Azoff's Power
So Warner's numbers tanked. It's not like this is a surprise. After all, CD sales have been going down, down, down for years, unrelentingly. Hell, Warner's market share improved recently, and the numbers still went down. That begs the question, is a lot of a little even relevant?
We can dissect EMI and Sony BMG all day long, chronicling their problems. EMI has essentially turned into Chrysler, another private equity boondoggle by someone ignorant in the sphere who has now downsized the company beyond recognition. Sony BMG has got a street guy, Charlie Walk at Epic, who can promote but isn't that good at signing, and a guru who's never been successful running a label, even though he's tried, Rick Rubin. Give BMG credit for bringing in a successful cheapskate, Barry Weiss. But it's not like Jive's been doing Backstreet Boys numbers recently. And there's not a ton of innovation, just running on Timberlake fumes. That brings us to the big kahuna, Universal.
Universal has a dual strategy, diversification and get a check. It's not like they've abandoned their traditional business, but even though they've got the largest market share, their sales are tanking too. So, they bought BMG's publishing assets. And Sanctuary, giving them a tiny toehold in management. As for the company's digital strategy, it's not about vision, it's about holding up innovators for payment. They'll make a deal with anybody if you cut them a big enough check. There's no real planning for the digital future, more extracting lunch money, protection cash from those who want to start new businesses. The deals are heinous, but you need their catalog to start.
Irving Azoff does not need Universal's catalog to start.
Funnily enough, as we contemplate the marginalization of Clive Davis, the era he presided over has already died. Clive was about record company power. That's been the mantra of the last 15 years, if not two decades. The record company controls the act. Tells it what to record and if it will release. The record company is the tyrant, your nemesis. But now, through the efforts of Irving Azoff, the act is king once again. May not feel so, you don't see Mo Ostin presiding over Warner Brothers, but that's the way it is.
Irving is the best protector of talent in the rock era. He even eclipses Colonel Tom Parker. Parker made a lot of decisions based on self-interest, like not allowing Elvis to tour Europe for fear his own illegal alien status would be revealed. Irving likes money, he likes to win, but he does this by going to the mat for the artist. What Henley wants, he gets. And not only Henley, but Christina Aguilera. Even Jewel. You take a meeting with Irving, and he closes you. And he's no patsy, if he thinks you're your own worst enemy, that you're not taking your business seriously, he fires you! Like J. Lo.
But it's not only Irving, there's Howard. Howard is the king of Live Nation. It's his acts that fill those dying sheds. And LN pays dearly for them. Jimmy Buffett takes 110% of the gross. And Def Leppard has been the surprise success of the sheds.
But it's not only Howard... There's a cornucopia, a veritable plethora of managers over at Frontline. And they come with acts!
The big story this week wasn't Warner's anemic numbers, but Azoff's formation of AGP, with Paul Geary and Jared Paul.
There's something happening here, and it's starting to become very clear. Irving Azoff has built a talent powerhouse. More powerful than any label. Which concert promoters are beholden to.
I'm not saying that an indie manager can't make it. Can't make good deals with promoters. I'm just saying that Irving has achieved critical mass. He has reached his goal. He dictates the terms. Others listen to him.
And his style benefits him. Those who don't know him are aware of his reputation for lack of veracity. For tantrums. But what they don't know is he's charming. That he charms his supposed enemies as well as friends. That he gives off the vibe of everyone being in it together... At least until there are problems.
How big is Azoff's power?
He sold interests to both Warner and TicketMaster... Neutralizing both, telling them they can ride his coattails into the future. Their businesses might be challenged, but they've got him in their corner, he'll help them.
If you think Irving helps anybody but himself and his clients...
Then there's the theoretical AEG/TicketMaster/Cablevision lockup. That's Irving play. Assembling a challenger to LiveNation.
The question is, having amassed so much power, having done what Jeff Kwatinetz and Terry McBride were unable to do, despite all their bloviating in the press, what does Irving do next?
He's got his own record company. The infrastructure built to sell Buffett albums and the relationship with Wal-Mart. He'll use a major's money to develop, but that's it...
He's smart enough not to go into competition with promoters. He built Universal Concerts and AEG, he knows the pitfalls, but Irving was bad as an owner. Remember Giant? Irving does best extracting money from others!
So what's the play? Is it just managing this talent, or leveraging it in some way?
Eventually he'll sell Frontline. Because someone will be stupid enough to write him a check, and he's getting older every minute, and no one lives forever. But what now? What's next?
It's Irving's world, we just play in it.
You could start your band from scratch, trying to build relationships in the industry, or make a deal with Irving and he'll get you on all the awards shows, like Christina Aguilera. Or get you a gig on a TV show, like Jewel with Nashville Star. Irving's like the labels used to be... Too many people owe him. He's got a symbiotic relationship with them. An ongoing relationship.
Can you get enough personal attention?
Certainly if you're Henley. And no one works the phones like Irving. But if you want to call someone about your girlfriend, Irving's not the one. Oh, he can speak that language, he just doesn't have the time anymore.
So what's your choice? Making a deal with Toyota or Volvo? Volvos are good cars, but Toyota gives you critical mass. R&D can be spread over many units. There are resources.
Stop watching the major labels. Start watching Irving. He controls the future of the music business. At least for now.
