BMG NORTH AMERICA
SPINS ON ITS AXIS

Calling it "a move to expand its creative centers and profitability," BMG North America has officially relaigned its U.S. labels and operations.

The RCA Music Group will now include Arista Records, while LaFace Records and So So Def Records will now be within the newly formed Zomba Label Group.

The announcement was made by BMG N.A. Chairman Clive Davis and President/COO Charles Goldstuck. The move marks Davis' remarkably circuitous journey home from the time he was relieved of his duties at Arista by his BMG bosses almost four years ago and replaced by Antonio L.A. Reid, who was forced to resign his post last month and has since landed at IDJ.

As previously announced, Arista Records will be reconfigured from a stand-alone company to a separate label under the RCA Music Group umbrella, retaining its own artists as well as A&R and marketing staffs. Sources say some 65-70 of the company's 175 or so employees will make the transition. In a final ironic touch, the label literally goes out with a bang, as Usher's new Confessions album is poised to top next Tuesday's chart, with almost 900k in first-week sales.

As part of the broad realignment, some Arista artists will be moved to the RCA Music Group, including Sarah McLachlan, Dido, Avril Lavigne, Carlos Santana, Whitney Houston, Kenny G and Babyface. Although LaFace and So So Def will remain stand-alone entities, they and their rosters of artists including OutKast, Usher, Pink, J-Kwon, Jermaine Dupri, Anthony Hamilton, Bone Crusher, Youngbloodz, Kelis, Clipse, among others, will now be included within the Zomba Label Group. The Zomba Label Group will take on key LaFace and So So Def A&R and marketing personnel.

"This new structure underscores our deep commitment to preserving and strengthening our diverse record labels and investing in creativity and artists," said Davis. "BMG has a peerless roster of superstar and developing artists who deserve the very best creative homes and the resources necessary to develop careers that endure and music that inspires. Now, will you excuse me? Simon Cowell just BlackBerried me that he found the next Clay Aiken."

Long-time Jive Records chief Barry Weiss will take on the new title of Zomba Label Group President/CEO, reporting directly to Davis. The Zomba Label Group will now include, in addition to LaFace and So So Def, the Jive, Verity, Volcano and Violator labels.

"I am really grateful that Barry will take on this critical role in our new structure," said Davis. "He is one of the premier music executives and has established a stellar track record during his more than 20 years in the business. I can't wait to show him the slides of me and Janis Joplin taken at Monterey Pop."

"The labels of the newly formed Zomba Label Group collectively boast one of the most powerful artist rosters in the music business," said Weiss. "I look forward to working with such an extraordinarily talented group of artists and to continuing to be part of BMG's dynamic North America team. My career just seems to go from one Clive to another."

Today's move will create new efficiencies by consolidating a number of functions across BMG's U.S. labels, according to Goldstuck.

"BMG North America is setting clear priorities to sustain and enhance our creative and financial success for the future in the face of ongoing marketplace challenges," said Goldstuck. "We continue to strengthen our A&R focus and investment in artists while creating an organization that is more efficient, responsive and profitable. Now does anyone have change of a deutschemark for the Coke machine?"

Under this new structure, BMG's North America operations will now include recorded music companies RCA Music Group (RCA, J and Arista), Zomba Label Group, and BMG Canada, as well as BMG Strategic Marketing Group and BMG Distribution. RLG-Nashville, BMG Music Publishing and BMG Classics are not affected by the realignment.