$5.95 (U.S.), $6.95 (CAN.), £4.95 (U.K.), Y2,500 (JAPAN) iW en w 1 z IITITTILTTLTLILTTITEEITTILTITJII I IItTTII 908 #BXNCCVR 3-DIGIT #90807GEE374EM002# BLBD 715 A06 MONTY GREENLY 3740 ELM AVE # A LONG BEACH CA 90807 -3402 THE INTERNATIONAL NEWSWEEKLY OF MUSIC, VIDEO, AND HOME ENTERTAINMENT JANUARY 8, 2000 GOOD WORKS IN MUSIC NEWS The Retailers Make Merry 1- Jailers, Mass Merchants, Others See Gains Latin Jazz BY DON JEFFREY ed mall chains Musicland Stores and and ED CHRISTMAN Trans World Entertainment would NEW YORK -E- commerce, the not disclose sales figures for the hol- recording mass merchants, and free -standing iday period, reports from other music stores were whistling a happy sources indicate that these retailers' tune after Christmas, while the mall same -store sales (from units open at that's chains had less to least a year) were be cheerful about. flat for the period, winning Exhibit Examines It was a mixed which began 3rd Single Shows holiday season for NATIONAL RECORD MART 111111ER Thanksgiving U.S. music retail- AECOAUS- VIIIEUCMS week. Guthrie legacy ers, according to I According to Lopez Has legs everyone's reports from SoundScan, album BY CHRIS MORRIS chains, independents, and label sales for the five -week period that BY LARRY FLICK LOS ANGELES -Woody sources. By all reports, E- merchants ended Dec. 26 totaled 140 million NEW YORK -In the six heart! Guthrie will come home to New enjoyed another season of astounding units, up 3.1% from the 135.8 million months since issuing her York on Feb. 5, when the Smith- growth but still are responsible for a moved during the same time frame Work /Epic debut, "On The 6," sonian Institution's "This Land small percentage of overall sales. last year. Jennifer Lopez has joined the Is Your Land," an exhibition Although the major publicly trad- (Continued on page 113) elite circle of actors to success- surveying the life and legacy of fully venture into the music the late folk music icon, opens arena. With the Jan. 25 release for an 11 -week run at the Muse- of the set's third single, "Feel - um of the City of New York. Web Cos. Positioned for Growth in' So Good," the label is prepar- (Continued on page 11 r) ing for another extensive leg of O'FARRILL IPU Frenzy -Ups; Majors Seen Tapping Mkt. In 2000 '99's lifted Start (Continued on page 108) BY BRIAN GARRITY stock sales. NEW YORK -For many companies Jordan Rohan, an Internet analyst Concert Industry on the frontier of music's fusion with with the online investment bank Wit Dual Singles technology, 1999 was the year that Capital, says this successful IPO Marks Big Year their efforts to mix the two worlds push by online media companies has Boost Latin Acts paid off-literally. given them vital financial resources This story was prepared by Ray In an unprecedented period of needed to expand and grow. BY JOHN LANNERT Waddell of Amusement Business. financing activity, music -related com- "While that is somewhat of an Latino stars are increasingly panies tapped the U.S. pub- obvious statement, it is scoring chart hits and plumping NASHVILLE -The North Ameri- lic equity and debt markets NE WS important," he says. "It's up their album sales and fan More on the can concert business has closed out for more than $1.5 billion in ANALLYSIS not just the major music bases by tapping into a rising 1999 with some big numbers behind new capital last year. companies that have trend: releasing multiple ver- next issue. it and plenty of positive indicators for Much of that money was used to resources these days." sions of singles targeted to indi- future growth ahead. support upstart music /technology/ As the industry began a major (Continued on page 107) January 15 (Continued on page 106) Internet hybrids looking to redefine transition to the online space last 2000 traditional notions of the industry. year, more than a half -dozen music - New online companies with music related companies operating on the IN THIS ISSUE businesses took advantage of a roar- Internet, or specializing in E -com- ing market for initial public offerings merce activities, assembled war Suits Over `N Sync Are Settled; (IPOs) and feverish investor demand chests of as much as hundreds of mil- Zomba, BMG Extend Distrib Pact http:// www. fantasyjazz.com THE UI i C REVOLUTION for Internet stocks by raising more lions of dollars each to compete in PAGE 6 than $1 billion in new funds via first- (Continued on page 108) JET STAR PROUDLY PRESENTS.. Reggae Hits Lee Perry Lost Treasures of the Ark Vol. 25 4 A great insight No $5.95 US $6.95 CANADA ordinarg reggae to this man 02> compilation! JET and his music! Jet Star Phonographics lost treasures o1 the ARK 155 Acton Lane, Park Royal, London NW10 7NJ England Tel: +44(0)20 8961 5818 Fax: +44(0)20 8965 7008 THE TIMES (UK) Email: salesr@jet- star.co.uk ('I) Box -Set of the Year 999!! o 74808 02552 7 www.americanradiohistory.com NET4MUSIC \ digitized sheet music ; midi files / information / education WHERE MUSICIANS www.americanradiohistory.com Billboard Editorial Editor in Chief: TIMOTHY WHITE EDITORIAL Managing Editor: SUSAN NUNZIATA Deputy Editor: Iry Lichtman News Editor: Marilyn A. Gillen Director of Special Issues: Gene Sculatti; Dalet Brady, Associate Director; Biz Poised For Renewed Price Wars? Kroll, Special Issues Coordinator Is Porter Hall, Assistant Editor; Katy Bureau Chiefs: Chet Flippo (Nashville), Bill Holland : Washirgton), John Lannert (Caribbean and Latin America), Melinda Newman (L.A.) about 6% profit, or $1.01. But these retailers have to dis- Art Director: Jeff Nisbet; Assistant: Raymond Carlson The issue of CD pricing has become contentious and cloudy once list price yields Copy Chief: Bruce Janicke again. The ongoing investigation of music industry pricing practices count it to remain competitive with the loss -leader merchants, which Copy Editors: Andrew Boorstyn, Marlaina Gray, Carl Rosen to squeeze Senior Editor: Ed Christman, Retail (N.Y.) by the Federal Trade Commission (FTC), combined with lowball Inter- means that they probably break even. They might be able Senior Writer: Chris Morris (L.A.) from the cooperative Talent Editor: Larry Flick (N.Y.) net pricing, raises the specter of renewed pressure on brick-and -mor- profit from other merchandise in the store and R &B Music: Gail Mitchell, Editor (L.A.) by the label. Country Music/Nashville: Deborah Evans Price, Associate Editor tar merchants' profitability and raises anew the question, What should advertising funds supplied Dance Music: Michael Paoletta, Editor (N.Y.) CDs be selling for? Why should consumers concern themselves with the costs involved Pro Audio/Technology: Paul Verna, Editor (N.Y.) how Merchants & Marketing: Don Jeffrey, Editor (N.Y.) Anyone in the recording industry is bound to eventually become in making CDs when the industry itself goes out of its way to show Digital Entertainment: Eileen Fitzpatrick, Editor (L.A.) pitch from a record club, Radio: Chuck Taylor, Editor (N.Y.) engaged in a discussion with a non -industry acquaintance about CD little it thinks a CD is worth? In a promotional Heatseekers Features/Music Video: Carla Hay, Editor (N.Y.) a penny. If a mass merchant or elec- Financial Reporter: Brian Garrity (N.Y.) prices. Invariably, the question arises: If CDs only cost 60 cents to make, a CD may be worth as little as Editorial Assistants: Rashaun Hall (N.Y.) tronics store is eager to get consumers in the door to buy computers Special Correspondent: Jim Bessman why do consumers have to pay $17? Contributors: Catherine Applefeld Olson, Bradley Bambarger, Fred Bronson, Indeed, if the cost of a CD were truly 60 cents, that would amount or tents, then a CD may be worth $10-$12. If a Webhead is surfing for Lisa Collins, Larry LeBlanc, Moira McCormick, David Nathan, Dylan Siegler, be $8 or $9. And if a Phyllis Stark, Steve Traiman to a grand case of price -gouging. the best deal in cyberspace, it might only worth International Editor in Chief: ADAM WHITE full- length CD than the label is trying to attract attention for a new release, it might even offer International Deputy Editor: Thom Duffy But there is far more to a $16.98 list-priced, International Editor: Torn Ferguson plastic it's cut on. For that album, the label charges the retailer about free downloads of one or two songs. German Bureau Chief: Wolfgang Spahr If they want Asia Bureau Chief: Steve McClure $10.75. After buy -in discounts and cooperative advertising funds total- No one can dictate to retailers what prices to charge. Contributing Editor: Paul Sexton Record ing, say, 8 %, that brings the label take down to about $9.90. to take a loss on the product, their own margins are at risk. CHARTS & RESEARCH have tried to instill discipline with minimum-advertised- Director of Charts: GEOFF MAYFIELD Then come the costs in selling the record. A distribution company has companies Chart Managers: Anthony Colombo (Mainstream Rock/New Age) Ricardo sales representatives developing programs with retailers to distinguish price (MAP) policies. These stratagems-by which distributors cut off Companioni (Dance, Latin), Datu Faison (Hot R &B Singles/Top R &B CDs at Albums/Rap/Gospel/Reggae), Steven Graybow (Adult Contemporary/Adult particular albums from the thousands in the bins. Distribution and sales cooperative advertising funds to any merchant that advertises Top 40 /Jazz/Blues), Wade Jessen (Country /Contemporary Christian), Mark lower the MAP credited by Marone (Modern Rock/Studio Action), Geoff Mayfield (Billboard 200/ cost major labels 13 % -15% of the wholesale price.