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Opinion December 16, 2020

An Australian major record label war is coming

An Australian major record label war is coming

After reading the headline “Jessica Mauboy leaves Sony Music to sign to Warner Music Australia“, it raised instant alarm bells. A war is coming.

This news comes off the back of Paul Harris leaving Sony Music Australia to take a senior role at Warner as SVP of Australian Artists and A&R. Paul has had a remarkable legacy at Sony with the careers of Gang of Youths, Tash Sultana, Tones And I, The 1975 and Amy Shark.

It was indeed Marcus Thaine (A&R) at Warner who was instrumental in signing Jess, however could Jessica Mauboy be the start of a mass exodus of Sony artists looking to follow Paul to Warner?

We only need to go back four years when Heath Johns left Universal Music Publishing (UMP) to launch BMG Australia to see what might happen.

Simply put, it was a blood bath for UMP, millions of dollars in revenue left the UMP building to follow Heath over to BMG. Artists like Peking Duk, Bag Raiders, Wolfmother, Jet and The Living End all jumped ship, and even Gang of Youths –  who still had their ANZ rights locked up with UMP – signed with BMG for the rest of the world.

It has been a four-year war between BMG and UMP, and if you look at the score board, HR won. Artists are loyal to the person, to the human resource, not the company.

Every business is a HR business, and when multinational companies like BMG and Warner poach senior A&R people like Heath and Paul, it’s a declaration of corporate war from the top. The aim is to not only bring a great professional in the building to sign and nurture the future global stars, but to also hurt the competitor as much as possible by ripping out their roster.

Like Heath would have felt back in 2016, Paul would be both extremely excited and feeling the enormous pressure of being on the front line of a declared major label war.

Paul is lucky that he has a new CEO Dan Rosen starting soon, so the whole business has a fresh start which means that global head office will likely (and should) afford both of them time to trial things, make mistakes and build the business they want together.

On the other side of these newly drawn battle lines is Denis Handlin AO at Sony. One thing you can’t criticise Denis for is putting his money where is mouth is.

Denis doesn’t like to lose and when he has his mind on something he will spend whatever it takes to get what he wants. This commercial aggression and passion doesn’t work every time, however Denis Handlin doesn’t half step, he doesn’t die wondering, and that’s what I respect him for.

Who wins when labels go to war with each other? Simply put, artists.

Deal terms get better, advances get higher and precedents are broken, all in a bid to ensure that the hot new artist, or existing cash cow does not sign with their enemy.

Welcome to war.

This article originally appeared on The Industry Observer, which is now part of The Music Network.


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