EMI's excuse is that it's focusing less on sales, which seems like a crazy thing for a profit-seeking enterprise to be thinking. But it's true insofar as the label doesn't care so much about individual sales as it does about getting people to pay for music in the first place. And because of music's new position, brand partnerships are one of the best ways to do that. I'll explain that in a second, but first, an example of this brave new world in action: "Tic Tac Chill," a partnership between the candy company and Sony. By entering a code, you'll be able to download for songs for free. Under the old scheme of music-as-culture, this doesn't make much sense. Why would an association with breath fresheners prompt you to buy the latest hit single?

But things are different now, because music as a product is competing with itself. This makes it more like traditional commodities. Think, for instance, of Tylenol. You can get the exact same product in generic form for half as much, so the marketer's task is to convince consumers to spend the extra money for the branded product. Music didn't used to be like this. If you wanted to experience Thriller whenever you wanted, you probably had to buy it. Sure, you could get other kinds of music for less or no money, but they weren't really the same product. Now, however, you can get the exact same thing for nothing: Thriller for free. So music's traditional marketing technique of radio promo, designed to make people want a specific song or artist, isn't as valid. They need instead to build up the brand to encourage people to pay money for something they could get for free. You do this through synergy, cross-promotion, brand partnerships, and all of that. Of course, it's a problem for music if individual songs and artists don't matter as much, since that means money and time won't get invested in finding and pushing them. But as long as something is selling, record companies are happy.

EMI Focusing Less On Track Sales, Hires Mycokemusic.com Founder [paidContent]

Elio Leoni-Sceti, chief executive of the company's recorded music division, will unveil the plans at a presentation to staff. The Italian Executive will announce that the business will be split into three distinct global units: new music, catalogue and music services, and with an increase in marketing resources, according to the Financial Times. The online music service EMI.com will launch this December.

Still, Leoni-Sceti isn't entirely optimistic about his company's future, saying that the road ahead will be "not be smooth or easy." While most labels have some separation between their new releases and catalog, it seems like creating a deeper divide between the two might not be a great idea for EMI, which needs to find a way to leverage its discography to make enough money to take chances on new artists. The company is counting on releases from Sarah Brightman and Tom Jones to create excitement in the fourth quarter, so clearly EMI has a A&R problem. And I doubt it'll be solved by sending the new release department out on an iceberg by itself.

EMI announces restructuring plans [Guardian]

About EMI posting losses of $1.2 billion, he says:

But the horizon is coming into focus, and it's clear that, at the least, EMI's music group is in trouble. The losses of Radiohead, Macca, the Stones and others have left gaping holes where steady revenue streams used to be, and it is going to be hard to replace them. Throw in increasing threats to the licensing division from evolving tastes and increased downloading, illegal and otherwise, and it could be that EMI may be the first of the big four majors to be sent down to the minor leagues.

As is pointed out in the comments, of course, the money isn't in future Paul McCartney records, but in past ones. And due to the onerous record company practices that BoingBoing and its ilk love to decry, EMI owns the catalogs of all those artists, which will continue to be profitable into the foreseeable future. In other words, the things about the record industry that online nerds constantly present as negatives are the only things keeping it afloat.

You don't have to be able to recite every lineup of Kiss to qualify as a music blogger, but if you're going to bitch about the music industry, you should at least know the basics of how it works.

EMI Badly Wounded, Bleeds Over a Billion [Listening Post]

Labels haven't traditionally done so when dabbling in their own digital-music stores (see: Pressplay), but no one has tried just throwing ideas at a wall to see what sticks yet, have they?

Music company EMI Group Ltd. is planning to launch an online music service later this year, wading into an increasingly crowded field of competitors and reviving a direct-to-consumer strategy that has historically been a loser for the major labels.

EMI's primary goal is to gather data about customer behavior, rather than to earn money from selling music, a person familiar with the matter said....

Like the new MySpace Music, EMI's music service is likely to combine streaming and paid downloads.

EMI executives led by digital-business head Douglas Merrill, who joined the company from Google Inc., are likely to experiment with various configurations of offerings to see how users respond.

So, the new EMI project will be at least somewhat like MySpace Music, a platform that just launched and one that EMI already participates in. You know, back when the "record store" model set in during the brick-and-mortar days, labels didn't spend millions of dollars on initiatives to open their own stores next to Sam Goody locations in the mall. If the purpose is gathering information on consumers instead of making money, isn't there a way to work within existing media instead of spending a ton of money on development and marketing on something people are likely to ignore?

EMI Plans to Launch Online Music Service [WSJ]

Let's go back to Sunday, when he posted this to his MySpace blog (punctuation is all his):

i'm writing this as a sort-of open letter to the people at emi.
i'm signed to mute records(for the last 15 years, actually), and as mute is owned
by emi that makes me an emi artist.
as some of you might know, the record business is falling apart.
revenues are down, cd sales are plummeting, people are losing their jobs, etc.
things at the record companies, especially the major labels, aren't looking so good.
one bright spot in this dismal retail firmament is the sale of music on-line through
portals like i-tunes.
the dance music equivalent of i-tunes is a site called beatport.
beatport, and other similar sites, enables you to preview dance tracks and then, if you like, buy them.
the average cost for a track on beatport is twice or three times the cost of a track on i-tunes(which
makes sense, as the tracks are a lot longer).
emi happily allow their music to be sold on i-tunes, but they don't allow their(and, by extension, my)music
to be sold on portals like beatport.
for over a year now i've been asking people at emi why they won't allow their electronic
dance music to be sold on beatport and i still haven't received a good answer.
one might think that in a time of rapidly dwindling revenues that a viable
and proven outlet like beatport might be greeted ecstatically at emi and the major labels.
but no.
very simply, i don't know why emi won't allow their(and my) dance tracks to be sold on beatport(for
an average cost of around $2.00 per track), but i do know that by not allowing their
electronic dance music to be sold on beatport that emi have denied themselves
very considerable revenue and have limited the audience for their electronic
dance artists(not to mention remixes done for their non-electronic dance artists, like
radiohead and coldplay).
many dj's live in urban areas with great indie-dance shops, and many dj's buy vinyl
and cd's on-line from great indie-dance shops, but there are thousands and thousands
of dj's who pretty much only buy their music from sites like beatport.
and with emi refusing to allow beatport(and similar sites)to sell their music it basically
means that tens of thousands of dj's around the world don't have access to any of
the dance records being released by mute and emi artists.
so this is my letter to anyone at emi who might be reading: by not allowing your music to be
sold on sites like beatport you are losing money daily and seriously compromising the careers
of your electronic artists(like, for example, the chemical brothers, me, massive attack, etc).
i can't see why you(the people at emi)wouldn't remedy this immediately and allow
people to buy your records on beatport and similar sites.
thanks
moby

[SIC]! But seriously, Moby is onto something here that confounds me as well. We only have a few more years left in this whole "selling music" thing, so you would think the majors would be jumping at any opportunity. And here's this store, Beatport, targeted to the types of people who would (theoretically) buy Moby's music, not to mention much of the Mute catalog, and EMI doesn't sell it there. EMI gave up on DRM a while back, so the store's trafficking in MP3s isn't an issue. The prices are higher than those charged by iTunes et al, so it's not the money. Call me ka-razy, but if there is an outlet that wants to, you know, sell your artists' music, then don't you want to sell it there? I know there are rights issues and the like in some cases, but why is every major label's entire catalog not for sale in every single retail outlet out there? Why do I have to troll the Internet just to get one lousy MP3 of Lindsey Buckingham's "Holiday Road"? Are these questions that I should even have to ask?

Apparently so.

(P.S.: Let me know if you have an MP3 of "Holiday Road" in comments.

He is my favorite guitarist ever.)

i'm writing this as a sort-of open letter to the people at emi. [Moby's MySpace Blog]
Beatport [Official site]

While it is fairly common practice for artists to offer promotional pre-release web streaming of new music, it is a unique arrangement to stream an album on newspaper and TV websites. For Gannett, this is an opportunity to deliver new music from a respected artist familiar to its core news audience. Top Gannett markets were chosen for the web streams, some because of the size of the market, others because of a large Brian Wilson fan base.

"Streaming a full album is a first for Gannett, so we are thrilled to be working with Capitol Records and a musician of Brian Wilson's stature to deliver music in a new way to our online audiences. This positions us well to expand our digital platforms while demonstrating the power of Gannett to deliver quality content across a network of websites," said Jim Lenahan, strategic development manager for Gannett's U.S. Community Publishing division.

The words "core news audience" in that quoted bit are of particular interest for reasons beyond icky advertorial ones. See, Gannett's flagship, USA Today, has apparently been working on changing its online music strategy over the past few months. What this has meant up to this point is that Ken Barnes' once-enjoyable Listen Up blog has basically been gutted of all its geekiness and turned into a repository for reviews that run in the paper and roundups of semi-moldy music news by one Korina Lopez, who's taken it upon herself to announce, special correspondent-style, that yes, it's actually her doing the recapping. When you look at these changes in the context of the Wilson deal, one has to wonder if "exclusive" Web content bits like this the future of music coverage for USAT (and whatever Gannett papers still have music content)? And if so, how long before the higher-ups decide that any music-related content should dispense with the pesky words altogether in favor of "quality content" that's acquired through corporate agreements?

Brian Wilson And Capitol/EMI Partner With Gannett For First Of Its Kind Album Premiere [Yahoo! Finance via Digital Music News]

So, as you may have heard we are being sued by our former record company for the ridiculously oversized, totally unrealistic and pretty silly (but slightly clever) sum of $30,000,000. Insane? Yea that's what we said too.

A little history...

We had been signed to our record contract for 9 years. Basically, under California law, where we live and signed our deal, one cannot be bound to a contract for more than 7 years. This is widely known by all the record companies and has been for years. In fact, so aware of it are they that they desperately try to make deals outside of California whenever possible. It is a law that protects people from lengthy, unfair, career-spanning contracts. This law also gave us the legal right to explore other possible opportunities.

Yes we have been sued by EMI. But NOT for failing to deliver music or for 'quitting'. We have been sued by the corporation quite simply because roughly 45 days ago we exercised our legal right to terminate our old, out of date contract, which, according to the law is null and void.

We terminated for a number of reasons, which we won't go into here (we'd rather not air any dirty laundry) but basically our representatives could not get EMI to agree to make a fair and reasonable deal.

A few things to note...

If you think the fact that we have sold in excess of 2 million records and have never been paid a penny is pretty unbelievable, well, so do we. And the fact that EMI informed us that not only aren't they going to pay us AT ALL but that we are still 1.4 million dollars in debt to them is even crazier. That the next record we make will be used to pay off that old supposed debt just makes you start wondering what is going on. Shouldn't a record company be able to turn a profit from selling that many records? Or, at the very least, break even? We think so.

That, and other issues, like the new regime at EMI firing most of the people we know and love, wanting to place advertisements on our website, EMI owning 100 percent of the masters of our record...forever, and basically having a revolving door of regimes at the company made it easy to not want to continue as is.

As the result of this takeover - and the firing of over 2000 employees - we have lost many of the people that were near and dear to us at Virgin/EMI and crucial to the success of 30 Seconds to Mars. A few of the great ones are still there, but it is hardly the same company we have known. After more than 5 regime changes in 9 years you'd think we would be used to the inconsistency, but the team that took the journey together for A Beautiful Lie was a very very special group of people and it's a huge loss that so many of them are gone. (Quick fact: There is not a single employee at Virgin records who was working at the company when we signed.)

FYI- Virgin/EMI was not required to make this lawsuit public or to list such an egregiously and stupendously large amount of mullah. In fact, they were not required to set any price even close to this. We did not want to take this public, but we felt it best to explain our point of view to you, our friends and fans, in hope that you can better understand our point of view.

We would always do our best to avoid a fight, but sometimes it's important to stand up for what you believe in. We hope that by doing what's right we can help to change things for the better, for ourselves and possibly others.

P.S. We will always remain grateful to the people at Virgin/EMI who were so integral to our success. And we hope that, above all, we can find a resolution to this in as civil and kind a way as possible.

There are certainly more important things out there in the world to spend time and energy on.

To be continued...

Jared Leto
30 Seconds to Mars

"If you think the fact that we have sold in excess of 2 million records and have never been paid a penny is pretty unbelievable, well, so do we... we are still 1.4 million dollars in debt to them"? Looks like someone didn't read his Steve Albini before diving into the major-label waters! On the bright side, Leto can also hold Lily Allen up as an example of what happens when artists do record their albums and submit them to EMI in good faith.

Virgin Records Sues Jared Leto's Band For $30M [AP]

Now , the album . it has been finished for a while now , I don't really know whats going on with it . The record industry is a very political place at the moment and I am on EMI records , lots of people have been fired or have taken redundancy recently as the company was taken over by a private equity firm called Terra Firma . Many of these people were people assigned to my projects and now i don't quite know whats going on . I'm sure everyone will find their feet soon enough and i'll be able to put the album out soon .

In the meantime there are the olympics to watch and the football seasons starting which are both far more entertaining anyway. I'm gonna go to the V concerts tomorrow , which will be fun i'm sure , and then i might go on another holiday as i don't have anything else to do .

It's probably too late for Lily to resubmit her album to her label and call herself "Coldie Play" or "Beaty Tells," I guess.

Olympics Is Wicked [Lily Allen's MySpace Blog]

I am delighted that Elio is joining as Chief Executive of EMI Music to lead the most exciting business transformation in the music industry. His career achievements and outstanding leadership qualities are ideally suited to ensuring that EMI is a successful business. Elio has the passion, drive and belief in the future of the music industry to realise the ambitions we all have for EMI. Having completed the organisational restructuring at the end of June and finalised our strategic work, Elio joins at the right time to shape, drive and lead EMI to become the world's most artist focused and consumer friendly music company.

Yeah, nothing says "we care about the artists" more than hiring a guy who knows how to make Lysol fly off the shelf. Then again, Leoni-Sceti's old company was praised for focusing "on a small number of high-margin brands prized by devoted customers." This might actually make him the perfect CEO for the age of Rihanna.

Found: Someone Who Wants To Run EMI's Music Business [Silicon Alley Insider]

What's most intriguing about this rumor surfacing is its timing. Live Nation made headlines last week after reports surfaced that the 360-heavy strategy was causing strife in the company's upper echelons, with concert promoter Michael Cohl reportedly wanting to make as many as 15 more such deals while chief executive Michael Rapino urged caution in the face of a worsening economy. Ethan Smith noted that Cohl and the Stones actually had a pre-existing relationship in his description of the Cohl-Rapino showdown:

The battle that has played out in recent weeks was complicated by Mr. Cohl's threat to take with him stars he says he brought to Live Nation over the years, including the Rolling Stones and U2. In the ensuing discussions, Mr. Cohl was reminded that his employment contract would bar him from competing with Live Nation for eight years if he left.

What if the leaking of this rumor was actually more about Live Nation corporate politicking than anything having to do with making Guy Hands squirm? I'm sure I'm not the only person who idly wondered this.

Stones move rocks Terra Firma [Observer]
Stones deny label move from EMI [Reuters UK]
Earlier: Live Nation's 360 Deals Are Making Some Higher-Ups A Bit Dizzy
Earlier: The Rolling Stones Flee EMI For Universal's Greener Pastures

• In the eye of Guy Hands, $1.28 billion is way too much money to spend on a recorded-music company in the current climate. "Mr. Hands said about 80 percent of the $6.4 billion paid for EMI was for the music publishing unit, which owns copyrights and provides a steady flow of cash. It is the other side of the business, recorded music, that he says he overpaid for, and could wind up selling if market conditions do not improve."

• "Creative accounting" was the real impetus behind all those Beatles reissues and re-reissues. "[A]ccording to Mr. Hands, the company was doing worse than commonly thought. An analysis by McKinsey and KPMG found that EMI had lost £750 million ($1.5 billion) from selling new music over the last five years. 'We didn't believe it at first,' he said, explaining that the figures that EMI previously reported counted sales of re-releases of music from old acts like the Beatles as new music revenue."

• Stories about rehabbing toilets can dazzle some people into thinking you're the right man for a job. Verve manager Jazz Summers on Hands' initial pitch to managers: "[Guy Hands] said, this is what I do... I took over failed pubs, and it worked. I took over failed service stations in Germany, and it worked. We put in new toilets. At first, I thought he was bright." Imagine if he'd also put in new sinks? That may have bought him at least another month.

• Guy Hands is not so into the old mantra "the music business is all about relationships," or the industry's "up all night, sleep all day" work ethic. "From the beginning, Mr. Hands did little to ingratiate himself either to EMI's own employees or executives within the industry, a famously clubby business wary of outsiders. He acknowledged that he is not a music person, and has turned down invitations to visit the recording studio to watch artists' recording sessions. EMI also instituted a ban on international travel without prior approval and barred employees from attending industry events 'unless these are specific profit delivering activities.'" Perhaps because, as he told the Times, he wants people to start showing up for work at a finance-company-appropriate hour: "I said Terra Firma people get in very early in the morning, work through the day, and go home... In contrast, people in the music industry get in to work later, work later and then go out late to the clubs and look for bands."

• EMI? Is about as screwed as you think. "In a confidential business plan showed to investors last year, Terra Firma said one way to reduce costs would be to use social networking sites to 'source new acts and as a means to test public reaction to individual acts.'" Why that idea was deemed worthy of being declared confidential in 2007 is beyond me, but hey, maybe I need to go replace some toilets in order to get the full perspective.

EMI's New Boss Sees Cracks in Music World [NYT]

According to Roger's morning dispatch, both Lee Trink and Jason Flom are losing their jobs at the Capitol Music Group, although Friedman manages to botch their job titles, so who knows. Either way, if the story is true, Hands plans to try running the label without actual executives at all.

Neither Trink nor Flom will be replaced. Guy Hands and the folks from Terra Firma, the new owners of EMI who have no experience in the record business, don't believe in label presidents.

This means that as Coldplay — the group headed by Gwyneth Paltrow's husband, Chris Martin — releases "Viva La Vida," the biggest album of its career, its American record label will have no one running it. This also means that the Beatles will have no one directly representing them. Neither will Katy Perry, who has the No. 1 single in the country with "I Kissed a Girl," or any other Capitol acts.

And the funny part is that none of them knows it. As of Monday morning, no one from EMI had bothered to call the people representing any of those acts to tell them the news. They even left the Beatles' Apple Records out of the loop. The Beatles catalog, which is not available for official downloading anywhere, still sells millions of CDs for Capitol.

This is the way I am told all the EMI labels will be run. Nick Gatfield is coming in to take over as "president of A&R labels for North America and the U.K." for all of EMI. But the individual labels will not have presidents. They will have "A&R presidents" and heads of marketing.

Possibly why none of the Capitol divisions haven't been informed is because the move isn't really happening, but even the idea that a label would go without actual presidents, especially after hiring a musically indifferent virtual-world bubble veteran yesterday, is a boldly ridiculous move. Maybe that sort of crazy talk is exactly what EMI needs to survive! Have Apple Martin run the company, or possibly some trained monkeys in Katy Perry t-shirts. It's a bold new world of possibilities when you've given up on reason.

Coldplay, Beatles Lose Leader [Fox News]

Qtrax had originally planned to offer up the big labels' tracks through a P2P service, which would theoretically mean that users were able to download a much wider variety of music than the stuff commonly available at digital stores like iTunes (AAPL). That's because QTrax would offer tunes that were officially sanctioned by the majors, as well as "grey" music — stuff that the labels would likely approve, like live tracks, but hadn't gotten around to yet.

But apparently, EMI and UMG aren't too keen on the whole P2P thing. Neither label's music will be available through P2P: Instead the music will come directly from Qtrax's servers.

Which I'm sure won't tax them at all. (Then again, the service may not have enough users for the load to be an issue.)

Would-Be Free Music Service Signs EMI; Two More Majors To Go [Silicon Alley Insider]

Watch as Bush, Obama, Clinton, Hussein, Blair and others attempt to dance to a turgid Coldplay song as the world collapses!

Watch as Coldplay attempts to dance to a turgid Coldplay song as their label collapses!

Which one reminds you more of Nero?

Bankers call new tune over EMI finances [Telegraph UK via Hypebot]

The good news, I guess, is that Amazon is going to use data collected from its currently existing store (read: find out which discs are selling well used and are relatively easy to license) to make new physical copies available through this CreateSpace thing. The bad news? There aren't really any titles available, and it's currently impossible to find them.

Amazon, Sony BMG, and EMI Music said that they will make hundreds of out-of-print albums available on Amazon's Web site through CreateSpace's Disc on Demand service.

Some of the titles that have been restored to availability include Hatari Soundtrack by Henry Mancini, Earthquake Weather by Joe Strummer, Motorcade of Generosity by Cake, Telepathy by Bill Stewart, Foreign Intrigue by Tony Williams, and Carryin' On by Grant Green.

A few of the recordings being made available through Disc on Demand are new releases rather than reissues, such as the upcoming title in KCRW's Sounds Eclectic series.

The arrival of brand-name, major-label content should enhance the credibility of CreateSpace's media on-demand service, which has yet to shake of the stigma associated with self-publishing. CreateSpace was born last August. It used to be called CustomFlix, which Amazon acquired in July 2005.

If you've been sitting around waiting for the opportunity to purchase the one somewhat tolerable Cake disc, that day has arrived, good sir! Otherwise, best of luck; as Maura found out yesterday, the somewhat unimpressive titles in the press release—all slapped up on Amazon with a $12.98 price tag (in the case of the Strummer disc) a copy—are all that the CreateSpace/Amazon partnership is willing to say that it's offering at the moment.

It's hard to understand what the real revelation is here for the consumer. Amazon makes a big connection with two major labels, and for what? A Henry Mancini soundtrack? Another KCRW comp to clog my shelf? In the age of endless opportunities to find out-of-print albums digitally, adding a plastic case and the (likely lousy) original liner notes isn't much to brag about. Anyone who has tried to work their way through the endless red tape involved in gaining the rights to an out-of-print title realizes the inherent difficulties involved in the process, but one can hope that Amazon, Sony BMG and EMI can get their collective acts together to give people something they might actually want, conveniently and at a decent price. If not, Europe's 50-year limit on copyrights will put quite a bit of stuff in our hands soon enough.

Amazon's CreateSpace Puts Out-Of-Print Music Back On The Market [Information Week]

"Viva La Vida" begins with a strident instrumental, "Life in Technicolor," built as much on an arpeggiated synth foundation as it is on an acoustic guitar melody. The same instrumental is tacked onto the final song, "Death and All His Friends," as a hidden track dubbed "The Escapist."



In between, the band frequently breaks from verse-chorus-verse constructions, particularly on "42," which is comprised of three distinct, seemingly unrelated sections. "Yes" shifts from a string- and tabla-driven rocker into a shoegazer-y breakdown, while a funky groove emerges from out of nowhere in the middle of "Death and All His Friends."



Elsewhere, Martin and the piano are at the forefront of the shimmering "Reign of Love," while "Cemeteries of London" conjures a foreboding vibe apropos of its title and "Lost!" swells with massive-sounding church organ strains.

Word is that "Lost!" was originally titled "Criminal Intent!" until Chris Martin realized that nothing rhymed with "D'Onofrio." The band will undoubtedly drop a potential "I Continue To Still Not Find What Bono Was Looking For" before Viva La Vida's release on June 16.

EMI's 2009 Financial Plan: Coldplay's Success Is Life Or Death [Set List]
Coldplay Indulges Experimentation On Fourth Album [Billboard]

Their last album, A Bigger Bang, was only a modest success, but carrying a catalog including Sticky Fingers and Exile on Main Street (which sold over 300,000 copies in the US last year) makes a big difference in any negotiation.

The negotiations pose a high-profile test for EMI and its new private equity owner, Guy Hands, to prove that they can retain top talent.


Mr Hands unsettled the artist community after buying the embattled company for £4bn ($7.9bn) last year, and announcing deep cost cuts in an attempt to remake the business.

The talks are also significant because, in addition to the major record companies, EMI will be facing competition from Live Nation, the concert promoter.

Last year, the company signed Madonna away from Warner Music in a landmark deal believed to be worth more than $100m.

Obviously, Live Nation would be interested in a bigger chunk of any future Rolling Stones tour, considering their last was the highest grossing ever, and the albums would just be an added bonus. Universal managed to steal away the soundtrack to Shine A Light, the forthcoming Martin Scorsese documentary about the band, so one would assume they have the inside track in the race, but it's certainly possible even the cash-conscious EMI will raise the stakes high enough to keep some of their high-profile catalog items. Then again, the fact that the most highly sought-after act in music is comprised of 65-year-old men should give us some indication of where this whole thing is headed.

Rival labels look to give Stones shelter [Financial Times]

Leading the pack of candidates to pick up the job is Universal Music Group, Disney's current distributor in the US.



While no decisions have been finalized, the situation highlights the challenges that EMI faces as it tries to keep its artists, managers and the other labels it distributes happy at the same time it attempts to dramatically transform itself under new private-equity owner Terra Firma.



Disney's international distribution pact with EMI expires in a year, and with EMI in flux, a source close to Disney said the company is keeping its options open in deciding whether to renew or go elsewhere.



Multiple sources said Disney also is trying to determine if the sale of EMI to Terra Firma gives the company an immediate out under a change-of-ownership clause in its deal.



Some industry watchers have suggested that if the Jonas Brothers album is distributed through Universal, it will serve as a test case for Disney eventually moving its entire business over to the music giant.

This seems like a pretty drastic move, but can you blame Disney for wanting to make sure every tween girl in Europe will be able to get her hands on that sweet J-Bro. nectar? Those boys are the geese that lay the golden eggs. Plus, Disney's got other gems in its stable that deserve only the best in international distribution:

To be sure, Disney's business is valuable to whoever distributes the catalog. Hits like the soundtracks to "High School Musical" have become global smashes. The soundtrack to last year's "High School Musical 2," distributed by EMI, sold 3.5 million copies outside the US, and Disney has a crop of budding stars to export around the world, including "Hannah Montana" star Miley Cyrus, and Grammy-nominated rockers Plain White T's.

Not the Plain White T's! Is no corner of the globe safe from the reach of "Hey There Delilah"?

Musical Mouse Games [New York Post]

"Warner Music Group has not authorized the use of our content on Qtrax's recently announced service," WMG spokesman Will Tanous told SAI via e-mail. Universal Music Group, the world's biggest music label, doesn't have a deal with QTrax either but is in talks with the company, says a person familiar with the situation. The LA Times quotes an EMI pr person saying that they're not in either. We haven yet to hear back from Sony-BMG, the fourth big major.

Here's the QTrax response, as of 9:57 pm eastern Sunday night: ""We are in discussion with Warner Music Group to ensure that the service is licensed and we hope to reach an agreement shortly."

QTrax officials had previously said they had deals with all four majors, which would give them access to a catalog at least as big as the 5 million tracks that Apple sells through its iTunes service. But we're told that the service's previous deal with Warner, signed in 2006, expired last year.

Launch delays strike again! Although it's probably not a good sign that they decided to go through with the press blitz despite not having 75% of the major-label population on board. (Didn't anyone learn the lessons of AnywhereCD?) The site's sort of up, although people have been reporting issues with downloading the client to me. (I'm locked out until March 18 at least since I'm on a MacBook.) You can see its inner workings (no download required!) at music.qtrax.com; right now they appear to be offering albums from the labels they're currently squabbling with, although given the delays that I've heard about I wouldn't be surprised if those pages were just placeholders. At least they give you the option of buying digital copies of said albums through their Amazon affiliate links, right? I bet they'll make tens of dollars off those today!

Warner, UMG, EMI: No Deals With Free Music Service QTrax (WMG) [Silicon Alley Insider]

The last album by Mick and Co.—2005's A Bigger Bang—wasn't exactly a sales gangbuster. It debuted at No. 1 and was certified platinum shortly after its release, but a Lefsetz Letter from Dec. 22, 2005—three months after the album came out—says that the album had actually moved only about 390,000 copies by that point. Most of the money the band realizes these days comes from touring; they made $138.5 million in grosses from being on the road in 2006. So this development, while superficially seeming like a bad thing for EMI, is actually pretty in line with Terra Firma chief Guy Hands' new forced-slimming-down strategy for the label. He's gone on record as saying that he's done with big advances for bands, and I'm sure the Stones were among the artists who could command a huge paycheck by virtue of their name alone—and that said paycheck wouldn't really result in big returns for EMI. What's more curious to me is the Stones' insistence on signing with a label at all; if any band could hook up with Live Nation in a Madonna-like deal, or even self-release their album, it should be them, since their tours are basically a license to print money. Maybe Doug Morris is a lot more charming than we all thought! And by "charming," I mean "willing to write huge checks."

Rolling Stones Move New Album From EMI [FT]
[Photo: AP]

It has been revealed that over one million unsold copies of Robbie Williams's last record 'Rudebox' are due to be sent to the country to be crushed.

The recycled end product will then be used in road surfacing and street lighting.

EMI owner Guy Hands told The Guardian: "Roughly 85 per cent of what EMI does get to release never makes a profit, in part because of the cash spent signing bands and partly due to ill-made bets on the number of CDs the market requires for particular acts."

Spin it as it measure to recoup lost sales all you want, Hands, but we know this is totally your passive-aggressive response to Williams' manager calling you names when you declined to alter Williams' contract to give him control over the back catalog now being pulped for new tarmac. And as asshole gestures that also help the environment go, we approve!

Robbie Williams To Pave Chinese Roads [NME]

"Football teams have very distinct corporate sponsorship," Hands told the FT. "Why shouldn't some of the leading bands have the same sort of relationships?"

Ah, yes. Clearly, Hands has never had a late-night pub conversation about the idea of the "sellout," and its various permutations within the rebellious-at-all-costs world of music. (Or maybe he's only seen music videos with lots of product placement in them.) Anyone else feel like this is the sort of cheeky announcement that makes me wonder if Hands wants "striking" artists like Robbie Williams and The Verve to finally have a huge tantrum and run away screaming from their contracts? A sorta sneaky way of engaging in some money-saving brush-clearing, if you will.

EMI set to take corporate world for a spin [FT; HT Gigwise]
The Verve latest EMI artist to threaten to go on strike [Guardian]

(London, 15 January 2007): EMI Group is today announcing a series of wide-ranging initiatives within its Recorded Music division to enable the group to become the world's most innovative, artist friendly and consumer-focused music company.

In a series of presentations to staff, artists and managers, Guy Hands, EMI Group's chairman, is unveiling a fundamental reshaping of the business to reflect the rapidly-changing nature of the music industry. The changes include:

* Repositioning EMI's labels to ensure they will be completely focussed on A&R and maximising the potential of all their artists
* Developing a new partnership with artists, based on transparency and trust, and helping all artists monetise the value of their work by opening new income streams such as enhanced digital services and corporate sponsorship arrangements
* Bringing together all the group's key support activities including sales, marketing manufacturing and distribution into a single division with a unified global leadership
* The elimination of significant duplications within the group to simplify processes and reduce waste

The changes, which will be implemented over the next six months, will enable the group to invest more in its A&R operations both to identify and sign promising new artists and to maximise the potential of its existing roster.

The restructuring is being carried out following an intense three-month consultation review of the business by Terra Firma since it acquired the business last year and many of the measures being implemented have come at the suggestion of staff, artists or their managers.

The restructuring will also enable the group to capture significant efficiencies and cost reductions which are expect to reduce costs by up to £200 million per year. The restructuring is also expected to lead to a worldwide headcount reduction within the group of between 1,500 and 2,000.

Guy Hands commented: "We have spent a long time looking intensely at EMI and the problems faced by its Recorded Music division which, like the rest of the music industry, has been struggling to respond to the challenges posed by a digital environment

"We believe we have devised a new revolutionary structure for the group that will improve every area of the business. In short it will make EMI's music more valuable for the company and its artists alike. The changes we are announcing today will ensure that this iconic company will be creating wonderful music in a way that is profitable and sustainable."

EMI job cuts: employees react [Times Online]