A Year of Music

EMI, the smallest of the four major labels, got bought out by a private equity group last year. The new owners have now decided on a massive restructuring that’s going to cut 2,000 jobs and “realize new efficiencies”, which basically means everybody who’s left is going to have to work twice as hard for the same pay, feel stressed out, and probably still not make any money because the major-label end of the music business is in freefall.

“But Forrest,” you say, “why so cynical?”

It’s simple, my good sophont:

But Guy Hands, founder of the Terra Firma venture capital group that bought EMI for £3.2bn last year, vowed to further clip the wings of unprofitable artists by offering them a day rate or salary rather than shelling out huge advances.

leads naturally to this:

…[S]horn of the big advances and trappings of a major label, many artists may prefer to sign with rival independents or put new material out themselves.

Without fat advances and major-label marketing budgets, why would anybody stay on a major label in 2008? Hands’ plans are going to last a year and end in embarrassment followed by another restructuring. Either that or EMI will simply implode. I’d almost bet money on it.