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The sackings appear to have directly followed an ultimatum from the EMI Board to Nicoli to fix the ailing company once and for all or else.
I.B. BAD ON WHAT REALLY HAPPENED TO LEVY & MUNNS AND WHAT’S NEXT FOR EMI
Also in This Episode: Roger Ames, Jermaine Dupri, Janet Jackson, Barry Weiss, Britney Spears, Steve Barnett, Bob Cavallo, Clive Davis
THERE’S NO BUSINESS LIKE BISCUIT BUSINESS: Although EMI has been unable to pull itself out of a prolonged slump, very few people inside EMI or around the industry anticipated the firings of music heads Alain Levy and David Munns last week. But now that the deed is done, some of the details are beginning to come to light. According to insiders, Levy and Munns were in New York Wednesday night for a Norah Jones event when they were told to immediately return to London in order to present their latest restructuring/cost-cutting plan to Eric Nicoli. After the meeting, which reportedly took place in a hotel suite, the two executives were dismissed by their boss. The sackings appear to have directly followed an ultimatum from the EMI Board to Nicoli to fix the ailing company once and for all or else. The EMI Group head, who came to the company from United Biscuits in 1999, was, of course, the one responsible for bringing in Levy and Munns in 2001, and for redoing their deals about two years ago, making their termination at his hand a tacit admission of failure. In another surprise—one that has many raising their eyebrows in disbelief—Nicoli put himself in charge of music. This revelation caused industry watchers to wonder what role, if any, will be played by highly regarded music man Roger Ames, who became an EMI consultant soon after being relieved of his duties as Warner Music chief in 2004. Will Ames now step up and take a more active role, considering Nicoli’s lack of experience in music? And if Nicoli actually intends to name Ames as the new head of EMI Music, what is the amount of time deemed proper by English etiquette before he’s formally named as Levy’s replacement—and Nicoli’s last hope? It’s believed that there has been some strain in the relationship of Levy and Ames over the years, both while they were at PolyGram together and while Ames was at WMG, and some believe they never did kiss and make up, even after Ames went on the EMI payroll. In any case, the naming of Ames would be a logical move if the new plan is to spruce up the company for a sale. Without proper management, the present ownership will have a hard time selling to anyone other than a strategic buyer like WMG, which can pay the most because of cost cutting. But what is EMI worth? Considering that BMG Music Publishing sold for north of $2 billion, some assert that EMI Music Publishing should be valued at $3.5-4 billion by itself. Additionally, it would appear that the master recordings of the Beatles, the Beach Boys, Pink Floyd, Frank Sinatra, Nat King Cole and the rest of EMI’s rich catalog are certainly worth more than a billion total. Last summer, EMI rejected WMG’s $4.8 billion offer. It would look bad if the company accepted a lesser offer now… Obscured by recent events is the status of former Virgin head of Urban music Jermaine Dupri. Reports surfaced last week that Levy and Munns had agreed to let Dupri out of his long-term EMI contract after attorney John Branca had negotiated an ambitious, free-standing entity for the label-less executive at the company. While it’s possible that Nicoli (or Ames) would rescind the order, that seems unlikely since EMI is looking to cut $200 million-plus in costs and the move would probably put the company in breach. So expect Dupri to still walk... As to where the sought-after free agent will land, the smart money is on L.A. Reid, with whom Dupri has a longstanding relationship forged over numerous joint successes, notably including Mariah Carey’s remarkable comeback project. If Dupri does wind up at IDJ, it appears that former Virgin artist Janet Jackson could join him. There’s certainly a historic precedent here—a longtime superstar in decline (her most recent album barely topped 600k), Jackson seems perfectly cast for another of Reid’s signature reclamation projects. The Emancipation of Little Sister, anyone? … In perusing the year-end marketshare tally (see report), three storylines stand out: Columbia taking top honors in both new-release and overall marketshare (at 7.3% and 7.2%) during the label's first full year under Steve Barnett’s savvy leadership; Disney exploding to 5.5% from 2.9% in ’05, for a #5 ranking in the new-release category, with the #1 and #2 sellers in High School Musical and Rascal Flatts (just south of 3.5m) as well as #8 Hannah Montana; and perennial power Interscope losing three percentage points, or more than a third of its new-release share on the year, from 8.6% to 5.6%, to finish at #3. The fact that UMG stayed virtually flat in new releases is due in large part to the remarkable performance of the distributed Disney labels, which gained nearly as much as Interscope lost… Whether 2006 marked the end of rap’s dominance as a mainstream genre is hard to gauge, but the year’s biggest hip-hop release, from Atlantic’s T.I. (#19; 1.6m), finished below four rock albums—Nickelback (#4; 2.7m), Hinder (#10; 1.8m), the Red Hot Chili Peppers (#13; 1.7m) and The Fray (#16; 1.6m)—as well as four country releases… Following two tumultuous years, look for the leadership of the major labels to return to a state of stability, with one possible exception, and expect a renowned creative executive to join one company’s power structure… Despite rampant tabloid rumors, Britney Spears is definitely not being dropped by Jive. Spears’ last album, released in November 2003, sold just under 3 million units, and no label head would drop an artist who can move that many units—certainly not Barry Weiss, who just signed a new deal, keeping Zomba under the expert oversight of one of the industry’s foremost executives. Spears is in the process of recording with all the top Pop writer/producers... Hot on the heels of their breakout ’06, the Disney Channel and Bob Cavallo’s Buena Vista Music Group are at it again, preparing to continue their domination of the preteen market with the soundtrack to the Disney Channel TV movie Jump In, this week’s likely chart-topper. Some are asking whether Jump In, which stars High School Musical cast member Corbin Bleu, will be to 2007 what the 3.7 million-selling Musical was to 2006, i.e., the year’s biggest album. Disney’s soundtrack successes, which also include Hannah Montana (just under 2m) and Cheetah Girls 2 (1.2m), have also generated tens of millions in touring and merchandising revenue, comprising the latest in a growing list of TV-to-music plays. This ongoing series of breakthroughs has everyone wondering why Nickelodeon, which tops all the kid demographics, hasn’t taken advantage of its sizable rabid audience to make a music play of its own, thereby deriving significant additional revenue from album sales, touring and merch... Moving to the most longstanding present-day example of the TV-to-music phenomenon, noters noting that 2006 American Idol winner Taylor Hicks (whose sales to date are under 600k) continues to be outpaced by second runner-up Daughtry (1.1m) for a simple reason: the rock-leaning Daughtry has radio hits and blue-eyed soul singer Hicks doesn’t—not yet, at any rate. While it’s too soon to know whether Daughtry will have the sort of impact on 2007 sales at Clive DavisRMG that 2005 AI winner Carrie Underwood (#3 on 3m) had last year, recent history says not to bet against it. The Idol rocker could get some competition from Hicks and/or ’06 first runner-up Katharine McPhee, whose debut streets on Jan. 30... The closing of Tower continues to have a dramatic impact on the jazz and classical sectors, as some predict the shuttering of several niche labels in the coming months. Will Concord and other indies benefit from this change in the landscape?… Names in the Rumor Mill: Don Passman, Michele Anthony, Tom Whalley, Andy Gould, Rob McDermott, James Taylor and Lionel Ridenour.
AND THE NOMINEES ARE...
The inevitable and the unexpected commingle. (11/25a)
TOP 100 WEEKLY MARKETSHARE:
THE TIGHTENING
Cue Archie Bell & the Drells. (11/24a)
STATE OF PLAY
IN THE U.K.
The first entry from our 2020 U.K. print special is now online. (11/25a)
AMAs TACKLED FOR LOSS BY SNF
Oof (11/24a)
MUSIC ORGS IMPLORE CONGRESS FOR HELP
The gang's all here. (11/24a)
RAINMAKERS 2020
Bring your umbrella.
GRAMMY OUTLIERS
Mulling possible surprises.
ZOOM THANKSGIVING
We're virtually stuffing ourselves.
TRUMP'S LAWSUITS
He's lost 25 out of 26, and so tired of winning!
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