Posted: Oct Tue 2008 11:33 AM CDT
EMI Loses $1.2 Billion In Fiscal Year
Reports have been rampant. The Record Company is no longer the powerhouse that it was; it will be replaced or changed to accommodate a changing industry; they’re losing money and will have to find new outlets for revenue.
This latest report makes it real; instead of general, sweeping generalizations, we have a concrete number attached to a concrete label giant to look at.
EMI– Label home to Katy Perry, Coldplay, and Lily Allen
EMI–label home to Coldplay, Lily Allen, and Katy Perry, among many others–has just reported a loss of $1.2 billion in the last financial year.
They’re saying that the problems stem from a poor operational system. The company has a very high spending model, with executives on enormous salaries, poor data reporting when it comes to artist’s profits, and very traditional relationships with the artists (think antiquated recording contracts with traditional marketing techniques, instead of what is needed-a totally renovated, internet-heavy approach).
Because of this, the company’s financial statement has suffered dramatically, and the label now ranks last of the four major labels in sales. The “Big Four,” as they’re called-Universal Music Group, Sony BMG Music Entertainment, Warner Music Group, and, of course, EMI-still account for a vast majority of the market’s overall sales.
Enormous umbrellas
The companies under these enormous umbrellas include Geffen, Interscope, Island, Universal, and Motown (Universal); Arista, Columbia, Epic, J, Jive, and RCA (Sony BMG); Asylum, Atlantic, Lava, Reprise, Rhino, and Warner Bros.; (Warner); and Astralwerks, Capitol, EMI, Mute, and Virgin (EMI).
EMI has had a host of legendary artists within those labels: Bobby Darin, Nat King Cole, Dean Martin, Liza Minnelli, Dinah Shore, Frank Sinatra, The Beach Boys, The Beatles, Janet Jackson, The Sex Pistols, David Bowie, and The Rolling Stones have all called EMI home.
Presently, they’ve got big-time sellers like Mariah Carey, The Foo Fighters, Amy Grant, Norah Jones, Paul McCartney, Kylie Minogue, Garth Brooks, and KT Tunstall.
“A history of signing great artists”
“EMI Music had a history of signing great artists but had not adapted sufficiently to the changing consumer market for music,” says the rather sorry financial report. “EMI cannot be turned around overnight.”
It’s true-none of these companies can be turned around overnight. They’ve got a whole new game to play, and this news only brings the known problem into focus. It’s a dizzying, exciting, terrifying change that we’ll continue to see as the biz undergoes its transformation.
What do you think-is this a good thing for upcoming acts (freeing up the market for indie-style marketing) or a bad thing (eliminating the powers that could have picked them up and made them stars)?
