Impact Of Warner Bros. Records Executive Layoffs Uncertain

Restructuring said to be a cost-cutting measure; band managers wait to see if top-level losses will affect artists.

The layoffs that hit Warner Bros. Records on Friday,

eliminating 44 jobs, took

a particularly heavy toll on the label's senior ranks, but it's

unclear just how the cutbacks will affect artists currently

recording for the label.

Among the longtime staffers let go in the latest round of

staff cuts at the label were an executive vice president and

senior vice president of A&R (artists and repertoire), a senior

vice president of finance and a vice president of legal and

business affairs, according to the label's publicity chief, Bob Merlis.

Many of the executive officers cut from the ranks as a cost-cutting

measure had been with the company 20 years or more. However,

one senior vice president of marketing who was let go had been

with the company for just a year, Merlis said.

Scott Booker, who manages the Warner Bros. Records act the

Flaming Lips, said his bandmembers knew the long-rumored layoffs

were coming and were waiting to turn in their next record until

the news was official.

"While this round doesn't really affect the overall thing

going on with the Lips," Booker said, "we have been waiting to

put out our next record until the situation [at Warner Bros.

Records] mellows out again. There's been so much upheaval in the

past year or so, I can't see how they could do much more."

The heavy round of cuts -- combined with an even larger set

of firings at the label in March, during which more than 60

staffers were let go -- has trimmed the ranks of the now 400-person

Warner Bros. Records staff by more than 15 percent, according to

Merlis.

"This was a restructuring that was based on a decision made by

[Warner Bros. Records Chairman and CEO] Russ Thyret in order to

bring overhead in line with profits," Merlis said.

Thyret explained in a prepared statement that while these types of

layoffs are never easy, Friday's cuts were especially difficult.

"Some of those who are leaving have been with us for considerable

lengths of service and all have made many important contributions

to the success of our company over the years," Thyret said.

The CEO added that as painful as the cuts were, they were

necessary to allow the label to continue to be competitive.

The cuts came mainly in the company's Burbank, Calif., headquarters,

but were felt in their New York and Nashville, Tenn., offices as well,

according to Merlis, who declined to specify what additional

positions were cut. The layoffs also involved the elimination of an

unspecified number of vacant positions.

Among those let go on Friday were Executive Vice President of

A&R Ted Templeman, a 30-year veteran who was credited with bringing

pop-metal act Van Halen to the label, as well as performing

production work with '70s groove-rockers the Doobie Brothers and, more recently, retro-swingers the Royal Crown Revue.

Also dismissed was Senior Vice President of A&R Karin Berg, who had been with the company for more than 15 years and worked with such bands as British guitar-pop act Dire Straits and Athens, Ga., superstars R.E.M., according to Merlis. Thyret did not address in a Monday afternoon meeting why the cuts had such a strong impact on the executive ranks of the company, Merlis said.

"I don't know what it means for the label; only time will tell," R.E.M. manager Bertis Downs said. "There are some good reasons, I'm sure, but in any large corporation there will be changes from time to time. We worked very closely with Karin and [dismissed Senior Vice President of Marketing] John Leshay, and we can only hope that the people there will work hard on this [R.E.M.'s Up] and future records and we have faith that they will."

While saying he didn't want to minimize the large losses to the label, Downs said he was unsure how the cutbacks would affect R.E.M.

More damaging, the Flaming Lips' Booker said, were the firings in March -- which included the entire alternative-rock marketing department -- which had worked closely in breaking that quirky, Oklahoma-based psychedelic-rock band. Booker said his band would particularly miss longtime Vice President of Legal and Business affairs Fred Brown, who was released Friday. Brown had been involved with the group since the day they signed with the label in 1990, Booker said.

"The new record is close to being done," he said, "so it's not so much that we've been waiting as much as we haven't hurried to finish it, because we figured there's no reason to put it out when things are so chaotic over there. It was a good excuse to spend a year making a record."

Among the other confirmed layoffs was Ken Lemunyon, a senior vice president of finance. Additional positions were cut in the business affairs, accounting, marketing and scheduling departments.

The day of the official announcement of the cuts, hundreds of Warner Bros. Records staff were forced from their Burbank, Calif., offices for two hours when a bomb threat was called into the building at about 11 a.m. It was not the first bomb threat at the Warner Bros. offices; a similar threat was called in during the 1992 uproar over gangsta-rapper Ice-T's controversial song "Cop Killer," from T's hardcore Body Count group.

Warner Bros. Records has had difficulty breaking new artists in recent years. Although senior A&R positions were eliminated there, two new A&R staffers were brought on this year at the company's affiliated Reprise label.

Earlier in 1998, David Kahne, who has produced albums by platinum-selling ska-rockers Sugar Ray and defunct ska-punk trio Sublime, was brought on board. More recently, rapper KRS-One was hired to attract fresh hip-hop talent.