Arista's Reid To Seek A Calm Transition (Billboard May 13, 2000)
BY MELINDA NEWMAN
LOS ANGELES-Following the long-expected May 2 announcement of Antonio "L.A." Reid as president/CEO of Arista Records (BillboardBulletin, May 3), succeeding Clive Davis, managers of Arista acts say they expect everything to calm down following what could be a rocky transition period.
"I'm sure that everybody there and L.A. Reid will have the best of intentions in making as smooth a transition as possible," says David Passick, who manages developing Arista rock acts Angie Aparo and Sister Seven. "However,transitions, unfortunately, do not happen smoothly from a Friday to a Monday. I think we have to accept the fact that there is going to be a transition period, and that things will be put on hold for a minute. Ultimately, I have faith that L.A. Reid will be successful at what he's doing and will be competitive."
Similarly, Terry McBride, who manages Arista acts Sarah McLachlan and Dido, says he expects a few minor bumps, especially for Dido, whose record is currently being worked by the label, but adds, "I think the transition is going to be fine. There are a couple of hundred people there; they aren't all walking out the door on July 1. It takes more than one person to make the company."
Reid, who co-founded Arista joint venture LaFace Records with Kenneth "Babyface" Edmonds 11 years ago, assumes his post July 1. He replaces Arista president/CEO Davis, who has been in an embittered battle with parent company BMG over the past six months after BMG demanded that Davis have a successor as part of his new contract.
Among those expected to leave with Davis are executive VP/GM Charles Goldstuck, senior VP of worldwide marketing and sales Tom Corson, and senior VP of promotion Richard Palmese. While Corson and Goldstuck declined to comment, Palmese, whose contract is up June 30, says he plans to follow Davis. "I came back to Arista to work with Clive, and he's the only one I want to work with," he says.
"In general when something like this happens and top people leave, it's very disruptive for the entire company and the artists that suffer during the rebuilding," says Jake Walesch, manager of 14-year-old singer/guitarist Shannon Curfman. "It's hard for people to focus. There's no way during this transition I'm going to try to launch another single or try to do anything really aggressive."
He adds that Reid has talked to him about Curfman, "and he says that he likes Shannon's music and that he has said she's going to be a priority."
Reid declined to discuss specifics regarding new Arista staffing, including the speculation that Atlantic Records executive VP/GM Ron Shapiro is to be offered a top position at Arista (BillboardBulletin, May 2), but he says he is talking to a number of people about new posts.
"The only thing I can say, without naming names, is that come July 1, we will have a head of promotion in place and that any records in play will become our top priorities. I have many people already in place, and come the beginning of July, I expect a relatively smooth transition," he says. "We are really working hard to make sure no records slip through the cracks. We may have to shift around some releases, but I can't say for sure."
When asked about his vision for the company, Reid replies, "Just look up, baby." Aside from divine guidance, Reid says, "My vision is to keep this thing together. This is a company that has been very successful in many genres of music; I'd like to see them become more successful, like in the Latin area, with the exception of the extraordinary success of Santana, as well as the alternative and rock genres."
CLIVE DAVIS' LEGACY
BMG Entertainment president/CEO Strauss Zelnick, to whom Reid will report, says "the legacy that Clive has created at Arista is extraordinary. I hope we can preserve that legacy and build upon it."
In a terse statement, Davis, whose Arista contract expires June 30, said he expects to launch his new venture in September. He declined to comment further.
According to sources, Davis could announce his plans in as little as two weeks, although other sources say Davis is still deep in negotiations with up to five companies; therefore, the decision could be postponed for a number of weeks.
Davis is expected to remain at the helm of Arista until his contract's conclusion June 30, which will allow him to oversee the May 16 release of Whitney Houston's two-CD greatest-hits set, as well as new Carly Simon, Next, and DJ Quik releases.
Between now and July 1, Reid says he plans to stay busy "listening to many tapes, taking many meetings, and just preparing" for his new post. "My job is to learn the music and learn the artists. Right now I don't envision going in and making cuts. I'm not Chainsaw Al."
He says he has no plans to "snoop" around the Arista offices before his official start date, in part because he'll be busy with his June 10 wedding and out of respect for Davis.
"It was him who gave me the opportunity in the first place," Reid says. "Will I be snooping around the building behind his back? Absolutely not. Because of Clive Davis, I am where I am today, and I'll never let anyone turn me against Clive. He's only brought great blessings to my life."
While thrilled about the position, Reid admits his job is not as he envisioned it. "I can tell you, it turned out a lot different from how I expected it," he tells Billboard. "Originally we discussed Clive and I working together; the initial thought was I'd be running the label with Clive as chairman, but it didn't work out that way."
Reid says he hasn't talked to Davis about his new post. "I've spent the last 12 years with Clive," he says. "We've had many conversations. As of late, we haven't had many conversations about it, for obvious reasons."
Despite his clear fondness for Davis, Reid says he has no intention of letting any Arista acts follow Davis out the door. "My position at Arista Records is not to give artists to other labels," he says. According to a source, none of Arista's acts had "key man" clauses with Davis, meaning they could leave the label should he depart. Sources say that, should Davis' new deal be with BMG, "some basis may be worked out whereby some artists can go," but "they won't be the superstars."
Reid's past successes have come primarily in the R&B and crossover genres; however, he is undaunted about his ability to spread his successes across a number of formats.
"I know rock primarily as a fan and through relationships," he says. "I haven't made rock records, but I don't really see genre lines or color lines. Obviously, it's a challenge to grow a company in an area where I haven't had a lot of experience, but to me, music is music. I don't really look at it as if there's something strange about it."
"I'm as confident as I've ever been about such a choice," says Zelnick of his decision to boost Reid. "I think he's a superb, creative executive. I think his taste is extraordinary, and he knows a star when he sees a star."
PURCHASE OF LAFACE
Terms of Reid's new post included the purchase by BMG of the remaining 50% of LaFace that the company did not already own. (Sources earmarked the purchase at more than $100 million; Zelnick declined to comment.) Plans now call for LaFace to become an imprint of Arista, which will assume marketing, sales, and promotion duties for the label. LaFace will remain headquartered in Atlanta. LaFace CEO Mark Shimmel will assume a new post with Arista, says Reid, although he declined to give his title.
As far as other cuts at LaFace, which employs approximately 70 staffers, Reid declines to give specific numbers but says "many of the people will join me at Arista, so we'll still service the LaFace artists. Some of them will stay in Atlanta, and some of them have already made the decision to move on with their careers."
He adds that no new president will be named for LaFace. "I'll still be the head," he says. Moreover, all acts currently on LaFace-including Toni Braxton, TLC, Usher, and OutKast-will remain on the imprint instead of moving over to Arista.
Despite rumors to the contrary, Reid says that LaFace operates in the black. According to a source, BMG put $4 million into the venture, and after the first 18 months, the start-up was turning a profit.
Reid's old partner, Edmonds, is getting a new joint venture with Arista, which sources say will be called Joe Lies.
"Kenny and I have a 20-year career," says Reid. "We've always been very close. When we decided to sell LaFace, we came up with a way we can work together, and the result is Kenny's new joint venture. The thing that was important was that we kept working together." Edmonds declined to comment.
Regarding other joint ventures, Reid says he has no plans to alter Arista's arrangement with Bad Boy. "It's a very successful company," he says of the joint venture formed with Sean "Puffy" Combs. "I intend to be there as a support system for Bad Boy. Don't fix what isn't broken."
He also has no current plans to make changes with either Melisma Records, run by producer Matt Serletic, or Time Bomb Records, run by artist manager Jim Guerinot. "Since rock music is a priority for the future of Arista, and they both bring their very strong rock sensibilities to the label, they are both priorities for me," says Reid.
Despite the successes of the current joint ventures, Reid says he is not a fan of such arrangements. "We're into growing the company artist by artist,"he says. "Joint ventures aren't something I believe in. To be honest, I haven't seen a long history of successful joint ventures."
In the long run, Reid says, he'd like to re-enter the country market. As of July 1, Arista/Nashville is being absorbed into the RCA Label Group. However, Reid says, "In the not too distant future, we'll definitely make noise in Nashville. I have plans for it later."
Assistance in preparing this story was provided by Gail Mitchell.
TO OUR READERS
The Billboard Salute to Arista in this issue went to press before the May 2 announcement that L.A. Reid had been appointed the new president/CEO of the label.
NEWSFILE: 6 MAY 2000
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