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This kind of backdrop makes it harder for the music industry to be taken seriously in the corridors of power. This week, Eric Nicoli, chairman of EMI, visited the Labour Party conference in Brighton to plead for better treatment. Mr Nicoli, who has been making similar arguments for some time, says that while the Government is keen to provide tax incentives for research and development, nobody gives the music business credit for its own form of R&D: A&R.
It is unwise to get emotional about the British ownership of media companies but EMI feels curiously important — as a supporter of British music in an industry otherwise run out of New York. Certainly, EMI spends serious money on A&R, something approaching £500 million, implying a UK investment of £75 million — EMI’s UK business is about 15 per cent of the whole — on finding and developing new Brit bands. This is serious money, although it needs to be set in context. Compare that with television: ITV spends just under £1 billion on new programmes a year, almost all of it in the UK.
EMI isn’t the only record company out there, although the ranks of the majors have dwindled to four. But it is hard to shake the feeling that it has a deeper commitment to the UK, rather than acting as an operation that essentially tries to sell US acts around the world. EMI UK is noted for excessive loyalty to acts and some break through internationally. Of the 45 EMI artists that have had million-plus selling albums in the past five years, nearly a third are British — including Robbie Williams, Coldplay and Joss Stone.
So, music is a serious British business, even if some of the artists take drugs. But, if it is, then it is hard to believe that it needs much specific help. Government intervention in media varies wildly, and the record of helping out is patchy. A vast amount of effort has gone into promoting British film, by devising tax breaks that attract hot money. Yet, compared with music, there is no great modern tradition in film, and to judge by the portrayal of Britain in many films — whether they qualify for tax breaks or not — it is hard to argue that the nation is being portrayed well.
Typically, whenever creative types start asking for help from the Government, it is time to reach for the sickbag. Some arts activities deserve subsidy but if people want to make British films, they should raise the money and simply make British films rather than squabble with Revenue & Customs. Perhaps someone could create a sustainable UK film company — if not, the weather’s better in Hollywood and the language is broadly the same. EMI, which has a sustainable and successful business, has less to worry about than it seems to think.
Bernard was also able to announce cost savings of £25 million, beyond the £7.5 million previously advertised. This pleased the City and took attention from the revenues slump of 9 per cent in the half to September. Bernard admitted that the distraction of the merger had contributed to the problem — if you are about to dismiss a whole sales force, then the effort that goes into forward bookings will be reduced.
Most interesting, though, was Bernard’s admission that the group’s analogue stations needed beefing up. His old Classic FM was spared criticism but he conceded that Capital 95.8 was underperforming, pointing out that it had lost share in London to the point where it is running neck and neck with Chrysalis’s Heart and Emap’s Magic.
From next year, Capital will have up to £7 million more to spend, presumably on talent, although Mr Bernard insists that breakfast man Johnny Vaughan is safe. Finally, GCap is starting to move forward, although Mr Bernard will have to work hard to convince colleagues that he is not leading a GWR coup.
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