By Hillel Aron
By Joseph Tsidulko
By Patrick Range McDonald
By David Futch
By Hillel Aron
By Dennis Romero
By Jill Stewart
By Dennis Romero
“I often notice, when I’m talking with people involved in the arts, that their concept of what they want to do is to aim for the biggest, most obvious target, and hit it smack in the bull’s eye. That’s success, whatever the particular field is. Of course with everybody else aiming there as well, that makes it very hard to hit. It’s made hard to do. It’s made expensive. As Jon Hassell always says, I prefer to shoot the arrow, then paint the target around it. You make the niches in which you finally reside.”
So, where do we stand? I’d like to avoid predictions because, frankly, I’m not sure what it means that Apple’s iTunes sold 100 million songs or what it would mean if they sold 100 million more during Xmas season 2005. I’m certain most of the bottom-line businessmen in the industry feel the same way, because their real fortunes are tied to the Billboard charts, not the future.
I do have a gut feeling, though, and to confirm it, I traveled to the 18th annual South by Southwest music festival in Austin, Texas. SXSW is to non-blockbuster music what Sundance is to the world of non-blockbuster film, and this year it drew 1,200 acts and 7,200 registered participants, among them many of the future A&R men, club bookers, label owners and talent scouts of America. I came away with two case studies.
First, the convention’s biggest controversy: The scheduled keynote speaker, Arista CEO Antonio “LA” Reid, was replaced at the last minute by proto–rock & roll icon Little Richard. The reason? A messy boardroom war between Reid and that Monterey starmaker Clive Davis.
In the years after the Monterey festival, Davis had followed the same bland-is-better path as Mutt and Shania, with Chicago and Billy Joel in the ’70s, Whitney Houston and Kenny G in the ’80s. He was rewarded with his very own label, Arista, but by the ’90s, he was readily admitting that he “never got rap music” (he funded the rise of Puff Daddy), and his reputation for hits had increased as his reputation for “golden ears” had faded. His bosses at BMG deposed him in 2000, fearful of his increasingly out-of-step tastes.
Davis quickly got back on his feet, though, with J Records, a label funded by the same company that axed him, and by January 2004 he’d clawed his way back into their good graces. Reid was fired; Davis became CEO of the parent company, BMG; and Arista, the label he had molded and shaped for two decades, was dissolved. Now he’ll head the newly merged Sony-BMG. Rumor has it the company’s “music people” are rushing for the exits.
The lesson: Among old Cynics, corporate machinations trump music any day.
Second, the SXSW convention’s biggest news: Just prior to the event, Edgar Bronfman Jr., the impossibly wealthy heir to the Seagram’s liquor fortune, completed his purchase of Warner Music Group from Time Warner.
This was the latest of many Bronfman forays into the music biz. As a songwriter, he penned Dionne Warwick’s ’80s hit “Whisper in the Dark”; in the ’90s, he led Seagram’s purchase of Universal’s entertainment business. His luck turned disastrous in 2000, when he allowed the family empire to be purchased by Vivendi, the French utilities company that was attempting to transform itself into an entertainment enterprise. The new, scandal-ridden company would go on to lose 60 percent of its value, as CEO Jean Marie-Messier resigned in disgrace.
With the purchase of Warner, Bronfman did things differently. Rather than mix it up with various corporate behemoths, he banded together with a number of equity firms and transformed Warner into a privately held concern. While the amount of money they put up is intimidating — $2.6 billion in cash and other considerations — it doesn’t change the fact that these funds are private.
Bronfman’s purchase was heralded at SXSW by a widely circulated memo announcing the likelihood of a 20 percent employee layoff at Warner. To pick up on a theme, what once was big would grow small. Gone nearly unnoticed, however, was one odd fact: Now shielded from public markets, Warner Music Group would be the biggest independently owned label on the planet. The company’s new American CEO, Lyor Cohen, has since kicked off the “Incubator System” — incubate being a euphemism for “stealing bands from smaller labels.” Indies will be offered money and resources to help “develop” young artists.
The lesson: It looks as if Edgar Bronfman might just give new meaning to the phrase “Gimme Indie Rock.”
Here is the moral of our story: In a music industry filled with Cynics and True Believers, they say the good men die like dogs, and the bad men make out like bandits. “Good men” has always been code for the True Believers, people who actually like music. Well, it’s about time the Cynics start watching their ankles. Some of those dogs have grown teeth. And they might turn out to be pit bulls.