Maybe the pop world is finally ready to believe what Calendar predicted nearly four years ago: that by concentrating on cutting-edge rock and rap music, upstart Interscope Records would become the envy of the music industry.

The Westwood-based company, which launched in late 1990 as a joint venture with Time Warner, stunned its competitors last fall by becoming the first label in the modern pop era to capture the four top positions on the nation's album charts in a single week, thanks to releases by Bush, Tupac Shakur, Snoop Doggy Dogg and No Doubt.

Battling rivals 10 times its size, Interscope went on to dominate the competition throughout most of the lucrative Christmas rush--nabbing the top spot on the Billboard chart for the past eight weeks.

Previously branded as a "gangsta rap" or "radical rock" label, Interscope emerged in 1996 as a full-service record company with a string of mainstream hit acts ranging from the radio-friendly No Doubt to roots-rockers the Wallflowers to traditional R&B purveyors Blackstreet.

Interscope's success is even more amazing when you consider it was just 15 months ago that Time Warner Chairman Gerald Levin made the shortsighted decision to dump the label following a rap lyric controversy. Interscope co-founders Jimmy Iovine and Ted Field quickly cut a more profitable deal with Seagram-owned MCA, which purchased half of the company in February for $200 million.
FOR THE RECORD:
Record executive--A Jan. 5 Pop Eye column incorrectly identified record industry veteran Henry Droz as one of several top executives who were fired during a corporate shake-up at the Warner Music Group. Droz, who now runs MCA's distribution arm, retired from his post as chief of distribution at Warner in 1993 after 16 years on the job.

With Interscope in tow, MCA instantly gained new credibility as a rock powerhouse and even jumped temporarily from last to first place last fall in terms of new album sales (when older, catalog titles are counted, MCA is fifth in overall album sales). In addition, MCA bolstered its image by recruiting several of the top executives recently fired by Warner, including Doug Morris, Henry Droz and Bob Krasnow. Highly regarded veterans Mo Ostin and Lenny Waronker also resurfaced at David Geffen's MCA-distributed DreamWorks label.

To be sure, the dramatic restructuring of MCA has focused the eyes of the industry on a bold new corporate player: Seagram chief Edgar Bronfman Jr., whose empowering and charismatic approach is being likened by some to that of the late and beloved Warner titan Steve Ross.

Although it will take time to determine whether Bronfman's revitalization plan will pay off, many already believe that Time Warner's days as the undisputed industry leader are numbered. Indeed, power shifted last year in the $12-billion business, with Sony, PolyGram, BMG, MCA and the independent label sector already beginning to close the gap on Warner's lead.

Here's how the major companies fared last year, based on SoundScan estimates of U.S. market share as well as interviews with key industry figures, who evaluated labels on both image and performance. The corporations are listed in order of domestic market share for new product only (excluding older, catalog albums) through Dec. 22.

WARNER MUSIC: 21%

Warner Bros: New co-Chairmen Bob Daly and Terry Semel have succeeded in calming the waters at Time Warner's troubled music division, but few insiders believe the new triumvirate of label chiefs will be able to return the corporation to its glory days. While Warner continues to dominate the domestic market, the talk is that the Bunny really no longer has anything special to offer artists over the competition.

With R.E.M.'s latest release getting off to a slow start, it was Madonna's tiny Maverick Records that saved the day, delivering the year's best-selling album, from Alanis Morissette. Warner also counted on Enya, Van Halen, Seal and Faith Hill to keep the cash registers ringing. It's still too early to tell what kind of imprint Chairman Russ Thyret will put on the label, but outside of re-signing R.E.M. and pink-slipping practically the entire black music department, things so far have been exceedingly quiet during Thyret's tenure.

Atlantic: Val Azzoli, on the other hand, shook things up at Atlantic last year, axing dozens of employees and artists as well as cutting ties with several unprofitable joint ventures. The verdict is still out on whether Azzoli has the creative vision to revive Atlantic, but the label quietly nudged along such acts as Jewel, Donna Lewis, Seven Mary Three, Poe, Junior M.A.F.I.A. and Lil' Kim. Hootie & the Blowfish's second release has sold only about a fifth of the 10 million chalked up by the band's debut. Old Atlantic standby Phil Collins bombed.

Elektra: Is there anyone left who still thinks a black woman can't run a rock label? If so, they obviously weren't paying attention to Sylvia Rhone's spectacular results last year at Elektra, which she took over in 1994. For the second year in a row, Elektra ranks as Warner Music's most profitable label, thanks to an eclectic string of hits from such acts as Metallica, Tracy Chapman, Keith Sweat and Natalie Merchant. Possible goof: Prodigy, the English techno-dance wonder Rhone trimmed from the roster during massive cuts two years ago, became the target of the biggest ongoing bidding war.

SONY: 14.4%

Epic: Among the crucial details unmentioned in Vanity Fair's vindictive profile of Sony Music chief Tommy Mottola was the fact that Sony Music posted record results in 1996 and delivered four of the year's Top 10 selling albums. The whopping success of Celine Dion's 6-million-selling "Falling Into You" offered proof that Mottola's wife, Mariah Carey, is not the only pop star benefiting from the masterful Sony marketing machine. Epic's David Glew and Richard Griffiths--with 550 Music's Polly Anthony--also pumped out a stream of hits from Oasis, Rage Against the Machine, Ghostface Killah and, though somewhat disappointing, Pearl Jam. In addition, Jeff Ayeroff and Jordan Harris finally put their Work label on the map with a new album from media darling Fiona Apple.

Columbia: Aggressive Chairman Don Ienner took charge again last year at Columbia, transforming underground rap act the Fugees into one of the year's biggest mainstream pop hits. Ienner's hot label produced a broad range of hits from Mariah Carey, Nas, the Presidents of the United States of America, Stabbing Westward and Alice in Chains, as well as breakthroughs from a number of new acts, including Maxwell and Primitive Radio Gods.