Deseree Stukes ([email protected])
Thu, 21 Jan 1999 04:47:08 -0500
Axe Falls Early At Universal/Polygram Labels
Artist rosters and label staffing to be decimated at such labels as Geffen
and Mercury.
Staff Writer Chris Nelson reports:
Universal Music Group, the largest of the world's five major music
corporations, plans to lay off 500 staffers Thursday (Jan. 21), launching a
significant reshuffling that will leave another 2,500 without jobs and
hundreds of bands without record deals by the end of summer.
While the bulk of pink slips are expected to be issued Thursday morning, a
high-level source at one affected label said cutbacks already had begun
Wednesday (Jan. 20).
"Staffing issues are happening as we speak," the source, who preferrred
anyonymity, said Wednesday afternoon.
"I'm doing a combination of things to make money." -- Robbie Fulks,
singer/songwriter
The layoffs are one of the first steps to integrate PolyGram and Universal,
following the $10.4 billion acquisition of PolyGram by Universal's parent
company, Seagram, in December. Under a massive restructuring plan, such
well-known labels as Interscope, Geffen, Def Jam, Motown and Island will be
fused into four new labels.
Amid the reshuffling, some of the world's most famous bands may wind up on
new labels. U2, for instance, are said to be leaving Island Records, their
longtime home, to sign on with another Universal Music Group division, the
new Interscope-Geffen-A&M, or IGA, group.
U2 manager Paul McGuinness would not explicitly confirm that the Irish band,
whose recent hits have included "Discotheque" (RealAudio excerpt), are
jumping to Interscope. But asked if the band anticipated having to adjust to
working with new label staff, McGuinness said, "Not really. Interscope is
being headed by Jimmy Iovine, who is a very old and good friend of ours."
(Iovine produced several U2 albums.)
The biggest acts at the combined labels, such as rockers Hole and Marilyn
Manson and country superstar Shania Twain, aren't likely to be significantly
affected, but the future of some lesser-known bands is unknown.
Folk-rocker Robbie Fulks, who is signed to Geffen, said Tuesday he is
already making alternate plans, although he doesn't expect Geffen executives
to decide his fate for three weeks, after label representatives have had a
chance to see him perform near his home in Chicago.
"I'm doing a combination of things to make money," said Fulks, whose Geffen
debut, Let's Kill Saturday Night (RealAudio excerpt of title track), was
released in September. "I'm going to go back into a [song]writer deal in
Nashville, and do a little bit of roadwork when I can afford to. Maybe do
some ad work and stuff like that, a combination of things."
Universal chief executive officer Doug Morris and chief operating officer
Zach Horowitz convened label heads in Los Angles last week to discuss cuts
in artist rosters and staff, according to an anonymous source close to the
reorganization.
UMG spokesman Bob Bernstein had no comment on the impending layoffs.
The corporation apparently has said little about the reorganization even to
its own staffers. Employees of PolyGram, Island and Def Jam claimed
privately Tuesday that they had been given next to no information about the
restructuring.
A Geffen Records staffer who did not want to be named, said the general
understanding at that label is that employees will be addressed individually
Thursday about severance packages. "By 5 p.m. we have to be out of the
office, and the new company will start Friday," he said.
Top officials have fled Universal's labels in recent weeks. Onetime Nirvana
manager Danny Goldberg, who two weeks ago quit the top job at Mercury
Records -- which will become part of the new Island/Mercury label -- said
last week he was not sure where he would land.
"I'll be in New York, I'll be in the music business, but that's all I know
right now," Goldberg said.
The Los Angeles Times offered a glimpse Tuesday at cuts designed to save UMG
$300 million yearly: Forty-five of 70 bands currently signed to Geffen will
be dropped, and 115 of Geffen's 145 employees will lose their jobs,
according to the paper, which quoted anonymous sources. At Mercury, 110 of
140 bands are said to be on the chopping block. At MCA, on the other hand,
both the artist roster and staff are expected to remain largely intact.
Sources told SonicNet Music News Wednesday that those numbers are largely
accurate. One source familiar with the restructing plan said the artist cuts
will unfold over several months.
An unnamed staffer at Geffen said while there is no list of "cuts" and
"keeps" at that label, popular groups such as Hole, industrial rocker Rob
Zombie and Beck are guaranteed a home at Geffen, as are influential rockers
Sonic Youth. Modern-rock bands Garrison Star and Remy Zero are also said to
be on the Geffen short list.
Staffers at the smallest labels in the UMG umbrella appear to be the least
fazed by the restructing -- despite the fact that the Mercury-affiliated
spoken-word label Mouth Almighty was told last month it will be cut loose.
Ken Friedman, Director of Artists and Repertoire for Interscope subsidiary
Nothing Records, said he doubts his label -- owned by Nine Inch Nails leader
Trent Reznor and home to Marilyn Manson -- will suffer extensive damage.
"I could be totally wrong," Friedman said. "But I don't think so."
The biggest changes ahead for Tom Rothrock, who owns Bong Load Records with
fellow producer Rob Schnapf, are likely to be whom he'll deal with at his
sister labels.
"The next release, from a logistics standpoint, will be going through a very
different group of people," said Rothrock, whose label has released vinyl
versions of albums by Geffen artist Beck. "But ... the new people involved
in the merger have a history of success."
Philip Walden, executive vice president of Mercury-affiliated Capricorn
(Cake, 311), said, "We're not going to be affected ... The only surprise
might be who we'll be working with."
Industry veterans Goldberg and McGuinness said an unintended result of the
restructuring may be a renaissance for independent labels, who can pick up
artists left out in the cold. They said indie labels also will be able to
take advantage of the UMG labels' expected reductions in new signings.
"People often talk about bands being under the radar," Rothrock said. "The
threshold of the radar is being raised as the corporations tighten up. Their
radar is not going to go as low as it even does now."
Rapper Chuck D (born Carlton Ridenhour), whose band Public Enemy has split
from Def Jam, said he knows several bands that won't have a contract when
the restructuring is complete.
But he said, "I don't think it's bad for artists."
Chuck D said he anticipates that some of those groups will take their wares
to the Internet for direct distribution to consumers, an area of the
business that he said the traditional industry has yet to conquer.
(Contributing Editor Chris O'Connor contributed to this report.)
deseree
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