Corner Office: Capitol Music Group Chairman/CEO Steve Barnett on Sam Smith and Beck's Grammy Sweep and Why Kanye West 'Needs a Therapist'
You won't find any corner offices in Capitol Music Group's Los angeles headquarters, but at the top of the iconic circular tower sits a sharp chief executive. Chairman/CEO Steve Barnett, 62, has only logged two years on the job, following a 15-year stint at Sony Music, but his impact on the music business -- and certainly universal Music Group -- has been felt globally thanks to out-the-gate successes by Sam Smith, 5 Seconds of Summer and Bastille; critically acclaimed revivals by Ryan Adams, Beck and Mary J. Blige; and, most recently, winning an impressive 13 Grammy awards, including honors in all four major categories (three for Smith; Beck's Morning Phase won best album).
To hear Barnett tell it, the road to industry respect was methodical and involved significant risk. Resuscitating Capitol, which was the crown jewel (albeit scuffed) of EMI's recorded-music empire when UMG bought it for $1.9 billion in 2012, required uprooting some 30 East Coasters (450 employees are under Barnett's supervision) to Hollywood -- including Barnett himself, a married father of four grown sons. In addition, there was a hiring frenzy to fill the new CMG ranks that didn't work out for some: Ron Fair, brought on to run Virgin with much fanfare, was let go after 18 months; so was Ron Spaulding (says Barnett of the former: "I probably should have done a better job to help him more"), and, in at least one case, practically an entire department turned over.
But there was also an undeniable confidence to the new leader, a trait Barnett, who started in the business as a manager to such acts as AC/DC, attributes to UMG chairman Lucian Grainge and his support of the Capitol experiment. It's that faith, says the native Brit, that was missing for him at Sony. Now boasting market share that puts him at a dead heat with former employer Columbia, and revenue estimated at $500 million, Barnett takes a victory lap.
First, congrats on the Grammy wins. What did Lucian say to you that night?
"Mazel tov." He was very happy. As I was for him and the team. He made this acquisition happen when everybody said it was impossible. He bet the house on us. And I felt great for people like [executive vice president] Greg Thompson and [svp, creative & video production] Danny Lockwood, who had gone through such a difficult period [at EMI]. For them to experience that night, there were a lot of tears shed.
How confident were you of a victory going into Grammys and to what do you credit that success?
From the beginning, we thought: be pragmatic. Our focus was: we'd like to win a Grammy, and when you win one, can we win two? We worked very hard in different areas to put Sam in the best position to be successful. And everything that we asked Sam to do, he did. I think the timing of the campaign we got perfectly and the stats on the record are very broad: It was a very unusual record-- like it was No. 1 on urban for ten weeks.
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You used to manage AC/DC and brought the band to Columbia, what did you think of the show's opening?
I personally would never have done that, because I think that you retain the myth and that environment's tough. But they were amazing and pulled it off, and credit to [Columbia Records chairman] Rob Stringer for putting it together, but it's tough to get your head around -- you put an act on for six minutes but they're not nominated for anything? It is an award show after all.
Beck was another big win for Capitol. What was your take on Kanye West's mock interruption?
I think he needs a therapist. … We live in America [where] there's freedom of speech, if you want to act like a buffoon, you can act like a buffoon.
Your most successful new acts, Smith and Bastille, were both signed by Universal Music U.K. How would you respond to criticism that your strength in A&R is based in England?
I can understand that and I think we feel a tremendous pressure to do better with our domestic A&R. This year, we sold 6.6 million TEAs [track equivalent albums] -- they're all Universal artists. So I would defend that you work the best records. That's what you do in a big, powerful global company and that's what Lucian's built at Universal. And certainly if you look at the success that Rob and I had at Columbia, we picked the best records. It didn't matter if it was Beyonce or One Direction or Adele or J. Cole. We have a similar philosophy here.
You spent so much of your career at Sony, what are the big differences culturally between the two companies?
Lucian. You just feel that he and his senior team have got your back every day. [UMG evp/CFO] Boyd Muir, [evp U.S. recorded music] Michele Anthony, [general counsel] Jeff Harleston, [president, global digital business] Rob Wells, all those guys I think were aware that we were kind of in a sorry state at the beginning. There's some things that they questioned us doing, but they've supported us 100 percent, in some very -- for me personally -- difficult times and difficult decisions. And I had a fantastic relationship with Rob at Columbia. He was one of my best friends for 15 years and everything that we accomplished, we did together and I'll always be proud of that. But I felt zero support, corporately, after Doug Morris got there. None.
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What are the challenges ahead for Capitol?
We want to be the best label in America. And with the competition from John Janick at Interscope and Monte Lipman at Republic, that's really a difficult thing to do.
So is it a friendly competition with your fellow UMG label heads?
We have a really good relationship with those guys. We respect what they've done and, frankly, they're a long way ahead of us. They have big strong rosters, we don't. We're really at the beginning of our journey. It's very competitive, but respectful.
When manager John Silva was looking for a new deal for his artist Beck, he met with all the labels. What ultimately drew him to Capitol?
He liked the team and he definitely bonded with evp Michelle Jubelirer, which really helped because it was a complicated deal -- it didn't end brilliantly for him within the Universal system, and we had to overcome that.
In retrospect, hiring Jubelirer, a seasoned attorney, seems inspired...
She's really done a brilliant job. And to many, she was a surprising appointment, but EMI had such a horrific reputation in that category -- they were just tough to deal with, so she was the first person I seriously thought about for the position.
How much closer is the manager-label relationship today than it was when you were working with AC/DC?
We've been through a couple of different eras where managers thought they could change the course of the business and obviously that's not the case, because managers don't actually own or control anything -- they're managers; they represent clients. But I think the smart managers are very involved. Certainly Sam's managers are -- they've been in every serious planning meeting since the day I introduced him to the company.
Before Katy Perry released Prism in 2013, she joked that her next album might be a "self-sabotaging" acoustic LP. Does she have your blessing?
That's fine. She can do whatever she wants to do. She's absolutely earned that right and we're there to support her. Katy is really a special person. And super smart with great natural instincts -- she's really the brains of that whole operation. If she ever wanted to retire, she could come and have my job.
What keeps you up at night?
Well, my wife -- who some call "Saint Nancy" -- thinks I need help because I woke up on Monday morning and I was writing a list of the things that I think we've got a shot of getting on the Grammys next year.
A version of this article first appeared in the Feb. 28 issue of Billboard.