Warner's Stock Loss: No Hits, All Misses

There's been a lot of talk in the last few days about the dismal IPO launched by Edgar Bronfman's Warner Music Group. Even with a splashy announcement adding Sean "P. Diidy" Combs to his foundering company and a Wall Street launch with Led Zeppelin's Jimmy Page, Warner couldn't make it happen. They raised just $550 million, about half of what they expected.

Yesterday the new stock finished the day at $15.73, down from an initial $17 on opening day. Let's not forget that Bronfman and friends had hoped for a $22 to $24 opening. Of course, that was before rock group Linkin Park sued to leave the label when they realized that the Bronfman gang was only interested in flipping the company for a huge profit. Linkin Park's complaint was that the execs weren't interested in having a record company.

Well, one look at the charts could have told them that. Warner currently has a paltry six albums in the top 50 with only one — Rob Thomas' solo effort — in the top 10. The Universal Music Group and Sony-BMG dominate most of the charts. Warner is simply an afterthought.

In the year or more since the Bronfman group came in, they've developed almost no new artists. Highly trumpeted Lyor Cohen, wooed from Island/Def Jam, is still waiting to see a success. But the good news is that he has over 2 million shares of the new company. One can only wonder when he'll cash out. It's easier than breaking a hit single.

Sad thing is, if I read an article about a record label that did spend time, money and effort in developing new and existing artists, I'd be surprised.


Record labels have always been run by slimey people with no regard for long-term goals and genuinely good-quality product, so how the hell things are getting even worse is beyond me. But they are.


At the UK Rock n Roll Hall of Fame opening ceremony, Bono gave an outstanding achievement award to the founder of Island Records and singled him out as a man prepared to ride the ups-and-downs in short-term sales and trends to develop artists properly. Nice to see an honest man get props but surely this is only what every label should do as a matter of course?!