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KKR sings a new tune

Tom Taulli — Wed, 08 Jul 2009 14:10:00 EST

Filed under: Competitive Strategy, Private Equity

Even though the internet continues to erode the music business, there is still investor interest in the sector. Just look at private equity powerhouse KKR. The firm has agreed to form a joint venture with Bertelsmann that will focus on music rights management (KKR will get 51% of the entity).

Actually, even though Bertelsmann has been shedding its music business over the past few years, there are still remaining assets. So, why not lower the risk of these assets by bringing in a financial partner?

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KKR sings a new tune originally appeared on BloggingStocks on Wed, 08 Jul 2009 14:10:00 EST. Please see our terms for use of feeds.

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Oasis completely dismisses ever 'pulling a Radiohead'

Richard Driver — Mon, 07 Jul 2008 18:31:00 EST

Filed under: Products and Services, Consumer Experience, Marketing and Advertising, Sony Corp ADR (SNE)

Radiohead's 2007 album In Rainbows has enjoyed critical and commercial success since it was released last October through a unique "pay-what-you-want" scheme directly from the band and its management team. Likewise, many fellow artists have come out in favor of the scheme or against the method used by the English band. Fellow English band Oasis, however, has completely dismissed any notion that the band will ever duplicate that method, citing expenses incurred during the recording of new album Dig Out Your Soul over the course of the past year.

A new report by Gigwise reveals the band's position and reasons for it, with Oasis calling the Radiohead method nothing more than a marketing tool. Noel Gallagher, Oasis' lead songwriter and guitarist, did call Radiohead "rebels and outsiders" when commending Radiohead's method as a unique marketing tool.

Oasis signed a new deal with Sony BMG Music Entertainment, a joint venture between Sony Corporation (NYSE: SNE) and Germany's Bertelsmann Music Group, last month that will see the band's own label, Big Brother Recordings, release the new album while Sony BMG oversees the band's back catalog and previous releases. The deal is a more traditional arrangement in today's market and environment that makes the new comments against Radiohead unsurprising.

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Oasis completely dismisses ever 'pulling a Radiohead' originally appeared on BloggingStocks on Mon, 07 Jul 2008 18:31:00 EST. Please see our terms for use of feeds.

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Bertelsmann values its half of Sony BMG at $1.5 billion

Richard Driver — Thu, 12 Jun 2008 13:08:00 EST

Filed under: Rumors, Management, Sony Corp ADR (SNE)

Germany-based Bertelsmann has valued its half of Sony BMG Music Entertainment between $1.2 and $1.5 billion, according to a report by Billboard published Thursday. The company reportedly wants to pull out of the joint venture with Sony Corporation (NYSE: SNE), and the noted price would lower if Sony offered to buy some services from Bertelsmann. Apparently the separation was expected to take place this summer, but neither party has reached a satisfactory agreement on the price of the aforementioned half.

The venture between Sony and Bertelsmann started in 2004 and is set to expire in August 2009, but rumors have emerged from within Bertelsmann that a new deal will take place before the expiration date, according to Billboard. Despite these rumors, Bertelsmann CEO Hartmut Ostrowski revealed in January that there were three options at that time: Bertelsmann would take over 100% ownership, sell the company's 50% to Sony, or continue the venture. More frightening is the note by Billboard that Bertelsmann's CFO Thomas Rabe has "reportedly met with at least two private equity companies to discuss the possible sale of its share" in the months since Ostrowski revealed the options.

Sale to a private equity firm would mirror a similar sale that occurred last year with British-based EMI Group. The label responsible for groups like The Beatles and Coldplay sold out to private equity firm Terra Firma, which resulted in mass layoffs and a new management plan that has not benefited the label or its artists. Billboard also notes that industry sources expect much of the European management and control for Sony BMG to shift to the U.S. anyway. If that is the case, it would leave two of the four major record labels based in the United States. The other label is Warner Music Group (NYSE: WMG).

Bertelsmann values its half of Sony BMG at $1.5 billion originally appeared on BloggingStocks on Thu, 12 Jun 2008 13:08:00 EST. Please see our terms for use of feeds.

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Sony BMG posts loss despite larger profits

Richard Driver — Thu, 25 Oct 2007 17:30:00 EST

Filed under: Apple Inc (AAPL), Sony Corp ADR (SNE), Media World

Sony BMG (a merger between Sony Corporation (NYSE: SNE) and Germany's Bertelsmann) posted a $8 million loss in sales during the company's fiscal second quarter, which ended on September 30, in a report by Billboard today. Sales in the second quarter totaled $851 million, which was down from $948 million during the same period of 2006. Nonetheless, Billboard notes that the $8 million loss is lower than that year's $39 million drop.

Sony BMG attributes the drop "to the declining of the physical music market and to fewer major artist release in this year as compared to last year." The $8 million drop is also compared with the 2005 second quarter results, which were $60 million lost and revenues of $936 million. Clearly some gain has been made in lowering the drop, but in comparison to the large revenue gap between 2006 and 2007, the loss seems pale.

In the record industry, Sony BMG has traditionally ranked second to Universal Music Group, amounting to about 25-30% of the market. The company has also reportedly signed on with Universal to create the new Total Music, which hopes to compete with Apple Inc. (NASDAQ: AAPL)'s iTunes Store, but as a subscription-based service. Unfortunately, Universal Music's second quarter earnings have not been announced, so any correlation between the two largest music companies and the decision to create Total Music cannot fully be assessed.

Visit AOL Money & Finance for more earnings coverage

Sony BMG posts loss despite larger profits originally appeared on BloggingStocks on Thu, 25 Oct 2007 17:30:00 EST. Please see our terms for use of feeds.

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New Bill Clinton book scheduled for September release

Beth Gaston Moon — Tue, 10 Jul 2007 16:29:00 EST

Filed under: Newspapers, Politics

Former President (and potential First Man) Bill Clinton is taking another stab at authorship. Possibly following the humanitarian lead of his former right-hand man, Al Gore, the former commander in chief is publishing a book on citizen activism, titled Giving: How Each of Us Can Change the World.

The book will be released on September 4, according to Knopf Publish Group (a division of Random House ... which is a unit of the privately held Bertelsmann AG). The initial print run will total 750,000 copies.

In an accompanying quote, the sax-wielding democrat noted that his observations of workers' devotion to various charitable organizations around the world have proven to him that "almost everyone -- regardless of income, available time, age and skills -- can do something useful for others and, in the process, strengthen the fabric of our shared humanity."

Clinton already has a good track record in the nation's bookstores. His 2004 memoir, My Life, was a leading seller for Knopf; the 957-page book sold more than 2 million copies in the U.S. alone and was printed in more than 30 countries. According to The Washington Post, it managed a fist-day nonfiction sales record of 400,000 copies.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

New Bill Clinton book scheduled for September release originally appeared on BloggingStocks on Tue, 10 Jul 2007 16:29:00 EST. Please see our terms for use of feeds.

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Random House offers refund for "A Million Little Pieces"

Beth Gaston Moon — Fri, 18 May 2007 11:45:00 EST

Filed under: Scandals, Books

Random House, a division of the privately held media conglomerate Bertelsmann AG, is offering compensation to any reader claiming to be "duped" by James Frey's memoir, A Million Little Pieces.

Frey's story was a scandal that broke in January of last year. The author's ostensibly non-fiction book described, in excruciating detail, his miserable existence within an alcohol and drug-addled haze. Toe-curling details include a three-month stint in jail, an anesthesia-free trip to the dentist, and time in rehab.

Published in April 2003, the book hit the best-seller list more than two years later, after Oprah Winfrey named it her September 2005 book club selection. But Frey's ride of success wasn't long; in January 2006, it was revealed that the "memoir" contained outright fabrications. (Essentially, Frey is the Milli Vanilli of modern American literature). Readers who bought A Million Little Pieces before January 26, 2006 (around the time Frey confessed that his penned story wasn't entirely true) are now entitled to a refund from the publisher.

Those who bought the hardcover copy will receive as much as $23.95; ones who bought the book in paperback will get a maximum refund of $14.95. The entire program is expected to cost Random House $2.35 million. The publisher's decision, approved by a Manhattan Federal Judge, is expected to resolve several lawsuits already filed across the country by disgruntled readers.

While Frey's fabrications are certainly reprehensible, the fact remains that A Million Little Pieces reportedly helped countless readers who were struggling with their own addictions. I can't help but wonder how Frey's real story might have gone if he'd pitched his book as one "inspired by true events" rather than a completely factual "memoir."

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

Random House offers refund for "A Million Little Pieces" originally appeared on BloggingStocks on Fri, 18 May 2007 11:45:00 EST. Please see our terms for use of feeds.

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Newspaper wrap-up 4-10-07: Time Warner sells Bookspan to Bertelsmann

Eric Buscemi — Tue, 10 Apr 2007 09:18:00 EST

Filed under: Newspapers, Magazines, Internet, Time Warner (TWX), Berkshire Hathaway (BRK.A), Citigroup Inc. (C), Bristol-Myers Squibb (BMY), Dow Jones and Co (DJ)

MAJOR PAPERS:

The Wall Street Journal reported that Time Warner Inc's (NYSE: TWX) Time Inc. has sold its interest in Bookspan, a book club, to Bertelsmann for about $150M.
According to the Financial Times, citing sources, Imperial Tobacco Group plc (NYSE: ITY) raised its bid for French and Spanish tobacco company Altadis SA to EUR47 per share from a previous bid of EUR45 per share. Bloomberg reported that Altadis rejected the sweetened takeover bid.

OTHER PAPERS:

The Telegraph reported that Dow Jones and Company Inc (NYSE: DJ), the publisher of the Wall Street Journal, is understood to be in advanced talks to buy the London-based Financial News newspaper for about GBP27M, with a deal possibly being announced within days.
Sanofi-Aventis ADS (NYSE: SNY) and Bristol-Myers Squibb Company (NYSE: BMY) have put there merger negotiations on hold due to a number of obstacles that are stalling the process, the French newspaper Les Echos reported.
Cablevision Systems Corporation (NYSE: CVC) said it will appeal a court ruling over its digital video recording service, the New York Times reported, citing the Associated Press.
The New York Times also reported that Citigroup Inc (NYSE: C) may cut nearly 8% of its work force or around 26,000 jobs.

WEBSITES:

Barron's Online's "Inside Scoop" column reported that Warren Buffett has disclosed that his investment company, Berkshire Hathaway (NYSE: BRK.A), now owns a 10.9% stake Burlington Northern Santa Fe Corporation (NYSE: BNI), according to SEC filings.

Newspaper wrap-up 4-10-07: Time Warner sells Bookspan to Bertelsmann originally appeared on BloggingStocks on Tue, 10 Apr 2007 09:18:00 EST. Please see our terms for use of feeds.

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Time sells out of book clubs

Jon Ogg — Tue, 10 Apr 2007 08:32:00 EST

Filed under: Deals, Time Warner (TWX)

Bertelsmann AG, via its DirectGroup, is buying the other 50% stake of Time Warner's (NYSE: TWX) Bookspan. Bookspan owns roughly 40 book clubs, including the "Book of the Month Club." Financial terms were not disclosed.

Time Warner and Bertelsmann formed the partnership in 2000. This also includes the Doubleday Book Club and Literary Guild. Bertelsmann will reel in Bookspan into its BMG Columbia House.

BMG will now be the clear leader, with no real competitors in book, music and DVD mail order clubs in North America. This is all part of Time Warner's strategic changes after it closed Life and sold off 18 magazines earlier. It appears that even if an industry is shrinking, there at least may be some perceived value in being a virtual sole-supplier.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.

Time sells out of book clubs originally appeared on BloggingStocks on Tue, 10 Apr 2007 08:32:00 EST. Please see our terms for use of feeds.

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