EXECUTIVES BEHAVING BADLY

AN ABRIDGED VERSION OF A CHAPTER FROM MY BOOK “THE BUSINESS” PUBLISHED BY UNBOUND (FROM AMAZON AND ALL OTHER BOOK SELLERS).

In the 70s and 80s, American record company executives reached peaks of megalomania never before seen, even in the music industry. At company after company, the ambition lobe in their CEO’s brain would develop a permanent, painful erection. At CBS, Walter Yetnikoff’s ambition lobe leapt right out of his trousers.

When Yetnikoff was put in charge of CBS’s American operations he didn’t know much about music, or running a record company, he was just a lawyer, fresh from the business affairs department. Now, as head of the company, he decided to re-invent himself.

“I was intent on making noise,” he said. “I needed an identity.”

The identity he came up with was a raging bull. He would go to war with Warner.

For the CBS convention he had banners printed that said, “Fuck Warner. Fuck the Bunny”, and to give the conflict a more personal focus, another one aimed at the newly promoted Warner president – “Fuck Mo Ostin!”.

When Yetnikoff bumped into Nat Weiss, James Taylor’s lawyer, he learned that Taylor’s contract with Warner was about to expire. Yetnikoff immediately offered him a million dollars an album to change labels and come to CBS, and for good measure threw in a 2.5 million advance to go with it. Taylor said OK, but he didn’t really want to leave Warner. So when they begged him not to go he changed his mind and said he’d stay. Yetnikoff summoned him to a meeting at CBS, locked the door and argued with him for ten hours until he agreed.

A little later, at Warner, Mo Ostin got the chance to sign Paul Simon, one of CBS’s most valued artists. Yetnikoff, in a fury at losing him, announced he would destroy Paul Simon’s career, The war was on for real.

When Rod Stewart’s contract with Warner came up for renewal, his manager, Billy Gaff, leaked a rumour that Walter Yetnikoff had called him, and when he walked into Mo Ostin’s office he was offered 20 million dollars before he could open his mouth.

Nobody was balancing the budget. Established artists like these were meant to provide the profits needed for financing fledgling acts. Paying too much for them was unwise. In the end they’d all reach a point where they no longer got any more hits – it was like buying a coal seam without checking how much had already been mined. Sometimes you hit lucky, sometimes you didn’t.

It was Ahmet Ertegun who started the whole thing off. At the beginning of the seventies he’d developed an obsession with signing the Rolling Stones to Atlantic, now part of the Warner group. It took him a while. First he waited until the group fired Alan Klein as their manager, then made himself the Stones’ best friend, partying, drinking, drugging and travelling with them. Finally, in 1971, he managed to bring them into the Warner fold, giving them their own label. The result was a Rolling Stone renaissance. The Stones sold more records than ever before and Ahmet got the credit. Other executives started courting the same sort of adulation, living the high life and massaging the executive ego.

When Jac Holzman started Elektra he told his friends he wanted to make a million dollars having fun. Warner and Atlantic offered him ten million dollars to forget the fun and merge his company with theirs, giving them a new name, WEA (Warner Elektra Atlantic), and another three top artists: The Doors, Tim Buckley, and Love.

The first new act Jac Holzman picked up as part of WEA was Queen. Entering into the spirit of corporate combativeness, he grabbed them from CBS just as they were about to sign. But Holzman soon found he didn’t enjoy being part of the Warner group and the principal reason was David Geffen.

Geffen had been the Eagles manager but had grown tired of it. So when WEA offered him a label he grabbed the chance and started Asylum Records. Soon David Geffen’s new label not only had the Eagles, whom he still managed, but Linda Ronstadt, Jackson Browne and Joni Mitchell.

Jac Holzman couldn’t stand Geffen. “Hurrying in with a raincoat over his head to avoid being seen... behind closed doors, shouting on the phone…  suddenly coming out and screaming at someone... his psychiatrist making house calls at the office... insecurity rampant in the corridors”.

Another person who didn’t like Geffen was producer Jerry Wexler at Atlantic. At a Warner Group social event in front of all the other executives, Geffen and Wexler lost control. Across the table, Geffen called Wexler a washed-up has-been. Wexler screamed back, “You’d jump into a pile of pus to come up with a nickel between your teeth.”

Ostensibly, the row had been about Bob Dylan. When Dylan’s deal with CBS had come up for renewal, both David Geffen, for Asylum, and Jerry Wexler, for Atlantic, chased after him on behalf of the Warner group. And Geffen got him - an enormous coup at an enormous price.

At CBS, having seen Dylan leave CBS for Warner, Walter Yetnikoff took no risks when Paul McCartney’s contract came up for renewal. He gave him everything he wanted. McCartney still hesitated, saying perhaps he should check around a bit first.

Since this could only mean going to Warner, and knowing McCartney’s passion for music publishing, Yetnikoff threw in a publishing company owned by the CBS publishing division, Frank Music. Its catalogue included all the songs of Frank Loesser, who wrote Guys and Dolls, and hits like “Baby, It’s Cold Outside”. When Yetnikoff bought the catalogue for CBS, he’d promised Loesser’s widow it would be the “jewel in the crown” of the company’s publishing, now he was giving it away for nothing.

McCartney accepted at once, as Yetnikoff knew he would. But it was pure financial vandalism – Frank Music was worth at least ten million, almost double the money McCartney was getting from the deal. It wasn’t like giving away a free tank of gas with a new car; it was like giving away three cars for the price of one.

Spending at Warner and CBS was going out of control. The money they were paying out would have to come from somewhere, and many of these artists, however big, were not going to sell enough albums for the companies to recoup. The point was – these executives weren’t just naughty kids playing games – this blustering warlike power-game was the new image of the music industry.

Walter Yetnikoff wasn’t a normal chief executive, he liked to stay up all night drinking vodka and whiskey; he cheated on his wife with his secretary, then cheated on his secretary with one of his artists. He loved socialising with Morris Levy, the Jewish mobster who owned Roulette records. Yetnikoff called him Moishe and they laughed about “fucking the artist”.

Ahmet Ertegun wasn’t much different; he drank even more than Yetnikoff and could stay up all night partying with stars and still be at a 9am meeting. He was obsessed with parties; if there wasn’t one he would invent one.

One night Ahmet had dinner with Bianca Jagger and Tom Dowd, one of Atlantic’s top producers. “We finish dinner at one o’clock – by which time they’re sweeping the floor of the restaurant and putting the chairs on the tables. Mick Jagger’s joined us by then, and Bette Midler too, and Ahmet says, ‘There’s got to be a party somewhere’.”

In the past, some of the best parties had been at Sonny and Cher’s house, but they’d separated, with Cher retaining the house. Now she was having an affair with David Geffen, taking a respite from being gay.

It was 2am.

With Cher and Geffen still being at the romantic stage of their affair, they would almost certainly be in bed. But Ahmet called anyway, “Hi Cher, I’m with Tom and Mick and Bianca and Bette – we’re coming over for a nightcap.”

When they got there, Cher had managed to get herself together and was wearing a gold lamé dress. Geffen had on shorts and tennis shoes. Mick Jagger sat down at the piano and Ahmet told Cher to get out the champagne. But it turned out there wasn’t any in the house.

Ahmet turned to Geffen with a frown. “We never had that problem when Sonny was here.”

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