{"id":625,"date":"2006-12-11T11:36:04","date_gmt":"2006-12-11T19:36:04","guid":{"rendered":"http:\/\/lefsetz.com\/wordpress\/index.php\/archives\/2006\/12\/11\/2006\/"},"modified":"2006-12-11T11:36:04","modified_gmt":"2006-12-11T19:36:04","slug":"2006","status":"publish","type":"post","link":"https:\/\/lefsetz.com\/wordpress\/2006\/12\/11\/2006\/","title":{"rendered":"2006"},"content":{"rendered":"

The Firing of Tom Freston<\/strong><\/p>\n

One thing never changes.\u00c2\u00a0 Those who pull the strings, those behind the scenes, those who make all the money…they want to be in FRONT of the camera, they want the adulation, the props, the LOVE!<\/p>\n

David Geffen was one of the most powerful men in Hollywood until he agreed to sit down with Tom King for the book that ultimately came out as "The Operator", wherein King David was revealed to be a duplicitous man who would manipulate\/fuck over his friends to gain a business advantage.\u00c2\u00a0 His career has not been the same since, no one is quite as fearful, furthermore, Geffen retreated, for he was EMBARRASSED!<\/p>\n

Sumner Redstone gained respect for building Viacom, but only from insiders, only from those who knew this guy started out with a chain of movie theatres and clawed his way to the top while none of the usual Hollywood players were watching.<\/p>\n

Then the dreaded end started approaching.\u00c2\u00a0 In other words, DEATH!\u00c2\u00a0 Fearful that his time was up, like a lumbering giant, Sumner gave a few final howls, wreaking havoc along the way.<\/p>\n

He fired Tom Cruise.\u00c2\u00a0 Then he fired Tom Freston.<\/p>\n

We’d cut Sumner a break, but the "Vanity Fair" article revealed him to be a tired old man whose thinking process was in question.<\/p>\n

Yes, this gentleman who said he would live forever, knowing so much about nutrition, was falling over in his home, losing thought in midstream.\u00c2\u00a0 And it was only rumor until he sat down with a "Vanity Fair" reporter and the truth was laid out for everybody to see.\u00c2\u00a0 Now Sumner is viewed as a tired old iconoclast who wants to go down fighting.\u00c2\u00a0 A grandpa one step from the nursing home, who makes your life miserable.<\/p>\n

Tom Freston was the most revered executive in the music business, maybe the entertainment business.\u00c2\u00a0 He knew you by name, and when he interacted with you he wasn’t phony, but real.\u00c2\u00a0 If you worked for him he gave you space, to do it your way, he did not micromanage.\u00c2\u00a0 And he was loyal.\u00c2\u00a0 He stuck by you, you had job security.<\/p>\n

His flaw was he was not a suit.\u00c2\u00a0 He wasn’t about money first.\u00c2\u00a0 He was honest.<\/p>\n

While his smarmy counterpart Les Moonves was saying CBS was in trouble in order to look like a hero when results exceeded expectations, Tom gave an honest appraisal of his business.\u00c2\u00a0 Therefore, Viacom’s stock didn’t bounce, and he lost his job.<\/p>\n

Contrary to Sumner’s belief, it IS NOT all about the stock price.\u00c2\u00a0 That’s true only if you’re gonna sell.\u00c2\u00a0 If you’re not, it’s about the assets you own.\u00c2\u00a0 Not only the value of the library, but as running concerns.<\/p>\n

Based on Mr. Freston’s track record, he’s the most successful executive in television.\u00c2\u00a0 MTV is a juggernaut.\u00c2\u00a0 For this he was fired.<\/p>\n

Welcome to the new world.\u00c2\u00a0 Not the same as the old world.\u00c2\u00a0 Money always talked, but now money is EVERYTHING!<\/p>\n

EMI<\/strong><\/p>\n

You diddle, you move slowly, and you can never win.<\/p>\n

By failing to revolutionize its business, by failing to move into the digital sphere as Warner walked right by them, by failing to maximize the revenues of their catalog, a la Rhino, by focusing on trying to have expensive hit records and failing…everybody’s gonna lose their job.\u00c2\u00a0 I’m talking about the guys who RUN the organization.\u00c2\u00a0 Eric Nicoli, Alain Levy, David Munns…<\/p>\n

Levy and Munns are old school, in a business that is so new, the textbooks haven’t yet been written.\u00c2\u00a0 Nicoli doesn’t seem to know music OR business.\u00c2\u00a0 So, private equity is gonna steal the WHOLE COMPANY and rape and pillage and downsize and end up with a FUCK of a lot of money.\u00c2\u00a0 EMI is 80s, but we’re in the twenty first century.\u00c2\u00a0 Time moves on.\u00c2\u00a0 Move with it, or get ousted.\u00c2\u00a0 It’s not only promotion guys who lose their jobs.<\/p>\n

Satellite Radio<\/strong><\/p>\n

The greatest salesmen for XM are its subscribers.\u00c2\u00a0 They LOVE the service.\u00c2\u00a0 The greatest salesman for Sirius is Howard Stern.\u00c2\u00a0 He’s a drug a certain element of society can’t live without.\u00c2\u00a0 But a Sirius subscriber doesn’t rave about the service to potential club members, because although Howard is better than ever, the service is clunky, not quite unusable, but close.<\/p>\n

Sirius just doesn’t work.\u00c2\u00a0 Reception is poorer than FM ever was.\u00c2\u00a0 Signal drops out constantly.\u00c2\u00a0 The Sirius service is a big hold back to progress in the sphere.<\/p>\n

But the sphere hit a wall.\u00c2\u00a0 Because those running the operation just didn’t understand the technical landscape.<\/p>\n

Hugh Panero believed satellite was cable.\u00c2\u00a0 A monopoly.\u00c2\u00a0 That people would have no choice.\u00c2\u00a0 He concentrated on convincing everybody BUT the consumer.\u00c2\u00a0 And not corralled, the consumer moved on, to the iPod.\u00c2\u00a0 Furthermore, the consumer believes Net in the car is just around the corner, so why should he invest in satellite?<\/p>\n

In an era of tech, programming is overlooked.<\/p>\n

All the stars on XM and Sirius, who gives a shit.\u00c2\u00a0 This is not television.\u00c2\u00a0 Radio is about picking music, PROGRAMMING!\u00c2\u00a0 There are great programmers on XM.\u00c2\u00a0 There are a few people doing phenomenal work on Sirius, like Little Steven.\u00c2\u00a0 But how can services succeed when they don’t even let people know what it is they’re SELLING!<\/p>\n

Satellite radio is niche.\u00c2\u00a0 It’s AOL to Google.\u00c2\u00a0 It’s so ignorant as to its market it’s laughable.<\/p>\n

Terrestrial Radio<\/strong><\/p>\n

Talk is holding on.\u00c2\u00a0 Music is dying.<\/p>\n

It’s just not happening on terrestrial.\u00c2\u00a0 They’re programming for an audience that doesn’t exist.\u00c2\u00a0 In an era of personalization, of media speaking TO YOU, terrestrial is broadcasting to a theoretical person research says exists, but doesn’t.\u00c2\u00a0 People WILL listen to music handpicked by human beings, but will it be on FM?\u00c2\u00a0 Highly doubtful.<\/p>\n

Apple Computer<\/strong><\/p>\n

The Beatles of its day.\u00c2\u00a0 Every product’s a winner.\u00c2\u00a0 Almost universally revered.\u00c2\u00a0 UNSTOPPABLE!<\/p>\n

It’s not about the iTunes Store.\u00c2\u00a0 It’s about great hardware, and great software.\u00c2\u00a0 To focus on the iTunes Store is to be myopic.\u00c2\u00a0 Apple has created SOLUTIONS!\u00c2\u00a0 A seamless music experience.\u00c2\u00a0 A friendly, easy to use computing experience.\u00c2\u00a0 Knowing it’s about a HOLISTIC approach, making people feel good, Apple not only owns the hand-held music player market, but is making significant inroads on the desktop.<\/p>\n

Buy stock.\u00c2\u00a0 This is the new Disney, the new Microsoft, the numbers are only going UP!<\/p>\n

Steve Jobs, like his old company Pixar, never seems to get it wrong, he always wins.\u00c2\u00a0 As long as he’s in control of Apple, the company will too.<\/p>\n

Zune<\/strong><\/p>\n

Clone band.\u00c2\u00a0 Everybody hates them in music, why do you think anybody would like them in tech?<\/p>\n

Internet Music Delivery<\/strong><\/p>\n

Don’t play by the rules.<\/p>\n

If you’re looking for licenses from the RIAA, please give up IMMEDIATELY!\u00c2\u00a0 They don’t want solutions, they want half-steps, no, they want MINI-STEPS!<\/p>\n

You’ve got to steal to have success.\u00c2\u00a0 Follow YouTube.\u00c2\u00a0 Follow MySpace.\u00c2\u00a0 Just steal the wares and pay Doug Morris after he threatens to shut you down.\u00c2\u00a0 Ask first, and you’re doomed.<\/p>\n

Unless P2P is monetized IMMEDIATELY, music acquisition will be driven even further underground, where there’s NO HOPE of ever getting paid for it.\u00c2\u00a0 Transfer via IM.\u00c2\u00a0 Via hard drive.\u00c2\u00a0 When fifty year olds are swapping hard drives, you KNOW you’ve got a problem.<\/p>\n

Make music cheap and easy.\u00c2\u00a0 If you think music is undervalued, if you think producers should make more, I say to look at the machine you’re reading this on, isn’t it worth a BAZILLION DOLLARS???\u00c2\u00a0 All that R&D, never mind hardware, in your computer???<\/p>\n

Music is priceless.\u00c2\u00a0 But that doesn’t mean it should be expensive.<\/p>\n

Get the tunes in EVERYBODY’S hands, at a low price.\u00c2\u00a0 How come the CELL PHONE BUSINESS understands this, and the music business DOES NOT?<\/p>\n

Oh yeah, the music business is run by thugs.<\/p>\n

MTV<\/strong><\/p>\n

Time to change the name.\u00c2\u00a0 It’s ANYTHING but music.<\/p>\n

That’s okay.\u00c2\u00a0 I realize you can’t make money with music on television, but can we get our word back?\u00c2\u00a0 Can’t you call it TTV or something?\u00c2\u00a0 You known, Teen Television.\u00c2\u00a0 Or Commercial Television.\u00c2\u00a0 Or SEX Television.\u00c2\u00a0 Or GIVE ME ALL YOUR MONEY Television.<\/p>\n

Blogs<\/strong><\/p>\n

You’re no longer a star unless you actually are one.<\/p>\n

For a long time, stardom was associated with fame.\u00c2\u00a0 If you were in the public eye, you were revered, you were looked up to.<\/p>\n

But that was before reality television, when ANYBODY could become a star.<\/p>\n

The biggest movie playing today is not in theatres, but on computer screens.\u00c2\u00a0 Wherein people from all over the world watch the inane, insane antics of young Hollywood via blogs.\u00c2\u00a0 One’s goal is to STAY AWAY!\u00c2\u00a0 This attention EVISCERATES your credibility.<\/p>\n

If you can’t write, if you can’t sing, you’re fodder, grist for the mill.\u00c2\u00a0 People want to WATCH Jessica Simpson, READ ABOUT her antics, but they DON’T want to listen to her music, never ever.<\/p>\n

Management<\/strong><\/p>\n

No longer about building acts, but cashing in.<\/p>\n

Yes, all the front line management companies.\u00c2\u00a0 They can’t AFFORD to build acts.\u00c2\u00a0 They’re too busy raking in the dough from licensing the dinosaurs, from putting them on tour and reaping rewards at the merch table.<\/p>\n

Think about it…\u00c2\u00a0 You’ve got a new act…\u00c2\u00a0 Try getting a major label deal.\u00c2\u00a0 The major pays less and wants to tell you what the music sounds like.\u00c2\u00a0 They want their money back right away, so they either overexpose you or dump you if you’ve got no traction.\u00c2\u00a0 To do it outside the system is OH SO HARD!\u00c2\u00a0 Which is why the landscape is wide open, which is why newbies shall inherit the earth.\u00c2\u00a0 They’re willing to ride the bus and work for peanuts, convincing customers one by one.\u00c2\u00a0 The private jet set doesn’t have the patience.<\/p>\n

Live Business<\/strong><\/p>\n

Fewer acts that can sell out buildings at higher prices.\u00c2\u00a0 Sound like a recipe for success to you?<\/p>\n

Live is the new Broadway.\u00c2\u00a0 Once in a while for an EXORBITANT PRICE!<\/p>\n

Baby, how’d we ever get this way.\u00c2\u00a0 Acts used to be BUILT on the road.\u00c2\u00a0 Because people would take a chance.\u00c2\u00a0 At low prices.\u00c2\u00a0 Going to the gig was akin to going to the movie.\u00c2\u00a0 Before a night out was one year’s tuition.<\/p>\n

Sure, bands are still developing on the road.\u00c2\u00a0 But with none of the usual money or suspects.\u00c2\u00a0 Because no one wants to play in this netherworld without cash.\u00c2\u00a0 So some newbie, akin to Coran Capshaw, will come out of the woodwork.\u00c2\u00a0 Yup, the Dave Matthews Band is the biggest act on the road today.\u00c2\u00a0 And Coran is a bar owner from CHARLOTTESVILLE!\u00c2\u00a0 Expect more of this.<\/p>\n

Universal<\/strong><\/p>\n

It’s gonna tank.\u00c2\u00a0 Sometime in the future, Doug and Jimmy or gonna panic.\u00c2\u00a0 Then it will be like 1929.<\/p>\n

I predict it will be when CD sales nosedive.\u00c2\u00a0 Which will happen probably in the next twelve months.\u00c2\u00a0 After all, an iPod is now SEVENTY NINE DOLLARS!<\/p>\n

Doug is smug.\u00c2\u00a0 Jimmy believes it’s his world, we just live in it.<\/p>\n

They survived Bronfman.\u00c2\u00a0 They survived the guy who ran Vivendi whose name no one can even remember.\u00c2\u00a0 But they can’t survive the customer.<\/p>\n

This isn’t a Universal problem, but a MUSIC BUSINESS PROBLEM!<\/p>\n

It’s just that Universal, with its 30% market share, CONTROLS the music business.\u00c2\u00a0 They make everybody else look incompetent and irrelevant.\u00c2\u00a0 But when they start to go down\/freak, change, overdue for years, will finally come.<\/p>\n

SonyBMG<\/strong><\/p>\n

A joke.\u00c2\u00a0 A company run by someone cheating retirement, if not death, and the brother of the boss.\u00c2\u00a0 Neither a good formula for ongoing success.\u00c2\u00a0 And with the latest layoffs, it’s clear that they care only about today, and not the future.\u00c2\u00a0 Because first and foremost, this is a business of PEOPLE!<\/p>\n

Warner<\/strong><\/p>\n

Come on, hand it to Edgar Bronfman, Jr.\u00c2\u00a0 He did what you want to do.\u00c2\u00a0 He made PILES of money.\u00c2\u00a0 Maybe by aligning himself with people who ONLY knew money, but why don’t YOU do this?<\/p>\n

Somehow, after all the cutbacks, Warner is seen as a team, that employees like being members of.\u00c2\u00a0 They’re poised for the future, they’ve embraced digital (albeit STILL too slowly) more than ANY of their competitors.\u00c2\u00a0 Dennis and Lenny can rail all they want, but Edgar and his team are having the last laugh.\u00c2\u00a0 Rather than pay the usual suspects, the same old toll takers, Warner has left the usual music business behind.\u00c2\u00a0 They’re playing to Wall Street, they’re playing to tech, they don’t care that you USED to have power.\u00c2\u00a0 Something is going on here, and I don’t know exactly what it is, but it’s dramatically more innovative than what’s happening at the company’s competitors.<\/p>\n

Napster<\/strong><\/p>\n

Come on, they don’t even ADVERTISE anymore.\u00c2\u00a0 They fell off the radar screen.\u00c2\u00a0 They’re DONE!<\/p>\n

Rhapsody<\/strong><\/p>\n

If you think their new Sansa player is competition for the iPod, you just haven’t used it.\u00c2\u00a0 Designed by chimps with Lilliputian fingers, this product might function well, but that assumes you can USE IT!<\/p>\n

Vinyl<\/strong><\/p>\n

Sounds better than CD, but it’s NEVER COMING BACK!<\/p>\n

God, don’t you understand the press?\u00c2\u00a0 They need a STORY!<\/p>\n

Vinyl penetration is de minimis, and to focus on it only proves you’re a Luddite.<\/p>\n

<\/p>","protected":false},"excerpt":{"rendered":"

The Firing of Tom Freston One thing never changes.\u00c2\u00a0 Those who pull the strings, those behind the scenes, those who make all the money…they want to be in FRONT of the camera, they want the adulation, the props, the LOVE! David Geffen was one of the most powerful men in Hollywood until he agreed to […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[],"class_list":["post-625","post","type-post","status-publish","format-standard","hentry","category-music-business"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/s96vPs-2006","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/625","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/comments?post=625"}],"version-history":[{"count":0,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/625\/revisions"}],"wp:attachment":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/media?parent=625"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/categories?post=625"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/tags?post=625"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}