Universal's Top Lawyer on Streaming, Splitting With Frank Ocean & Exclusive Releases

Scott Witter
“No industry has been disrupted as severely as music was by technological innovation,” says Harleston, photographed Sept. 30 at Universal Music Group’s Santa Monica headquarters. “We fought through that and have come around to adjusting, evaluating and investing in new business models, and we’re starting to see growth in terms of revenue.”

As general counsel for the world’s largest music company, a key skill that Jeffrey Harleston relies upon is adaptability.

"The one thing I know for sure is that whatever I’ve planned that day, I’m going to get hit by something different," says the 55-year-old Boston native. "The ­business is changing just that fast."

Harleston has been in the trenches for much of that evolution. Most recently, Harleston helped Universal Music Group hammer out a licensing deal with SoundCloud that allows the label to decide whether its music appears on the service’s free or paid subscription tier.

Harleston, who graduated from the University of California at Berkeley’s Boalt Hall law school, joined UMG some 23 years ago as senior vp business and legal affairs for MCA Records, ­working with a ­roster that included Mary J. Blige, New Edition and Common. Previously, he was ­associate independent counsel ­during the ­investigation and prosecution of the Iran-Contra ­scandal and worked as a ­litigation associate with the firm of Covington & Burling in Washington, D.C. (He was also GM of UMG’s Geffen Records for several years.) A year ago this month, his purview for UMG expanded from North America to the company’s ­worldwide ­operations; he simultaneously joined UMG’s 10-­member executive ­management board, helmed by UMG chairman/CEO Lucian Grainge. Harleston oversees a team of more than 26 lawyers dealing with ­litigation, ­transactions, ­digital, ­government ­relations and other legal specialties.​

With all of that on his plate, what ­business matters keep Harleston awake at night? The married father of four says, "Nothing bothers me more than when I feel there’s a situation that’s not fair, whether to the company or the artist."

As general counsel, what type of legal matters rise to your level?

Typically, it’s the magnitude of the ­problem in terms of a significant ­litigation or deal impacting the corporation, whether it be the dollar amount that’s at risk in a ­litigation or the stature of an artist ­relative to the rest of our repertoire -- those are the natural ones. But there are certain relationships that I will always be involved with: anything having to do with Uptown Records, a relationship that goes back to my MCA days, and anything that has to do with the James Brown ­catalog -- that’s a relationship I ­manage on a ­personal and professional level. Also ­anything that has to do with the Bob Marley estate.

UMG acts such as Drake and Kanye West have released music ­exclusively through Apple and Tidal. Doesn’t that create problems between the artists and their labels?

I don’t think artists’ relationships with ­platforms are necessarily mutually ­exclusive to their label relationships. In any of those situations you’re ­referencing, the label has been very involved. Using Drake as an example, his ­activities with Apple are really in concert with Universal. The three of us worked together very closely on releases like his new film [the Apple exclusive Please Forgive Me]. I was up late at night dealing with last-minute clearances. The most important thing is that the artist and the label maintain the freedom and flexibility to determine how they want the music presented to the public.

That brings up Frank Ocean’s new releases, which were said to have resulted in an edict that UMG was banning streaming exclusives. Was that a result of Ocean’s project?

Well, first, Frank is an incredibly talented artist, and I certainly wish him well. We don’t really talk about internal policies, but we’re always experimenting and adjusting our practices with one goal in mind: to provide artists with the ideal environment to develop creatively and commercially. If something doesn’t meet that goal, we change our practices.

But don’t you think there’s a new world order, in terms of the way some artists now view the role of a label versus, say, that of Apple Music?

I wouldn’t read so much into what I read in a few publications, including Billboard, about certain platforms doing things with artists. I don’t see a ­fundamental change in the relationship between labels, either major or independent, with their artists.

Is the SoundCloud negotiation ­helping ongoing discussions with the streaming services?

The SoundCloud negotiation was difficult but also one of the most rewarding. In SoundCloud, we have a partner that was willing to really work with the labels in trying to structure something different. There are multiple tiers of availability in terms of content: a free ad-supported tier and a paid subscription tier. But our deal allows us to have total discretion as to whether our music appears on the free tier or paid tier -- something that some other services have not yet come around to accepting.

How close is a meeting of the minds with other digital platforms?

The most significant thing that has ­happened in the last 12 months is the [increased] involvement of artists in the compensation debate. The level of acts’ understanding of how the ­services work has grown immensely, and as artists ­continue to be more involved, we move closer every day to a model of ­compensation that’s very equitable.

You're one of the few black senior executives working in the industry. How heavy is that responsibility?

It’s a frustrating situation, to say the least. I continue to be disappointed at the paucity of senior black executives in the music business, especially given what it was like when I came into the business with six majors around. There were senior black executives then who went out of their way to make sure black executives who came in had the support, ­mentorship and opportunity to succeed if they applied themselves. You don’t see that at a lot of companies today now that we’re down to three majors and some independents. This is a business that holds tremendous opportunities for everybody. I feel it’s part of my job and my duty to do everything I can to increase those ­numbers. When you can count the number of black senior ­executives on one hand, it makes you pause and think.

What keeps you excited about the music industry?

No industry has been disrupted as greatly and as severely as music was by technological innovation. What I’ve seen our business go through over the last 15 years is really coming to terms with a business model that didn’t fit consumers’ needs and desires, or the availability of new and innovative ways of delivering music. We fought through that and have come around to adjusting, evaluating and investing -- I can’t emphasize enough the word investing -- in new business models that have created the world we’re in now, where we’re starting to see growth numbers in terms of revenues. We’ve known for several years that consumption was very high. What we didn’t know for many years is that revenues were going to increase. It’s a very interesting time.

Golf is one of your guilty pleasures. Who’s the fiercest opponent you have gone up against in the music business?

I won’t say it was fierce, but I recently had a really good round of golf with David Dorn from Apple.

Who won?

Well, David came out on top. (Laughs.) But I had to [let him win] -- he works at Apple.

This article was originally published in the Oct. 15 issue of BillboardAn earlier version of this story erroneously attributed a Jay Z-Samsung deal to Harleston.