11.17.13 My Favorite Adam Moments of 2013 – so far!

I cannot answer why they would do this, but it is clear that there is a longer than normal release time involved here. My 3 ideas are:

1. They exercised option #3 and paid Adam part of his advance, so they wanted something for it. I just can't imagine that this could have happened and Adam got out of it.

2. Trespassing and FYE have more associated revenue trailing it than we know and RCA wanted time to maximize their earnings before Adam released another album. They agreed to a release agreement with Adam getting some compensation and RCA getting more time. This could be revenue from licensing, sales, advertising use, etc. I can see RCA wanting this, but not sure why Adam would have done it.

3. DMG orchestrated this so that Adam looks good and they had time to reposition Adam so he gave them a time window in exchange for controlling the message, a smooth transition and $1.

Note: we know that under the Idol contract RCA would have to have exercised their option within a year. And that is what has happened to all the Idols on the Season 5-9 contract: Cook album #2 June 28, 2011 drop announced May 10, 2012, Kris album #2 May 22, 2012 drop announced Sep 19, 2012. Archie album #3 October 5. 2010, drop discovered Feb 18, 2011.

All I know is that there is something else going on here.

And I will just put it in the same files as why wasn't Cuckoo released as a single in the US.

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Why did RCA drop Adam?

At the beginning of 2013, RCA axed every remaining high risk music project. Adam would be considered a risk because Trespassing did not have strong sales.

RCA operates within Sony and I used to do a lot of work with both Sony Entertainment and Sony Music Entertainment. I do not have any specific knowledge about what was going on with Adam but just with my experience with how executives function within Sony.

Music is only a small part of Sony's business (6.3% last year) and if they did not deliver a profit, Sony would have sold them off or axes all the major execs.

Sony lost money for 5 years in a row - through the end of their 2012 Fiscal Year (year ending March 2013). They had one single-minded corporate goal in Fiscal 2013 - be profitable. In April 2012, the put a new management team in place and began "optimizing resources and realigning our business portfolio" AKA cutting everything that was not profitable. For Fiscal 2013, they were able to significantly improve operating results and realized full-year profitability for the first time in five years.

From their 2013 annual report, "Market share and profitability in the recorded music business similarly benefited from our efforts to discover, nurture and develop new artistic talent such as One Direction, who achieved significant global success in fiscal year 2012."

Sony Music Entertainment Sales in fiscal 2013 were down slightly -- F2012 442.8 yen vs. F2013 441.7 yen. They missed their revenue and earnings goals. No risk was possible for F2014 and all risky projects at SME were scrapped.

In the latest quarter ending October 31, 2013, Sony Music Entertainment Sales increased 15.9% year-on-year (essentially flat on a constant currency basis) to 115.0 billion yen (1,173 million U.S. dollars) due to the favorable impact of the depreciation of the yen against the U.S. dollar. Sales were essentially flat on a constant currency basis due to a decrease in Visual Media and Platform sales resulting from a decrease in home entertainment revenues for animation products, offset by a year-on-year increase in sales of Recorded Music due to continuing growth in digital revenues and the success of a number of recent releases. Best-selling titles in the current quarter included Justin Timberlake’s The 20/20 Experience - 2 of 2, Kana Nishino’s
Love Collection ~pink~ and Love Collection ~mint~, ikimono-gakari’s I, and Miley Cyrus’ Bangerz.

Operating income increased 1.8 billion yen year-on-year to 9.7 billion yen (99 million U.S. dollars). This increase was primarily due to the favorable impact of the depreciation of the yen against the U.S. dollar and the above-mentioned increase in sales of Recorded Music.

In other words, without the weak dollar, SME is not delivering.

My understanding is that Kazuo Hirai, Sony President and CEO will evaluate SME without the benefit of the currency gains and that SME's management has very little time left to prove they can turn the US business around.

I also know that within the Sony corporate culture, if you pay money, you must extract something in return.

That last sentence in your analysis just sits there for me. Why on earth didn't they go balls to wall with promotion? Seems they could have been very successful with Trespassing had they really promoted it!!

Amazing...love American woman.. saw Lenny Kravitz perform it live at a  free  outdoor concert in Florida years ago .Who knew it was the statue of liberty..  WOW... Talk about connections,"six degrees of separation" Like the video.. Prince as your backup.. Dreams do come true

It is interesting to hear that you, Q3, also still have a few question marks left in trying to figure out how and why this whole RCA chapter went down the way it did.

I fully understand that RCA is right now run by their accountants. Is what will eventually doom them artistically and organizationally, imo, but that is a different discussion.

I also believe that Adam was close to break-even with Trespassing, but not quite there yet. Probably close enough, that over the years, Trespassing will eventually make them whole. The reality was though, that this information was available in the summer of 2012, a few months after the TSP album release. The initial sales had run its course and the album was selling in the hundreds rather than thousands from then on. They also knew their financial targets and everything they needed for an A3 decision well before this decision was ever due. So why the muddling and why seemingly the change of mind in early 2013?

Finally, the other open question I have, goes back even further. Why did they doomed the TSP album promotionally. The release strategy that RCA chose for both singles made absolutely no sense. The only date that was chosen wisely, was the album release date, but by then Adam was fighting against two singles that did not perform well. Adam was not given TV promotion, even though it was totally clear that this is what works best for him. He was sent instead on this waste of time of a radio promotion tour.

To me, what happened between Dec. 2011 and April 2011 was almost sabotage of his account and his brand. Now why would a company have interest in doing that to themselves? Drill holes into the boat they are sitting in?

a) Let's hide the first single release during the Xmas break, so nobody notices
b) Let's release a single that does not define the artist's sound
c) Let's delay the album, even though we have enough songs to release it ( this one ended up ok, because in March, Adam would have not gotten a # 1 album, because he was up against 1D and somebody else that week, he would have had a #3 only), but it brought NCOE with it, which imo was a wrong decision for both the album and even more so as a single.
d) Let's do this promotional tour, but clearly not financially support the single, making it almost a laughing stock for some PDs
e) Let's release as second single a song that the media and the fan base do not want and that again does not define Adam's sound
f) Let's not do any TV promotion, because that might actually be successful

Why did they do all that? And if they really gave up on Adam in late 2011, which is what it looked like to me, then why even monkey around with A3? Why not cut your losses right after TSP roll-out and move on within the next year, like they did for other artists?

There are a lot of things that don't add up here, and I think we will never know.

But as far as timing right now is concerned, I think that RCA just negotiated a window during which Adam could not come out with a competing album. Whether that is actually a smart move, can be debated, because new music would also propel the old albums forward. I think it has more to do with maintaining face. If Adam would leave RCA and right away be picked up by another major label, it would make them look bad.

So instead, the new storyline, that btw has already started to be spun in the media, is that Adam's career has all of a sudden picked up again because of iHeart and Glee. There always is a way to spin things.
In the end, I believe that the new RCA never got Adam artistically. Numbers wise things did not look all that promising and so there was no path forward for either of them.

Adam is better off without them, whether he gets that new major label deal or not.
RCA on the other hand has imo more challenges and less great ideas than I would wish on anybody.
I am looking forward to hearing what new plans Adam has for 2014. It all sounds very exciting.