LOS ANGELES (CelebrityAccess) – Warner Music Group (WMG) will eliminate 270 positions as part of a reorganization of the company, new CEO Robert Kyncl (formerly YouTube’s Chief Business Officer) announced Wednesday (March 29) in a company-wide email reported by Variety.
The 270 positions to be eliminated make up 4% of the company’s 6,200 employees worldwide. The company will also reduce discretionary spending and slow hiring, prioritizing filling roles in areas where Kyncl sees opportunity.
“In my discussions with our leaders across the company, many of them came to the same conclusion–that to take advantage of the opportunities ahead of us, we need to make some hard choices in order to evolve,” Kyncl wrote to WMG employees.
WMG’s next phase will be specifically focused on supporting “new tech initiatives” and “new skills for artist and songwriter development.” Those initiatives to be prioritized include the label’s recent Web3 efforts and future experimentations with AI, a person close to the matter confirmed to Decrypt.com.
Kyncl joined WMG on January 1 and is reportedly focused on technology and very driven in tech with his leadership approach. Wednesday’s layoffs come on the heels of tech and media companies eliminating unprecedented portions of their workforces amid increases in interest rates and inflation. Amid those layoffs, numerous companies have had to decide whether to continue to invest in experimental Web3 divisions or cut them entirely.
Amazon laid off 18,000 employees, the majority in the tech arena, earlier this year, yesterday Disney eliminated its entire 50-person metaverse unit amid 7,000 layoffs, and Google let go of 12,000 people in January – notably keeping its entire Web3 team.
Last month, WMG hired Ariel Bardin, a former Google and YouTube exec, to become president of technology to oversee the company’s technology and data teams as part of the next phase of global growth.
Kyncl’s memo follows in full:
As I mentioned at our first All-Hands meeting last month, I’m committed to direct and honest communication with all of you. The music business is filled with new possibilities: more fans are engaging with artists and songs than ever, our reach is enormous, and new business models are constantly emerging. WMG is positioning itself for this new phase of growth at the intersection of creativity and technology.
In my discussions with our leaders across the company, many of them came to the same conclusion – that to take advantage of the opportunities ahead of us, we need to make some hard choices in order to evolve. Consistent with this direction, we’ve made the tough decision to reduce our global team by approximately 270 people, or about 4%. At the same time, we’re reallocating resources towards new skills for artist and songwriter development and new tech initiatives. We’re also reducing discretionary spending and open positions to provide us with additional flexibility for our future.
I want to be clear that this is not a blanket cost-cutting exercise. Every decision has been made thoughtfully by our operators around the world, who considered the specific needs, skills, and priorities of each label, division, and territory in order to set us up for long-term success. The leader of your division will either be holding a town hall or sending an email to explain more about this path forward.
I’m also acutely aware of how unsettling this can be. Having to say goodbye to talented colleagues is always difficult. For those of you who will be leaving WMG, please know that we’re deeply grateful for your hard work, dedication, and all you’ve contributed to this company. In all territories, except where you are explicitly told there will be a review or consultation period, anyone affected will hear from your leaders, supervisors, or People team reps within 24 hours. I know this transition will be tough, but we’re committed to supporting you during this process.
In times of great disruption in our world and society, artists and songwriters who have something original to say, who rise to the occasion, will resonate the loudest. Equally, the rapid changes in our economy and ecosystem create the conditions and opportunities for innovation and breakthroughs. I learned when I joined WMG that this is a gritty, incredibly resourceful, and highly impactful team that I want by my side every day of the week. We deliver for our artists, songwriters, and labels with laser focus, inventiveness, and care. And now, more than ever, we need to double down on that.
I’ll have more to say about all of this at our next All-Hands meeting, including more details on our plan.
Let’s support each other with empathy and integrity as we work through this process.