A year that left 'em spinning

Los Angeles Times Staff Writer

Among the rules established in 1994 in the music industry: The Eagles can still sell a lot of records and concert seats, monks with good voices can break into the Top 10, and it's important to differentiate whether rap refers to rap music or a rap sheet.

Mostly, 1994 in music was the year of executive suite turmoil, played out publicly for weeks. Although things have calmed down at Time Warner's music group for now, there remain some hot spots to watch in 1995. Here are some of them:

* Where will Mo go? The biggest executive departure in the music business in 1994--and potentially the biggest executive recruit in 1995--is industry legend Mo Ostin.

Ostin's official departure last week as head of Warner Bros. Records after an executive suite corporate battle was reminiscent of the classic "Mister Roberts" scene in which Henry Fonda leaves his ship. Tears flowed as hundreds of employees lined the halls and streets to watch Ostin, 67, take his last stroll out of the Burbank headquarters of what has long been considered the most successful and stable label in the rock era.

Those who run the $11-billion industry are still reeling from the bitter boardroom brawls last fall that drove Ostin out the door and nearly brought his label's parent company, Warner Music Group, to its knees.

The betting is that Ostin will end up with David Geffen, who is forming a label as part of the new entertainment conglomerate he's creating with director Steven Spielberg and former Walt Disney Studios chief Jeffrey Katzenberg. Hiring Ostin would be a coup for Geffen's label.

Should that happen, expect Ostin to be joined by longtime partner Lenny Waronker, along with a number of hot rising executives and artists. Insiders believe Geffen's new company will immediately change the dynamics of every bidding war for talent on the West Coast.

"Geffen is going to make such a huge noise when his new company opens for business," said one record chief. "There isn't a competitor in this business who isn't anxious about it, especially with Mo and Lenny probably going over there. I mean, if I was a manager, I'd bring my band to those guys in a second. That company is going to be a mother."

* More Warner stuff. The major complaint about Ostin was that he refused to play ball with the corporation and resisted streamlining his bloated label, which his critics called a graveyard for over-the-hill rock stars and deadwood executives.

But Ostin's successor at Warner Bros. Records, Danny Goldberg, has assured anxious employees and talent managers that he has no plans to make slashes in the artists or staff when he takes over next week. In the aftermath, insiders find it ironic that Ostin and longtime sidekick Waronker may be the only veteran executives to have been purged from the firm.

Most insiders are confident that Doug Morris, who was recently granted autonomy over Time Warner's domestic music division, has the creative vision to restore order and confidence not only at Warner Bros. but throughout the conglomerate. Morris is starting to stabilize things at Elektra, where he installed longtime lieutenant Sylvia Rhone and industry veteran Seymour Stein to run things, and he moved quickly to resolve an embarrassing breach-of-contract lawsuit filed by superstar band Metallica.

* The rap on Interscope. One task ahead for Warner is to finalize its purchase of Interscope Records, the successful label founded by Ted Field and Jimmy Iovine and part-owned by Warner.

Sources say Field and Iovine, with buyout offers from other companies on the table, are still waiting for Time Warner's board to approve a bid that would allow them to stay at Warner. The price forWarner to acquire the remaining 75% of Interscope is said to be a hefty $300 million.

Interscope has an enviable record of signing and breaking cutting-edge artists such as Trent Reznor, Dr. Dre and Snoop Doggy Dogg. Interscope has also bested other start-up labels--such as American, Giant and Hollywood Records--and is now considered a primary competitor in the signing wars among established labels such as Geffen and Epic.

A number of the label's most talented stars, however, are facing legal problems as they enter the new year. Dr. Dre, Snoop Doggy Dogg and Tupac Amaru Shakur have all been charged with violent crimes. Time Warner's board is known for having shied away from controversy in the past, but insiders predict its members will approve the purchase primarily because they can't afford to lose the enormous profits or creative respect Interscope brings the firm.

* Sumner time? Viacom Chairman Sumner Redstone has made noises about entering the music business. Viacom spent $10 billion earlier this year to acquire Paramount Communications, but Paramount does not have a music operation.

Another possibility is that Ron Perelman, whose New World is expanding its presence in Hollywood, will enter the music industry.

Companies not versed in music haven't had much luck when it comes to starting up labels in recent years, however. Just look at Walt Disney's Hollywood Records.

* EMI trouble ahead? Despite reporting decent profit, the British-owned company that had a big hit with chants by Benedictine monks may need a prayer or two in the coming year.


Lots of older records from the Capitol Records catalogue are selling, but where are the new acts that talent whiz Gary Gersh (handpicked by Charles Koppelman, EMI Records Group North America chairman) was supposed to deliver? The label clearly needs to develop younger acts for the day when it pairs them up with Frank Sinatra for "Duets V."

Virgin's Ken Berry is the biggest star at EMI these days, but the glow diminished when his wife, Executive Vice President Nancy Berry, reportedly began impinging on the turf of Virgin President Phil Quartararo. Quartararo tried to get out of his contract when Warner Bros. beckoned, but EMI President James Fifield wouldn't let him.

EMI dumped President Daniel Glass after a lackluster year, replacing him with Davitt Sigerson. Word is that Fifield is also keeping a closer watch on Koppelman these days.

* BMG. New North American chief Strauss Zelnick may need to take out a help-wanted ad to find someone to run laggard RCA Records.

Music agent Tom Ross, like the batch of executives before him, is said to have turned down the job. RCA's country music chief, Joe Galante, abandoned the position to return to Nashville. Word is that BMG Canada's Bob Jamison may fill the spot.

On the brighter side, BMG's Arista, under Clive Davis' leadership, continues to outperform labels twice its size.

* PolyGram. Its Mercury label is a mess. But Island, run by Chris Blackwell, and its A&M Records label, run by Al Cafaro, are both strong.

* MCA. MCA under Al Teller remains hot in country and rhythm and blues, and the respected Eddie Rosenblatt at MCA's Geffen Records will remain after namesake David Geffen leaves after his contract expires next spring. After former Elektra boss Bob Krasnow was forced out, Teller moved quickly to pick him up.

* Sony Music. This is the one thing Sony Corp. did right in entertainment. The company's movie operation has lost a bundle, but Sony Music under Thomas D. Mottola continues to make money with stars such as his Epic label's Pearl Jam and Columbia's Mariah Carey. Columbia also launched a West Coast label, with industry vets Jeff Ayeroff and Jordan Harris, that could draw in new talent.

* Final thoughts. Said one industry insider of what to expect in 1995: "It isn't like we're entering a new year here; it's more like we're moving into a brand-new phase. New music. New technology. New faces in the executive suites. It's going to be interesting to see who survives."

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