Jackson Free Press

The biggest news involves one of the most storied labels in hip-hop. Island Def Jam head Lyor Cohen recently left his position to head Warner Music Group's U. S. Recorded Music right on the heels of WMG being purchased by former Vivendi Universal exec Edgar Bronfman Jr. for $2.6 billion. As a result, former Arista chief Antonio "L.A." Reid has been named chairman of the Island Def Jam Music Group. Reid will report directly to Universal Music Group chairman and CEO Doug Morris and president Zach Horowitz. However, trouble is in the air as Def Jam President Kevin Liles reportedly has decided to leave the company in March.

What this means to you: Artists and consumers both are going to be deeply affected by the game of CEO musical chairs. CEOs determine the creative and business directions for their labels. The creative and fiduciary landscape is going to be reshaped, and most affected will invariably be Def Jam. Def Jam is probably the most notable label in hip-hop. It is to the hip-hop generation what Motown was to '60s soul music. Reid's successes outside of Outkast have been primarily in R&B. Unless Reid can forge a true direction on the hip-hop front, this storied label will suffer. WMG will have possibly the most to gain if they streamline resources and focus on the creative elements. Having T.I. and Jahiem on your roster would be good building blocks for any label. The next 18 months are pivotal for their success.

Rumors have also circulated that WMG and Sony Music are courting Canton's own Boo Da Boss Playa. It will be interesting to see if he winds up with one of the two or stays independent. Rumors are also circulating that Jackson hip-hop pioneers Wild Society may be coming together for a reunion. On which label? Let's just say they would be label mates with Lil Jon, Ying Yang Twins and newly signed Pitbull.

Corporate Muscle
Microsoft Corp. and the Walt Disney Co. have announced an agreement that will involve innovations in home entertainment. The multi-year agreement will begin with Disney licensing Microsoft's digital rights management technology (DRM) for its digital media. Things are becoming extremely convoluted as cable giant Comcast has offered to purchase Walt Disney for $66 billion; and Disney CEO Michael Eisner declined. A merger would add to Comcast's power as they are already the nation's biggest cable operator, as Disney owns the ABC broadcast network as well as the Disney film studio, ESPN, and other assets. For now, the Disney board is standing behind Eisner, but analysts say Comcast might try to wait Eisner out.

What this means for you: Most people don't realize how powerful Disney is in the music industry. Disney owns and operates arguably the largest independent label in the U.S., Buena Vista. Comcast may not be to purchase Disney if forced to raise its price. Despite having the financial resources, the company may not have the financial flexibility it needs after its 2002 purchase of AT&T Broadband, among other issues. Whether they do or not, the company that has the most to gain financially is actually Microsoft. This directly affects consumers because if Disney is acquired by Comcast, the combined company will have the added muscle to strongly compete in the online music retail and legal file-sharing areas. Not to mention, owning Buena Vista and the Disney channel provides a plethora of cross-marketing opportunities. Microsoft already owns around 7 percent; if Comcast does acquire Disney, Microsoft would then own around 4 percent to 5 percent.

Only the Strong Will Survive
Chuck D is planning on launching a new hip-hop cable network that will be aimed at the 18-34 demographic. The Real Hip Hop Network or (RHN) is expected to launch this year with a major cable operator. The venture will be backed by CNN founder Reese Schonfeld and former Viacom executive David Houle. The network plans to compete with both MTV and BET. What this means to you: Everybody is jumping on the premium hip-hop channel bandwagon. Reportedly, Tom Joyner, P Diddy, Eminem and several other artists and executives are partnering with corporations to form ventures to reach the lucrative 18-34-year-old market that MTV and BET have in a stranglehold. Only the strong will survive. For consumers, any of these ventures that have the ability to capture a substantial part of the market will be able to shape the creative direction of hip-hop and other forms of music. Several will be strictly uncensored and offered on demand with no commercials. Wondering about the impact? Imagine how hip-hop, or rock music for that matter, would be without the protracted impact of MTV or BET.

They Got the Power
The recent filing of Chapter 11 protection by retail giant Tower is shocking and disturbing. Mass merchandisers and electronics retailers have recently become the spot for exclusive music with many top acts striking deals. Last holiday season, Rod Stewart's new CD, "As Time Goes By: The Great American Songbook Vol. II," was available only at Target; simultaneously Wal-Mart had exclusive rights to a special release of Britney Spears' new CD with links to online features. A Rolling Stones concert DVD was only sold at Best Buy, and Target offered a Bon Jovi CD for $7. The exclusive deals are being offered at a time when mass-market merchants are gaining an increasing share of the retail music market. Wal-Mart accounted for 13.5 percent of music sales in 1994. However, this year the retailer accounted for 34.8 percent.

What this means to you: With the implementation of Universal Music Group's JumpStart program, many popular CDs distributed by UMG have been sold for around $9. This affects the mom-and-pop community record stores. making it impossible for them compete. In an economic environment where local retail outlets have closed due to sagging sales, the control of exactly what will be sold is falling into the hands of a few select retailers. This can be extremely dangerous for independent artists, especially rappers, as many of the major chain outlets refuse to carry local artists. The power is in the hands of a few power players, giving the consumer less of a choice and aspiring indy-music entrepreneurs less of a chance.

Alphonso Mayfield is the JFP's hip-hop columnist.