Independent record labels roll over as the conglomerates go rocking on

THE END was not unexpected, but it was brutal and quick. When the 170 employees of A&M records - the label that gave the world Joe Cocker, Cat Stevens, Supertramp and the Police - turned up for work last Thursday, they were told they were all fired and had until the end of the day to clear their desks.

As the doors closed for the last time on the label's Hollywood office, employees hugged and wept in the car park. Sheryl Crow, one of the label's more recent stars, turned up to commiserate. Someone wrapped a black banner round the company's trademark signpost on La Brea Avenue. A 37-year era of independent music production reached the end of its final track.

A&M has become the latest, and most illustrious victim of a major shake- up in the record industry, in which the once-thriving independent sector is being eaten up by corporate giants with terrifying speed.

For the past decade, A&M had operated as a largely autonomous arm of PolyGram Entertainment, but that came to an end last month when PolyGram was bought for a staggering $10.4bn (pounds 6.3bn) by Seagram, the Canadian drinks conglomerate that has decided to move forthrightly into the entertainment business.

The deal gave Seagram control not only of A&M, but also of a clutch of other labels, including Geffen Records, Motown, Mercury and Island and their hugely-valuable back catalogues. More than 100 people have already lost their jobs at Geffen and a further 200 at the other three labels, all based on the US East coast. In all, as much as 20 per cent of PolyGram's 15,000 employees worldwide are expected to be laid off, and about 250 bands and solo artists will lose their contracts.

Such savage cutbacks have an easy business rationale: many of the smaller labels have been struggling for years, largely as a result of taking on too many loss-making bands, and Seagram - which also owns Universal Studios - hopes that a leaner operation with extraordinary economies of scale can produce a surge in corporate profits.

But for the producers and artists at the receiving end of such cold business logic, it feels as though the industry's soul has been savaged.

"I don't think their bottom line has much to do with music or artists. It's very black and white," said Herb Alpert, the jazz trumpeter who co- founded A&M back in 1962.

Already, he said, after the takeover by Polygram "it was hard to make a decision like we used to ... just from the gut, based on feeling, not whether an artist might be able to sell oodles of records".

"The Lonely Bull", by Alpert and the Tijuana Brass, provided A&M with its first hit, and gave it the confidence to sign up such names as Carole King, Burt Bacharach, Joe Cocker, Cat Stevens and the Carpenters. Later stars included Supertramp, the Police and Janet Jackson. A&M will not disappear altogether: its familiar trumpet symbol will continue to appear on records and discs, but as little more than a corporate logo under an entirely new management team.

Both A&M and Geffen will be absorbed by Interscope, a successful former indie operation in its own right, responsible for the rap stars Dr Dre and Tupac Shakur, among others. The net result will be similar to the new landscape in the film industry, where artistically vigorous independent production companies that once posed a real challenge to the big studios have been bought up and turned into so-called "mini-majors" - slicker, but generally blander subsidiaries of large corporate holdings.

"This isn't about Universal or Seagram," the outgoing head of A&M, Al Cafaro, said about his own firing. "The record business is changing fundamentally. Don't think that there are calm seas on the other side of this threshold ... It's a Wall Street world now. Get ready."

The record business now boils to down to five big conglomerates, and that could be reduced to four if rumours of a buyout of EMI Group by BMG are substantiated.

What industry professionals most fear is that what remaining diversity and originality there is in popular music will be snuffed out for the sake of making easy, unchallenging money-spinners: in other words, more Take That and Spice Girls clones. Serious artists have already found it difficult over the past decade or so to hold on to their integrity and resist the pressure to commercialise.

It has been a long process of rationalisation, dateable back perhaps to the worldwide record-buying recession of the late Seventies. For a while, the industry sought to buoy itself by introducing new formats, with varying degrees of success. Compact discs took off only slowly in the mid-Eighties. Minidisc was a conspicuous flop when introduced at the end of that decade.

In Britain, the independent rock sector is now struggling badly. Only long-established, relatively copper-bottomed indies such as Beggar's Banquet/4AD and the roots and reissue label Rykodisc have much of a profile these days. And though there remains a relatively healthy underground dance music industry, it is a sector that does not tender to the album- buying market and is therefore small beer in terms of turnover and sustainability.

Over recent years, the major labels have sought to bridge the gap between the indie ethos and the mass market by running pseudo-independent "boutique" labels, which appeal to specialist tastes and work both as an artists- and-repertoire engine for the big labels and as "cool" branding for otherwise uncool mega-corporations.

Meanwhile, the majors have been investing more and more in "new media", looking to exploit the potential of the Internet. They run Intranets to maximise their internal efficiency and Extranets to bring their products to market. This, say informed sources, is how major record companies see the future.

"The history of the record business is filled with stories of artists, from the Beatles to Garth Brooks to Alanis Morissette, who were turned down by label after label until they finally found someone who saw something unique and was willing to take a chance on signing them," lamented Robert Hilburn in the Los Angeles Times at the weekend. "Every time you close a label door, it reduces the odds for that special artist to find a champion."

IT'S ONLY ROCK AND ROLL - THE SEAGRAM MUSIC EMPIRE

A&M

ISLAND

MOTOWN

GEFFEN

MERCURY

FOUNDED

Founded in 1962 by producer Jerry Moss and jazz trumpeter Herb Alpert (left).

Founded in 1959 by white Jamaican Chris Blackwell as specialist ska label. Within a decade was world's largest independent record company.

Emerged from the Detroit jazz and blues scene when Berry Gordy set up a recording studio under his apartment in 1959.

Founded in 1980 by David Geffen, the millionaire behind Asylum Records and manager of Laura Nyro and Crosby, Stills & Nash.

Founded in 1947 in the United States, it is the oldest of the Seagram labels. Purchased in 1961 by Philips.

WHY IT WAS

GREAT

First hit, "The Lonely Bull", by Alpert and the Tijuana Brass, was impetus for signing artists like Joe Cocker, Carole King, and Burt Bacharach. Later came Supertramp, the Police and Janet Jackson. Flirtation with the Sex Pistols in Seventies.

After his first hit in 1964 with Millie's "My Boy Lollipop", Blackwell signed Traffic and Free in the Sixties, Bob Marley and Roxy Music in the Seventies, U2 in the Eighties, and the Cranberries and Pulp in the Nineties.

Changed the face of popular music with artists like Diana Ross and the Supremes, Stevie Wonder, Marvin Gaye and The Jackson Five. The Motown Sound was the definitive Sixties and Seventies "hit factory".

The most successful independent label, a bastion of American Adult Orientated Rock, its stars included Guns `N' Roses and Peter Gabriel. Also released John Lennon's last album, Double Fantasy.

Most of Rod Stewart's early solo albums and singles, including "Maggie May", were released on Mercury. More recently it became the home of Metallica, INXS, Page and Plant, Bon Jovi, Boyzone and Elvis Costello.

WHERE iT STANDS NOW

Retained its identity within PolyGram for 10 years until the recent Seagram takeover, when only the trumpet symbol survived a new management team and absorption by Interscope Records.

Sold to PolyGram in 1989. Blackwell remained as chairman until 1997 prior to Seagram takeover. Fantastic back catalogue, but current roster, apart from co-owners U2, is poor. Uncertain future.

Said to have lost its edge since it moved to Los Angeles in 1972, its future as a separate entity must be in doubt without new artists. Now largely a back catalogue "heritage" label.

Sold to PolyGram in 1990 and now likely to become, like A&M, little more than a logo. But a solid performer now that it has diversified from AOR to hipper-than-hip acts such as Nirvana and Beck.

Should survive as a separate label. Another good back catalogue, coupled with currently popular artists such as the resurgent James and Texas and hipper acts such as Roni Size & Reprazent.

Research: Jane Hughes and Nick Coleman