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"I try not to answer my detractors. I let the businesses speak for themselves."
TALKIN’ LIQUOR AND MUSIC
WITH EDGAR
VU Exec. Chairman Bronfman Jr. on Sept. 11, the French, and Being Honored by City of Hope
Liquor and music have always been closely linked, but no one has played a larger role in the distribution of both than Edgar Bronfman Jr. The 45-year-old father of seven joined the family business, Seagram, in 1982 as Assistant to the Office of the President before rising through the ranks to President/CEO in 1994, with side trips to Hollywood as a producer and forays as a songwriter along the way. Bronfman has made many controversial moves as heads of Seagram, especially when, in 1995, under his guidance, the company purchased 80% of MCA from Matsushita for $5.7 billion, later changing the company's name to Universal after its film studio. In 1997, Bronfman sold the majority of Universal TV to media veteran Barry Diller, and for the first time, Seagram’s entertainment divisions outperformed its traditional beverage business. In 1998, Seagram paid $10.6 billion to buy PolyGram, creating the world's largest music company. Last year, Bronfman sold Universal's operations to French giant Vivendi, becoming the combined company's second in command. In the tradition of such luminaries as Quincy Jones, John Sykes and Frances Preston, Vivendi Universal Exec. Vice Chairman Edgar Bronfman Jr. will be honored with the City of Hope’s Spirit of Life award on Oct. 11. A who's-who of artists headed by Mary J. Blige, Jon Bon Jovi, Melissa Etheridge, Shelby Lynne, Smokey Robinson, Sisqo, India.Arie, Jonny Lang and the Temptations will be on hand to perform Motown songs as part of the festivities. HITS' resident teetotaler "On Your" Marc Pollack donned a French beret to grill the man, though he turned down his offer of a wine cooler in favor of chocolate milk.

What does the City of Hope "Spirit of Life" honor mean for you?
It's really a way to help an extraordinary institution continue to deliver on its mission. It’s such an extraordinary place, not only for medicine but for its compassion. The ability to help the City of Hope meet its mission is what this is all about. Research at the City of Hope has literally revolutionized the practice of medicine. Fifty percent of all insulin-dependent diabetics in the United States are now treated with a synthetic insulin discovered at the City of Hope. And the hospital’s research scientists are at the cutting edge of cancer treatments that provide new hope for a cure for this catastrophic disease.

Have you visited the City of Hope facility?
I’ve been to the hospital. I’ve met with the doctors. Obviously [UMG President/COO] Zach [Horowitz] has been involved for 30-odd years. He has always been very committed, and I’ve always been very supportive of Universal’s leadership role, through Zach, in all of the Spirit of Life awards. I’ve also been involved in meetings with other industry leaders to elicit support in the fundraising.

I’ve actually been able to seek their advice. They’ve been very helpful with referrals. I lost a sister-in-law—my older brother’s wife—about 11 years ago to breast cancer. She wasn’t treated at City of Hope. She went through the bone-marrow transplant procedure up in Stanford, but it didn’t work for her. So there’s a personal connection here for me, too. It’s important to see City of Hope saving lives that otherwise would be lost.

There has been an outpouring of donations in the wake of the events of Sept. 11. Do you think it will have a negative effect on raising funds for City of Hope?
I know of no more deserving institution, on an ongoing basis, than City of Hope. Obviously, at this moment in time, there will be people who focus their charitable donations elsewhere, but I do hope that we’ll have a very successful event and the City of Hope will be able to raise a lot of money because, fundamentally, what they do is so important.

You are a big supporter of Israel and the Jewish community. How did the tragic events touch you personally?
I certainly reacted as an American first, as a person who loves and cherishes freedom second, and, as a Jew, third. I reacted as a father and husband and brother. Everyone has a great many different feelings. I would say it’s probably awakened in everyone the fundamental truths that there are things not to be taken for granted—love of freedom, love of pluralism and a compassionate and open society. As a Jew and a supporter of Israel, it makes it easier for Americans to understand the struggle that Israel faces—perhaps it makes it somewhat easier for Americans to understand why Israel is reacting in a way many Americans have disagreed with in the past. And I’m not suggesting their disagreement is wrong, but perhaps the reaction has been made more understandable. Ultimately, this is not between Jews and Arabs and it’s not a war between the West and Moslems or Islam. It’s a war between people who believe in fundamental human freedoms and people who don’t.

Are you proud of the way the music and entertainment industry has banded together around these events?
The music industry has been, almost consistently, nothing but the brunt of criticism for several years. This reaction to the tragedy in New York was, fundamentally, a fairer picture of the people in the music industry and the caliber of their commitment than all of this nonsense from the past few years. It shows the true colors of the people who care about their arts and their country. They care about their fellow citizens. I am so proud of people like Universal Music Group’s own Jimmy Iovine, who gave himself so selflessly to make possible the recent telethon. I have been extremely proud of the industry, both musicians and executives, coming together to make it happen.

How does the harsh glare of the media spotlight make your job more difficult?
Right or wrong, I try not to answer my detractors. I let the businesses speak for themselves. Three years ago, they were writing that we would never get the movie studio right and we now have the most successful film company out there. Three years ago, they were writing that the PolyGram merger would be a disaster and now we have the largest music company in the history of the world. But you can’t really answer skeptics by making promises. You answer skeptics by delivering the goods. I feel we have delivered the goods. The theme park, film and music businesses are all clicking and the USA Networks deal speaks for itself. There are few people who can claim that they’ve had a better investment over the last 2 1/2 years and one which retains a better future. I’m very proud of my track record and very much at peace with the way it has played out.

Let’s talk about music. UMG has been very consistent in its ability to grab almost 30% of the market share while keeping its top-level executives in place.
There are many important ingredients, but stability is certainly one of them. The reason for our success in the music industry is entirely due to the quality of the management there and that’s [UMG Chairman/CEO] Doug [Morris], Zach and all of the label heads. There are other executives who may not have a high profile, but, for instance, there isn't a better business affairs department in the music industry. There’s not a better legal department. There’s not a better sales department. Jim Urie, who runs UMVD, is also the best. What makes me so proud of Universal Music Group is that its excellence isn't confined to any one particular area.

Do you have any regrets about selling the company to Vivendi?
None. I think it’s very important for the music company, in order to continue to be successful, to be aligned with a larger group. You look at the struggles of smaller companies in terms of entertainment assets and it’s not easy for them. And, although we have this fantastic company, it will be able to grow more quickly by having access to all of the financial strengths that Vivendi has brought to the table.

What is your current role at Vivendi-Universal?
I see myself as the #2 executive in the group. I have broad strategic responsibilities along with [Vivendi Universal Chairman/CEO] Jean-Marie [Messier] to determine the overall destiny of the company, and on a day-to-day basis, to oversee the activities of the group here and all of the Internet activities globally.

When will we ever see the Internet generate significant revenue?
It will take some time. We have to continue to fight the legal fight. We’ll have to add layers of protection and alternative subscription services. In order to do the latter, music publishers will have to decide whether or not they care about the music industry enough to allow us to be able to deliver music through subscription.

I see the Internet as a very exciting distribution channel that allows us to sell and package music in ways that physical distribution channels cannot provide. There will be many new product services offered digitally rather than in a physical format and that’s good news. It's the fundamental core of our business, with assets like Rollingstone.com, GetMusic.com, farmclub, Emusic, etc. If you look at the results in the marketplace, these sites are growing.

You've also recently announced a new anti-piracy technology the company will include on its CDs.
I really can’t talk about that from a competitive standpoint. But it makes no sense for artists, songwriters and rights holders to simply stand by and allow wholesale piracy of their property. At the same time, we want to make sure the consumer experience is not impeded. There needs to be a line drawn between legitimate uses that consumers are entitled to and the illegitimate uses that they are not entitled to. We will employ any technology that will help us draw that line.

As a songwriter, how do you relate to the needs of the music industry?
The music industry is, by and large, quite fair to artists, songwriters and performers or else the industry would have fallen on its own sword long ago. The fact is the industry invests billions of dollars annually on artists all over the world and very few of them become successful. And those that do succeed make a very good living, particularly those that write songs. What we don’t want to do is see that right taken away from artists or the ability to invest in new artists taken away from record companies by this massive piracy which is enabled because of the ability to make perfect digital masters with no protection.

Do you still have time to write songs?
Less and less. I’ve never been very prolific, but I still do write from time to time. I’d love to do more. It’s one of the things I love, but I get to do it very rarely.

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