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I.B. BAD: NEW BEGINNINGS

SHUFFLING THE DECK: As late as Thursday, 9/28, the day after the news broke that Interscope President of A&R Aaron Bay-Schuck was headed to Warner Bros. Records to run the label alongside RCA President/COO Tom Corson, he still hadn’t given the offer his final approval. In a rumored meeting with incoming WMG CEO Recorded Music Max Lousada Thursday night, the deal was finally sealed, and Interscope head John Janick was informed that Bay-Schuck was leaving. Top execs at Interscope, including Janick, and UMG had assumed he’d made the decision some time ago because of the size of the Warner offer, but it wasn’t until the following day that Bay-Schuck internally announced he was out of there. That prompted a succinct memo from Interscope EVP/CFO Jeremy Erlich to the company reading, “Aaron Bay-Schuck has made the decision to leave the company. He will remain here in his current role until September 2018.” It went out after Bay-Schuck’s internal memo revealing that he was departing to become Chairman/CEO of WBR was quashed.

When Len Blavatnik bought WMG in 2011, he and CEO Steve Cooper began cutting salaries and the lengths of employment contacts—and these moves followed massive layoffs during the Bronfman-Cohen regime. But Corson (repped by Joel Katz) and Bay-Schuck (whose attorney is Aaron Rosenberg) are said to be getting $5-6m annually in their new posts, the kind of money other major-label chairmen are making. So it appears the rumors that WMG is now paying truly competitive money for top execs are true.

While it’s common knowledge that the glory days of WBR abruptly came to an end with the departures of Mo Ostin and Lenny Waronker in 1994, the situation worsened considerably during the Tom Whalley era. After then-WMG head Roger Ames tapped the well-liked, widely respected Interscope exec to run WBR in May 2000, Whalley remained at Interscope for more than a year before starting his new job in August 2001, not wanting to give up any of the money owed him on his deal. During his nearly 10 years at Warners, Whalley had big hits with Green Day, Josh Groban and Michael Bublé but signed nothing of consequence, leaving the cupboard bare when he left in 2010; indeed, Warner vets are hard-pressed to name one big act signed during Whalley’s tenure. Blaming his failure to run the label effectively on his fractious relationship with Cohen, Whalley faded into obscurity, but he did so as a very wealthy man. WBR never fully recovered.

But the storied label’s prospects are once again looking up as the Bunny gets a new lease on life. Even before Lousada’s 10/2 start date, he was proactively beating the bushes nonstop between London, New York and L.A. in search of top executive talent, bagging a pair of strong, complementary veterans in Corson and Bay-Schuck as the key part of a determined effort to restore the label to competitiveness. The label’s great catalog, along with Lousada’s other frontline label, Atlantic—which is shaping up as 2017’s marketshare champ—and Lousada’s U.K. company, which is having another solid year, further bolster the #3 worldwide music group.

Lousada is said to be focused on modernizing the company on a global basis, as the streaming paradigm changes the distribution and consumption of music. Repertoires from outside English-speaking regions will become more important as the result of increased exposure, as is happening now with Latin music and K-Pop. It’s only a matter of time before worldwide hits are coming out of emerging markets like China and India, adding scale to the English-speaking core of the global business as access becomes ever greater.

LAME DUCKS: Corson and Bay-Schuck are under contract for six and 11 months, respectively. How their tenures end will be determined by negotiations involving their current employers, their new employer and themselves. In a worst-case scenario, the negotiating tactics could include the exec first being ordered to stay home and then being fired for cause because of breach of contract, at which point the individual files a lawsuit. It’s impossible to predict what will happen in these parallel situations.

Bay-Schuck has partnered with Janick on numerous projects at both Atlantic and Interscope. His career-making move was Bruno Mars, whom he discovered, developed and signed as well as supervising the A&R on Bruno’s first two albums. During his three years at Interscope, the 36-year-old exec has A&R’d albums for Selena Gomez and Gwen Stefani while presiding over a staff that focused on new artists including BØRNS, Daya and Billie Eilish. He also worked with Imagine Dragons, Maroon 5 and Lady Gaga, among others. Bay-Schuck’s loss is somewhat softened by the increasing heat of Janick’s collaborations with EVPs Joie Manda and Sam Riback. Interscope is having a bang-up year behind Kendrick Lamar, Dragons, Playboi Carti and Rae Srummerd, as its marketshare hovers around 8%.

Corson, who is respected throughout the business for his skillfulness at managing a label, should readily adapt to his new role, having been half of a successful ruling tandem with Chairman/CEO Peter Edge since 2011. On the heels of Corson’s departure, the talk is that EVP/GM Joe Riccitelli and EVP John Fleckenstein will be given broader roles. The label, whose share is in the 6% range, is doing well with new acts under Edge and senior A&R exec Keith Naftaly, including SZA and Khalid—both inked by recently upped SVP of A&R Tunji Balogun—and the just-inked Marshmello, whose track “Silence” is super-hot, as well as established artists P!nk, Kesha, Miley Cyrus, Bryson Tiller, G-Eazy and Foo Fighters.

The situation is also fluid at Def Jam, with Steve Bartels leaving at year’s end and EVP Promotion Rick Sackheim moving to Epic. The top priority of incoming Def Jam head Paul Rosenberg has been 
Eminem’s next album, believed to be scheduled for 11/17, a week after Taylor Swift’s reputation. The superstar seized headlines with a powerhouse anti-Trump rap at the BET Hip-Hop Awards, reminding the world that his gifts—and his fury—are as potent as ever, and foreshadowing a potential monster project for the poet of a generation. But Rosenberg’s also close to bringing in Steven Victor, currently SVP A&R at UMG, as President. Replacing Sackheim is another piece of the puzzle. Bartels and Sackheim are leaving the label on a high note: Def Jam has recently broken Alessia Cara and Logic.

Does the contract of any of the above contain a sunset clause with a “no poach, non-compete” stipulation?

NOISE: The aforementioned label execs aren’t the only high-profile industry people believed to be in motion. SONGS partner Ron Perry is widely rumored to be getting a top slot at a major, while Maverick’s Gee Roberson could also possibly be making a move to label land. And L.A. Reid is supposedly close to getting financing for a new venture.

NAMES IN THE RUMOR MILL:Jimmy Iovine, Michele Anthony, Craig Kallman, Joey Arbagey, Steve Berman, Heath Kudler and John Branca.

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