HITS Daily Double
Morris' series of aggressive moves has everyone guessing what he'll do when UMG's deal with Apple expires.


Who's Hot and Who's Not Late in the Fourth Quarter; Plus Doug Morris, Barry Weiss, Lisa Ellis, Eric Nicoli and Other Gunslingers
IT’S NOT HOW YOU START: The sports aphorism, “It’s not how you start, it's how you finish,” perfectly applies to the music industry, and several majors appear to have traction as we hit the final, critical month of 2006. IDJ is riding the considerable momentum generated by Jay-Z, Nickelback, The Killers and Ludacris, with Young Jeezy and Nas still to come. IGA will get lots of bang from a back-loaded release schedule that includes The Game, Snoop, 2Pac, Fergie and a U2 hits collection, with Gwen Stefani on deck. BMG is paced by Justin Timberlake, Barry Manilow and a pair of American Idol graduates in Carrie Underwood and Daughtry, with Idol winners Taylor Hicks and Fantasia waiting in the wings. Sony’s hot sellers include Beyonce, John Mayer, Tony Bennett, John Legend, The Fray and Il Divo, with Incubus and Bow Wow coming... The 70-some-odd staffers of Sony Urban remain on pins and needles two weeks after Peter Lauria’s assertion in the N.Y. Post that the division was about to be dismantled. According to the reporter, incoming Sony Music head Rob Stringer, whose priorities are said to include staff reduction, will cut a wide swath through the company’s urban division, reassigning label acts and some employees to Columbia and Epic while terminating the rest. The big question mark, Lauria wrote, had to do with the fate of highly regarded label head Lisa Ellis, who currently has charting records with Beyonce, John Legend, Bow Wow and Lyfe Jennings. Sony insiders believe that Ellis is not leaving the company and will function in some new capacity while continuing to be involved as a major player in black music at Sony U.S.… In more upbeat news, look for highly respected Zomba Label Group ruler Barry Weiss, who is regarded by those in the know as one of the people who really get it, to redo his deal in the near future, as the perennially successful record man guides ZLG to yet another impressive annual performance… Noters noting how aggressively Doug Morris has taken the lead in the music industry's advance into the digital frontier, superseding the RIAA, which has been reduced to issuing lawsuits against suspected file-sharers under Mitch Bainwol. After successfully facing down Yahoo, AOL and YouTube, and initiating a precedent-setting pact with Microsoft for a piece of the Zune hardware action, Morris last week went after Fox-owned MySpace in an effort to get paid for the site’s use of UMG content. Naturally, these decisive moves have everyone guessing what Morris will do when UMG's deal with Apple expires a few months from now… BARBARIANS AT THE GATE: Stories last week in the two most respected business dailies allege that EMI Music has been approached by various private equity groups about a possible sale of the company. The two reports appear to contradict each other, with the Financial Times claiming the prospective buyers are KKR and Goldman Sachs, while The Wall Street Journal names European-based Permira Advisors. Some hypothesize that both groups are in play, the second in league with EMI ruler Eric Nicoli, who is attempting to take the company private (as has been rumored), thus ensuring the incumbency of Nicoli and his management team... The situation EMI now finds itself in exemplifies the present-day landscape, in which deep-pocketed private equity cowboys are increasingly eager to swoop in and snap up music industry assets at bargain prices. The current feeding frenzy comes in the wake of the killing made by Thomas H. Lee Partners, et al., following their 2003 acquisition of Warner Music Group. But what some see as a vote of confidence in the business on the part of Wall Street can also be perceived as another serious threat to an already troubled industry, considering that the standard endgame of equity investors is to sell their acquired assets off. In the case of EMI, some contend that EMI Music Publishing could fetch upwards of $4 billion, dwarfing the recent $2.7 billion valuation of EMI as a whole. This scenario inevitably causes industry watchers to fantasize about other possibilities. For example, could EMI’s labels be auctioned off in pieces? There are surely potential buyers out there for the master recordings of the Beatles, Frank Sinatra, the Rolling Stones, the Beach Boys, Norah Jones, Robbie Williams, Coldplay and Radiohead, among other catalog treasures… Names in the Rumor Mill: Irving Azoff, Allen Grubman, Michele Anthony, Marty Bandier, Roger Ames, Tim Bowen and Chaka Zulu.