EMI Employment Prospects Bleak
January 13, 2008
The music industry's transition into the digital age appears to be on another collision course with the free market. The Telegraph
is reporting today that Guy Hands, CEO of the private equity firm Terra Firma, is looking to restructure EMI and to lay off nearly 2,000 employees. Terra Firma took over the smallest of the "big four" record labels during the summer of 2007.
This isn't the first massive job layoff EMI has announced since music began its digital transition. In March of 2004, EMI laid off
nearly 1,500 employees - most (~900) of which were manufacturing jobs. During this time, EMI had approximately 7,000 employees. This cut brought EMI's population down to its most recent number, 5,500. If today's cuts go through, EMI will be down to approximately 3,500 employees.
The news doesn't come from an official source, rather Yahoo! News reports
an internal memo was leaked into the public. Part of Guy Hands' strategy is to cut marketing and band management, while dropping thousands of acts. The official announcement is expected on Tuesday.
EMI has been the most progressive among the “big four” record labels. It was the first to accept the realities of DRM-free music, while quick to distribute its music online. The record label has experienced numerous difficulties adapting to the digital age, however. Leadership has been shaky, physical sales are down, and we're in the second round of massive layoffs in only four years. While much of this could be attributed to an economic correction during the digital transition, any more corrections may not leave much of an EMI remaining.
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