EMI to axe 2000 jobs

Music giant EMI is to axe up to 2,000 jobs as part of a drive to save £200 million a year, its new private equity owner said today.

The cuts, which could affect up to a third of its workforce, will be focused on the group's recorded music division.

Terra Firma, which bought the group for £3.2 billion last year, said the cuts were needed because EMI had been "struggling to respond to the challenges posed by a digital environment".

EMI - whose artists include Coldplay, Robbie Williams and Joss Stone - has been struggling with falling CD sales across the industry due to the rise of digital downloading and piracy. The company made pre-tax losses of £263.6 million last year.

The group said the restructuring included measures to eliminate "significant" duplication within the group, focus the group's 40 labels on talent spotting, and maximise existing artist potential. It will also look to help artists open up new income streams such as corporate sponsorship.

EMI said the changes, which will be brought in during the next six months, followed consultation with staff, artists and their managers.

The company said: "The restructuring will also enable the group to capture significant efficiencies and cost reductions which are expect to reduce costs by up to £200 million per year.

"The restructuring is also expected to lead to a worldwide headcount reduction within the group of between 1,500 and 2,000."

Financier Guy Hands, Terra Firma's chief executive and EMI group chairman, has already signalled that around 400 middle managers faced the axe, as well as hundreds of other marketing and administration staff.

He said today: "We have spent a long time looking intensely at EMI and the problems faced by its recorded music division which, like the rest of the music industry, has been struggling to respond to the challenges posed by a digital environment.

"We believe we have devised a new revolutionary structure for the group that will improve every area of the business.

"In short, it will make EMI's music more valuable for the company and its artists alike. The changes we are announcing today will ensure that this iconic company will be creating wonderful music in a way that is profitable and sustainable."

The plans to cut costs across the business have angered many of the group's artists, who have gone public with their complaints.

Radiohead have quit the label and existing artists such as Robbie Williams are understood to have threatened to withhold new records and demanded assurances over marketing and distribution.

Williams' manager Tim Clark has described Mr Hands as a "plantation owner" after he called on artists to work harder, while Chris Martin-led Coldplay are also reported to be reviewing their options.

Around 100 staff braved heavy rain and strong winds to attend a meeting with Mr Hands and other executives at the Odeon cinema in Kensington, west London.

While most remained tight-lipped about the company's future, one employee, who did not wish to be named, said: "This is exactly what needs to happen to the company."

Mr Hands was mobbed by reporters and cameramen as he arrived shortly before the 10am meeting, but made no comment as he was ushered into the building by security staff.

Coldplay, who are one of EMI's biggest recent success stories with more than 30 million album sales, have been an active supporter of various social and political causes including Oxfam's Make Trade Fair campaign and Amnesty International.

The band's manager Dave Holmes told the Financial Times he was keeping an open mind before hearing the full plans about EMI's restructuring.

But he added that he would "definitely not" advise one of the new artists he represents to sign to the label because it was going through "too much change".

A spokesman for EMI said around a third of the proposed job cuts would fall in the UK, with posts being axed "over the next few months".

The group's total worldwide headcount is around 5,500.

Mr Hands has set up a board at EMI that includes former BAA chief Mike Clasper, former BBC director general John Birt and former Northern Foods chief executive Pat O'Driscoll.

Ms O'Driscoll, who has been brought in by Mr Hands to identify what talent the new slimmed down EMI needs, told the Financial Times she wanted to see the changes in place by the end of June.

"The faster you get through the process of change, the better," she said.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
News
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Ashdown Group: Marketing Services Manager - (communications, testing, DM)

£32000 - £35000 per annum + benefits: Ashdown Group: Marketing Services Manage...

Guru Careers: Finance Account Manager

£Neg. (DOE) + Excellent Benefits: Guru Careers: A Finance Account Manager with...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Direct Marketing Manager - B2C, Financial Services - Slough

£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...

Day In a Page

Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas
La Famille Bélier is being touted as this year's Amelie - so why are many in the deaf community outraged by it?

Deaf community outraged by La Famille Bélier

The new film tells the story of a deaf-mute farming family and is being touted as this year's Amelie
10 best high-end laptops

10 best high-end laptops

From lightweight and zippy devices to gaming beasts, we test the latest in top-spec portable computers
Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

The batsman has grown disillusioned after England’s Ashes debacle and allegations linking him to the Pietersen affair
Susie Wolff: A driving force in battle for equality behind the wheel

Susie Wolff: A driving force in battle for equality behind the wheel

The Williams driver has had plenty of doubters, but hopes she will be judged by her ability in the cockpit
Adam Gemili interview: 'No abs Adam' plans to muscle in on Usain Bolt's turf

'No abs Adam' plans to muscle in on Usain Bolt's turf

After a year touched by tragedy, Adam Gemili wants to become the sixth Briton to run a sub-10sec 100m
Calls for a military mental health 'quality mark'

Homeless Veterans campaign

Expert calls for military mental health 'quality mark'
Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

Meet Racton Man

Analysis shows famous skeleton was a 6ft Bronze Age superman
Garden Bridge: St Paul’s adds to £175m project’s troubled waters

Garden Bridge

St Paul’s adds to £175m project’s troubled waters
Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

Stuff your own Christmas mouse ornament

An evening class in taxidermy with a festive feel
Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

Joint Enterprise

The legal doctrine which critics say has caused hundreds of miscarriages of justice
Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

Freud and Eros

Love, Lust and Longing at the Freud Museum