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August 12, 2011

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Three teenagers were arrested Wednesday in connection with the fire that destroyed Sony DADC's warehouse during the London riots Monday, gutting the inventories of more than 150 independent labels.

According to a BBC report, two of the suspects, aged 17 and 18, remained in custody while the other, 17, was released on bail. The three were among the 922 riot-related arrested reported by police authorities to the press on Thursday.

The 150 companies affected by the blaze include premiere U.K.-based indies such as XL and Domino -- whose rosters include Adele, Arctic Monkeys, the xx and many others -- that are still in the process of assessing their losses in the wake of the fire. The larger labels have said they have stock at other locations, but many of the smaller indies are facing devastating losses. A Sony rep told Billboard that some 25 million discs total -- including CDs, DVDs, Blu-ray discs and video games -- were destroyed.

The Guardian reported that PRS for Music, the U.K.'s music royalty organization, and the Association of Independent Music are working on a plan to provide relief loans to labels that might not otherwise survive the loss of stock and sales. While the paper said inventory in the building is believed to be insured, it may take a considerable time for payments to reach the labels.

The paper also reported that HMV, which owns more than 250 stores, has offered warehouse space for Pias for all stock intended for the retailer so that it can go straight to its stores with as little disruption as possible.

A campaign called LabelLove has been created in an effort to raise money for the labels affected by the fire.

The 215,000-square-foot Sony DADC warehouse, used to store CDs, DVDs, Blu-ray discs and video games, was the company's primary distribution center in the U.K. and Ireland. Around 40 firefighters fought the blaze; one witness claimed to have seen a number of looters leaving the building with discs before the fire became prohibitively large.

On Wednesday, Sony DADC issued a business continuity plan in the wake of the fire. According to a statement released by PIAS, the company is "back up and running from a new control room in Enfield" - the London borough where the original warehouse was located.

"Sony DADC have identified a temporary distribution partner [yet-to-be-announced] and it is envisaged that they will be in a position to pick, pack and ship orders in the course of next week," the statement continues.

"Our key focus at the moment is to get things re-manufactured and we are working with our labels on the best way of doing that is -- identifying which lines are turning over the fastest and getting them to start re-manufacturing again," Nick Hartley, chief operating officer of PIAS Entertainment Group, told Billboard.biz.

"At the same time we looking in our Brussels warehouse and [speaking to] other labels in Europe, if they don't go through us, to see what stock there is to be able to ship back from Europe into the U.K. in order to keep supplies going," he said.

According to Hartley, the present situation is aided by the fact that U.K. retailers typically "carry a reasonable amount of stock."

"Our biggest problem is going to be the depth of catalog," he said. "Remanufacturing and getting stock in [outlets] next week of the top several lines is do-able, but we had over 8,000 lines at Sony DADC. [As for] whether they will all ever be re-manufactured, there's obvious issues there and I think some of them will lose out in that process."

On Tuesday, AIM, the U.K.'s Trade Association for the Independent Music Industry, issued a statement calling on music fans to help support U.K. indies affected by the blaze. "This is a disaster for the music community, but with the fans' help, labels and artists will survive, said Alison Wenham, Chairman and CEO of AIM. "Please show your support for the music community by buying a digital album from an independent label today."

U.K. labels trade body the BPI has additionally offered its support to the U.K. indie sector. "It is devastating for the labels affected, and we are liaising with members and DADC/PIAS to offer help and information where we can to help them to react as quickly and effectively as possible to these very regrettable events," said Geoff Taylor, chief executive at U.K. labels trade body BPI, in a statement.

[Edited 8/12/11 7:36am]

[Edited 8/12/11 7:11am]