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The UMG-Microsoft deal has the entire music industry fantasizing about a scenario in which the Big Four had split up $3-4 for every one of the 70-80 million iPods sold to date.

I.B. BAD: THE GEEK STAR WARS PITS JOBS VS. GATES, HEAD TO HEAD

Also Starring Doug Morris, Jimmy Iovine, L.A. Reid, Steve Barnett, Mel Lewinter, Sylvia Rhone, Monte Lipman and Roger Faxon
HOW ZUNE IS NOW? The significance of UMG’s pact last week with Microsoft giving the music group a piece of the revenue from the sales of Zune players—at least $1 for every $250 Zune sold, according to N.Y. Times reporter Jeff Leeds—can’t be overestimated. The deal has the entire music industry fantasizing about a scenario in which the Big Four had split up $3-4 for every one of the 70-80 million iPods sold to date. The majors all readily agreed to play ball with Apple five years ago, failing to consider the fact that Steve Jobs’ mission was to sell hardware, not music. Thus, the industry’s take relative to that of Apple equated to a gnat on the back of King Kong. In the wake of this precedent-setting deal—yet another example of Doug Morris’ quest to ensure that UMG is compensated for every use of its content—some in the industry have concluded they were duped by Jobs. The UMG-Microsoft agreement strongly suggests that they won’t get fooled again when the majors’ current deals with Apple run out next year. As Morris stated at the Merrill Lynch conference two months ago, “Fool us once, shame on you. Fool us twice, shame on us.”... The specific importance of this new arrangement will depend on whether the Zune is able to carve out a sizable slice of the marketshare pie—which might as well be called an Apple pie to this point. What, then, will UMG do to make the Zune player and store stickier? Some believe the company will try to gain leverage with Jobs by giving the Zune store some exclusive content, as the majors have long done with the iTunes Music Store. But no matter what the labels attempt in an effort to get a piece of iPod sales, Jobs has all the leverage at this point by virtue of the fact that Apple controls the digital marketplace. A recent study cited by Leeds estimating that iTMS has sold an average of just 20 songs per iPod, with 95% or more coming from ripped CDs and P2P downloads—making Apple’s absolute preeminence in the digital revolution that much more apparent… The best hope for a big finish from perennial powerhouse Interscope Geffen A&M following its slow start this year rests with the just-released second album from The Game (whose debut sold 2.3m). Label insiders are hoping for a 450k-500k first week on the album, which will debut at #1. The Game is the first of several IGA superstars with new releases on deck; Tupac, Snoop and U2 street on Nov. 21, followed by Gwen Stefani on Dec. 5—so it appears that Iovine’s empire will close out the year with a bang… L.A. Reid’s Island Def Jam has some heavy artillery of its own, led by Jay-Z (11/21; 3.2m), the prognosticators’ consensus pick for the biggest debut of 2006. Also coming from Def Jam's deep rap roster are new albums from Young Jeezy (12/12), Nas (12/19) and Fabolous (12/26)... Jay-Z and his labelmates should move enough units to put IDJ at #1 in the new-release marketshare competition on the year, although it will be challenged  by Steve Barnett’s Columbia, which should take the top spot in the overall category… As for Universal, the remaining sector of Doug’s World, Morris and Mel Lewinter’s splitting of the company into two labels in February appears to be paying off, with both Sylvia Rhone’s Universal Motown and Monte Lipman’s Universal Republic finishing strong. Universal Motown’s Blue October, JoJo and Birdman & Little Wayne, and Universal Republic’s Hinder, Jack Johnson and Godsmack provide the proof in the pudding, while retail mavens expect Rhone’s Akon release, through Steve Rifkind’s SRC, to do big numbers next week. Thus far, the combined marketshare of the two labels is a push from a year ago, but they're effectively developing artists, and they've held steady without the benefit of a release from Nelly… The black music division at one label group is said to be in great turmoil, with talk heating up that the head of said department is about to exit stage left... Roger Faxon is already making his presence felt as the sole ruler of EMI Music Publishing just two weeks after the early departure of Marty Bandier. His first move, according to insiders, will involve the replacement of EVP Creative Evan Lamberg with up-and-coming executive Dan McCarroll, who’ll join Jody Gerson as Faxon’s creative go-to team. Lamberg will stay on at the company for the time being, but he’s expected to become a free agent when his deal is up, bringing up the possibility that he’ll then rejoin his mentor Bandier wherever he lands. Worldwide Vice Chairman Bob Flax, a close and longstanding colleague of Faxon, will obviously continue to play his key role within the pubbery… Names in the Rumor Mill: Clarence Avant, Fred Davis, Irving Azoff, Nancy Berry, Chris Lighty and Bryan Turner.
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