"We're on top of the pile right now—we have the magic. If there is anything we're doing differently, I certainly wouldn't want to tell [my competition] what it is."


An Exclusive HITS Dialogue With Universal Music Group's Chairman/CEO
While F. Scott Fitzgerald observed there are no second acts in American lives, he never met Doug Morris. As Universal Music Group Chairman/CEO, Morris has presided over the creation of the world's #1 record company, dominating the industry landscape like no other in modern music history by recognizing and then nurturing talented, brilliant and sometimes controversial executives like Interscope's Jimmy Iovine and Island Def Jam's Lyor Cohen. He currently presides over a music conglom which last year set records with more than $1 billion in EBITDA, close to a 30% marketshare and four consecutive years of unparalleled growth, earning him the No. 6 ranking in this year's Entertainment Weekly Power 100. Vivendi Universal's Edgar Bronfman Jr., who first tapped Morris to head UMG six years ago, recently praised his exec in his City of Hope speech, calling him "a consummate professional, an instinctive executive and a great enthusiast. He is also an honorable man I have never had a more rewarding working relationship in my career."
     The Columbia University graduate began his music career in the creative sector, penning the Chiffons' 1966 hit "Sweet Talkin' Guy" and producing Brownsville Station's "Smokin' in the Boys Room." He joined Laurie Records, where he was eventually named VP/GM before launching his own Big Tree Records, distributed and acquired in 1978 by Atlantic Records, which initially named him President of its ATCO imprint. That began a 17-year association with Warner Music, which included appointments as President of Atlantic in 1980, then Co-Chairman/Co-CEO of the Atlantic Recording Group in 1990 with the legendary Ahmet Ertegun. He was subsequently named President/COO of Warner Music U.S. and, finally, Chairman of the operation by Bob Morgado before being fired by then-WMG chief Michael "Where Art Thou Now?" Fuchs.
     Until that point, Morris had been putting together his Warner Music team, which included Interscope's Iovine (Morris put up half the money for the creation of Interscope), Elektra's Sylvia Rhone and Atlantic cronies Danny Goldberg, Val Azzoli, Jason Flom, David Foster and Craig Kallman. After his exit, Doug was hired by fellow songwriter Bronfman Jr. in July 1995, shortly after the Seagram heir engineered the acquisition of MCA Music Entertainment Group. He formed a joint venture, a New York City-based full-service label, Rising Tide, and then founded Universal Records. In November 1995, Morris was tapped as Chairman/CEO of the Universal Music Group, which proceeded to purchase PolyGram in 1998 to become the world's #1 record company. Doug's been smokin' in the boardroom ever since.
    As a onetime songwriter/producer himself, Morris is a staunch believer in creative independence and has stood up for any number of controversial artists, from 2 Live Crew's Luke Campbell to Eminem and Tori Amos
     These days, the affable Morris is having the time of his life. Too nice to gloat, the well-liked exec nevertheless took a few moments of his time to detail his accomplishments to someone who could use a few of his own, HITS' resident pool boy Marc Pollack.

The recent Vivendi Universal half-year figures underscore Universal Music Group's outstanding performance, with nearly 30% of the music- market. How do you maintain this high marketshare?
There is no mystery. It's because I try to surround myself with the best people. The bottom line is that companies are like sports teams: The team with the best players will always win.

You always give credit to your team. How does that mentorship approach differ from the way other label chiefs conduct their business?
I don't know what other people do. I just know that when someone does something exceptional, they deserve the recognition. Very often, their accomplishment is taken by someone else. That doesn't happen at our company. I've learned how important it is to recognize these talented executives, try to impart my experience to them and then give them 100% support. This has worked for me and I'm very proud of the music people I've been associated with.

How did you assemble the team and keep them happy?
You assemble a team by knowing who's good. That knowledge comes from experience and not buying into the B.S. To keep them happy, you better pay them correctly. What someone earns is a measure of your respect for them. I would never want to hire someone "on the cheap." People you believe in must be paid more than fairly.

What do you value most in your team of executives?
I value their work ethic, intelligence and competitiveness. If you get it right, you create a culture that stands above the crowd. What we wanted to do at UMG was create a company that has no equal—and that's all about the quality of our people.

UMG seems to be a lot more aggressive than the competing music groups.
I think that may be true. We put together a string of very successful years and that gives us the ability and reputation to expand our reach. I know it's important to keep moving forward when you're doing well. There's no sitting on our laurels with this bunch.

Is the executive talent out there capable of bringing their own companies to the position that you now hold?
I think so. Tommy Mottola is an extraordinary record executive. Roger Ames, Alain Levy, Donnie Ienner—they're all proven, quality executives. And what can you say about Clive [Davis]—absolutely amazing. But, right now, I don't think their teams are in as good a place as ours, but only time will tell. There are plenty of young people who are coming up and will, within the next five to 10 years, replace us. We're on top of the pile right now—we have the magic. If there is anything we're doing differently, I certainly wouldn't want to tell [the competition] what it is.

When we speak to UMG executives, they all mention your nurturing ability. Who was your mentor?
I learned a lot from Ahmet [Ertegun]—he's a very smart and savvy record executive. One of his great talents is knowing what to say in any situation. For example, I've been in his office when someone would come in and say, "Ahmet, you've done a lousy job with my record. You ruined my career. I hate you. You're a miserable person." Now, my reaction would have been to get up and be angry. Ahmet would lean back and say, "That makes me feel so bad, because I really like you." That was an interesting observation for me. It always struck me as a bit pragmatic, but I learned a lot from him. It's tough to get me sore.

The heads of the labels have been in their jobs since the PolyGram acquisition.
Stability is very important. Sometimes you need to have the courage to stay with someone and see them through the difficult times. I believe in being more supportive when someone's cold—they don't need you when they're hot.

Let's talk about the fourth quarter.
I believe we'll have a very good fourth quarter. We have many major artists coming out. Last year, we peaked a little early. We had a great run in August and September. This year, I think we'll hit the Christmas business exactly right.

How intense is the competition between the labels within UMG?
I think they all strive to be the best and, therefore, they do compete among themselves. But, being professionals, they realize the real competition is on the outside.

Some would say that 34% marketshare is a ceiling.
I don't know. We haven't gotten there yet, but if it's doable, we'll do it. It's not always so easy to keep increasing marketshare. You have a 50/50 chance of going down. It's sort of fun, though, to set a goal and try to achieve it. I don't know if 34% is the goal; I just know the goal is to do the best you're capable of.

Are you happy with the way things have gone following the sale of Universal to Vivendi? What is it like for you being part of a larger company?
Everything has gone very smoothly—the merger has given us a larger platform to operate on and a much greater reach. [Vivendi Universal chief] Jean-Marie [Messier] has shown us enormous respect and support and allowed us complete freedom. Edgar's vision of building the world's most important record company is a reality and, at this moment, all is well.

When will we see the Internet account for a significant portion of revenue?
The Internet is simply an alternate distribution platform and another marketing and promotional tool. The industry will sell music electronically, but no one knows when it will really reach critical mass. For many years we've been a packaged-goods service selling little round things in stores. The new source of revenue from subscription or downloading is additional business and that revenue stream will increase. It has been difficult to sell music over the Internet because it has been so widely available for free. It also hasn't really been set up in a way that facilitates the customer. It has to be all about the consumer. You can't build from the top down It has to be from the consumer up. Ease of use, what the buyer wants—that's still the challenge and the ultimate goal. The golden ring is a new source of revenue that we can extrapolate into the future.

The supposed lack of morals in the music industry has been slammed over the years. However, the telethon was a good example of how the music industry is capable of supporting larger issues in a positive fashion.
It seems to me that generalizing about any industry is dumb. I personally think the music business stands tall in bringing forth different points of view, defining the rights of young people and documenting our culture. Music has always been a tremendously powerful form of communication. It excites, it soothes, it heals and it places great exclamation points on certain moments. The telethon was one of those moments. Everyone associated with our industry should feel proud.

What do you think about the current state of the industry?
I think it is what it is. Right now, the industry is selling fewer records. Next year, we'll probably sell more. It's always been like that. You get hot and after hot comes cold. And thank God it gets hot again. Whatever the state of our industry, it's always something exciting. If you can carve out a career in the music business, it's a happy life.

What people are talking about right now. (9/23a)
It's been a while since anybody outpointed Bad Bunny. (9/23a)
A toast to Philippe and Alissa (9/23a)
Who's ready for Kyncl culture? (9/19a)
RIAA drops some stats. (9/22a)
New categories! New rules! New WTF!
It's the one you didn't see coming.
"Who took my passports?"
Allow us to apologize in advance.

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