Island Def Jam Label on Right Track

No one in the record industry will be surprised this morning when Island Def Jam Music Group, a division of media giant Vivendi, captures two of the top three positions on the nation’s album chart for the second week in a row. The stunner is that one of them is a rock record.

With nine albums in the top 100 and a parade of potential blockbusters due out before Christmas, Island Def Jam is evolving from its roots as a successful rap label to a full-service record company with a string of rock, rap and country hits from such acts as Ja Rule, Foxy Brown and Slayer and the soundtrack to the film “O Brother Where Art Thou?”

By any accounting, Island Def Jam also is emerging as a force within Vivendi’s Universal Music Group. Company sources project the division will generate $400 million in sales this year. Since last winter, the division has increased its share of current-album sales in the U.S. to 6.4% from 5.2%, increasing Universal’s lead over second-place Sony Music, according to music research firm SoundScan.

Island Def Jam is one of Universal’s four major divisions, formed in 1999 from the Island, Mercury and Def Jam labels. Amid a massive reorganization, Universal trimmed at least 120 acts from the Island and Mercury payrolls, essentially leaving intact Def Jam’s roster of rap artists and executive team.

Since then, the question dogging Island Def Jam executives Jim Caparro and Lyor Cohen had been whether they could restore the company’s presence in rock and other genres while continuing to dominate the rap charts.

Last week, the company captured the top two positions on the nation’s pop chart with albums from rap star Jay-Z and rock band Nickelback. Island Def Jam is expected to have the No. 1 album again this week with Jay-Z, whose album sold an estimated 270,000 copies last week. Nickelback sold an estimated 120,000 copies, sources said, but may slip to No. 3 when new weekly sales data are released today.

The chart success caps a lengthy campaign to diversify the division’s roster by signing new acts and investing in joint ventures with hot independent labels. Competitors criticize the label for spending too much money to promote its acts; still, the division is on track to meet its profit projections this year.

Sales of three unknown rock acts signed by Island Def Jam have climbed steadily over the summer, though none have yet reached 1 million units sold. According to SoundScan, Sum-41 has sold about 961,000 copies of its album; Saliva has sold 454,000; and American Hi-Fi has sold 328,000.

The rock albums scoring Island Def Jam’s highest chart positions came through an affiliation with New York-based Roadrunner Records. Island Def Jam paid an estimated $32 million this summer for a 51% stake in Roadrunner, which released the album by Nickelback and another act, freak-rock band Slipknot.

Slipknot debuted at No. 3 and has since sold an estimated 391,000 copies in three weeks; rock band Nickelback opened at No. 2, sold 178,000 in one week and is expected to remain in the top three when new sales data are released today.

Separately, an earlier joint venture with Mercury Nashville chief Luke Lewis, Lost Highway Records, delivered the “O Brother” soundtrack, which has sold about 2 million copies.

With the fourth-quarter sales rush about to get underway, the label also is counting on releases from Def Jam rap stars such as DMX, Ja Rule and Ludacris and rock band Hoobustank.

“It’s nice to put your mind to something and see it come to fruition,” Cohen said in an interview Tuesday. “But I’m greedy. I want more. I want to be the biggest label in the United States, and I want to be the most culturally significant label in the United States.”