[Dixielandjazz] EMI to cut One Third of its employees.

[Steve Barbone]

Not specifically OKOM, but an indicator of the problems with record
companies and declining CD sales. IMO, the sooner record labels realize
their highly profitable days are over, the better it will be for them and
us. Digital music sales will not make up for lost revenue. Suing their
customers base won't make up for lost profits. Revenues in their industry,
are going to continue to shrink.

Because their main product, recorded music, is so cheap to make that the
ultimate consumers actually make it themselves. They download a billion
songs a month, mostly illegally, from various sources.

IMO, as the price of recorded music continues to fall, bands will look to
make money elsewhere. Live concerts may well become the largest source of
revenue for many artists. Recorded music, CDs and DVDs will be used to
promote those live events and the top artists will still make a very, good
living. Those who do not spend much time performing live, will have a much
harder time staying viable.

Cheers,
Steve Barbone


1,500 Job Cuts Expected at EMI

NY TIMES - By ERIC PFANNER - January 15, 2008

LONDON ‹ Terra Firma, the private equity firm that recently acquired the
music company EMI Group, plans to announce a reorganization Tuesday,
including the elimination of close to a third of EMI¹s staff, according to
people briefed on the plans.

Terra Firma plans to dismiss more than 1,500 employees, out of about 5,500,
as it moves to streamline marketing operations at EMI and focus on the
discovery of new artists.

The cuts have unnerved managers of artists signed to EMI, including Robbie
Williams and the Verve, who fear that support for their works will falter.

EMI, which Terra Firma acquired last year for £3.2 billion, or $6.4 billion,
is perhaps the most troubled of the major record companies, which include
the Universal Music Group, Sony BMG and the Warner Music Group, all of which
are suffering from a continuing steep decline in sales of compact discs.
EMI¹s share of album sales in the United States fell to 9.4 percent last
year from 10.2 percent a year earlier, according to Music & Copyright, a
research service.

EMI and Terra Firma declined to comment. But a person briefed on the plans
said reports of up to 2,000 job cuts were ³probably a little bit on the high
end of the range,² saying 1,500 was more likely. In any case, that would
still represent a big share of employment at EMI Music, the recording
division, which was expected to bear the brunt of the cuts. EMI¹s music
publishing unit, which has performed well, is expected to be affected less.

People briefed on the plans said EMI might shut down some of its record
labels and some marketing might be consolidated.

The cuts would be the second overhaul for EMI in the last year. In January
2007, the company merged its two main American labels, Capitol Records and
Virgin Records. 

Still, industry analysts say more wrenching changes may have been delayed at
EMI as the company spent the last few years in dead-end discussions with a
rival, Warner Music, over a possible merger.

Job cuts are a common consequence of private equity takeovers; what is
unusual, analysts say, is that Terra Firma has taken several months to
detail its plans. When private investors led by Edgar Bronfman Jr. acquired
Warner Music in 2003, they announced a reorganization plan, including job
cuts, almost immediately.

Now Warner, with a slightly larger global market share of recorded music ‹
13.8 percent in 2006, to EMI¹s 12.8 percent ‹ has a smaller staff than EMI,
having reduced workers to 4,000.