It’s no accident that these two blockbusters came from the houses of L.A. Reid and Jimmy Iovine, two of the mainstream industry’s most fearsome sluggers.


While Hands and Bronfman Give Pep Talks,
Reid and Iovine Light Up the Scoreboard
GUY & JUNIOR EXPLAIN THEMSELVES: Within the last week, two of the Big Four’s top executives have outlined their strategies for the struggling companies they head, and each tried to give the impression that he had a viable plan to turn things around. In his first detailed prospectus since purchasing EMI, Guy Hands exhibited a degree of naiveté as he promised to redirect the long-struggling company toward the strategies he believes will lead to eventual prosperity following seven years of futile attempts to merge with Warner Music during the reign of Eric Nicoli. While continuing to heap praise on Roger Faxon, Hands has been curiously mum about EMI North America head Roger Ames, whom the conventional wisdom has as the obvious choice for heading up EMI’s recorded music operation. Concurrently, Edgar Bronfman Jr., obfuscating as only he can during his keynote address to The Deal’s Convergence 2.0 Symposium, likened the current predicament of the industry to its dire state in 1980, a half-decade prior to its salvation via the compact disc, as a preface to his laundry list of proposed fixes to the current malaise. A day later, at a Goldman Sachs gathering, Bronfman pointedly hinted that he might finally come around to removing copy protection—which some saw as yet another of his attempts to pull Warner stock out of its doldrums. If that was the case, it didn’t work. Bronfman’s two addresses must have bombed on Wall Street, because the decline has accelerated as soon as he closed his mouth and is now in shouting distance of its all-time low of $9.79… What the Hands and Bronfman texts had in common was an emphasis on digital growth and forming contractual partnerships with artists—in short, the very same concepts that everyone has been throwing around for the last several years. Bronfman would seem to have no other recourse than to repeat the same mantra, finding himself just two weeks from the end of a disastrous fiscal year, one characterized by a ravaged staff and roster, a lack of hits (with few, if any, potential hits on the horizon) and the swooning stock. The full evidence of Warner’s horrendous year will be somewhat camouflaged in the upcoming earnings report by the $110 million Napster settlement the company received from Bertelsmann in April.

“LET THEM EAT CAKE!” As WMG was informing employees that there would be no bonuses for them this year, the word spread through the company that Lyor Cohen had spent approximately $400k on prime seats for the Knicks’ 2007-08 season home games. Not surprisingly, one staffer characterized Cohen’s splurging on ducats while eliminating bonuses as “scandalous.” This is merely the latest of countless arrogant and self-aggrandizing moves on Cohen’s part—a pattern of behavior that has engendered ever-increasing resentment and ill will among the WMG rank and file. Employees there have lost all respect for Cohen and are asking each other how the powers that be could possibly justify renewing his deal, even at the greatly reduced guarantee he reportedly received.

SEEMS LIKE OLD TIMES, FOR NOW: The 1.6 million-plus combined units racked up by Kanye West and 50 Cent last week brought a bittersweet sense of nostalgia to industry veterans—sweet because it turns out that it’s still possible for an album to debut well north of a half million, and bitter because this sort of sales explosion happens so rarely these days. What is inarguable is that Kanye is a remarkably savvy artist and businessman, portraying himself at once as the initiator of the next stage in hip-hop’s evolution and the antidote to the baseness of hardcore rap. At the same time, 50 has shown that a significant segment of the marketplace is still drawn to gangsta rap’s lurid storylines when they’re delivered convincingly. Meanwhile, the mainstream music business has demonstrated that it can still play long ball with the right act and the right album at the right time. It’s no accident that these two blockbusters came from the houses of L.A. Reid and Jimmy Iovine, two of the mainstream industry’s most fearsome sluggers. Like his boss, Doug Morris, Reid has a knack for surrounding himself with other talented executives, and there’s a certain aptness to his upping of longtime right-hand man Steve Bartels to IDJ President/COO during the week of Kanye’s release. Reid has one more event record to release this year—the follow-up to Mariah Carey’s The Emancipation of Mimi (5.8 million), as well as a recently recorded and just-revealed album from Jay-Z inspired by the upcoming Ridley Scott film American Gangster. Iovine’s event record will be from Mary J. Blige (2.9 million)… Another Interscope act got a nice boost from Cupertino, as Feist’s critically acclaimed and commercially active album tripled in sales, from 5k to 15.5k, thanks to wall-to-wall exposure on Apple’s TV spots for the new iPod Nano, starting on the first Sunday of the NFL season… Names in the Rumor Mill: Tom Whalley, Scott Sperling, John Frankenheimer, Joe Galante, Benny Medina, Jeff Kwatinetz, Peter Grosslight, Gary Stiffelman and Craig Kallman.