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How Things Really Stack Up at the Capitol Records Tower : A shake-up is going down at Hollywood and Vine, with a new chief coming in and artists and employees waiting to see if they're heading out

June 13, 1993|CHUCK PHILIPS | Chuck Philips writes about pop music for Calendar.

From the street, the Capitol Tower still casts the calm, familiar shadow over the world-famous intersection of Hollywood and Vine that it has since 1956. But inside the 13-story landmark, the mood is ominous.

The decision last month to replace easygoing, veteran Capitol Records label head Hale Milgrim with young, aggressive Gary Gersh was the first blow in a dramatic shake-up at the historic label--a roll of the dice by an East Coast management team that has left many employees fearing for their jobs.

Next up on the chopping block: a score of artists, including such possible candidates as Great White and Richard Thompson, as well as rumored staff cuts.

"It's not a pretty place to be right now," one Capitol employee says. "Everybody is either too busy watching their back or brown-nosing the new regime to actually get out there and sell any records."

Gersh may be the man in charge, but all eyes are on Charles Koppelman, the controversial figure who was brought in earlier this year to head the North American sector of British conglomerate Thorn-EMI's music group. Among the labels Thorn-EMI owns are Virgin Records, Liberty Records, Blue Note and Capitol, home of such acts as Paul McCartney, Bonnie Raitt and Hammer.

His mission: to make EMI the No. 1 record corporation in the world by 1998. That's a tall order for a firm that currently ranks last among the six record conglomerates in domestic sales.

The only thing more prevalent around town these days than rumors about Koppelman's next move is the debate over why he was given such a mandate from EMI in the first place.

A shrewd East Coast music veteran with a three-decade track record of pop hits and the successful launch three years ago of his own SBK Records, Koppelman comes to the job with a reputation for flamboyance and self-promotion and is widely perceived as a street-smart big-spender unafraid to butt heads with the corporate structure.

"Charles is an old-school risk-taker who isn't scared to make a decision from the gut," says Giant Records owner Irving Azoff. "It's a big statement for EMI to turn to Charles, especially during a period when there's so much talk about this bean-counting mentality that now governs the music business."

Still, many insiders question whether Koppelman has the corporate acumen necessary to run a billion-dollar record enterprise.

His resume is riddled with a string of short-fused success stories: Vanilla Ice, Tracy Chapman, Wilson Phillips, and most recently, his own SBK Records label, which some say has yet to turn a profit. Koppelman's latest elevation, critics jest, gives new meaning to the phrase "failing upward."

Koppelman, a lifelong New Yorker, is expected to shift control of Capitol from the West Coast to EMI's Manhattan headquarters, making the label more accountable to EMI's upper brass. His flair for the quick fix can be seen in his choice of Gersh, who discovered Nirvana at Geffen Records. Gersh has an immediate mandate to sign new acts to resuscitate and energize the floundering label (see accompanying story).

"There's no doubt that Charles has the golden touch," says one influential industry insider. "Everything he gets his fingers on ends up paying off extremely well for him personally. The question is whether Charles is capable of making any money for EMI."


Charles Koppelman is sitting on the couch in his $1,500-a-night Hotel Bel-Air room sucking on a Cuban cigar. Not shy about flaunting his success, Koppelman blew into town in a private jet and arrived on the Westside in a chauffeur-driven Bentley.

Those who know him say he's loyal to friends and devoted to his three children and wife. But most of all, he's passionate about music.

"I'm not one of these new bean counters," Koppelman says. "Me and the music go way back."

The dapper, 53-year-old New Yorker, who lives on an opulent Long Island estate, says he's somewhat baffled over the brouhaha surrounding his new status on the West Coast. Acknowledging the challenges that lie ahead, EMI's new North American honcho appears relaxed and confident.

And why shouldn't he be? After all, Koppelman's been on a winning streak for more than 30 years.

"Charles has an ego the size of Mt. Fuji," says Carnie Wilson, a member of SBK's multimillion-selling Wilson Phillips trio. "But why not? He's an absolutely brilliant music man."

After breaking into the business in 1960 with the Ivy Three, who had the Top 10 novelty hit "Yogi," Koppelman worked a stint for publisher Don Kirshner and then formed his own publishing and record-production firm where he signed songwriters such as Tim Hardin and the Lovin' Spoonful's John Sebastian.

He joined forces in 1975 with lawyer Martin Bandier to form a publishing and production company bankrolled by Bandier's wealthy father-in-law, real estate kingpin Sam LeFrak. Their firm helped produce huge pop hits for Barbra Streisand, Dolly Parton, and Diana Ross.

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