Boy did Andy Lack fuck THIS one up.<\/p>\n
As you will remember, the Warner BMG merger broke up over valuation.\u00c2\u00a0 As in Bertelsmann wanted more.\u00c2\u00a0 The question arises, WAS IT WORTH MORE?<\/p>\n
We know how the Warner movie played out.\u00c2\u00a0 Richard Parsons, knowing nothing about music, reading the PRESS instead of being knowledgeable about his company, blew out the music division not for mere pennies, but for not a hell of a lot more than fifty cents on the dollar.\u00c2\u00a0 This deal will look even MORE atrocious when online stealing is finally monetized, and all those records in the catalog, evergreens like Led Zeppelin, the Doors and Crosby, Stills and Nash, AND YOUNG, sell forever.<\/p>\n
Catalog.\u00c2\u00a0 You see that’s where the action is.\u00c2\u00a0 The GLAMOR is in new product, but the money, the PROFITS, are in the old stuff, the CLASSIC stuff.<\/p>\n
Not that Andy Lack would know this, hell, he came from TV!<\/p>\n
Seeing the breakup of the Warner\/BMG tie-up, Andy decided to move in and make a deal himself.\u00c2\u00a0 The deal points?\u00c2\u00a0 IRRELEVANT!\u00c2\u00a0 The merger had nothing to do with money, with details, it was all about MAKING ANDY LACK LOOK GOOD!\u00c2\u00a0 Look, you hired me and I DID something, pulled a rabbit from the hat, PROMOTE ME, make me head of Sony U.S., EVERYTHING!<\/p>\n
But Andy Lack’s been marginalized, neutered.\u00c2\u00a0 Because not only did he make a bad deal, he couldn’t play the game.\u00c2\u00a0 He was no match for Clive Davis.\u00c2\u00a0 Clive Davis, like a despot in an old British movie, put a knife in Andy’s back, and then to make sure he was truly safe, deposed his old disloyal lieutenant Donnie Ienner, and his henchwoman Michele Anthony.<\/p>\n
The teflon executive, Howard Stringer, who smiles as the companies he runs tanks, brought in his brother to rescue the situation, but just like he lost MGM, Howard’s gonna lose Sony Music.\u00c2\u00a0 And it’s all his fault, after all, he put Andy Lack in power to BEGIN WITH!<\/p>\n
Perception on the street is that Clive Davis is a wunderkind, everything he touches turns to gold, not only does he personally select the material his acts record, he ends up selling tonnage, make a FUCKLOAD of money.<\/p>\n
Well, if that was true, he wouldn’t have been blown out of Arista.<\/p>\n
You see the Arista numbers just weren’t that good.\u00c2\u00a0 Because although Clive moves some units, the COST of said sales is ASTRONOMICAL!\u00c2\u00a0 And, the acts that Clive signs and breaks, after he extracts every last sale from their current albums, they’re done, there IS NO CATALOG!<\/p>\n
Whereas Sony…\u00c2\u00a0 They’ve got all those Springsteen albums, and Billy Joel, and Meatloaf, and…<\/p>\n
Now you might say that some of those Sony catalog acts were signed under Clive Davis, that he should get credit.\u00c2\u00a0 I don’t want to debate history, I’ll just say for the LAST THIRTY YEARS, ever since he founded Arista, Clive has been catalog deficient, he’s about hits today, and NOTHING tomorrow.<\/p>\n
Yet Clive is running this show.<\/p>\n
Let’s go to the numbers…<\/p>\n
BMG’s a hit machine.\u00c2\u00a0 That was one of the reasons Andy Lack did the merger, on equal terms.\u00c2\u00a0 Sony might have had the catalog, but BMG was all about TODAY!<\/p>\n
Well then, how come Sony outsold BMG last year, this PAST year, 2006?\u00c2\u00a0 And not only in 2006, but 2005!\u00c2\u00a0 Why did everybody running Sony lose his job, and everybody working at BMG come out smelling like a rose?\u00c2\u00a0 Why is Donnie Ienner a zero and Charles Goldstuck a hero when Sony had a market share of 15.49% to BMG’s 11.95% in 2006?\u00c2\u00a0 And 15.67% to 11.78% in 2005?<\/p>\n
But those are total numbers.\u00c2\u00a0 A combination of new and catalog product.\u00c2\u00a0 Let’s break out new product ONLY.<\/p>\n
Well, it turns out Sony beat BMG both years ANYWAY!\u00c2\u00a0 Yup, this year Sony had 14.42% of current albums and BMG 13.71%.\u00c2\u00a0 In 2005 Sony had 14.55% and BMG 13.16%.\u00c2\u00a0 If you want to get technical, BMG inched forward nearly half a percentage point, but is that enough for all the Sony brass to have lost their jobs??<\/p>\n
But let’s move on to the catalog numbers.\u00c2\u00a0 This year Sony almost DOUBLED BMG’s number.\u00c2\u00a0 Having a 17.23% market share to BMG’s 9.08%.\u00c2\u00a0 This is a VAST improvement over last year’s performance.\u00c2\u00a0 Where Sony had a 15.77% catalog market share, and BMG had a 10.54% share.\u00c2\u00a0 Sure, Sony was helped by the death of Johnny Cash, but Elvis has been dead FOR THIRTY YEARS!<\/p>\n
Maybe Clive should have focused more on moving the old stuff.\u00c2\u00a0 But that’s not glamorous.\u00c2\u00a0 And BMG doesn’t have as GOOD old stuff as Sony, because over thirty years, Clive just DIDN’T CREATE IT!<\/p>\n
But whose fault is that.\u00c2\u00a0 Who does Clive report to ANYWAY?\u00c2\u00a0 Where does the buck stop?\u00c2\u00a0 Obviously nowhere.\u00c2\u00a0 Fuck with Clive, tell him what to do, and you lose YOUR job.\u00c2\u00a0 Just ask Strauss Zelnick…<\/p>\n
And how did Andy Lack lose control of this operation ANYWAY?<\/p>\n
By trying to pull ANOTHER rabbit out of the hat, by solving the piracy issue, with the ROOTKIT debacle.\u00c2\u00a0 Well, Andy was top dog, but wasn’t BMG complicit?\u00c2\u00a0 The paper trail didn’t only lead back to Sony…<\/p>\n
You really have to blame Sir Howard.\u00c2\u00a0 For putting this inept clown in charge of the music division.\u00c2\u00a0 Yes, Andy made a bad deal, and then got caught in the palace intrigue.\u00c2\u00a0 But Sir Howard could have saved him.\u00c2\u00a0 But that’s not Howard Stringer’s style, he only saves HIMSELF!<\/p>\n
It won’t be long before the BMG brass runs the company.\u00c2\u00a0 Clive won’t live forever, but his protege, his second, Goldstuck, has a long time left on this planet.\u00c2\u00a0 ROB Stringer is no match for Goldstuck.\u00c2\u00a0 Rob’s a MUSIC man.\u00c2\u00a0 Goldstuck’s a money man.\u00c2\u00a0 And you’ve got to hand it to a money man who always wins while putting up bad numbers.<\/p>\n
Yes, Goldstuck is seen as a god, not Ienner, not Barnett, not Walk, even though that trio BEAT HIM where it counts, in sales.<\/p>\n
But sales aren’t that important in the music business.\u00c2\u00a0 It’s a game of confidence, of relationships, of image.\u00c2\u00a0 And nobody plays it better than Clive Davis.\u00c2\u00a0 He’s survived.\u00c2\u00a0 Give him credit for that.\u00c2\u00a0 But don’t call him the best record executive of all time, don’t laud his business and sales sense, because the numbers are not with him.\u00c2\u00a0 Clap for his promotional efforts, his style, for his ability to triumph.\u00c2\u00a0 But when it comes to money, he’s a loser.<\/p>\n
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