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SONYBMG TO DISMANTLE

 

SonyBMG is set to announce a dismantling of its Sony Urban Music division that will hand pink slips to a large number of employees just in time for the holidays.

 

According to several sources both inside and outside the company, the dissolution of Sony Urban, which was created under the former regime of Don Ienner and Michelle Anthony, is imminent, with an official announcement coming by Dec. 1.

 

Sources said employees' have been unnerved while they wait for the layoff ax to fall ever since Rob Stringer, brother of Sony Corp. boss Howard Stringer, took over for Ienner in September. Late last week the label essentially wiped out its classical music arm, tossing out all but two executives.

 

The next round of cuts will result in what one source described as "wide-ranging and substantial layoffs," with back-office departments such as business affairs and legal affected the most.

 

Fortunately, not all of Sony Urban's roughly 70 employees will be laid off, however; some are slated to be reassigned to other units within the label, the second-largest behind Universal Music Group.

 

Sources appeared divided on what the folding of Sony Urban means for division president Lisa Ellis, who was installed a year ago. While some believe Ellis' close relationship with Ienner and Anthony could hurt her, others believe she is well-regarded with a promotional acumen that's a highly prized asset for a label whose year-to-date market share in the rap genre is a paltry 13 percent.

 

Universal and Warner Music, by comparison, hold a 41 percent and 22 percent share, respectively.

 

"[Ellis] is the one to watch in all of this," said one former insider. "She's considered a rising star over there and was very hands on developing [R&B singer] John Legend. I'd be surprised if she wasn't reassigned."

 

Artists residing at the division - including Legend, Beyoncé and Oscar winners Three 6 Mafia - will be reassigned to Epic and Columbia, SonyBMG's two main labels.

 

In fact, sources said one reason for dissolving Sony Urban is because the creation of the unit, which sits outside the Epic and Columbia labels, has had the unintended consequence of isolating artists, rather than freeing them up.



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