Merck Mercuriadis
"Our World Has Changed - Stop Hiding Under The Covers

- Continued from page 4 -

It is easy to use the biggest successes as examples but let’s remember that in 1969, Neil Young was playing the Showboat and in 1970 Massey Hall and it wasn’t long before he hit Maple Leaf Gardens. In 1982, Maiden were playing in 1,000 seaters and inside of 18 months were selling out Madison Square Garden at a point in time when their latest album at that time, The Number of the Beast, had only sold about 375,000 albums in this country. In ’84, Metallica were playing the Masonic Temple and then, boom. All of them had the faith, focus and determination of great managers, agents and promoters behind them and radio and MTV played a minor role.

The changing landscape that I described earlier was not exclusive to record labels. Twenty years ago, we also had at least 30 great promoters – the Bill Grahams, the Brian Murphys, the Leon Ramakers, the Thomas Johanssons, the Michael Cohls around the world – each of whom knew their territory. They knew how to work it and they had faith in what they were promoting and who they were promoting it to.

Today like the labels, they have been consolidated into two or three major players and for the most part, have suffered from the lead of the major labels and the lack of artist development.

As a result, today’s hit ratio is probably not much better than the major record companys’. The successes generally come from the career artists that are still attracting the music enthusiasts and the failures from the latest pop sensations appealing to the passive consumer.

Who knows why the lead of the majors was followed. Perhaps it was because, logically, they were investing the money to develop the artists, and everyone believed that they would continue to develop artists. Unfortunately, it has taken the better part of 15 years to recognize the ramifications of consolidation and their actions.

They have disenfranchised their career artists and they have disenfranchised the logical target consumer, the music enthusiast. The bottom line is that, as with the Hush Puppies, we are now at a critical juncture.

With the exception of Virgin, Arista, Geffen, Def Jam, and Interscope, those 30 great artist development houses that I referred to earlier were all founded in a 15-year period between 1947, when Ahmet Ertegun founded Atlantic, and 1962, when Herb Alpert and Jerry Moss founded A&M and Chris Blackwell founded Island.

The majority of the companies that ruled the music business for the next 50 years were all founded in that period. I believe we are now five years into a similar period that will perhaps last 10 years rather than 15, where the companies that rule the business for the next 50 years are determined.

I am delighted with the changes that my friend Michael Rapino has instigated in the short time he has been at the helm of Clear Channel – not so much the initiatives on surcharges and cheaper tickets, which are important moves that should not be overlooked, but on the moves he has made to reestablish his local brands – great brands like Avalon – as I believe they not only have a critical role to play in future artist development but also being meaningful to the music enthusiast.

Some of the majors will be like the dog that can’t learn new tricks and will fade away while a couple will undoubtedly get their act together and survive. The title that I gave this address is “Our World Has Changed – Stop Hiding Under the Covers,” which is a phrase I’ve used a lot over the last few years to describe those in the industry that are scared of change and how they are hoping that they will wake up and it will all be a bad dream and that the world that they knew will be once again. That is not going to happen.

The bottom line is that if our industry and our businesses are going to flourish, we must once again target the music enthusiast; we must once again develop great new talent and respect the talent we have previously developed. If we want that
14-year-old kid to get up off his ass and away from his Xbox, we better give him a reason. We better develop artists that he can have as much faith, determination and focus in as he does Halo 2 or Grand Theft Auto.

At the end of the day, everyone in this room is in the business of developing artists and if we embrace the concept that we are in the artist business, it does not matter whether it is CDs, downloads, 8-track tapes, or whatever new technology is going to come along and scare the hell out of our industry or whether it is concert tickets or T-shirts or mobile phone ringtones or wallpaper. What matters is that we develop artists and build brands that music enthusiasts want to pay money for.

A few years ago, if I had said that Sanctuary was going to be one of those companies that would rule the next 50 years of the music business, most “experts” would have asked “Who?” Today I believe that most of those experts would bet on it, and I hope that most of you are there alongside us.

But there is no question that we are at an important time in the evolution of our industry and it’s going to have to take some faith, focus, determination as well as a resounding “Fuck the professional excuses” to develop great artists and the relationship between those great artists and an audience of people that consider music to be a significant factor in their lives.

An audience that does want the record, that does want the bootleg, that does want the concert ticket and the T-shirt and are willing as they always have been to pay for it.

Today, the Yeah Yeah Yeahs, Bright Eyes, Tegan & Sara, Arcade Fire, The Killers, Mastodon, The Strokes, Tilly And The Wall, and Funeral For A Friend are playing for everything from a few hundred to a couple thousand people in most markets.
If all of us in this room come out from under the covers and put the same faith, focus and determination, along with the resounding “Fuck the professional excuses” that our business put behind Neil Young, Led Zeppelin, Elton John, Guns N’ Roses, Slipknot, Eminem, KISS, and Iron Maiden, inside a couple of years those artists will be putting bums on seats in arenas and 20 years from now they will still be putting bums on seats, playing arenas.

So it’s all about faith, focus and determination, and agents, promoters and managers.

Thank you.

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