Businessweek Archives

Can This Man Lift Motown's Blues?


Entertainment: MUSIC

CAN THIS MAN LIFT MOTOWN'S BLUES?

It is nearly noon when 35-year-old ex-rapper Andre Harrell shows up for his first day at the Wilshire Boulevard offices of Motown Record Co. Music executives are rarely early for anything, so Harrell is right in step. Looking relaxed and stylish in a white turtleneck, black slacks, and soft Italian loafers, Harrell has just spent the past three days jetting between New York, Miami, and Los Angeles to meet with singers Johnny Gill, Queen Latifah, and John Frankenheimer, Diana Ross's manager. This evening, he will entertain Motown great Stevie Wonder at dinner.

If the founder of tiny Uptown Records is daunted by the challenge of reviving the faded fortunes of the biggest brand name in music, he's not showing it. Only when he describes the two hours he spent the night before at Motown founder Berry Gordy Jr.'s five-acre Beverly Hills estate does he seem the least bit awestruck. "I mean, that was Berry Gordy, the man who created a legend," Harrell says. "He created a piece of America, something that is now my obligation to build on."

Harrell's great ambition is to become the Berry Gordy of the 1990s--the next man to package black music for the widest possible audience. Motown, Harrell believes, can be the Disney of the music industry, a multimedia entertainment empire built on the strength of a rich, evocative brand name. His dream is shared by Motown's parent, PolyGram Holdings Inc., which for two years has been frustrated by the label's clumsy attempts to expand into film and TV. On Oct. 2, PolyGram replaced former CEO Jheryl Busby with Harrell, largely because Harrell's Uptown label was upstaging Motown with such hot rhythm and blues stars as Mary J. Blige and Jodeci. Harrell's deal: a potential $20 million.

As the new boss takes over, the only sure thing is that Motown is a long way from becoming another Magic Kingdom. Some wonder whether Harrell's reputation for picking hot acts veils his inexperience as an operator. "Andre is a gunslinger," says one industry insider at a competing label. "He'll go out and find you a hit artist, but he sure as heck has never run anything."

OLD R&B. Motown's glory days--when it topped the charts with such superstars as the Supremes and the Temptations--are a fading memory. Today's African American music market is dominated by such new labels as Interscope and LaFace promoting street-wise acts such as Snoop Doggy Dog and TLC. Motown commands a bare 1.8% of the music market, according to SoundScan Inc., down from a peak of double-digit market share in the 1960s and 1970s.

The problem is that Motown has lost the pulse. In recent years it has broken only one superstar act--Boyz II Men--while it has spent heavily to promote such failures as Rosie Gaines and For Lovers Only. The label is living off its past: Over 40% of this year's expected sales of $105 million will come from its oldies catalog. Most labels consider 15% a big number for catalog sales.

HELP WANTED. "Motown has hardly been a bad investment for us," insists PolyGram CEO Alain M. Levy, who paid $325 million in cash and debt assumption for the label in 1993. But it has not been a good one, either. Insiders say Motown profits were off by nearly 20% this year. And Levy admits he's worried about the dearth of new acts. "We are O.K. now and maybe for the next year," he says. "But down the road, we're far less comfortable."

Harrell says his marching orders are: "go back to the streets," to find the next generation of black artists. "I'm from those neighborhoods," he says. "I can sit with them, their parents, their girlfriends." Beefing up a label's artist-acquisition prowess is at best an inexact science. But it begins and ends with hiring good people. Harrell's top priority is to fill Motown's top A&R (artists and repertory) position, which has been open for months. He'll also add a new marketing director. Meantime, he plans to open offices in New York and Atlanta--urban music hotbeds--and is considering moving headquarters to the Big Apple.

Harrell grew up in the South Bronx and was briefly a member of the rap duo Dr. Jekyll & Mr. Hyde. He launched his business career selling radio advertising but in 1983 joined Russell Simmons' Def Jam Records as a producer. Two years later he found his first star: a little-known rapper named Heavy D. By 1986 he had launched his own label, Uptown, which eschewed harder-edged "gangsta rap" for a more melodic sound that could sell in the suburbs. Acts such as Mary J. Blige, Jodeci, and Soul For Real became big hits.

For all his success, though, industry insiders constantly debate whether Harrell is really as good as his press clippings. He throws lots of parties and cultivates the media. But critics snipe that it was Harrell underlings, including Sean "Puffy" Combs and Heavy D., who found many of Uptown's artists. He's on his own at Motown. Moreover, Harrell is known for spending lavishly to break his acts, running up bills for limos and other luxuries, while overspending on videos.

In 1992, MCA Inc. bought Uptown and signed Harrell to a $50 million development deal whereby the label would produce records but also branch into black-oriented films and TV. The relationship soured early over Harrell's open-checkbook policy. It did not help that Harrell's attempts to expand into TV (he produced the Fox series New York Undercover) were distracting him from the record business. Then MCA balked when Harrell petitioned company brass to triple his 35-person staff.

Levy says he's aware of Harrell's free-spending ways but still willing to bet big on him. Harrell's contract could pay him $20 million, Levy acknowledges, if the Motown chief hits certain sales targets. In return, Levy will retain tight control. "We'd be idiots if we didn't know all about Andre's reputation," Levy says. "His job is to find the acts, ours is to give him boundaries."

For now, that means delaying his Disney ambitions. Harrell and Levy both have big multimedia dreams, but they both insist records come first. During Busby's seven years at Motown, the company launched an interactive game division, began printing Motown comics, and licensed its name for a string of Motown Cafes. Busby admits he let artist development deteriorate badly.

The plan now is to scale back those efforts and find some big acts to propel Motown forward. "None of that other stuff means anything unless you're making the music," says Harrell. That sounds a lot like Berry Gordy. But Harrell still has plenty to prove before his Motown looks like the Motown of old.

HARRELL'S PLANS FOR MOTOWN

-- Lure more hip, urban artists to Motown to reduce dependence on catalog of old hits

-- Improve Motown corporate morale, beef up depleted marketing unit

-- Expand Motown unit to make movies, TV shows

-- Decide fate of recent diversifications, including units to make interactive games and MoJazzBy Ronald Grover in Los Angeles


Toyota's Hydrogen Man
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus