The company will let go of approximately 60 staffers in North American territories. Says a statement released to THR: "The current economic climate dictates that we continue to look for more efficient ways to run our business."
Universal Music Group is expected to undergo another round of layoffs today (Jan. 21). The company which counts powerhouse label Interscope Geffen A&M (home to U2, Eminem and Lady Gaga), the legendary R&B shop Universal Motown, Island Def Jam (Kanye West, Bon Jovi and Justin Bieber), and Universal Republic (Florence + The Machine, Colbie Callait), among other subsidiaries, will let go of approximately 60 employees, all from North American territories, sources tell THR.
While UMG was ranked No. 1 in market share for 2010
(with over 30% of U.S. music sales), the company cites the ongoing recession as one of the main reasons for the cost cutting, which is expected to impact departments such as finance, IT and administrative services across most UMG label properties. It marks one of the first moves by newly installed UMG CEO Lucian Grainge
, whose official start date was Jan. 1.
A statement released by UMG to THR states: "As any well run company, the current economic climate dictates that we continue to look for more efficient ways to run our business. So we are taking steps to reduce costs while increasing our creative investment in a number of key areas and new businesses. While we regret the impact these cost savings have on those affected, we believe acting now will enable us to be even better positioned in taking smart creative risks, leading the industry in the growing mobile and online businesses, and delivering compelling quality, music-based entertainment to consumers globally."
This year marks the third January in a row that UMG has initiated significant cutbacks, albeit not as dramatic as some of the industry chatter on the blogosphere
has predicted. “There are no plans for merging of labels or anything like that,” says a UMG insider, who notes that the company is actually planning to enhance its creative investment and A&R, though not necessarily by way of head count.