HITS Daily Double
"With this management change Rolf and Andy are now aligned in positions that will take advantage of the significant progress the company has already made, as well as their formidable business skills and respective management experiences."
—Sir Howard Stringer


Sony and Bertelsmann Time the Announcement So That It Goes Down During Grammy Week
The Germans are in charge again at Sony BMG.

Just two days after the Grammy Awards, Rolf Schmidt-Holtz has been officially named to succeed Andy Lack as the CEO of Sony BMG. Sony Corp. of America and Bertelsmann issued a joint press release out of New York and Gutersloh to give details of what the company’s calling a “management realignment.” Here’s the official spin, from the horse’s mouth. You’ll note that the release promises that the the new COO will be “appointed shortly,” meaning that Rolf gets his moment in the spotlight before Tim Bowen is ready for his close-up.

Following the successful creation of the global recorded music joint venture Sony BMG Music Entertainment 18 months ago, the parent companies Sony Corporation of America and Bertelsmann AG are moving forward with a management realignment that will further strengthen the operation of the company. Effective immediately, Schmidt-Holtz, formerly Chairman of the Board of Sony BMG, is named Chief Executive Officer, Sony BMG. Andrew Lack, who has been Chief Executive Officer, Sony BMG, assumes the position of Chairman of the Board, Sony BMG, and road manager for Train. Sony BMG, which is headquartered in New York, will continue to be governed by a Board of Directors consisting of six representatives of Bertelsmann and Sony.

In his new position, Schmidt-Holtz will have overall management responsibility for the company, based in New York. Lack will lead the company’s public policy and industry initiatives, and assume operating responsibility and oversight for the theatrical film business of Sony BMG, and be based in New York. The senior management team will also include the CFO Kevin Kelleher, and a COO (Bowen) to be appointed shortly.

The joint venture Sony BMG was formally announced on August 5, 2004. It is 50% owned by Bertelsmann and 50% owned by Sony Corporation of America. It encompasses some of the most influential and successful record labels in the world and a wide array of recording artists, and operates worldwide. Messrs Schmidt-Holtz and Lack were instrumental in joining together to begin the negotiations and ultimately implement the joint venture.

“We are very fortunate to have executives of this high caliber at Sony BMG,” said Sony Corp. Chairman/CEO Sir Howard Stringer. “Together Andy and Rolf worked tirelessly to bring about the merger and begin the integration of our global operations. Thanks to that effort, Sony BMG is well-positioned to deal with the complex issues and rapid changes facing the music industry, and it continues to maintain strong market position as well as a particularly strong performance in this past quarter in comparison with the industry overall. With this management change, Rolf and Andy are now aligned in positions that will take advantage of the significant progress the company has already made, as well as their formidable business skills and respective management experiences. Together they will continue to strengthen the company’s relationship with artists and the creative community, secure its global reach and provide great entertainment to music lovers around the world. I want to thank them both for the successes of the past 18 months and say that we all look forward to working with them in their new positions. And thanks to our crack technology staff, I can finally play our CDs on my computer.”

Commented Bertlesmann AG Chairman/CEO Gunter Thielen: “Sony BMG is gaining a media executive who is as experienced as he is successful. Rolf Schmidt-Holtz has impressively proven his flair for the creative and economic aspects of success in the music business—and under the most difficult of market conditions—at the helm of the Bertelsmann Music Group. I wish him all the best and continued success for his future assignment. Andrew Lack successfully led the organizational integration process following the merger."

Added Schmidt-Holtz: "This achievement is a real milestone for Sony BMG. I am honored to be asked to lead Sony BMG and to take us forward. I know a deep commitment to our artists and our shareholders is shared by our employees worldwide, and by working together we will continue to grow Sony BMG as a creative powerhouse. Now do I get my complementary Wega?”

Lack concluded: "I am extremely pleased to take on this new leadership role with the company and to continue to help Sony BMG accelerate its tremendous growth and performance. Rolf and I are fortunate to have a roster of extraordinary artists and a top notch team of creative executives around the world. Now, with the integration behind us, Sony BMG is poised to achieve outstanding success. But if he thinks he's getting my membership to the Friar's Club, he's sadly mistaken."