The fact that Seagram's Universal Music Group wants to sever ties with so many acts is a condemnation of the industry's tendency to sign talent so indiscriminately. Because there is so much profit to be made when an act hits big, companies often believe they can come out ahead even if only one or two of every 10 signings score. But the cost of all those signings is staggering--as much as $1 million an act--when none succeed.
The executives would argue that their labels have to get smaller, but they have to get smarter, too. They have to make every signing count and think long-term, not just immediate returns.
By dismantling A&M and Geffen, and placing the remaining staffs and rosters under the control of Interscope Records, Seagram's Universal Music Group is rolling the dice with what has been the most acclaimed independent record management team of the '90s.
Under the leadership of Jimmy Iovine, Ted Field and Tom Whalley, Interscope has shown a remarkable ability to tap into the most dynamic pop movements of the decade, from rap (Dr. Dre and Tupac Shakur) and hard-core rock (Nine Inch Nails, Marilyn Manson) to gospel (Kirk Franklin).
The irony is that Interscope was started as an independent label, much like the early A&M and Geffen. Iovine, in fact, has been one of the biggest critics of the corporate invasion in the record business.
Until now, Interscope has been partners with Seagram, but the plan is for the conglomerate to soon buy the remaining portion of the label. The question in the industry is what effect all this new ownership and new responsibility will have on Iovine, Field and Whalley.
Will the Interscope team, which is used to quick decisions and a limited number of artists, be able to work under the new arrangement and pressure?
The Seagram brain trust obviously believes so--and Seagram stockholders should be pleased. If you had one team handling your musical decisions, this is the one--based on their track record in the '90s. At the same time, pop fans and artists have every right to be nervous about this increasing concentration of power in the record industry. Even if Interscope maintains its independent spirit, it's healthier to have more--rather than fewer--people with the authority to nurture and sign acts.
The Universal Music Group stresses that A&M and Geffen will continue to exist as labels, complete with A&R staff that will search for talent. But the power to sign and drop acts rests with the Interscope team. It is no longer an autonomous label.
Indeed, the limit of A&M's autonomy was underscored Thursday.
Early in the day, some employees put a black band around the A&M sign, a symbol of what they felt was the end of an era at the once proud label and, quite possibly, the end of an era in the record business as well. It was a spirited, but ultimately harmless gesture in keeping with the rebellious spirit of rock 'n' roll.
By mid-afternoon, the word came from Seagram headquarters. The black band was to be taken down immediately.