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[compasspnt]

Subject: Re: EMI in today's Telegraph

Hands attempts to reassure EMI stars

By Dominic White



Guy Hands has written a grovelling letter to EMI recording artists - assuring them that they are "at the epicentre" of his plans to turn around the struggling music company.

The Terra Firma boss circulated a letter last month to EMI's artists, which include Robbie Williams, Kylie Minogue, Coldplay and Gorillaz, following reports that his private equity firm was preparing to axe acts who do not work hard enough.

The reports had been based on this earlier leaked letter to EMI's staff in which Mr Hands said: ''While many [artists] spend huge amounts of time working with their label to promote, perfect and endorse their music, some unfortunately simply focus on negotiating for the maximum advance - advances which are often never repaid.

''However, once EMI has the best products and services in music and the best culture for working together then, as already exists within some of our labels, it will be open to us to choose which artists we wish to work with and promote."

In a bid to quell fears of a major cull of EMI's roster, Mr Hands tells artists that the quotes taken from that earlier letter were ''highly selective".

He writes: "Firstly, let me say how much I am looking forward to working with you, your managers and our staff at EMI to transform the company into the really successful business we know it can and should be.

''Terra Firma is very committed to the future of EMI and the contribution of our artists is central to the success of the company."

He adds, later: ''Believe me, I do know how hard you work in the creation and promotion of your records. We really value the collaborative relationship you have with the many EMI staff globally, who work on your projects.

"The point I was trying to make was that when EMI Music provides truly world class service levels to you all, we would then earn the right to choose the artists we work with and we would want to work together to ensure our mutual success."

Terra Firma's private equity management style has put it on a collision course with many creative staff in the industry, and EMI artist managers have expressed concerns about the impending outcome of Mr Hands' strategic review.

''I have found him very bright and willing... [but] I don't think he really understands the artistic process," said Jazz Summers, manager of EMI band The Verve.

He added: ''You can go around saying artists have to work and you're not going to pay big advances, but if you don't pay you won't get the artists because competitors will pay more."

Terra Firma is believed to be turning down over half of EMI's proposed new artist signings as it works on its review.

*     *     *
Hands tries a different tune with EMI



City big hitter faces a fight to turn around the music group, reports Dominic White

Is Guy Hands right about EMI? That is the debate raging in the music industry as Hands' private equity lieutenants from Terra Firma crawl over the company that signed the Beatles in an effort to make his bumper

[J.J. Blair]

I have a good friend who's doing A&R at Capitol, right now.  He's not sure if he'll have a job in a month, even though he just got it.

I was supposed to do a record with an EMI Sweden artist this year.  Guess how that turned out?

I give up.

Oh, you have only $6,000 to make a record?  Sure!  Let's do it!

Please kill me.

[organica]

Does anyone happen to know if they are still pretty much a " rock only " company  at this point ?

[RSettee]

Does anyone else have difficulty taking someone like "Guy Hands" seriously? What is this, an episode of Seinfeld?  

[Brian Kehew]

When they came to see Abbey Road, they told anyone who worked there they could schedule an appointment to get their ideas hear. Evidently about 90% of the profitable ideas they get for company restructuring come from within, and about 10% from "expert consultants" turns a profit.

Makes sense - they are NOT walking in and telling people how to do their job, they are asking people how their job COULD be better...

[compasspnt]

Subject: From today's Daily Telegraph ...



EMI's new owner Terra Firma has told executives at the music group
they will receive no bonuses unless the music company hits a

[jerrybosun]

So this is where $13.95 of every CD Sale goes, No wonder I stopped buying cd's

[J.J. Blair]

compasspnt wrote on Tue, 11 December 2007 06:05

Terra Firma has also asked EMI to present a sample of around a dozen different artists - from international stars such as Robbie Williams, Coldplay and Norah Jones to breaking stars and local acts - to study which type of artists produce the best returns.

Uh oh.  I guess EMI is going to become a hip hop and country label.

Quote:

It is also clamping down on overshipping. It is understood that EMI had 65m unsold CDs returned to it by retailers last year at a cost of about studio info They say the heart of Rock & Roll is still beating, which is amazing if you consider all the blow it's done over the years. "The Internet enables pompous blowhards to interact with other pompous blowhards in a big circle jerk of pomposity." - Bill Maher "The negative aspects of this business, not only will continue to prevail, but will continue to accelerate in madness. Conditions aren't going to get better, because the economics of rock and roll are getting closer and closer to the economics of Big Business America." - Bill Graham rnicklaus Hero Member Offline Posts: 3859 Re: The Latest about EMI 65 MILLION units returned last year?  I find that hard to believe. The Pound and a half comes from pressing, shipping, retail co-op and then the return ship.  That sounds low in a 65 million return. Think about this.  Even if EMI was running an unprecedented 40% return rate, what product could they have shipped in the last 1.5 years that would have totaled over 100 million units worldwide and only sold through 60%?  What retail outlets are going to over order stiffs?  None.  Retail can replenish their shelves in 48 hours today so they don't generally overstock. In the US retailers generally will not keep in stock more than 6 weeks of product.  With computerized inventory  and weekly soundscan reports, shelf space and margins are too tight to keep stock on hand. In many territories outside the US, sales are one way and not subject to return, so titles do not get over shipped. Odd figure - But I guess anything is possible. R.N. Jay Kadis Hero Member Offline Posts: 2165 Re: The Latest about EMI RSettee wrote on Mon, 10 December 2007 16:55 Does anyone else have difficulty taking someone like "Guy Hands" seriously? What is this, an episode of Seinfeld?   Think Mr. Bill. -JK http://ccrma.stanford.edu/~jay/ http://cdbaby.com/all/jaykadis rnicklaus Hero Member Offline Posts: 3859 Re: The Latest about EMI The more I think about the 65 million returns it makes me think of this Best Buy Scenario, EMI head of sales calling Best Buy's Gary Arnold. Hey Gary, we have this great new band The Dumpster Divers coming out Jan 3rd and we want you to order 200K CDs for your chain. Um, why? Because we love it and it's going to be a smash and sell all the units you order and then double that. Um, How is it going to be a smash?  What is your plan?  What is your spread at the rest of retail?   We plan to have a huge hit at radio, MTV will be banging the video, they will tour and be on the cover of Rolling Stone. Um yeah?  Who is playing the track right now?  What format? What is your reach?  Can you get me a copy of the the tour dates, markets and ticket counts?  When does the magazine piece hit?  Is that firm?  Send me the marketing plan. OK will do.  We don't have any stations on board yet, but we will.  And Rolling Stone said they would do the piece when the band went gold.  The tour will happen when we have the radio hit. Um, ok, I will order 5K units and we'll see what we sell in the first 6 weeks. Thanks! Bye now. Bye. R.N. marcel Hero Member Offline Posts: 1257 Re: The Latest about EMI compasspnt wrote on Mon, 10 December 2007 16:26 ...to evaluate what type of artists will generate the best returns across those categories over time... Sounds like EMI is going the way of Clear Channel et al, selling what are already proven commodities without risking their assets on anything new.  Sounds like a recipe for a stagnant roster...  Have these guys considered the possibility that eventually nobody will *want* to sign with them anymore, except in the twilight of their careers? Quote: "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate." Really?  Does anyone here agree with that?  I kinda thought the opposite was true, and that truth was the reason that more and more (particularly new) artists are turning their back on major labels. Best, Marcel Best, Marcel seriousfun Sr. Member Offline Posts: 329 Re: The Latest about EMI compasspnt wrote on Mon, 10 December 2007 16:26 Subject: Re: EMI in today's Telegraph Hands attempts to reassure EMI stars ... "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate." ... "He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry." ... Yes, the bad old days, when record companies were run by people who knew music and  knew how to make a buck from it. And, correct me if I'm wrong, but aren't returns (at least in the US) still generally paid for by the artist by a percentage of sales recouperable from the advance? doug osborne | my day job compasspnt Hero Member Offline Posts: 16266 Re: The Latest about EMI Usually a percentage of otherwise payable royalties is held out to offset potential returns, and then actuals calculated later. rnicklaus Hero Member Offline Posts: 3859 Re: The Latest about EMI seriousfun wrote on Tue, 11 December 2007 10:21 compasspnt wrote on Mon, 10 December 2007 16:26 Subject: Re: EMI in today's Telegraph Hands attempts to reassure EMI stars ... "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate." ... "He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry." ... Yes, the bad old days, when record companies were run by people who knew music and  knew how to make a buck from it. And, correct me if I'm wrong, but aren't returns (at least in the US) still generally paid for by the artist by a percentage of sales recouperable from the advance? First, Chrysalis music is up for sale, so they aren't in it for the long haul by any means.  But yes there is incredible waste in the record business.  Most of that waste going to exec pay, perks and overhead. Returns are not a cost to the artist.  Plus, once an artist gets the advance, they don't pay it back from their pocket, the only way it is paid back is though sales, R.N. Print Pages: [1] 2 3 ... 15   Go Up « previous next » R/E/P Community > R/E/P > R/E/P Archives > Whatever Works > The Latest About EMI   SMF 2.0.19 | SMF © 2021, Simple Machines | Terms and Policies XHTML RSS WAP2 Site Hosted By Ashdown Technologies, Inc. Page created in 0.054 seconds with 21 queries.

[rnicklaus]

65 MILLION units returned last year?  I find that hard to believe.

The Pound and a half comes from pressing, shipping, retail co-op and then the return ship.  That sounds low in a 65 million return.

Think about this.  Even if EMI was running an unprecedented 40% return rate, what product could they have shipped in the last 1.5 years that would have totaled over 100 million units worldwide and only sold through 60%?  What retail outlets are going to over order stiffs?  None.  Retail can replenish their shelves in 48 hours today so they don't generally overstock.

In the US retailers generally will not keep in stock more than 6 weeks of product.  With computerized inventory  and weekly soundscan reports, shelf space and margins are too tight to keep stock on hand.

In many territories outside the US, sales are one way and not subject to return, so titles do not get over shipped.

Odd figure - But I guess anything is possible.

[Jay Kadis]

RSettee wrote on Mon, 10 December 2007 16:55

Does anyone else have difficulty taking someone like "Guy Hands" seriously? What is this, an episode of Seinfeld?

Think Mr. Bill.

[rnicklaus]

The more I think about the 65 million returns it makes me think of this Best Buy Scenario,

EMI head of sales calling Best Buy's Gary Arnold.


Hey Gary, we have this great new band The Dumpster Divers coming out Jan 3rd and we want you to order 200K CDs for your chain.

Um, why?

Because we love it and it's going to be a smash and sell all the units you order and then double that.

Um, How is it going to be a smash?  What is your plan?  What is your spread at the rest of retail?  

We plan to have a huge hit at radio, MTV will be banging the video, they will tour and be on the cover of Rolling Stone.

Um yeah?  Who is playing the track right now?  What format? What is your reach?  Can you get me a copy of the the tour dates, markets and ticket counts?  When does the magazine piece hit?  Is that firm?  Send me the marketing plan.

OK will do.  We don't have any stations on board yet, but we will.  And Rolling Stone said they would do the piece when the band went gold.  The tour will happen when we have the radio hit.

Um, ok, I will order 5K units and we'll see what we sell in the first 6 weeks.

Thanks!

Bye now.

Bye.

[marcel]

compasspnt wrote on Mon, 10 December 2007 16:26

...to evaluate what type of artists will generate the best returns across those categories over time...

Sounds like EMI is going the way of Clear Channel et al, selling what are already proven commodities without risking their assets on anything new.  Sounds like a recipe for a stagnant roster...  Have these guys considered the possibility that eventually nobody will *want* to sign with them anymore, except in the twilight of their careers?

Quote:

"The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate."

Really?  Does anyone here agree with that?  I kinda thought the opposite was true, and that truth was the reason that more and more (particularly new) artists are turning their back on major labels.

Best, Marcel

[seriousfun]

compasspnt wrote on Mon, 10 December 2007 16:26

Subject: Re: EMI in today's Telegraph Hands attempts to reassure EMI stars ... "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate." ... "He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry." ...

Yes, the bad old days, when record companies were run by people who knew music and  knew how to make a buck from it.

And, correct me if I'm wrong, but aren't returns (at least in the US) still generally paid for by the artist by a percentage of sales recouperable from the advance?

[compasspnt]

Usually a percentage of otherwise payable royalties is held out to offset potential returns, and then actuals calculated later.

[rnicklaus]

seriousfun wrote on Tue, 11 December 2007 10:21

compasspnt wrote on Mon, 10 December 2007 16:26 Subject: Re: EMI in today's Telegraph Hands attempts to reassure EMI stars ... "The industry is full of executives who have been around for years who know a lot about music but are not financially or commercially literate." ... "He is absolutely correct," says Jeremy Lascelles, chief executive of smaller rival Chrysalis Music. "There is a criminal amount of waste in every major record company, and that is one of many reasons why the economics of the record business have gone so awry." ... Yes, the bad old days, when record companies were run by people who knew music and  knew how to make a buck from it. And, correct me if I'm wrong, but aren't returns (at least in the US) still generally paid for by the artist by a percentage of sales recouperable from the advance?

First, Chrysalis music is up for sale, so they aren't in it for the long haul by any means.  But yes there is incredible waste in the record business.  Most of that waste going to exec pay, perks and overhead.

Returns are not a cost to the artist.  Plus, once an artist gets the advance, they don't pay it back from their pocket, the only way it is paid back is though sales,