STREAMING AND STREAMLINING: The announcements—and anointments—are coming at a lightning pace from
Sir Lucian Grainge’s newly reconfigured
UMG. A global restructuring is underway at the publicly traded company, which clocked record revenues in 2023 but has seen little movement in its stock price since its 2021 IPO. The leadership team has taken long meetings with the crew at
Bain, who, we’re told, assisted with “financial modeling and efficiencies” but were not involved in structural, leadership or strategy matters.
Most consequentially, Sir Grainge has eliminated a slew of direct reports. LG’s role as head of a publicly traded global company is changing; as he turns his full attention to the macro paradigm of changing the biz—reworking streaming-compensation models, contending with
TikTok, tackling AI—he has placed U.S. label oversight in the hands of market share champions
Monte and
Avery Lipman and
John Janick. (We remain certain, however, that Sir Grainge still has plenty of game when it comes to recognizing a hit song or a star artist.)
The Lipman brothers’ and Janick’s terrain now collectively represents an unheard-of 25% of current U.S. market share and 27% overall. We haven’t seen such numbers from individual labels since the days of
Mo and
Joe or
Tommy (fuhgeddaboudit),
Donnie and
Polly. In any case, Their jobs have become massive, and however much they may empower their lieutenants, the buck stops with them. Monte and Janick are considered by many to be the most effective label CEOs currently in the business.
In the most substantive structural changes with respect to labels in the new order,
Def Jam and
Capitol Music Group move under the auspices of the Lipmans and Janick, respectively.
The East Coast’s revamp brings several storied labels with star-studded rosters—the Lipmans’
Republic (with
Wendy Goldstein as president and chief creative officer),
Imran Majid and
Justin Eshak-led
Island,
Tunji Balogun’s Def Jam,
Tyler Arnold and
Ben Adelson-helmed
Mercury and
Glenn Mendlinger-helmed
IMPERIAL/
Casablanca.
The estimable
Jim Roppo now has an awesome set of responsibilities as president and COO of this new umbrella entity,
Republic Corps, the shared-services structure of which supports the A&R and marketing thrust of each label. Multiple execs report to him, including promo boss
Gary Spangler, PR chief
Joe Carozza and the heads of the international, revenue and data departments.
Def Jam’s entry into the Corps is probably the most consequential change in the East. (Island had a prior shared-services relationship with Republic.) Def Jam’s roster, catalog and legendary standing in the history of hip-hop in particular offer fresh opportunities, and Republic Corps firepower could supercharge the impact of Balogun’s creative efforts.
As we were assembling this column,
Seth England’s
Big Loud—the home of
Morgan Wallen—announced a big new distro deal with Mercury/Republic. On the same day, Wallen sold 40k tickets for his July 4
Hyde Park BST show; a 60k sellout looks like a royal lock, with tix selling like mushy peas. Meanwhile, the long-rumored
HYBE/
QC deal, negotiated by
Scooter Braun and
Mr. Bang with
Allen Grubman, could be announced in the very near future. With the revamped UMG structure in place, might this be just the first in a series of new whopper deals? What other pacts might be in the pipeline? And will all of this finally move UMG’s stock?
Clearly, the creation of the new
Interscope Capitol Labels Group entity on the West Coast is a more complicated maneuver than the changes in the East, involving as it does the incorporation of Capitol Music Group, a multi-part major with 300+ employees, a giant artist roster and a voluminous catalog. ICLG is presided over by trusted Vice Chairman
Steve Berman and COO
Annie Lee; Chief revenue officer/GM
Gary Kelly will also figure prominently.
CMG—including the legendary
Capitol Records,
Motown and
Blue Note, as well as the multifaceted
Capitol Christian Music Group—moves into the freshly conceived unit with
Tom March as chairman and
Lillia Parsa as president.
Janick also revealed a new IGA structure divided into pop/rock and urban “arms.” The urban arm is to be led by A&R star
Nicole Wyskoarko as president and head of urban A&R.
Michelle An, long a key factor in the secret sauce of IGA artist development, has been named president and head of creative strategy, while A&R mainstay
Sam Riback, who has also been essential to IGA’s creative machinery, becomes president and head of pop/rock A&R.
Among the erstwhile Capitol execs proving vital in the new mix are promo boss
Greg Marella, head of media
Ambrosia Healy and CFO
Geoff Harris.
It's worth noting that Marella and Spangler will take on an unprecedented amount of responsibility for promotion executives, with enormous portfolios to oversee. It’s a huge investment of trust from their respective chieftains for two of the very best in the game.
However gratifying it has been to see these talented execs stretching their wings, it’s also been painful for company personnel to witness the cuts necessitated by the new model. There’s no denying that it’s been a stressful period for everyone involved as team members see their colleagues of many years let go amid the changes. Still, it’s clear that the old major-label model, much of which was based on a bygone marketplace and media landscape, wasn’t working. 10 years into the streaming era, we have seen a significant amount of new-artist development happening outside the structure of the majors. The shared-services model will, it’s hoped, bolster the A&R and marketing cores of these iconic label brands on both coasts.
This massive reorganization seems in part to reflect a greater focus on building on the artist development that has gone on at the big companies, giving it global scale and structure and empowering the people who know how to pull the right levers. Will the result be a more nimble and effective kind of major, less Godzilla and more velociraptor? We shall see.
