January 21, 1999: Universal Music Group makes major personnel cuts at Mercury, Geffen, Motown and A&M Records. A&M Corner is mourning the staff cuts at the A&M lot, as well as the absorption of A&M into the corporate fabric of UMG, with this Black Thursday page. This page features news clippings about the cutbacks, and comments from our A&M Corner regulars regarding the changing of the guard...and the inevitable loss of one of our favorite record labels. A shocking site at 1416 N. LaBrea: the familiar revolving A&M logo is bedecked with a black band. A&M Corner extends sympathies...to the employees who were the innocent victims of corporate downsizing, and the millions of music fans who are losing their favorite labels as a result of this "restructuring." (It's more appropriate to call it a wholesale butchering.)
Bill Bernardi, posting at A&M Corner: A&M. Alpert & Moss. Artists & Music. A&M wasn't just a company, it was ATTITUDE. Artists before money. Give the artists their space and see what happens. That separated A&M from every other company. Herb and Jerry ran the company with class and dignity. We may never see the likes of a record company like this again.
Dave Twogood, posting at A&M Corner: Even though the record biz is "just entertainment", I take my music very seriously. This whole debacle is the end of an era, in which the music was exciting, and I couldn't wait to get the next record. I'm hoping Herb & Jerry can work something out! At least they need to protect their past work...
Hollywood Reporter, January 22, 1999: The flag flew at half-staff on the A&M Records lot Thursday as outgoing company chairman Al Cafaro bid farewell to about 170 employees fired from the company in the midst of the biggest corporate restructuring in the history of the music business. A wake-like atmosphere descended over both coasts at the offices of Island, Mercury, Geffen, Motown and A&M, where a total of about 500 U.S. employees were dismissed Wednesday and Thursday following the absorption of music giant PolyGram by Seagram Co.'s Universal Music Group. Sources said Thursday that the departures will swell to approximately 1,200 within nine months, and that figure could eventually climb as high as 3,000 worldwide. The cuts could amount to about 3% of UMG's 15,500-member worldwide work force. UMG will make as much as $150 million-$200 million in severance payments to staffers and artists, sources said.
David Winer, posting at A&M Corner. A&M Records is as an important event in music history as Motown, Sun and many other record labels. Great moments in recorded history have taken place there. Every artist or group ever signed to A&M was the ideal A&M act. Don't throw it away!
E! Online, January 22, 1999: The Record Biz's "Big One" by Joal Ryan
The record labels that launched the Carpenters, Guns N' Roses, the Police and Nirvana onto the charts are effectively dead. The cause: Corporate restructuring.
Some 280 employees of A&M Records and Geffen were canned Thursday as the once-independent labels were folded into the giant octopus that is Seagram (parent company of Universal, among others).
"It's very sad for me," Geffen founder (and namesake) David Geffen told the Los Angeles Times. "It's a painful thing to watch."
Technically, the Geffen and A&M names live on. But their days as living, breathing movers and shakers are all but over--their resources spent. Signaling the death of A&M, Los Angeles-based workers (or, ex-workers) wrapped the company's sign in black on Thursday. The new bosses at Seagram later ordered the "arm band" removed, the Times reported.
This bloodletting was all but assured after Seagram acquired PolyGram in a $10.6 billion deal in May 1998--immediately becoming the world's biggest music player. PolyGram was itself a conglomerate--its roster including A&M, Motown, Island and Mercury. (Geffen--having been gobbled up by the Universal's MCA arm in 1990--technically was already owned by Seagram.)
As mega-giant corporations are wont to do once they become even more mega and more giant, Seagram called for a round of restructuring, i.e., pink slips.
In all, some 3,000 Seagram workers worldwide could be out of jobs by year's end. Some 500 lost their gigs this week alone, including another 200 staffers at Motown, Island and Mercury.
To be created from this chaos: IGA--an amalgam of Interscope, Geffen and A&M.
"The record business is changing fundamentally," axed A&M chief Al Cafaro said in the Times. "If the quake that devoured A&M and Geffen is a 6.0 on the Richter scale, there is a 7.0 coming in this industry. It's a Wall Street world now. Get ready."
The talent--aka, bands, singers and whatnot--better get ready, too. The Seagram shakeup also will claim up to 250 artists, musicians who will be dropped from the company's roster in the next few months.
A&M was founded in 1962 by trumpeter Herb Alpert ("This Guy's In Love With You") and partner Jerry Moss. Its acts included the Carpenters, Carole King, the Police and Sheryl Crow.
David Geffen launched Geffen Records in 1980 with a roster that included John Lennon and Elton John. It was credited with breaking Guns N' Roses, Hole, Beck and releasing Nirvana's major label debut, Nevermind.
Stephen Vakil, posting at A&M Corner: A cliche, but an apt one : this really is the end of an era. I hope that Herb Alpert and Jerry Moss have the opportunity to consider the repurchase of at least part of the business - the lot and, most important, the recordings of the 60's and 70's which most of us grew up with and which are so valuable to us. You never know, Herb and Jerry might even invite the board regulars to an A&M reunion at the lot this summer, once they've bought it back...I'd gladly make the trek from England! One can but dream.
Jean Carlo Marchio, posting at A&M Corner: A&M was the unique label where in the sixties and seventies , the best of jazz and brazilian musicians met. Picking an A&M album without listening it was always an adventure more than a gamble. The constant touch was taste even in popular music. The eighties started the same way and then came the begining of the end. A&M the music company was dead already for a long time. Now the name rests in peace. Let's hope somebody will revive it.
Rolling Stone Network, January 21, 1999: ...There also seems to be an awful lot of artist jockeying going on between labels behind closed doors. Almost as soon as the blockbuster merger was announced, U2 made a dash from its longtime home at Island to Universal's Interscope Records. That got Sting to thinking about leaving A&M for another label within the Universal family. Why? Because according to his manager Miles Copeland, A&M, which will be just a shadow of its former self once the consolidation is completed, "no longer exists -- period." No decision has yet been made as to who will release Sting's new album, due this spring. Meanwhile, Boyz II Men and 98 Degrees, two of Motown's biggest acts, have bolted for Universal Records. And sources report fellow Motown artists Diana Ross, Queen Latifah and Brian McKnight all want to leave the shrinking label and find a new home within Universal....
Jon Skinner, posting at A&M Corner: As a child, it was evident that anything produced by A&M Records was special. Gone are the days when you could look forward to that next release - any release - that had the A&M logo attached to it. A&M is an institution. How many A&M artists have shaped modern music into what it is today? The list is endless. Hats off to Herb, Jerry and the entire A&M staff for their contributions to the music world. The spotlight has gone out, but it will always shine for us.
Reuters Variety, January 22, 1999: ...Many staffers arriving for work at the labels were met by security guards, some of whom stood over exiting employees while boxes were packed and belongings taken out to cars. The normally open front gates to the A&M Records lot in Hollywood were shut early in the morning...
L.A. Times Business Section, January 22, 1999: After 37 years of spinning out hits by such acts as Cat Stevens, the Police and Sheryl Crow, A & M Records closed its doors Thursday--firing nearly 170 employees who were given the day to pack and leave.
Artists and executives hugged in the parking lot as weeping employees carried boxes of personal belongings to their cars. Above them, the A & M sign was draped with a black band and the flag flew at half staff, to commemorate, fired workers said, the death of the historic Hollywood record label.
Those fired at A & M were among nearly 500 employees cut in Los Angeles and New York by Seagram Co. as part of a massive restructuring that will eliminate thousands of music industry jobs worldwide. Two miles down the road, Geffen Record employees stripped the walls of gold records and carried boxes down Sunset Boulevard past the label's headquarters after being notified that they too no longer had jobs. About 110 Geffen employees were fired.
Signaling an end to an era in the Los Angeles music scene, the layoffs underscore the changing economics and direction of the music business as Seagram, which recently completed its $10.4-billion acquisition of PolyGram, combines two of the world's biggest record conglomerates.
At their peaks, A & M and Geffen represented the commercial and artistic potential of independent labels, which have been the proving ground for scores of musicians whose talents and vision did not fit into more mainstream labels.
But both labels began losing autonomy after they were bought up during the last decade by conglomerates PolyGram and MCA.
Changes Alarm Some Critics. Some industry critics are alarmed at the changes. With power concentrated in fewer and fewer hands, the danger, they fear, is that there will be no room left for the independent spirit that helped build such legendary independent labels as Atlantic, Motown, Island, A & M and Geffen. Among the artists launched by A & M and Geffen alone: Cat Stevens, the Police, Nirvana, the Carpenters, Joe Cocker, Beck and Guns 'N Roses.
"This isn't about Universal or Seagram," said A & M chief Al Cafaro, who also was fired. "The record business is changing fundamentally. Don't think that there are calm seas on the other side of this threshold. If the quake that devoured A & M and Geffen is a 6.0 on the Richter scale, there is a 7.0 coming in this industry. It's a Wall Street world now. Get ready."
Sources say Seagram is considering selling the A & M lot--which houses film star Charlie Chaplin's former sound stage--and the Geffen Records' headquarters--a converted groups of houses once owned by songwriter Hoagy Carmichael.
Executives at Seagram's Universal Music Group say that A & M and Geffen will be folded into Interscope Records to form IGA--one of four large music groups made up of consolidated labels acquired in Seagram's purchase of PolyGram. About 200 employees were laid off Thursday at the New York-based Motown, Mercury and Island labels. About 250 artists will also be dropped over the next few months, sources said.
Universal executives say they intend to preserve the individual identities of the downsized labels as they fold them into larger groups, but the handful of A & M and Geffen employees who survived the blood bath were skeptical.
A & M, Geffen, Motown, Mercury and Island all have performed poorly in recent years, producing few hits and often operating in the red. Some label employees kept on by Seagram privately acknowledged that the downsizing was merited. Several workers who lost their jobs even praised Seagram's handling of the layoffs, saying the company had offered them generous severance packages.
"While change is always difficult, the restructuring of the labels is necessary for us to be more competitive, develop artists' careers and pave the way for meaningful growth," Universal Music Group said in a statement.
Seagram expects to produce $300 million in savings annually by consolidating the companies. Analysts suggest that the restructuring will provide Universal with unparalleled economies of scale guaranteed to boost operating margins and position the conglomerate for strong earnings growth over the next three years.
But that's little consolation to record label employees who were issued pink slips Thursday morning.
At A & M, employees wore baseball caps embroidered with the slogan "The Last of the Lot" as they gathered for a 9:30 a.m. meeting inside the Charlie Chaplin sound stage to hear the news. Sheryl Crow and Soundgarden's Chris Cornell stopped by the lot to trade war stories with tearful employees in the afternoon. Before the day was over, Universal officials ordered A & M to remove the black band that employees had draped around the company's famed trumpet overlooking the label's La Brea Avenue entrance.
While A & M and Geffen will live on in name, the gutting of their enterprises effectively ends their history as independent upstarts.
A & M started modestly, with trumpeter Herb Alpert and his business partner Jerry Moss pooling their money and initials to create a record company. "The Lonely Bull," by Alpert and the Tijuana Brass, was a huge first hit for the nascent label in 1962, and the co-founder would remain the label's star until Carole King, Joe Cocker, Burt Bacharach, Cat Stevens and the Carpenters were added in the late '60s or early '70s.
The company turned to arena rockers--Styx, Peter Frampton, Supertramp--as the '70s wore on, and found its flagship act for the 1980s in a British trio called the Police. Janet Jackson became a huge A & M star before Alpert and Moss decided to sell the company to PolyGram for about $500 million in 1989. Alpert and Moss quit the label after a series of disputes with corporate management at PolyGram.
"It's certainly sad to see what is happening today, but to tell you the truth, you could see it coming once A & M became part of the [conglomerate structure] at Polygram," Alpert said Thursday. "I saw that train coming . . . the sharp contrast between the independent world and that corporate. I don't think their bottom line has much to do with music or artists. It's very black and white.
"I'm not speaking for all corporations, just my experience at PolyGram. It seemed like they were so bottom-line conscious that it was hard to make a decision like we used to . . . just from the gut, based on feeling, not whether an artist might be able to sell oodles of records."
Roster of Big Names. Where A & M started small, Geffen Records landed with splash in 1980 as its founder, David Geffen, returned to the music industry after a eight-year hiatus to sign John Lennon, Elton John and Donna Summer to his new namesake label.
Geffen picked up where he left off with the 1972 sale of his Asylum Records, a label that boasted Jackson Browne, the Eagles and Linda Ronstadt. But Lennon's murder rattled the company badly, and a slump followed.
Geffen eventually found hit-makers in Aerosmith and Cher, acts viewed as retreads by others in the industry, and huge new super bands Guns N' Roses and Nirvana. The roster also included veterans Don Henley and Peter Gabriel, who hit their solo strides in the 1980s, and quick-hit money-makers such as Whitesnake.
Geffen employees were told about their fate in a pair of 45-minute morning meetings in the conference room of the Geffen Records building, at the west edge of the Sunset Strip. Later in the day, several dozen employees, including fired Chairman Eddie Rosenblatt, gathered across the street at the Rainbow Room for what they called a "wake."
"It's very sad for me," said David Geffen, who sold the label to MCA in 1990 and now is a principal in DreamWorks SKG. "The thing that made Geffen and A & M and Interscope appealing and successful was the fact that they were small, agile and were able to react quickly. That gave an artist a certain kind of involvement and attention compared to what the big record companies could provide. Now Geffen and A & M and Interscope are one big company. It's a painful thing to watch."
-=Rudy=-, posting at A&M Corner: A&M Records. There was something special about standing next to Dad's Admiral hi-fi in the basement and watching stack after stack of that wonderful vinyl working its way through the record changer. The Tijuana Brass, Baja Marimba Band, Brasil '66, Burt Bacharach, Carpenters...all classics I grew up with. As years went by, I came to trust A&M as a symbol of artistry before profits. Styx, Supertramp, The Police, Sting and Janet Jackson would be staples of my listening throughout the 80's and early 90's. In recent years, I've begun to collect (on vinyl) many of the earlier artists I'd missed the first time around, and that wonderfully warm and fuzzy "A&M Sound" is right there where I left it!
It was a shocker to hear that A&M sold out to Polygram several years ago, but that is nothing compared to this latest development. At least under Polygram, I had hope that they would begin mining the A&M back catalog like others under their umbrella. An example: Verve Records. Of the record labels I know well (and collect), Verve had one of the best reissue programs in the business, and Norman Granz would have been proud. Even Motown had a good thing going.
In contrast, let's look at another well-known record label: GRP Records. GRP has many parallels to A&M. GRP (Grusin/Rosen Productions) was founded by Dave Grusin (the musician) and Larry Rosen (the businessman). Their artist roster included a who's who of contemporary jazz: David Benoit, Kevin Eubanks, Eddie Daniels, Rippingtons, and Lee Ritenour were featured artists on their label. All GRP recordings, like A&M's, had a certain "sound" that made them unique. Moreover, GRP felt like a family.
GRP had grown large enough, and built such a good reputation, that they were able to take on the entire jazz portion of MCA's catalog. That wouldn't last--soon Universal would take over, and GRP would be desecrated. Most of the label's major artists had been dumped from the label, and the majority of the label's back catalog was dumped en masse into cutout bins around the country. Instead, Uni wanted to get the big sellers in the lucrative (but musically sterile) Smooth Jazz market, and the new GRP would sign George Benson as one of its premier acts.
"Profit Before Artistry" seems to be Universal's war cry these days. Personally, I have little or no expectations of seeing any of A&M's classic recordings reissued in years to come. Uni just won't find it profitable...and chances are slim it will ever happen. With Polygram, I at least had a glimmer of hope. Now, I just shake my head, and wonder which independent label will be gobbled up next. These big movers and shakers like Universal are winning no new fans. And I hope their attitude comes back and bites them one day, after they realize they've alienated just about every music lover who buys outside of the Top 40 charts.
