Company Town : A Giant Clash Over Record Company

After successfully launching the Eagles’ “Hell Freezes Over” tour, Irving Azoff isn’t taking it easy. Sources say his partnership with Time Warner Inc. is headed for a breakup.

Azoff’s around-the-clock work for the Eagles has strained his relations with the media conglomerate, which was already unhappy with their joint venture, Giant Records. Sources look for the two sides to part sooner rather than later.

“I can’t believe it’s real comfortable for Irving there now,” said one industry associate. “If someone wants to come along and buy Giant, I’m sure Time Warner would have a perked-up ear.”

Sources say Azoff and Time Warner Music Group Chairman Robert Morgado have already held preliminary divorce talks but remain miles apart on the terms. Morgado is said to be demanding a multimillion-dollar settlement to release Azoff from the final three years of their Giant agreement. In response, colleagues say Azoff is considering legal action.

Morgado, who has been described as openly hostile toward the Giant joint venture, declined to comment. He referred all calls to the Warner Bros. Records unit, which also had no response. While he was equally silent on the issue, Azoff is known to be furious at Time Warner for refusing to release an Eagles reunion album, which has been tied up in litigation.

“He’s got a real dilemma,” said one knowledgeable source. “He’s with a company that clearly doesn’t want him but that also might not let him go so easily unless the price is right.”

*

All that tension hardly makes for beautiful music. Though Azoff is regarded as a shrewd deal maker, critics say the 4-year-old Giant is an underachiever. High-profile acts such as Hammer have not paid off for the label. Giant’s biggest sellers include “Common Thread,” a rehash of Eagles songs by country music stars that reached No. 3 on the Billboard Top 200 chart, and the soundtrack to “New Jack City.” Said one industry source: “You can’t build a label on those records like you can with a hot new act.”

Azoff’s supporters say the label still has outperformed most start-ups, and they point to “Common Thread” and discoveries such as “Big Head Todd & the Monsters” as evidence of its viability. On a personal level, friends say Azoff is having one of his best years, with the Eagles show doing banner business and his merchandising company handling such big summer events as the Eagles and “Lollapalooza” tours.

It’s too soon to say where Azoff might land. Some colleagues assume his deal will be picked up by Bertelsmann Music Group, which distributes Giant overseas.

Recent speculation also had Azoff in talks with Ronald O. Perelman, whose New World Communications Group has cut a wide path through Hollywood recently by signing rapid-fire television deals with Fox Inc. and former NBC programming kingpin Brandon Tartikoff.

Azoff and Perelman, who are longtime friends, were spotted having lunch at the Grill in Beverly Hills two weeks ago. In a recent interview, New World Chief Executive William C. Bevins confirmed that the company is considering a music investment, but he declined to comment on Azoff specifically. Behind the scenes, sources say New World has hired star record industry lawyer John Branca, whose clients include Michael Jackson, as a consultant.

Adding Azoff to his camp and striking a music distribution deal would give Perelman entree to the record business, much as the Tartikoff deal raised New World’s profile in television. Sources say Azoff would go into business with Perelman “in a minute.” New World declined to comment. Publicly, Azoff said: “Ron Perelman and I are friends. I have great admiration for him.” But people close to the executives consider a deal unlikely.

“Perelman is interested in record business, but not at Azoff’s level,” said one source. “He wants to buy something like (record giant) Thorn EMI.”

*

As the summer box office shakeout continues, the weekend brought good news for one studio on the rocks and bad news for another trying for a comeback.

Columbia Pictures finally emerged from its long slump with “Wolf,” which took in about $18 million. The sophisticated horror tale starring Jack Nicholson and Michelle Pfeiffer was seen as a must-succeed movie for the studio, which has had a slow year. Lisbeth R. Barron, an S.G. Warburg analyst, estimates Wolf will take in $75 million domestically, based on its performance to date.

MGM had the opposite experience with “Getting Even With Dad.” The perennially troubled studio hoped the Macaulay Culkin-Ted Danson comedy would mark its return (Culkin even appealed for people to support the movie on an MGM preview reel shown at the ShoWest convention in Las Vegas earlier this year), but the weekend box office was only $5.6 million.

Barron projects that “Getting Even With Dad” will max out at about $20 million domestically. Management at MGM was startlingly quick to disown the movie in the wake of its failure, pointing out that it was greenlit by the old regime. The new MGM brass, a popular group that still has the strong support of its colleagues in Hollywood, now has its summer hopes riding on “Blown Away,” a Tommy Lee Jones-Jeff Bridges thriller.

*

MCA Records has a serious case of Jimi Hendrix-itis. Over the past 12 months, the company has put out four packages by the late rock legend. A boxed set of studio albums came out with a greatest hits release, “The Ultimate Experience.”

Then came an album of mostly unheard Hendrix blues songs. Now comes word that MCA is putting out “Jimi Hendrix: Woodstock,” showcasing his performances from the seminal music festival. Timed to coincide with Woodstock’s 25th anniversary, it includes an essay by Hendrix scholar Michael Fairchild, who rhapsodizes that Hendrix made his guitar sound like “jet engine orgasms.”