Making Music the Priority
The ‘90s may go down as the first decade in the record business where what happened in the executive suites was more important than what happened in the recording studios.
The big story has been the Invasion of the Conglomerates--a series of high-profile acquisitions, climaxed by Seagram’s $10.4-billion purchase of PolyGram that has left the heart of the industry in the hands of five massive companies. And that number could shrink to four if BMG buys the EMI Group.
The danger, some industry observers feel, is that there will be no room left in this power concentration for the entrepreneurial spirit that helped build such legendary independent labels as Atlantic, A&M;, Island and Motown.
But there is no evidence that the entrepreneurial spirit is dead yet. Some of the biggest success stories of the ‘90s involved entrepreneurs and upstart labels, including Ted Field and Jimmy Iovine at Interscope and Russell Simmons and Lyor Cohen at Def Jam.
None of these, however, matched in 1998 the estimated $250 million in sales of Bryan Turner’s Priority Records, whose artist roster includes rappers Ice Cube and Master P’s remarkable No Limit Record stable.
Impressed, EMI’s Capitol Records, which already had owned half of Priority, paid $75 million last year for the remaining 50%.
With Seagram also expected to acquire the full ownership of Interscope and Def Jam, the question now is whether these entrepreneurs will be able to work successfully within the conglomerate structure--and whether there is room for new Interscopes, Prioritys and Def Jams to emerge.
In his office in Hollywood, Priority President and CEO Turner--a 43-year-old Winnipeg, Manitoba, native who formed Priority in 1985 with former partner Mark Cerami--spoke about the challenges facing the record business and the issue of entrepreneurship.
Question: Let’s start off with the Seagram purchase of PolyGram. Do you see it as having a positive or negative impact on the record industry?
Answer: I think it is a great move for the record industry because I think it will encourage other potential entrepreneurs to start small independent labels and they will flourish.
Q: That makes it sound like you think there is still lots of room for newcomers in the business despite the power of these conglomerates. Why do you feel that way?
A: Look at what happened in rap. Rap was started by a series of entrepreneurs in New York who felt the excitement surrounding the music and saw the potential for it. This gave them a head start on the bigger labels, which were slow to recognize what was going on in the clubs and on the streets.
After a couple of years, the labels hired A&R; people and sent them into clubs, but they couldn’t compete with the entrepreneur who has to run his own business.
Q: Why is the entrepreneur better able to do it?
A: Because he wants it more. He’ll go that extra length to make things happen. Besides, you have to go through so many layers of management at a big company to get a decision. . . . I honestly believe the major label system is broken and it has been for five to seven years because of all the financial pressures to come up with immediate results.
Q: But you are now part of a major conglomerate, EMI. Don’t you feel those same pressures?
A: No, because we are doing really well and making [EMI] a lot of money, and those results tend to keep them focused on other problems they have.
Q: But what happens if growth slows dramatically? Do you worry about interference then?
A: So far, these companies have won by bringing in small operations, like us and Interscope and Def Jam, and letting them do their thing. The question of whether these arrangements will continue to work won’t be told by how well we work with them, but how well they work with us. Are they going to let us do what we have been doing, which is why they wanted us in the first place?
There’s no guarantee. Look what happened over the years to Chrysalis, to I.R.S., to Island and A&M; and Motown . . . all these great independent labels that have fallen on hard times.
I went through all this before I sold the company. Look at all the skeletons . . . the burial ground of all these labels that changed the musical world. Hopefully the chief executives of these conglomerates have learned from all that has happened in the record industry and won’t make the same mistake again.
Q: N.W.A was the first rap act you signed to a distribution deal in 1988. What was your reaction to the music--the violence in that whole gangsta rap style?
A: For one thing, I think Public Enemy and KRS-One prepared me for N.W.A. Public Enemy’s first album changed the whole direction of rap. It became less of a dance, nightclub, party thing and something that could have commentary and content.
That was a bridge to N.W.A, which was young people being rebellious and standing up for their right to express themselves. I would listen to “Straight Outta Compton” and then talk to the members of the group one-on-one about their experiences, the things in their lives that led to the ideas in the music. I could see where the music was coming from.
Q: How did you feel when the FBI sent you a letter saying N.W.A’s music was encouraging violence against law enforcement officers?
A: My immediate reaction was I couldn’t believe it . . . I couldn’t imagine that listening to a record could cause someone to do that. I thought it was just an attempt to squash rap. I didn’t take it seriously. But as I got more into it, I started thinking about the 1st Amendment and how it was important to stand up for someone’s right of expression, and that became an important principle for this company later, when other artists came to us after being turned away by other labels because of “content” issues.
Q: Why did you sell to Capitol and EMI? Why not remain independent?
A: As the major labels entered the rap business, the stakes went up. All of a sudden Columbia would be spending $500,000 on a Will Smith or LL Cool J video, so you need more financing to be competitive. One day I turned around and my payroll was $10 million a year. I am sitting there, going, “Wait a second.” I had a good crew, but every industry, especially the record business, runs in cycles. If I hit a cold spell, I could have been out of business.
Q: For a while, many in the industry were saying that the record business was losing its audience because today’s young people are more interested in the Internet and video games than in music. Does that seem valid to you?
A: The Internet and video games are definitely something competing for that entertainment dollar, but I don’t necessarily believe it will replace the hunger for music. Music is an emotion. That’s something you can’t get out of a computer.
Q: What about music? There has been a lot of criticism about mainstream pop being unusually bland during the ‘90s. Are you still excited by music yourself?
A: Yes. I believe in cycles, and what we have gone through the last four or five years is the winter of the music business. I can see music turning the corner. You hear it in the energy level from these artists who come in. I believe the next young cultural movement will be something unlike anything we’ve ever seen.
Q: Do you see a resurgence in rock or a further expansion of hip-hop?
A: I’m talking about a hybrid . . . the stuff the Beastie Boys are doing, the new Offspring record, the tour Ice Cube did with Korn. There’s already an integration of the cultures, and it’s going to get much stronger. Ultimately, I think it is going to be hip-hop dominated, because for the last 10 years, hip-hop is in the musical fabric of young America. White kids who are 18 or 19 have grown up on hip-hop more than they have rock ‘n’ roll, so even if they continue to pick up guitars, the music they make will be influenced strongly by hip-hop.
What worries me is the talent drain on the business side. The entrepreneurs will always find a way to succeed, but all these huge companies are going to need lots of people to keep going, and there are other software and computer industries around that are competing for the smartest and most intelligent people. That’s where the conglomerates may find their biggest challenge--attracting quality executives.
(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)
The daily Calendar section will continue through Thursday its series of interviews, conducted by Times critics, with leaders in the arts and entertainment.
Movies: Steven Spielberg
Classical music: MaryAnn Bonino
Television: Jeff Greenfield
Jazz: Tommy LiPuma
Dance: Garth Fagan
Restaurants: Nobu Matsuhisa
Architecture: Philip Johnson
Stage: Beth Henley
Pop music: Bryan Turner
Art: Gary Kornblau