{"id":652,"date":"2007-01-11T18:56:16","date_gmt":"2007-01-12T02:56:16","guid":{"rendered":"http:\/\/lefsetz.com\/wordpress\/index.php\/archives\/2007\/01\/11\/emi\/"},"modified":"2007-01-11T18:56:16","modified_gmt":"2007-01-12T02:56:16","slug":"emi","status":"publish","type":"post","link":"https:\/\/lefsetz.com\/wordpress\/2007\/01\/11\/emi\/","title":{"rendered":"EMI"},"content":{"rendered":"

And sooner or later
Everybody’s kingdom must end<\/em><\/p>\n

"The King Must Die"
Elton John<\/p>\n

I can’t say that I know Alain Levy.\u00c2\u00a0 I’ve met him a couple of times.\u00c2\u00a0 Once, smoking cigars at the closed Chasen’s on Grammy night.\u00c2\u00a0 Actually, we always seem to meet around Grammy time.\u00c2\u00a0 At the charity dinner, at the EMI party.\u00c2\u00a0 But I don’t think he’d remember me.<\/p>\n

David Munns?\u00c2\u00a0 Ask Van Morrison about David Munns.\u00c2\u00a0 The notoriously difficult artist would ONLY speak to Munns.\u00c2\u00a0 At least that’s the way it used to be…\u00c2\u00a0 David Munns is a record man, positively old school, but the days of the record men are through.<\/p>\n

Alain Levy is an empire builder.\u00c2\u00a0 A dreamer who plays by his own rules.\u00c2\u00a0 But people like this tend to get blindsided, they’re so busy going headlong in one direction, they can’t see their enemies plotting on the byways.\u00c2\u00a0 As a result, PolyGram was sold to MCA without him even knowing.\u00c2\u00a0 The fact that such a stealth operation could be pulled off in the notoriously gossipy music business is quite amazing, but in this one case it was done.\u00c2\u00a0 Actually, when MCA sold their operation to the Japanese, before Bronfman bought it, David Geffen was kept out of the loop, it was feared he couldn’t be counted on to keep his lips closed.\u00c2\u00a0 But none of those people have any power anymore.\u00c2\u00a0 Matsushita exited the software business, licking its wounds.\u00c2\u00a0 David Geffen has all but done the same thing, he’s available for a quote, but DreamWorks is done, the film and record operations sold off, animation spun off.\u00c2\u00a0 Bronfman has reemerged, but he seems to have something to prove.\u00c2\u00a0 Panasonic and Geffen know there comes a time to take your chips off the table and go home.\u00c2\u00a0 Alain Levy had something to prove.\u00c2\u00a0 He came out of retirement to head EMI for bupkes.\u00c2\u00a0 He failed.\u00c2\u00a0 Times had changed.<\/p>\n

It’s tough being an also-ran.\u00c2\u00a0 And although EMI controls the Beatles, they’re an also-ran.\u00c2\u00a0 If you’re an also-ran, you’ve got to align yourself with one of the big players, or reinvent the wheel.<\/p>\n

A merger could never be constructed.\u00c2\u00a0 As for EMI being the Apple of the music business…Levy and Munns were too inured in the old ways to truly revolt.\u00c2\u00a0 The old wave never revolts, it believes in EVOLUTION!\u00c2\u00a0 But sometimes revolution is inevitable.\u00c2\u00a0 The music business is in an era of revolution.<\/p>\n

Copyrights are more valuable than ever.\u00c2\u00a0 It’s just a question of how you market and collect the receipts for said intellectual property.\u00c2\u00a0 Levy and Munns were waiting for the return of…\u00c2\u00a0 The eighties?\u00c2\u00a0 The nineties?\u00c2\u00a0 It was as if they expected AOR to be dominant once again, and for MTV to go back to wall to wall videos.\u00c2\u00a0 It’s like no change was contemplated.\u00c2\u00a0 Oh, they pussyfooted, with online initiatives, but that’s like Microsoft making the Zune, too little, too late.<\/p>\n

We can forget Levy and Munns now.\u00c2\u00a0 They’re gone, there’s no place for them anymore.\u00c2\u00a0 And they’re both so rich, it doesn’t matter.\u00c2\u00a0 We need new blood, to reconcile the music business with a future that is already here.\u00c2\u00a0 Talent spotting will always be important.\u00c2\u00a0 But in an era of instant communication around the globe, with everybody linked in, finding talent isn’t that hard, it’s more a matter of MARKETING said talent.\u00c2\u00a0 But, with intense bottom line pressure, nobody is innovating, everybody’s playing by the old rules.\u00c2\u00a0 Run the new stuff up Top Forty and sell the hell out of the catalog to the big box retailers, allow them to pay for it EONS from now, giving you time to pull a rabbit out of the hat.\u00c2\u00a0 But based on these firings, those days are through, that paradigm won’t work anymore.<\/p>\n

It has to be about less money initially.\u00c2\u00a0 About gaining the trust of the customer with more credible acts, that touch people’s souls as opposed to sliding right off of them.\u00c2\u00a0 That takes time.\u00c2\u00a0 A LOT of time.\u00c2\u00a0 Nobody at a major label today has that time.\u00c2\u00a0 So, running in pursuit of the old dream, they’re leaving the playing field wide open for new players, with new game plans.\u00c2\u00a0 But said plans have to reflect the new reality, one wherein every person owns a lot of music, most of it presently free.\u00c2\u00a0 The acquisition of said music has to be legitimized, MONETIZED, before the sun starts to shine again.\u00c2\u00a0 Oh, you can build something on the road, but to leave out compensation for recorded work, that’s a mistake.<\/p>\n

There’s no easy way out of this for the major labels.\u00c2\u00a0 They’re running headlong towards disaster.\u00c2\u00a0 The mismanagement by Levy and Munns wasn’t day to day, rather conceptual.\u00c2\u00a0 One has to apply the brakes and start driving in reverse, to where the people are.<\/p>\n

There are opportunities for EMI.\u00c2\u00a0 Whether Eric Nicoli will embrace these or be replaced when private equity investors swoop down and buy the whole operation is unclear.\u00c2\u00a0 I’m betting on the latter.\u00c2\u00a0 But if Nicoli wants to save his job, he must make major moves.\u00c2\u00a0 Now that Marty Bandier is gone, he can state that the Big Kahuna, EMI Publishing, will go to a percentage rate.\u00c2\u00a0 Eliminating the fiction of single sales online replacing the physical disk business.\u00c2\u00a0 That bird ain’t never gonna fly.\u00c2\u00a0 You’ve got to sell the files much more cheaply.\u00c2\u00a0 And to do this, publishers can’t enforce a penny rate.\u00c2\u00a0 Everybody’s got to take less.\u00c2\u00a0 Except the artist.\u00c2\u00a0 The CD was built on the artist’s back, with discounted royalties, and that’s just patently unfair.\u00c2\u00a0 And it’s this unfairness that has helped drive new talent to indie labels.<\/p>\n

And EMI must authorize legal P2P.\u00c2\u00a0 They’ve got no option.\u00c2\u00a0 Unless they start charging for music acquisition the way people presently do it, they’re screwed.\u00c2\u00a0 Legalize P2P and you get the YouTube phenomenon, everyone will be music CRAZY!\u00c2\u00a0 License at the ISP level.\u00c2\u00a0 Or just legalize Limewire and THEN sue everybody who doesn’t pay a monthly fee.\u00c2\u00a0 But to ignore how the vast majority of music is acquired is not only ridiculous, but economic death.\u00c2\u00a0 Music is very valuable, it’s just a matter of charging for it via the new system.<\/p>\n

This is an historic day.\u00c2\u00a0 In partnership with this past week’s seventeen plus percentage point SoundScan drop, it’s clear the old guard, playing by the old rules, cannot continue.<\/p>\n

And it’s not only Levy and Munns.\u00c2\u00a0 It’s Doug Morris.\u00c2\u00a0 And Jimmy Iovine.\u00c2\u00a0 Universal is not immune.\u00c2\u00a0 They’ve just got a bit more leverage and a benevolent corporate parent.<\/p>\n

The music business soon will not look the same.\u00c2\u00a0 I’d like to tell you exactly how it’s going to turn out, but I don’t know.\u00c2\u00a0 It depends on so much.\u00c2\u00a0 Whether the majors will wake up to the crisis and actually make moves, or whether they’ll cede the landscape to new companies.\u00c2\u00a0 It depends on exhibition issues, the marginalization of Top Forty, and the rise of alternative formats.\u00c2\u00a0 It’s a complex puzzle, but one thing is patently clear, the old players are not up to the task.<\/p>\n

The king is dead, the king is dead
The king is dead, the king is dead
Long live the king<\/em><\/p>\n

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And sooner or laterEverybody’s kingdom must end "The King Must Die"Elton John I can’t say that I know Alain Levy.\u00c2\u00a0 I’ve met him a couple of times.\u00c2\u00a0 Once, smoking cigars at the closed Chasen’s on Grammy night.\u00c2\u00a0 Actually, we always seem to meet around Grammy time.\u00c2\u00a0 At the charity dinner, at the EMI party.\u00c2\u00a0 But […]<\/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-652","post","type-post","status-publish","format-standard","hentry","category-music-business"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/s96vPs-emi","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/652","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=652"}],"version-history":[{"count":0,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/652\/revisions"}],"wp:attachment":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/media?parent=652"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/categories?post=652"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/tags?post=652"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}