary focus, or will he have any role at all going forward?… Second-round bids for EMI are due shortly, but the primary purpose for this round is simply to allow the first-round bidders to get a look under the hood of EMI. Not much is likely to transpire until round three, which will commence in late September. Most in the business believe the process is a mere formality, and that Access Industries/WMG all but has its quarry in the bag. In this scenario, the only possible hang-up has to do with whether Warner accedes to Citi’s demand that it assume all the risk and costs of the regulatory process. In other words, WMG would own EMI whether or not the deal is cleared… Beats Electronics creators Jimmy Iovine and Dr. Dre pocketed 30% apiece of the $309m paid by HTC for a controlling interest in the wildly successful company, while UMG’s cut was 20%. But the $309m is just a first payment; the total for the company could eventually be close to $600m. This coup is the latest in a remarkable run of mega-paydays for Iovine stretching back two decades. He’s also drawing accolades for a superb branding effort… As for the widespread assertion that Jay-Z and Kanye West’s superstar collaboration Watch the Throne has under-performed thus far, it’s worth noting that West’s last release also sold around 600k in its first two weeks last fall, or around 43.1k a day, while Jay-Z’s 2009 album did 45.5k a day during the same period, putting both in the same ballpark as Watch the Throne’s 43.3k. And sales reports strongly suggest the pattern will hold steady in week three. That said, some observers insist the album would have come out of the gate stronger had the artists not reportedly forced IDJ to rush-release it in order to maximize ticket sales on their upcoming arena tour. Nonetheless, many believe the album is embedded with potential hits beyond the still-building first single, which will give the project some momentum heading into Q4... So what does all this mean for Universal Republic’s Lil Wayne, whose Tha Carter IV streets next Monday (8/29)? Probably very little, in that Wayne’s first single is #1 at both Urban and Rhythm, while the second debuted Top 10 at iTunes last week, lending credence to those 750k first-week estimates. The likelihood, then, is that Monte Lipman’s hot streak will continue, as promotion chief Joel Klaiman keeps the pedal to the metal at radio. Some of the heat is coming from Republic Nashville, a joint venture with Scott Borchetta’s Big Machine, as The Band Perry continues to climb the Pop charts… Names in the rumor mill: Allen Grubman, Richard Parsons, Roger Faxon, Steve Bartels, Mike Dungan, Tom Whalley and Karen Kwak.