This week on the music beat

By Chris Willman
Updated July 10, 1998 at 04:00 AM EDT
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THE PLAYER’S CLUB It’s been three years since the last significant game of musical chairs took place in the upper ranks of the record industry. Get ready for an even more interesting round, with the number of available seats set to shrink dramatically. Ironically, the prime shuffler will be a shufflee from last time. Doug Morris—ousted as Warner Music Group head during the music wars of ’95—has capped a stunning comeback by being named chairman/CEO of the Universal Music Group, soon to be the world’s biggest music company if PolyGram and Universal Music complete their proposed merger.

Morris already has a hot operation at Universal, so there’s fear and loathing among the not-so-profitable PolyGram labels about who’ll get squeezed out in the inevitable consolidation. “No decisions have been made,” insists a Uni spokesman. Antitrust concerns prevent the deal from being finalized till this fall, allowing Morris and Seagram prexy Edgar Bronfman Jr. a few months to consider options. Meanwhile, Morris has been querying artists’ managers about their opinions of key execs.

Conventional wisdom foresees PolyGram’s Motown, A&M, and Island imprints—along with Universal’s own loss leader, Geffen—being severely cut back or folded into other labels. (As superstar raisons d’etre, Geffen has only Beck, Hole, and the vague promise Axl Rose will rise again; Motown—Boyz II Men; A&M—Sheryl Crow and Sting; Island—U2.) PolyGram’s joint venture with Def Jam is also a predicted casualty. Morris is keen on some of these companies’ execs, but many are contemplating a gloomy Christmas.

Who’ll come out ahead? Though Mercury chief Danny Goldberg and Morris were close when each labored for Warner, the Universal CEO is said to feel more pragmatic about his former protege now that Mercury’s post-Hanson numbers are sliding. (Projected second-quarter red ink for Mercury and other labels caused PolyGram’s purchase price to be readjusted from $10.6 billion to $10.4 billion last month.) A definite winner, though, is Jimmy Iovine: Universal will likely buy out the remaining 50 percent of his label, Interscope. Iovine’s also viewed as a strong candidate to head up a West Coast division for Universal, maybe even based on the A&M lot. Who’d head the East? If not Goldberg, maybe another Morris protegee, Sylvia Rhone—whose contract to head Warner’s Elektra runs into late ’99 but may not be inescapable.

Where does this leave Alain Levy, who just angrily exited as PolyGram president/CEO? Perhaps, in one far-flung scenario, as head of music at the troubled Warner group, even though toppers Bob Daly and Terry Semel insist they’ll keep running things themselves, thank you. Of course, this is all just idle speculation till the music…stops.

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