2005-05-04 ::
Linkin Park Looking To Break From Contract
 
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Last Monday, rap/metal hybrid group Linkin Park demanded that they be released from their current recording contract with Warner Music Group, claiming that the label hasn’t been marketing their music effectively.

The early release request comes before the band’s remaining four album commitment has ended and just before Warner’s initial public offering.
A statement issued by the band said that they want off the label and that they are "weighing all of their options on how to best get new music to their fans."

Reuters has cited a source as saying that the public cry against their label was a ploy developed by the band’s management team, The Firm, to renegotiate their contract. Reuters also reported the source as saying the band was looking for a $60 million advance before the IPO and 50% of the profits.

The Firm told Reuters that the $60 million figure was inaccurate and that Warner had offered a $15 million advance for five records without any marketing or promotional guarantees. No other details were given on the deal.

"While Linkin Park's talent is without question, the band's management is using fictitious numbers and making baseless charges and inflammatory threats in what is clearly a negotiating tactic," a statement issued by Warner said.

The tactic is well timed. Warner Music Group has filed for an initial public offering that could raise as much as $782 million, but according to the band, only $7 million of proceeds from the IPO would be funneled back to the label.

Warner Music is currently the world’s fourth biggest music company. It was purchased last year by Edgar Bronfman Jr. and a group of private equity firms from Time Warner Inc. Among the private equity firms is Thomas H. Lee, which will profit from Warner’s IPO, and is also an investor in The Firm.

According to the band, sales of their records have made up about 10% of Warner’s total sales over the past five years. They feel that if Warner were to lose the band, it could seriously hurt the company. According to Warner, the band only comprised about three percent of sales over the past five years.

Warner said last month it planned to sell 32.6 million shares to the public at an estimated price of $22 to $24 per share.

Our Thoughts

We love Linkin Park and are sure their records sell themselves without the need for promotion. The announcement the band issued Monday reeks of corruption.