Warner Music Group, recently sold off by Time Warner, has hired Lyor Cohen to head North American operations:
- Mr. Cohen got his start 20 years ago promoting rap music in Los Angeles but has since worked with a broad range of artists, including Public Enemy, Jay Z, Mariah Carey and Bon Jovi. He has been named chairman of United States recorded music.
The formal announcement, set for Monday, will end nearly a month of speculation about whether Mr. Cohen would leave the Island Def Jam Music Group, a unit of the Universal Music Group, where he was chief executive. Edgar Bronfman Jr., the Seagram heir who helped lead the buyout at Warner Music, said he had talked to Mr. Cohen since December and even consulted his friend Doug Morris, the chief executive of Universal Music and Mr. Cohen’s former boss.
….A person briefed on the negotiations said that Mr. Cohen was offered a five-year contract worth $50 million to stay at Island Def Jam. Mr. Bronfman declined to say how much Mr. Cohen would be paid, although he added that Mr. Cohen’s financial success was tied to the fortunes of the company.
That will give Mr. Cohen plenty of incentive to make substantial job cuts and eliminate profligate spending. Already hundreds of Warner Music employees are expected to lose their jobs. Under Roger Ames, who has been chairman of Warner Music for four years, the company has undergone a broad restructuring and improved its profitability. But Mr. Bronfman suggests it was not enough. “Ultimately, for our investors to get returns,” Mr. Bronfman said, “they need more growth.”
….While Mr. Cohen’s career has always seemed to follow an upward trajectory, the last year has proved to be more difficult than most. TVT Records was awarded $132 million in a contract dispute with Mr. Cohen and the Island Def Jam Music Group over the release of an album featuring Ja Rule, who is a Def Jam artist. A federal judge later lowered the amount to $53 million; a representative for Mr. Cohen said he was appealing the decision. And his recent effort to reinvigorate Mariah Carey’s career was a limited success at best. [NY Times]