Sony Music Entertainment
POWER MOVE: Investing big in creative centers -- like Dr. Luke’s Kemosabe label and Patrick Moxey’s Ultra Records -- continuing to grow market share and cleaning up the corporate structure of the Sony-BMG merger.
THE RUNDOWN: The Doug Morris-led Sony Music Entertainment last year came within striking distance of finally challenging Universal Music Group as the U.S. market-share champ in sales of albums plus TEA (track-equivalent albums). However, UMG held on with a share of 30.5% beating Sony’s 29.1% share. And this year the gap will grow wider as UMG’s market share currently stands at 40.6% thanks to its acquisition of EMI Recorded Music, which closed Sept. 29.
Since coming onboard, Morris placed Antonio “L.A.” Reid (No. 40) at the helm of Epic, tapped Peter Edge and Tom Corson (No. 41) to lead RCA and revamped his international team by putting Germany’s Edger Berger in charge and bringing Nick Gatfield in to head Sony’s U.K. operation. He’s also cut a deal with Dr. Luke (No. 38) and his Kemosabe label, calling the producer his new “Jimmy Iovine.” Morris isn’t done yet, either—he just hired Patrick Moxey as president of Sony’s new electronic music division and acquired a minority stake in his Ultra label for $15 million, sources say.
So far, these new label-management teams are treading water in terms of market share, as is Columbia, which is the largest label in the U.S. industry. “It all comes down to getting hits,” Morris says. “These creative centers are as good as I can put together. Now, the question is: Are they going to deliver?”
While waiting for dividends from his A&R investments, Morris managed to maintain Sony’s market-share growth momentum -- it had been almost steadily on the rise since 2008 with a 24.4% share vs. UMG’s 32.3%. The 29.1% that Sony turned in for 2012 was up from 28.4% at the end of 2011. Beyond market share, one of Morris’ biggest contributions so far, according to company insiders, has been clearing out the dysfunctional corporate structure left over from the Sony-BMG merger, no small feat in itself.
Doug Morris photo by Matt Furman