Less than a decade ago, EMI was regarded as the most prestigious and successful of the four major record labels, the home of legendary artists like the Beatles and Pink Floyd, as well as more contemporary superstars like Radiohead and Coldplay. That was five years ago, however. Since then, no label has been hit harder by the music industry's financial woes. The company was purchased by equity firm Terra Firma in 2007 and major strategic changes followed, leading many of EMI's marquee acts to jet -- the Rolling Stones, Radiohead and Paul McCartney have all moved their catalogs elsewhere. This weekend brought more bad news for the floundering giant: Queen, who spent nearly four decades on EMI, revealed they'll be taking their talents (and "Bohemian Rhapsody") to Universal.
Queen join the Rolling Stones as the second major artist in as many years to make the jump from EMI to their major competitor. Under Queen's deal with Universal, the band will remaster and reissue 15 of their most popular albums. Those reissues should give Universal a nice little boost in the wallet because interest in Queen is sure to skyrocket once the Freddie Mercury biopic starring Sacha Baron Cohen arrives.
One of the big reasons these artists are ditching the label they called home for decades is lack of faith in Terra Firma CEO Guy Hands, a relative newbie to the music industry who was once likened to a "plantation owner" by the manager of Robbie Williams, one of EMI's biggest stars (overseas, anyways). When Radiohead entered into contract negotiations with EMI in 2007 prior to "In Rainbows," the band asked for £12 million and control over their own work. Hands, in one of his first moves as head of EMI, countered with a low-ball offer of £3 million, which led guitarist Ed O'Brien to quip "[Hands] doesn't understand the music industry." In early 2008, Hands also revealed an odd, half-baked scheme to seek corporate sponsorship for artists under the EMI umbrella. That brainstorm came just before EMI axed nearly a third of its workforce due to redundancies (and its ever-growing debt).
The loss of Queen wasn't even the worst new EMI received in the last seven days. This was: Guy Hands, who has long accused Citigroup of misleading him into purchasing EMI for $6.8 billion, lost his lawsuit against Citigroup. Hands was attempting to recoup some of the money Terra Firma owes Citigroup; a judge found that Citigroup committed no wrongdoing, and that it was Hands' own poor decision to purchase the label.
Because EMI is in the hole -- the company lost $2.5 billion last year -- the label has been unable to provide the assurances or funds its former stalwarts, like Queen, Radiohead and the Stones, needed in order to stick around. But on the bright side, at least they still have the Beatles!
[Photo: Associated Press]
- Terra Firma
- Pink Floyd