Jimmy Shoes.  That’s what they called Jimmy Iovine in the studio.

They laughed at him behind his back.  Without a college degree, driving a Mercedes-Benz coupe, needing to work his way up the ladder.

Yes, Jimmy needed it.  We can analyze why, but that’s not important.  Iovine’s drive brought him to the top.  From Shelly Yakus’ assistant to employing Shelly on his production projects to working with Stevie Nicks, then U2 and eventually helming Interscope.  The business was built upon the backs of men like Jimmy Iovine.

But somewhere along the line, the culture changed.  Ahmet and his brother did not arise from the bottom financially, but they needed to follow their passion for music.  This is what drove them.  Mo Ostin fell into running a record label.  A financial wizard, Frank Sinatra put him in control and Mo learned on the gig, eventually blossoming and constructing the best record company that ever existed.

All the old titans didn’t come from within.  They were scrappers.

But then came all the money.

Ahmet sold Atlantic to Warner for a pittance.  Less than Tommy Mottola made at Sony in a year.  You see in the nineties, all the label executives made so much money that they suddenly saw themselves as members of a different class.  No longer street urchins, but refined hitmakers, who lived a lifestyle befitting kings.  They’d left their histories behind.  They got together at City of Hope dinners and made like they were friends.  And when Napster arrived they were caught completely flat-footed.

Funny, because the impresarios of yore capitalized on trends.  Whether it be folk music, British Invasion, the San Francisco sound or disco.  They chased a buck.  Utilizing the same logic, shouldn’t they have chased the Internet?

But they felt superior to the Internet.  Especially to boy wonder Shawn Fanning and his band of renegade backers. Hummer Winblad was a venture capital company.  Fanning’s uncle was only in it for the money.  These people didn’t know anything about music.  These interlopers had to be taught a lesson.

But it was these outsiders who imparted a lesson to the music business.  That the fat cats still haven’t recovered from.

Despite the press releases, suing customers does not decrease P2P trading.  But rather than admit this truth publicly, the barons of yore are fighting the public will.  The public is now the enemy.  As if eons of commerce rules can suddenly be erased.

I was on a conference call with the President of a major label.  He was trying to convince me that it was a mistake to sell at iTunes.  Longwinded, he went on for ten minutes without me interrupting.  And then I told him he was wrong.  So, this gentleman launched into another ten minute spiel, essentially the same, yet delivered more vociferously.  I repeated my mantra and this gentleman became exasperated.  So, very slowly, he started in one more time.  And after telling him I understood his logic but the marketplace dictated otherwise, he told me we had to meet in person, so he could show me.

I wondered what it was like to work for this person.

I don’t know if you read that article in the "New York Times" about the shrinks to the ultra-rich.  They charge $750 an hour. When one doctor asked a recalcitrant Congressman if anybody ever disagreed with him, this lawmaker said it had happened once.  And he’d fired the underling.  No wonder the Congressman wasn’t heeding the shrink’s advice!

That’s what those running the old wave music business are like.  Forces of nature.  Believing they can dictate reality by sheer will.

They told their employees to scrub P2P software from their computers when logic would tell you they should be stealing like crazy, to find out how the public, the supposed enemy, is functioning.  But if you stood up to your boss you were considered a troublemaker, you were fired.

I just finished reading Malcolm Gladwell’s November 10th "New Yorker" story entitled "The Uses Of Adversity".  It focuses on Sidney Weinberg, who rose from the streets to run Goldman Sachs.  His success was based on being an outsider.  He could speak the truth that those in the club could not.

The music industry has become a club.  It doesn’t want to hear any contrary opinions.  It believes it’s entitled to rule forever.  And it’s precisely this insider quality that’s devastating it.

Jimmy Iovine’s a bit smarter than most.  He still knows it’s about the artists.  He no longer demonizes Net startups in print, but sidles up to some.  But his sheer power has created a blind spot.  He’s no longer of the street.  He’s about image.  The number one hitmaker, the Oz of the chart.  And this is hurting him and Universal Music.

Has Doug Morris been hampered by graduating from Columbia?  Can he not sympathize with the college dropouts that are creating the applications that are ruining his business?

Edgar Bronfman, Jr. never had to steal.  Maybe he doesn’t understand the mentality.  Lyor Cohen is not going to cross him because he’s being paid too much.  As for the money men…  The holier than thou private equity companies want nothing to do with the street.  They want to fly private and stay at exclusive resorts.  They’re out of touch, and they believe money triumphs in the end.  But no amount of money has been able to stifle file-trading.

As for Clive Davis, he has just denied the future.  As if Whitney Houston can be rehabilitated and can sell ten million CDs.  As for telling Mr. Davis that he’s wrong, that hasn’t happened in memory.  He takes pleasure from always being right, from wining and dining media heavyweights to promote his vapid projects.

But the masses aren’t watching TV and listening to radio.  Not those stations, not in quantity.  And niche product made for almost nothing on computers is revered by many.  But since this is so scary, the concept of relinquishing control, of possibly being wrong, of needing to learn something, the old heavyweights would rather jeopardize their businesses than risk losing face.

You can’t change the truth.  But you can listen to it.

The Uses of Adversity