The newish boss of EMI Music, Elio Leoni-Sceti, who took over as CEO of the major's recorded music business back in July, is expected to reveal his plans for restructuring the company later today.
Some of you might have thought there'd already been quite a bit of restructuring at the struggling major - there's certainly been plenty of job cuts - but there's still lots of revamping to come apparently. According to the Financial Times, Leoni-Sceti will tell his staff today that the major "is still in the very early stages of its renaissance" while adding "the road ahead will not be smooth or easy". Whether or not that means more job losses I'm not sure.
On the upside, Leoni-Sceti will precede his latest restructuring announcement by reporting that the major's recorded music business made £59 million in the first half of the current financial year, compared to the £14 million loss made in the first half of the previous year, so that's good. The turn around has been brought about by both cost reductions and more profitable releases, apparently. Given just how bad the previous financial year was for EMI (as revealed in that recent report by EMI Group parent company, Terra Firma's Maltby Capital), presumably this year had to be an improvement, but for those EMIers who have been through difficult times this last year, confirmation that at least it's resulted in a profit will presumably produce some smiles.
As for the restructure, well, according to the FT, recorded music will be split into three distinct global business units - new music, catalogue and music services. I think 'music services' includes all the marketing and promotions units which had already become a separate division following an earlier restructure which saw A&R and marketing activities split.
The catalogue division will be headed up by Ernesto Schmitt - we know this because EMI announced his appointment yesterday. Schmitt is another non-music business appointment, he was most recently Group Development Director for the company that owns Currys and PC World. Confirming that appointment, Leoni-Sceti told reporters: "Ernesto is a growth manager, with a passion for music, who likes to build businesses and use technology to improve the consumer experience. He has a background in both the music and retail sectors, and has built his own internet businesses from scratch. With his proven leadership skills, he will be a key player in our mission to help our artists strengthen their relationship with fans and build innovative new models and channels".
Despite this year proving to be profitable for EMI so far, and Leoni-Sceti's insistence that the restructuring instigated by him and Terra Firma chief Guy Hands, and the appointment of men like Schmitt, mean the major is now in its strongest position for years, some question whether the major's new guard haven't so far ignored the company's biggest weakness - a lack of good bankable artists. Although new A&R chief Nick Gatfield is now in place, has all the culling and turmoil at EMI since Terra Firma took over left the major with a roster deficiency leaving Gatfield and his team playing catch up?
EMI execs on both the business and creative side would no doubt disagree, but the FT quote the boss of media and net analysts Enders Analysis, Claire Enders, who thinks Hands et al have undervalued the importance of talent in the record business. Noting that some of EMI's biggest upcoming releases are Tom Jones and Sarah Brightman albums and a Coldplay special edition, she says: "The longest term problem is EMI's creative problem. If you do not provide attractive new music you cannot generate significant income out of digital downloads and ringtones. Tom Jones and Sarah Brightman are not going to set the world alight. There is nobody to dispute the company has done the bravest of cost-cutting in the music industry but new music investment is systematically a failure. They can solve every cost problem on earth and they will still have the biggest problem".