Listen to Office 6 here:
Our current New York office is a floor at 645 Madison Avenue between 59th and 60th Streets. The building has a unique feature, it’s own entrance to the Bun N’ Burger on 60th Street directly from the ground floor reception. This is particularly brilliant in the depths of the New York City winters when you can pop downstairs for lunch without braving the outdoors. Mike Bone is the new President. He’s laconic with a southern drawl from Macon, Georgia where he was brought up. He hasn’t been a President before but he can manage and he has a good team. Daniel Glass is our VP of promotion, a great promotion man and an outstanding leader. Frances Pennington is Head of Press and Adam Ritholz is a popular VP of Legal. Kate and I along with our son Matt and daughter Jess have spent the summer in Westport Connecticut so that I could commute daily to the office. I see everyone is aware of the financial pressure the company is under and are working hard to break new artists and sell records. I just hope they get the time they need.
It’s good that Jeff Aldridge is still VP of A&R after the disruption of Terry leaving and also good that Kate Hyman has joined us in A&R. She worked for the extraordinary Ze Records home to James White and the Blacks, Kid Creole and the Coconuts, Lydia Lunch and Bill Laswell amongst a lot of cutting edge artists. Since the mid-70’s New York, whether it’s the Lower Eastside, Brooklyn, Bronx or Staten Island, has been the research centre for music. Punk rock, house music and hip hop have all grown and flourished cheek by jowl with each other. We haven’t been involved enough in this scene despite Blondie and it’s still flourishing so we need to catch up.
We do have artists that are going well, the Australian band The Divinyls produced by Mike Chapman and The Pursuit of Happiness from Canada produced by Todd Rundgren. Was (Not Was) have hits with their singles ‘Walk the Dinosaur’ and ‘Spy in the House of Love’ from their ‘What Up Dog’ album. The Waterboys have released ‘Fisherman’s Blues’ and we also have artists we’re hoping for success with World Party with their debut album ‘Private Revolution’ and Sinead O’Conor with her a debut album ‘The Lion and the Cobra’. Cooltempo are working on new artists Monie Love, Gang Starr and a debut album from Adeeva. We want to add an A&R person in LA. Tom Zutaut at Geffen is our top candidate but it’s a longshot and salaries are going through the roof. Aaron Jacoves is my main hope but he’s doing well at A&M where he’s about to sign Soundgarden from Seattle.
Running a large independent label in the US is expensive. It requires sales and promotion people across the country with big budgets for a&r, marketing and promotion.There is also a major cost in manufacturing and shipping enough discs to cover the market as well as having to pay for the returns if they don’t sell. Our deal with CBS means we make big profits on big sales but a dip in sales can be very costly. A cyclical pattern in sales isn’t unusual in the record business. Hopefully it evens itself out over a number of years based on the timing of releases and having hits of course. The issue for us is how quickly we can turn the US company round . The city shareholders are impatient.
Chris and I are spending a lot of time in New York and a lot of money on Concorde tickets. We stay in different hotels. I like the Berkshire on 52nd and Madison whilst Chris stays at the Ritz Carlton on Central Park South. The Berkshire is very convenient for breakfast meetings with our lawyer Allen Grubman who has an apartment in the Olympic Tower across the street on 52nd and Fifth Avenue. Chris and I meet up in Alan’s lobby at 8.30am for breakfast meetings. Alan is ready for work. All of his closest clients seem to call him around this time. David Geffen is usually the first which is amazing when you think he’s in LA where it’s three hours earlier. He has no trouble getting up in the morning.
Our US losses continue. It seems almost inevitable now that we’re going to make a deal with one of the major labels and it’s only a question of what kind of deal and with whom. Competition amongst the major corporations for market share is desperate and that’s creating spectacular valuations of record labels. David Geffen sent his plane to collect Chris for a meeting in LA and has begun buying shares in the Chrysalis Group on the stockmarket. His associates at Warners are also keen on buying Chrysalis and making it part of their international set up. Bertlesman Music Group, which used to be our old friends Ariola, are interested in some kind of an investment and so is Clive Calder of Zomba. We’ve worked with Clive on an artist he managed Trevor Rabin and he was great to work with. Chris is reluctant. I suspect he doesn’t want another partner. I’m sure he feels the same about David Geffen.
CBS our current US distributors don’t seem to be very interested. If we make a deal with one of their competitors we’ll be obliged to negotiate a severance of our agreement with them and that will be expensive. I think that’s on their minds. We meet Tommy Mottola President of CBS with Alan Grubman but it doesn’t go anywhere. In fact Tommy Mottola annoys me by saying we need to sign some street records. He obviously doesn’t know about Cooltempo which has great street records. Peter Edge, who runs Cooltempo, has introduced us to a number of independents like Fred Munao at Select, Eddie O’Loughlin at Next Plateau and Corey Robbins at Profile. All of them are involved in street records which is mainly hip-hop and dance. This music is making big inroads. Chris and I meet Corey Robbins in his office downtown. He has a large space and a flourishing business. I wanted Chris to see how much cheaper it is to move downtown and how well street records are selling. I believe this is a way forward for us in the US. Chris is surprised by the size and profitability of the company and flippantly suggests that perhaps we should be buying Profile. Corey smiles and replies perhaps he should be buying Chrysalis.
Chris is worried he might lose the company as a result of US losses. One possibility is to reduce our overheads and try to buy some time that way. We’re missing Terry Connolly’s input on working through the deal options and their financial impact. Chris wants to hire Jo Kiener an ex-Ariola executive, recently working at Addidas, to help structure a deal. He’s not someone who has impressed me in the past but Chris asked me to meet him so I did. It’s clear to me he sees this deal as an opportunity to install himself as the CEO of an American record company and emulate someone like Clive Davis at Arista. I see no sign of his ability to do any of this. Chris is feeling such pressure that I go along with the appointment despite my doubts.
Since the moment we met at university Chris has been the one with the business acumen and I’m sure he feels he knows better than me. I accept he has a much bigger stake in the game.
We soon leave New York for Munich with Alan Grubman and Jo Kiener to meet Michael Dorneman at Bertlesman. I’ve always enjoyed working with Monti Luftner and others at Ariola now the Bertlesman Music Group. They’ve bought Arista and RCA already as Monti had always dreamed. The meeting doesn’t go well. I don’t understand why not but we’re soon heading back to London and a meeting Alan Grubman has arranged with Jim Fifield the new CEO of EMI who has flown in from New York hoping to close a deal. He’s new to the music business and keen to make his name. Buying Chrysalis would be a good start. Eventually we agree to sell half of the label to EMI who have the right to buy the other half sometime during the next ten years. The EMI Board are happy and the Chrysalis Group Board are also delighted. Flags are flying in the City. It’s the sort of thing they like.
I’m disappointed with the outcome. The price isn’t fantastic and it doesn’t offer a solution to our ongoing US losses. I also notice there are clauses in the agreement which enable them to buy the second half of the label early, particularly if we’re having a bad year. In fact as I spend time with the EMI people it’s obvious they can’t wait to take over Chrysalis. I ask myself are we still able to focus on fighting for our artists? I’m also anxious about the people working for us. Many of them have spent most of their careers with us and I can’t be certain of their future.
I take Chris to lunch at Sally Clarke’s restaurant in Notting Hill. It’s one of our favourites. The purpose of the lunch is for me to explain that I intend to leave. He’s not happy but he can see my mind is made up. It’s a truly terrible decision to make but I can’t stand around and watch the company we painstakingly built over such a long time being dismantled by EMI. I’ll miss the people and the artists dreadfully. Am I letting Chris down? I don’t think so. He’s made his own decisions and the die is cast. There are a lot of people out in the world who have worked for or with the label. They’re no longer part of it but they contributed a lot to Chrysalis over the years. I believe they remember their time there with feelings of loyalty and affection and I’m proud to be joining them.