MCA Cements Relationships With Custom Labels

In rock ‘n’ roll, the most colorful shouting matches are between managers and record company execs. They’re natural adversaries, with managers fighting, often quite ferociously, for as much record-label support as possible for each of their acts.

So why are so many formidable managers so happy with MCA Records these days? Easy--they all have new custom-label deals there.

In a move that signals how serious MCA has become about beefing up its artist roster--and providing potential hit albums for its new worldwide Uni Distribution network--the record company is completing custom-label deals with three major management firms.

MCA already has joined forces with Alan Kovac, manager of Richard Marx, Vixen and L.A. Guns, whose new label is called Impact Records.

Soon to be announced: Gasoline Alley Music, a joint-venture label deal with the Stiefel-Phillips management firm, which handles Prince, Rod Stewart and Susanna Hoffs, and Radioactive Records, a custom label run by Gary Kurfirst (who manages the Talking Heads and Deee-Lite) and top British agent Ian Flukes.

MCA’s new label deals aren’t just with managers. It recently started the Future Enterprise, an ambitious deal with hot writer-producer Teddy Riley, and has covered its hip-hop flank by forming SOUL Records, run by rap kingpins Hank Shocklee and Bill Stephney.

“I’ve always subscribed to the theory that you can never have too many A&R; sources, so this is a way of expanding and diversifying our A&R; contacts,” said Al Teller, chairman of the MCA Entertainment Group. “These aren’t just manager deals. We’re starting labels with people whose strengths range from A&R; to image-making to career development. In an age of disposable artists, we’re associating ourselves with people who can identify talent with lasting career viability.”

Not all pop insiders share Teller’s vision. They point to several recent custom label ventures, particularly an Elektra Records deal with manager Bruce Allen and a PolyGram deal with the Lippman-Kahane management team--which produced few tangible results.

“It was a miracle we did as well as we did,” said Michael Lippman, who now manages a number of prestigious producers. “PolyGram was in a state of total disarray and the label chief who signed us, Dick Asher, left in the middle of our tenure there.

“But if a record company is run well, a custom label can be a valuable A&R; source. This is a business of relationships. And if a manager like Alan Kovac is working a new artist at Top 40 radio, you can bet they’ll remember that he manages a hit artist like Richard Marx too.”

Teller says MCA won’t neglect its new labels. “We’ve set the stage to integrate these deals into our infrastructure,” explained Teller, who said he wanted to institute similar deals during his tenure at CBS Records, but was stymied by “internal politics.”

“We won’t have the kind of infighting you’ve seen at other places.”

Still, many observers aren’t convinced that managers--or producers--necessarily make good talent scouts. “It’s warped thinking,” said one industry veteran. “Why make label deals with managers? They don’t find talent. They simply manage it. Where’s the logic? MCA wants to find new acts, so they’re paying all this money to guys who only got these artists as management clients after they were signed to a label.”

A rival record company exec added: “I don’t see much evidence that these managers have a great track record of finding new talent. A lot of people think MCA is making these deals because it may have to battle its new sister label, Geffen Records, for priority treatment in their new Uni distribution system. Geffen has a big array of superstar bands and if MCA can’t supply Uni with hit acts, they could have a problem.”

Teller insists his new custom labels will give MCA access to a broader range of new acts.

“If I didn’t strongly believe in these people’s ability to find terrific young artists, the deals wouldn’t have been made,” he said. “I think they’ll be great talent scouts.”