In an unprecedented move Wednesday, EMI Records announced that the label would be buying Carey out of the remainder of her reported multi-album, $100 million contract. Though both parties said it was an “amicable termination,” Carey was later upset with a regulatory disclosure that EMI sent out for stock-market purposes. It stated that the company had “terminated its contract with Carey.” Her lawyers claim it helped stir press headlines such as RECORD COMPANY DUMPS MARIAH.
The label is clearly unhappy, too, starting with the sales of the first EMI-Carey album, “Glitter.” It sold only 500,000 units in the United States. Several factors contributed to the CD’s poor showing. Though its mix of ballads and funk was not a musical departure for Carey, its harder hip-hop edge and the singer’s new bad-girl persona were clear signs Carey was scrambling to update her image. It didn’t help that it was a soundtrack to a poorly received movie or that the album had the bad luck of being released on Sept. 11. And of course, Carey did less promotion for the CD than usual, due to her infamous breakdown and self-imposed rehabilitation this past summer due to “exhaustion.”
But EMI and Carey’s parting of ways may have less to do with the diva’s behavior than with a sagging economy and a murky economic outcast for the record industry. Had the CD’s sales skyrocketed, the 31-year-old singer would probably be working on her next release instead of cashing the $28 million check she received from the label’s Virgin Records. Instead, the sudden pay-off is a signal about the state of the troubled music industry. With the rise of downloadable music and so much piracy on the Web, CD sales have been sagging over the past year. In 2001, purchases were down 5 percent. Now, drop the current recession into the mix, and you have an industry that is cutting ties with those who can’t produce quick money-making hits.
EMI in particular had a rough 2001: it reported a loss of $77.6 million the first half of its fiscal year. The label was banking on releases by Carey, Mick Jagger and Lenny Kravitz to pull it back into the black, but the sales of those albums hardly met expectations. With new CEO Alain Levy on board, EMI also recently parted ways with the high-priced rock legend David Bowie. These cost-cutting measures may be harbingers of things to come. High-profile acts with similar contracts such as Whitney Houston and R.E.M.-who hardly have spotless track records when it comes to consistent blockbuster sales-may soon feel more pressure from their labels. Record execs may be skipping to the bottom line a lot faster in the future.
