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WMG May Purchase Major Management Firm

By: Bruce Houghton
2007-04-20

"... a big industry player is closing in on another type of union that would tap into new Wmg revenue outlets -- and if it's successful offer a new economic model for the major record companies.

"Warner Music Group...is inching toward a deal to acquire Front Line Management, the nation's largest artist management firm, owned by the famed manager Irving Azoff (and Howard Kaufman). The firm represents a slew of big-name artists, everyone from Christina Aguilera to Van Halen to Aerosmith. The deal has been rumored for months within the industry, but sources tell me that talks have lately gained momentum." - Fortune/CNN via Coolfer

With revenues falling, major labels are smartly looking at new models. Since in a digital landscape distribution matters much less, labels are trying to figure out how to better monetize their other asset - marketing muscle.

"If the investment required to establish a band is the same, but the rewards to record companies are dwindling, than we have to be willing to explore new economic relationships," says Entertainment Atty. Fred Davis. "That may include participation in other non-recorded music streams of income."

Can two sides that have traditionally been adversaries live under one roof? How protected is an artist if so much of his career is controlled by a signal entity? Would it make more sense for managers to add labels as Nettwerk and The Firm have?

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About the Author:
Bruce Houghton is a 25 year music industry veteran who owns booking agency Skyline Music and the tour marketing company Skyline Innovations.

http://www.hypebot.com


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