: LONDON – Virgin tycoon Richard Branson officially launched his record company, V2 Music Group, last week.
The move, announced last spring, marks his return to the music biz four years after he sold Virgin Records to music giant EMI for $935 million in order to finance other interests. The sale to EMI included the restriction that Branson could not set up a new record company for 30 months.
Regrets from the get-go
At a press conference, Branson said he “regretted the sale almost from the word go” and added that “for the last three years, I’ve felt like a dog without a bone.” Branson said he had been forced to sell the company to combat fierce competition from British Airways in the early days of his own Virgin airline.
To start, V2 has signed two young acts, Stereophonics and Kings of Infinite Space, to its roster and expects to sign another eight in its first year. Cooperative deals also have been struck with four indie labels: Big Cat, Blue Rose, Banana and G Street. V2 will pursue more deals with indies.
Branson said that he is also looking to bring established music acts to V2. He disclosed that he had bid for mega-band R.E.M. when its contract with WEA ended recently, but lost out by “a couple of million dollars.” R.E.M re-signed to WEA in September for a reported $80 million.
The V2 head office is located in west London, not far from Branson’s home. Jeremy Pearce, a former managing director for indie labels at Sony, is CEO; David Steele, a vet of many labels including Virgin, is general manager. There are also offices in the U.S., Germany, France and Scandinavia, and V2 intends to set up in Australia, Italy and Spain and to initiate joint ventures in Japan and South East Asia in 1997.
Branson would not disclose V2’s start-up cost or budget, saying only it is “some millions of pounds” and that he would invest “as much as it takes.”
“At the moment, everything couldn’t be better, but we’re in our honeymoon period,” Branson said. “We could have a number of tough years ahead of us.”
Acts signed to the Big Six majors typically have contracts weighed down with deductions for everything from packaging to publicity. V2 intends to eliminate some of these practices in an effort to bring acts to the label. If the approach is successful, it could influence others to follow suit.
Branson said he is “proud of the fact that no major artists left Virgin in the 20 years” that he ran the label.