Music Maven : Doug Morris Has Set the Tone for the Dinosaur-to-Diva Rise of Atlantic

One of Doug Morris’ first jobs in music in the 1960s was working as an assistant to the late songwriter Bert Berns, known for such hits as “Twist and Shout” and “Hang On, Sloopy.”

A periodic task was to cash Berns’ paychecks at a bank. Morris would then head over to Atlantic Records’ New York studio, where he would deliver the cash to Berns.

Some 30 years later, Morris is still delivering the cash at Atlantic, albeit in considerably higher sums. As co-chairman and co-chief executive of Time Warner’s Atlantic Group, Morris in four years has transformed a label that was widely perceived as a dinosaur into one of the industry’s hottest music labels.

Atlantic has the biggest market share of all the major labels so far this year in the new releases category, with 8.8% (including catalogue sales, its overall market share is 8.22%, placing it third). It has also held the lead in new releases sales for the past two weeks, thanks to the rap soundtrack from the film “Above the Rim” from Atlantic’s Interscope partnership and the Texas rock group Pantera’s “Far Beyond Driven” from Atlantic’s EastWest Records. Also continuing to sell is music from rap star Snoop Doggy Dogg on Interscope, the alternative rock band Stone Temple Pilots and country star John Michael Montgomery.

Neither Atlantic nor its parent, Warner Music Group, will discuss sales numbers. But music industry sources estimate that its worldwide revenue soared from about $400 million in 1991 to about $750 million in 1993. Some say it’s possible that with its most recent spurt Atlantic may account for as much as 40% of the Warner Music Group’s business now.

As little as five years ago, Atlantic was, as one prominent record producer put it, “in the toilet.” It was known for surviving mainly on the basis of its rich, but aging, catalogue of music from such groups as Led Zeppelin, Crosby, Stills & Nash and Genesis.

“We were (viewed) everywhere as an old warhorse company that lived off its catalogue. A lot of things deteriorated in the company. It was very depressing,” Morris says.

The change came in 1990, when a blunt message came from Warner Music Chairman Robert Morgado that Atlantic wasn’t cutting it.

Atlantic founder Ahmet Ertegun, who still shares the co-chairman and co-chief executive titles, agreed to give management authority to Morris, 54, a former songwriter from Long Island (he wrote the Chiffon’s 1966 hit “Sweet Talkin’ Guy”) and one-time music producer (his credits include “Smokin’ in the Boys Room” for Brownsville Station in the 1970s).

What is unusual about Atlantic’s revamping is that it wasn’t accomplished by an outsider brought in to clean things up, but by someone who cooled his heels for years before finally getting his chance.

“It’s clear the company had to be repositioned,” Morgado said. “If you are able to find someone to do the job from the inside it’s usually the preferable approach.” Competitors say that Morris’ time in the trenches writing, producing and peddling songs has given him invaluable experience that helps him now that he finally has clout.

“I’ve watched him come up from the days where he literally delivered records in a station wagon to stores,” said Thomas D. Mottola, Sony Music Entertainment president and chief operating officer. “He’s come through the ranks. He’s a music man. He’s a veteran who has learned by trial and error.”

After taking charge, Morris began a spending spree that included bolstering a video arm, cutting deals with such innovative labels as Rhino Records, Matador and Mammoth as well as forming a joint venture with mogul Ted Field and producer Jimmy Iovine for Interscope Records. He founded a country division, and formed a subsidiary label called EastWest, naming Sylvia Rhone, the industry’s most senior African American woman, as chief executive.

The result of all his moves, Morris recalled, was “big expenses and little sales” in 1991, resulting in Atlantic’s first ever loss since it was founded in 1948. Said Morris: “I was terrified. I said to myself, ‘What have I put in motion?’ ”

Danny Goldberg, a former artists’ manager who Morris has tapped to run his Atlantic Records unit, credits Morris with sticking with the long-term investments despite the losses.

“There is a tremendous temptation when in the short term you need to show a quarterly profit to show an accountant’s mentality toward this business,” Goldberg said. “That means cutting costs and living off the catalogue. We have a strong catalogue, so you can meet your numbers that way, but you are eating your seed corn. You need to keep breaking and developing artists.”

Atlantic’s most biggest and most visible deal was with Interscope, which it plans to eventually acquire outright. Although its music is relatively diverse, Interscope is best known for rap. That association has generated plenty of unwanted press for Time Warner, from controversy over rapper Ice-T’s controversial “Cop Killer” song two years ago to murder charges pending against Snoop Doggy Dogg, who maintains he is innocent.

Morris acknowledges that he walks a fine line in handling controversy. “The only answer to me is to trust the executives we have in place. The main thing I’m looking to protect is Time Warner. We don’t want to hurt the mother company,” Morris says.

Says producer Iovine: “Doug is very practical. He knows that great music and music that is progressive or ahead of its time is going to be controversial.”

Morris has just cut a deal with heavy metal producer Dave Jerde. He has also recruited Grammy-winning producer David Foster as a vice president to bolster Atlantic’s pop music standing, and has been in talks to bring aboard A&M; Records founders Herb Alpert and Jerry Moss. Other recent ventures include forming an audio books division.

Morris is in demand for deals, and is sometimes attracting them in unusual ways. He recently found himself in a bidding war at a charity auction for a block of time on MTV. Each time Morris bid, a man in the back topped him.

He lost that day to fashion designer Tommy Hilfiger. But the two men chatted after the auction, which led to a joint venture on MTV and VH-1 that just debuted in which Hilfiger visits celebrities at home to look over their wardrobes.

Atlantic’s Share

Record company market share by label, year-to-date for the week ending April 3. Columbia: 9.29% Warner Bros: 8.71% Atlantic: 8.22% Epic: 6.76% MCA: 6.49% Ari, BWCsta / La Face: 5.58% Electra: 3.49% Capitol: 3.16% RCA: 3.12% Geffen: 3.06%

Source: Soundscan Inc