Gary Gersh, prexy/CEO of Capitol Records, has let it be known that he’s unhappy with the cutbacks mandated by chieftains at EMI, the label’s parent, and that they could impact his label’s ability to properly market and promote its upcoming slate of album releases.
Colleagues and managers of artists have sensed Gersh’s frustration at the prospect that his artist-friendly leanings are clashing with the desire of EMI brass to create a lean and mean company.
But sources said Gersh, who joined Capitol five years ago, has yet to actively discuss an exit with EMI brass, contrary to industry chatter, and is not expected to make any overtures at least until the release of the Beastie Boys disc “Hello Nasty” July 14.
The group is one of the acts Gersh brought to the label, and his close relationship with the band and its Grand Royale label is well known.
The rounds of high-level exec exits, such as EMI Music prexy/CEO Jim Fifield earlier this year and North American chief Charles Koppelman a year ago, coupled with the recent reorganization at EMI’s U.K. outposts, have impacted the continuity of marketing acts throughout the conglom.
Sources said they felt Gersh, who declined to comment, could possibly leave the label before his contract expires early next year, unless conditions change. Gersh inked a one-year extension in March of this year.
EMI, under the aegis of CEO Ken Berry and North American deputy prexy Roy Lott, has been on a mission to cut costs and eliminate redundant operations across all levels of the company in an effort to improve profitability at the third largest music conglomerate.
The reductions are presumably to make the company attractive to a potential buyer and boost its stock price.
But execs running the labels inside the conglom have expressed concern that the cutbacks and staff reductions could affect their labels’ resources used to market albums and maintain market share.
Gersh’s exit is being considered at a time when Capitol is at its hottest thanks to the “Hope Floats” soundtrack and albums from Marcy Playground and Everclear.