Warner’s Middlebronfman: ‘We sell our songs through iPods, but we don’t have share of iPod revenue’

“Edgar Bronfman Jr.’s Warner Music Group, once derided as an awkward investment in a troubled industry, is starting to gather a little steam,” Sandy Brown reports for TheStreet.com. “Bronfman’s $2.6 billion buy of the Time Warner music division last year, along with a group of private-equity hard chargers, was written off as little more than a vanity play for a self-professed music fanatic cum media mogul. After all, the music industry has been hit by rampant piracy and declining retail sales, trends the industry has been unable to contain. But the tables may be turning. Described as a noncore asset at Time Warner, Warner Music now looks like a play on a management group that saw the time was right to get into an industry in transition.”

“Part of the reason for the uptick may be what Bronfman has said recently regarding file-sharing, industry pricing and pay-for-content as it is distributed on newer platforms,” Brown reports. “‘We are really the arms suppliers to a significant series of wars going on,’ Bronfman said at a recent conference. He noted what he called the device wars, ‘as Sony, Samsung and others come after Apple’s dominance in the device space,’ as well as content distribution wars among telcos, cable, broadcast and others. Plus, Bronfman said, there’s ‘opportunity for penetration on existing platforms like mobile, where, despite drastic changes we’ve seen in digital, we have yet to sell a single song.'”

Brown reports, “Bronfman would like to change the balance of what the music labels get paid for and what they give away. He says that 20 years ago the industry gave music to MTV and made that business successful, and that has more recently been the case where iPods are concerned. ‘We’re selling our songs through iPods, but we don’t have a share of iPods’ revenue,’ he said. ‘We have to keep thinking about how to monetize our content for our shareholders where we’ve been creating value for so many other streams.'”

“Though Bronfman and his group have seemingly put Warner Music on the right track, some investors still think Time Warner made the right choice in bidding adieu to the music business,” Brown reports. “The challenge for Bronfman is to prove those problems aren’t too big to overcome.”

Full article here.

MacDailyNews Take: Wethinks Middlebronfman has popped his cork. Now the greedy @#$%&! wants a share of the hardware revenue, too? Did the record labels get a cut of turntable sales for umpteen years? Did Sony pay Warner Music a percentage of each and every cassette Walkman they sold? For the love of Jobs!

From Middlebronfman’s iPod voice recorder: “Note to self: don’t forget to call the iPod case and accessory makers, we deserve a cut from them, too. And the headphone and speaker makers. Oh, and those guys that make the chips inside iPods, too. And copper smelters! And the plastics makers!! And the LCD screen makers!!! And, and, and… more later. Money, money, money! Ah-hahahahaha!!! (singing) money, money, money, money!

We hope that someday Steve Jobs is the one who eliminates the middlebronfman and allows the artists to go directly to their fans via iTunes; no more outdated ideas like making an album a year (you write a song, record it and release it via iTunes whenever the creative urge hits) and no more greedy, waste-of-space middlebronfman types always getting in the way with their stupid money-hungry ideas and disproportionately outsized takes.

[Note: MacDailyNews coined the term “Middlebronfman,” a combination of “middleman” and “Bronfman,” in an article on Monday, October 03, 2005 with the sentence, “Eliminate the middlebronfman.” Full article here.]

Related articles:
Apple’s iTunes Music Store dominates as digital music sales more than triple – October 03, 2005
Dvorak: record companies’ biggest concern about Apple’s iTunes is clear and accountable bookkeeping – September 29, 2005
In 99-cent fight with ‘Looney iTunes’ labels, Apple CEO Jobs will get whatever Jobs wants – September 29, 2005
Warner music exec discusses decapitation strategy for Apple iTunes Music Store – September 28, 2005
Warner CEO Bronfman: Apple iTunes Music Store’s 99-cent-per-song model unfair – September 23, 2005
Analyst: Apple has upper hand in iTunes Music Store licensing negotiations with music labels – September 23, 2005
Steve Jobs plays high-stakes poker with greedy record labels – September 22, 2005
Record labels accuse Apple CEO Jobs of ‘double standard’ as they seek to force iTunes price increase – September 21, 2005
Apple CEO Steve Jobs to repel ‘greedy’ record companies’ demands for higher iTunes prices – September 21, 2005
Apple CEO Steve Jobs vows to stand firm in face of ‘greedy’ record companies – September 20, 2005
NYT’s Pogue to record companies: it’d be idiotic to mess with Apple iTunes Music Store prices – August 31, 2005
Apple CEO Steve Jobs prepares for pivotal fight on digital music prices – August 28, 2005
BusinessWeek: Apple unlikely to launch music subscription service – August 15, 2005
Record labels to push Apple for higher iTunes Music Store prices in 2006? – August 05, 2005
Study shows Apple iTunes Music Store pay-per-download model preferred over subscription service – April 11, 2005
Record labels look to raise iTunes wholesale prices, music industry fears Apple’s market domination – March 05, 2005
Report: Apple CEO Steve Jobs ‘angered’ as music labels try to raise prices for downloads – February 28, 2005
Report: Music labels delay Euro iTunes Music Store fearing Apple domination – May 05, 2004
Greedy Big Five music labels looking to jack up iTunes songs to $2.49 each? – April 22, 2004


  1. Okay, here you are, some bigshot musician whose band’s contract is up for renewal. It’s time to shop around. Do you (a) go to Warner, so that some breathtakingly arrogant buffoon can gamble your future in a heads-Warner-wins-tails-you-both-lose gambit, or (b) sign with somebody else?

    Tough choice. Guess I’d go with Sony. Or Virgin. Or Apple.

  2. Methinks that they are looking at the model developed for the Music CD-R where the only difference from a regular CD-R was that part of the purchase price went to a general fund to distribute royalties. They made the assumption that it would be used to re-record commercial music. I doubt that anyone that really deserved the royalties actually received them.

  3. Does that mean that they should have been collecting revenue for every gramophone and record player ever manufactured?

    The platform war is nothing new in when it comes to devices that play music…. look at the shift from 78’s to 45’s and 33 1/3’s and the different companies… Columbia/CBS, RCA and others who offered competing “platforms.”

    What is new is the pushing of greed way beyond the reasonable limits of the past.

  4. Simple question…..
    What value does a music company add ?

    Now with modern technology and consumers on the internet, they are no longer needed for production, promotion or distribution.

    The music companies act like they create this content….they don’t. They buy it from artists for pennies on the dollar and then act as a broker to the buying public.

    Their business model is to screw the artists and the consumers to the max. Apple has to figure out a way to get more money to the artists and squeeze out the record companies.

  5. don’t you just love it when rich, bloodsucking, clueless wankers speak about their shareholders? does anyone really think that middlebronfman cares one whit about his shareholders? His Steveness will soon administer a nice spanking to this dork, then send him on his way.

  6. If I own a Grocery store, and you produce vegetables, Do I have to share my profits with you? I don’t think so!!!
    These music industry executives are the greediest ba$tards, almost like Billy Gates. Expenses of producing/selling a CD vs selling music through iTunes are not even cloes to being the same. They are getting most of the money that Apple makes per song, while doing absolutly nothing and still they want more.
    Is not like they really share what they make with the artists.

    We users/buyers should get organize somehow and let them know what we think of them and their ways.

  7. Boys and girls – Edgar ain´t asking for a share of iPod sales. He´s just making an analogy. Read it again slowly and closely.

    Only ones that are concerned about themselves here are the Music producers and Apple. There is no one speaking for the artists or the consumers.

    Wouldn´t it be nice to buy directly from the artists and then load it on our iPods? The artists get all the revenue for their creative work.

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