LABEL NEWS: Atlantic Group's Senior Management Restructured & Digital Downloading Must Be Viewed As A Growth Area For Record Companies

(CelebrityAccess MediaWire) –Warner Music Group (WMG) has restructured the senior management of The Atlantic Records Group, consisting of Atlantic, Elektra and Lava Records. Jason Flom, Lava Records' president and founder, has been named chairman and CEO of The Atlantic Records Group. At the same time, Atlantic's President Craig Kallman has been named co-chairman and COO of The Atlantic Records Group, and Julie Greenwald, formerly president of Island Records, has been named president, reporting to Flom and Kallman. Ahmet Ertegun will continue with the company as founding chairman of Atlantic Records. Flom. Kallman will report to Lyor Cohen, Warner Music Group's chairman and CEO of U.S. Recorded Music.

"A great music company always needs a central heartbeat to guide the careers of both artists and executives, and to nourish the creative process," said Cohen. "I am very pleased to announce that Jason Flom, Craig Kallman, and Julie Greenwald, along with Ahmet Ertegun's guidance, will now assume this very serious responsibility. Jason has proven himself from the outset as an exceptional music man. Jason's A&R resume alone chronicles a remarkable history of contemporary music, and the extraordinary success he has enjoyed with Lava Records is evidence of a natural leader with uncommon business instincts. Craig, right out of college, created a pioneering independent label from scratch, and went on to build an outstanding career distinguished by unerring leadership in both the indie and major company arenas. He has a brilliant track record in discovering and breaking talent in a diversity of musical genres."

With these two amazing music executives leading the company, and with Julie Greenwald, who has demonstrated consummate skills in management, operations and marketing, we now have the ideal team in place," he continued. "Along with Ahmet Ertegun, whose wisdom and musical sensibility have sustained Atlantic — if not American popular music culture — for decades, we have an unparalleled depth and breadth of executive talent. The thorough grasp of the nuances of our business these executives have demonstrated and their aggressive entrepreneurial spirit is exactly what our newly energized Warner Music Group needs to meet the challenges of a changing marketplace."

"From the time I started as a trainee field merchandiser for Atlantic 25 years ago," said Flom, "I always dreamed that this moment would come. This will always be Ahmet's house, and it's my goal to continue his vision by taking chances and breaking important new artists. Having grown up listening to bands such as Led Zeppelin, AC/DC, and Queen, and to now be working side-by-side with Craig, leading the company that spawned these incredible artists, is both a great honor and an awesome responsibility. I want to thank Ahmet for showing the way, and Lyor for opening a new door. With the benefit of Julie's enthusiasm and experience, we promise to deliver great artists and great records, marketed and promoted by the best team in the business."

"I'm very excited to be part of the team which has been charged with the mission of leading this company into the future," said Kallman. "The histories of Atlantic and Elektra are sources of incredible inspiration, legacies of amazing music from groundbreaking artists who have reflected and shaped our contemporary culture. Both labels began life as innovative, grassroots-driven indies that ultimately transformed the music business, and Lava has become a worthy addition to that tradition. That entrepreneurial spirit will continue. I look forward to partnering with my colleague Jason as we strive to forge a great new company for a new era. It is an honor to continue to work with Ahmet, who has been a great mentor. And I am delighted to join forces with Lyor, my longtime friend, and to welcome our new friend Julie into the fold."

"As two of the most respected and important music companies in this business, Atlantic and Elektra have a combined roster of talent and a rich heritage that is second to none," said Greenwald. "Working together with Jason, Craig Ahmet and the incredibly talented staff that has been assembled, I am excited to be part of this great team as we create a forward-looking and innovative music company of the future — one that can easily adapt to the evolving industry and takes full advantage of change. Moving forward, we will work hard to make The Atlantic Records Group the most creative and supportive environment for new and existing talent, one that offers the most exciting opportunities for artistic development in the industry."

"When we started Atlantic Records nearly 57 years ago, we did it because we were first and foremost music fans," said Ertegun. "I am thrilled to say that as this company enters a new era, it will continue to be run by real music people. Lyor Cohen follows in the tradition of the great music men of our business, whose lives and careers have been driven solely by passion and creativity. Needless to say, I am immensely proud that two of Atlantic's own sons, Jason and Craig, are assuming the senior posts in our new label group. Jason literally grew up in this company, from his start as a field merchandiser 25 years ago to one of the industry's top A&R men and label heads. Craig is cut from the same entrepreneurial cloth out of which this label was created, and he has truly hit his stride as an exceptional, visionary record man. Along with Julie, they form a leadership team of extraordinary strength, depth, and above all, love for the music — one that is ideally suited to build upon the legacy of this great company."

Since 1995, Flom has served as president of Lava Records, the label he founded within Atlantic Records. At Lava, Flom continued to build on an exceptional A&R track record that includes a string of multimillion-selling rock bands such as Twisted Sister, Skid Row and White Lion. In the 80s and 90s, he expanded the breadth and depth of his signings with such artists as Tori Amos, Clannad, Kid Rock, Uncle Kracker, matchbox twenty, Sugar Ray, Edwin McCain and The Corrs. He also brought Ireland's Celtic Heartbeat label to Atlantic and oversaw the signing of Stone Temple Pilots and Collective Soul. Since its inception, Lava has been responsible for breaking an incredible string of new artists whose albums have sold in excess of 100 million units worldwide.

Kallman began his music industry career as a DJ at many of the top clubs in New York City. In 198, he founded the independent Big Beat label. When the label was acquired by Atlantic in 1991, Kallman joined Atlantic as vice president/assistant to the co-chairman and was later promoted to executive vice president. In that position, he oversaw Atlantic's entire A&R operation, working with such artists as Aaliyah, Brandy, Junior M.A.F.I.A, Lil' Kim, P.O.D., and Linda Eder and Frank Wildhorn. Since 2002, he has served as co-president of Atlantic. That same year, Kallman forged an alliance with pioneering dancehall reggae label VP Records, whose first release by Sean Paul has sold over 5 million copies and earned three Grammy nominations. He is also responsible for bringing to the label such artists as Twista, T.I., The Donnas, Craig David, Nappy Roots, TapRoot, Trick Daddy, and Trina.

Greenwald, who joined Def Jam Records in 1992, established the label's award-winning marketing department and helped shape the company into the urban powerhouse that it is today. Working with artists such as LL Cool J, Jay-Z, DMX and Ashanti, she and her team helped the label land dozens of platinum and gold records throughout the 90s. In 2002, she was simultaneously named president of Island Records and promoted to executive vice president of Island Def Jam. In these positions, she oversaw all aspects of the label that serves as the rock and pop division of The Island Def Jam Music Group and played an instrumental role in developing and promoting the careers of Sum 41, Mariah Carey and Bon Jovi. ,/P>

The son of the former Turkish Ambassador to the United States, Ertegun was born in Istanbul and subsequently raised in Switzerland, Paris, London, and Washington, D.C. A passionate music fan and collector, Ertegun founded Atlantic Records in New York City in the fall of 1947 serving not only as an executive, but also as a producer and a songwriter as well. Under Ertegun's direction, Atlantic evolved from a groundbreaking, independent r&b and jazz label into one of the world's preeminent music companies ,and established a legacy that includes such icons as Ray Charles, Aretha Franklin, John Coltrane and Led Zeppelin. Ertegun is a founder and current chairman of the Rock and Roll Hall of Fame. In recognition of his pioneering contributions to popular music, he was himself elected to the Hall of Fame in 1987, and the museum's main exhibition hall in Cleveland bears his name. In 2000, he was honored as a "Living Legend" by the United States Library of Congress on the occasion of the Library's Bicentennial. –Bob Grossweiner and Jane Cohen

Digital Downloading Must Be Viewed as a Growth Area for Record Companies

(CelebrityAccess MediaWire) –The promising success of legal digital music services, such as iTunes, as well as the outlook of newer types of music features, including ring-tones and ring-backs, represent both a growth area and challenge for the music industry, according to Shahid Khan, a managing director with the Media & Entertainment practice of BearingPoint, Inc., one of the world's largest business consulting and systems integration firms.

"The issue is essentially being forced on the music industry, both from a content owner's perspective, as well as from a new business venture's perspective," said Khan. "Ignoring or fighting these growth areas is no longer an option. Record companies must now transform themselves to take advantage of the market, or be left behind."

"For new business ventures, the opportunities for the industry are clear and diverse, especially in the infrastructure and support services areas," added Khan, a veteran of the business with more than 12 years of experience with such leading companies as Bertelsmann, Viacom and Scholastic. In addition, Khan led the activities of the various IBM Global Services groups focusing on Entertainment, Publishing and Information Services clients.

Khan explained his insights during the recent Billboard Music and Money Symposium, where he participated as a panelist for the "Investing in the Digital Future" discussion. The panel explored such growth areas in the music industry as digital downloads and ring tones, as well as the outlook for new ventures.

Khan said:

** "There is a limited room for "me-too" models, and new ventures must
demonstrate the potential for both profitability and survivability, as
well as innovation in business models and customer value propositions."

** "There will be future market opportunity for niche players and for
support services around these growth areas, such as end-to-end
operational infrastructure, including billing, digital rights
management, rights tracking, sales audit, and royalty reporting."

** "New ventures may come from new geographies, as consumer desires
globalize. However, disparate infrastructures may vary in different
geographies and impact the ability to support globalization."

** "Owners of intellectual property (publishers and recording companies)
need to re-orient their internal processes and systems from release
planning, product creation, contracts management, and royalty
distribution to be more agile in order to respond quickly and strongly
to market opportunities."

** "Rights acquisition — especially around future rights — in artist and
songwriter contracts will become a greater issue, as will a focus on the
elimination of specific approval clauses in licensed music."

** "Owners of intellectual property will need to focus on catalog depth
available by usage and by territory so that 'celestial jukebox' concerns
of labels and publishers are met."


–Jane Cohen and Bob Grossweiner

The Orchard Inks Roger McGuinn

(CelebrityAccess MediaWire) — The Orchard, the world's leading supplier of independent music, has signed an exclusive digital distribution and promotion partnership with Roger McGuinn to distribute his latest effort, "Limited Edition," which was released April 1st.
"Limited Edition" will be available for download exclusively at eMusic for 90 days before being digitally distributed to all the legitimate digital music services in the United States , Europe and Australia via The Orchard's distribution network. The record will be made available for sale as a physical CD on McGuinn's website, www.mcguinn.com, as well as via online
retailer Amazon.com, www.amazon.com.

"I am a big fan of Roger's music and greatly respect how he has been at the creative forefront musically and technologically for decades. The record is incredible, and we look forward to great things with Roger," said Greg Scholl, CEO of The Orchard and managing director of Dimensional Associates, Inc, the private equity fund that owns The Orchard, eMusic and eMusicLive. "This arrangement exemplifies our vision at Dimensional of how independent companies, and artists outside of the major label system, will transform the music business, and the unique value that our businesses offer to artists and labels."

A mainstay in the music business for decades, McGuinn has also been a champion of digital music and an online distribution pioneer, having begun recording and uploading to his web site a series of traditional folk songs as early as 1995. "I have been excited by the potential of the web and of creating, promoting, and distributing music digitally for years," McGuinn explained. "Finally with eMusic, eMusicLive, and The Orchard, I have found a group of companies that are turning potential into reality; and not just for me, but for almost any musician."

In addition to working with The Orchard and eMusic on his most recent studio recording, McGuinn will partner with eMusicLive to record a live performance on his upcoming tour and release it exclusively through
eMusicLive at www.emusiclive.com.

"Roger's new record with his beautiful vocals and amazing work on the Rickenbacker and 12 string guitars will definitely appeal to his many fans. The cover of his friend George Harrison's 'If I Needed Someone' is a particular standout," says McGuinn's representative Bruce Houghton, president of Skyline Music. "This unique alliance and our plans to record an exclusive digital release for eMusicLive on Roger's upcoming tour are tremendous examples of artist promotion and distribution in the new digital age." –Bob Grossweiner and Jane Cohen

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