The First of Two Parts
HEAVY MACHINERY: Taylor Swift’s 1989 has hit 2m after just three weeks; it’s projected to be between 3.5-4m by year’s end, putting it in a battle with Disney’s Frozen, now at 3.2m YTD, for the top spot on the 2014 final sales chart. And to think that just a few weeks ago, naysayers in Nashville and elsewhere were convinced she’d lose a chunk of her audience by moving away from country. The bigger Swift’s album gets, the more valuable Scott Borchetta’s Big Machine Label Group becomes as he puts it up for sale, with attorney Joel Katz handling the negotiation, when his deal with UMG is up at the end of the year. If Borchetta re-signs Swift, his company’s value increases exponentially, but even if he’s unable to keep her, Borchetta still gets one more Swift album, and he owns her catalog. Given these solid-gold assets, it’s hard to imagine any deep-pocketed, music-related company—not just Universal, Sony Music and Warner Music Group, but also Spotify, Google, Apple, et al—not giving serious consideration to making a bid on BMLG. And if there’s a big job for Borchetta himself, such as heading up a company’s Nashville operation, the deal becomes even more intriguing.

Will the opportunity pick up to a property of enormous value inspire WMG owner Len Blavatnik to become a buyer after two years of passivity and seeming inattention? It makes sense considering that WMG Nashville has been out of the loop for years. As the richest man in the music business, Blavatnik can certainly afford to make a deal of this magnitude. Blavatnik may not be the most charismatic individual, but he’s smart and engaging, and most of those who work for him like him, with the marked exception of Atlantic Co-Chairman Julie Greenwald, who openly expresses her disdain for both Blavatnik and CEO Stephen Cooper, viewing them as carpetbaggers. Indeed, people inside Warner claim Blavatnik and Cooper are intimidated by Greenwald’s gruff demeanor and aggressiveness. Greenwald remains fiercely loyal to her former boss and protector Lyor Cohen, and had his latest venture, The 300, not been such an abject failure, most believe she would have bailed from Atlantic and rejoined him.

Jason Flom, whose own deal with UMG for his Lava label is up if not exercised at the end of its term in Q1, started his career and had an extremely successful run at Atlantic before Cohen, who was then calling the shots at WMG, abruptly and incomprehensibly fired him. There is said to be mutual interest between Flom and people inside Warner, and here again, such a move would indicate that Blavatnik is indeed serious about restoring his company to competitiveness. Lava is a profitable label, according to inside sources, and Flom has consistently signed and broken a big act every year or two. But the smart money says that both Lava and Big Machine with remain at UMG; Lucian Grainge is not in the habit of losing these kinds of deals.

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