Universal Music’s integration of EMI Music is in full swing Down Under. In recent weeks, the company has waved goodbye to EMI Australasia Chairman Mark Poston, while a sizeable chunk of the EMI business here has been let go. The official line is that one-third of EMI’s 70 staff in Australia are now looking elsewhere for work. Among those who’ve made for the exit are Sarah Partridge (marketing director), Dixie Battersby (promo) and Glenn Dickie (A&R). On a personal level, some outgoing staff are devastated. Others are happy to take a payout. Dickie has already landed on his feet, joining Sounds Australia as export music producer.
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EMI Australia will exist as a standalone label within Universal’s orbit. Staying on with the new EMI company are key staffers Scott Horscroft (A&R head), Lisa Spunner (marketing director), Roddy Campbell (new business) and Darryl Bailey (promotions).
Australia’s regulatory watchdog the ACCC last year gave the green light to Universal’s acquisition of EMI, though it surprised many observers when the deal was cleared without the need for divestments.
The corporate regulator had declared EMI to not represent a “uniquely vigorous or maverick competitor” to its new owner. The reality is, EMI’s business here has typically been a vibrant one – and profitable. In recent times, the music company has signed and delivered a local roster which includes likes of Empire of the Sun, Angus & Julia Stone, 360, Birds of Tokyo, Airbourne and Keith Urban.
As it currently stands, EMI retains a “significant portion” of its people with its own dedicated marketing, promotions and A&R functions, and the company will have integrated and expanded services within Universal’s business in shared areas such as sales, licensing, new business, merchandising, catalog, finance and supply chain. Billboard.biz caught up with Sydney-based George Ash, Universal Music Australasia president, to talk about the new shape of the biggest music company in these parts.
Once the dust has settled on this restructuring, what will the bigger Australian company look like?
We want EMI to be the powerhouse it once was. We want to grow it from what it is today into a much more substantial company. Eventually we’ll have Universal and EMI competing in the marketplace with everyone else and with each other. It’s going to take a lot of hard work. There are a lot of people who will be working extremely hard to pull this off. The passion is there with the people at EMI and with the people at Universal, across Australia and New Zealand. As a company, EMI did have significant constraints globally because of the financial difficulties they’ve had. They’ve been lifted and if anything it’s a complete 360-degree turn, where the parent company is giving it a huge capacity to invest and compete.
Some will say Universal’s vow to run EMI as an ongoing label is just window dressing, drawing attention from the big picture. Is it?
You’ve got to look at the big picture of what happened here. EMI essentially was repossessed by Citigroup. It was then sold to Universal. What we’re doing at Universal is investing heavily in the business to grow it. Part of that is looking at synergies between Universal and EMI. Those synergies will free-up significant money for us to invest back into EMI to grow the business. We’re making a massive bet in Australia to build the company and make a commitment to it being a standalone company in Australia. You’ve got to look forward. And if you look forward we’re significantly increasing investment in all the areas that will give the company a future — which is primarily, creative, innovation, entrepreneurial and marketing. Those areas are long-term commitments. The areas that are being integrated tend to be support functions where we can release value to invest money on creativity. And if there’s one thing the integration of the two companies will give us is the scale to be able to compete on a global basis with our artists. I’m really excited about what both Universal and its labels and EMI and its labels are going to be able to do. There’s always been constraints in labels supporting their acts outside Australia, but we’re going to have the ability to do that now which really is going to give artists signed within the family a real advantage over everyone else. From my perspective, it’s bloody awesome. It’s incredibly exciting.
Will any artists be dropped from either Universal or EMI?
No. There’s definitely no plan to drop artists. In terms of a creative vision, we’re planning to turn up the investment. We expect to grow our A&R activities pretty quick and grow the number of signings on both the Universal and EMI side. In Australia, EMI has been a strong company with an incredible past and a strong domestic business. We want to protect the strong parts of the business. In Europe and the U.S., because of the divestments, it’s a different scenario. To Universal’s credit globally, they’ve taken a local view of how to support EMI without an overriding global vision, but ultimately it’s a local view of how you support and grow EMI. The U.S. and Canada are further ahead of us. Japan is going to be a slower process. That’s the nature of the market. In Asia, EMI was licensed out. As those licenses expire, it’ll be integrated in with Universal. Everywhere (the integration) has been a slightly different story.
EMI moved to an expensive new HQ in Surry Hills, Sydney, just two years ago. What happens with that space?
EMI and Universal are currently spread across both offices. In the long term we’ll probably do a new fit out at (Universal Music Australia HQ) Munn Reserve and the companies will be consolidated on that site. But that’s a longer-term outcome.
How’s the search going for a replacement to Mark Poston?
We haven’t appointed anyone yet. We wanted him to stay. I would have loved for him to have stayed, but I know it would have been hard for him. It would have been good if he did.