Warner Music to Lay Off 270 Staffers, Making Hard Choices in Order to Evolve

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UPDATED: Warner Music Group will eliminate 270 positions as part of a wider evolution of the company, new CEO Robert Kyncl announced to the company’s staff in an email obtained by Variety. The memo says that in order “to take advantage of the opportunities ahead of us, we need to make some hard choices in order to evolve.”

Kyncl stresses in the memo that the move is “not a blanket cost-cutting exercise” but rather a reorganization to adapt to a rapidly changing business climate. “Every decision has been made thoughtfully by our operators around the world, who considered the specific needs, skills, and priorities of each label, division, and territory, in order to set us up for long-term success,” he wrote.

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Warner — which went public in 2020, nine years after being acquired by Len Blavatnik’s Access Industries — is the world’s third-largest music company and includes the labels Atlantic, Warner, 300-Elektra, Parlophone, the catalog division Rhino and others, as well as Warner Chappell Music publishing.

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It was not immediately clear which positions or divisions will be affected, but Kyncl says it comprises around 4% of the company’s global staff. Later on Wednesday, Warner Music U.K. announced that Isabel Garvey – most recently managing director of Abbey Road Studios – will take up the newly created post of the division’s chief operating officer, reporting to CEO Tony Harlow; it also announced that Jennifer Ivory, currently senior VP of Warner Records U.K., will take over as Parlophone’s managing director, with co-presidents Nick Burgess, Mark ‘Mitch’ Mitchell, and general manager Jack Melhuish exiting.

Kyncl was announced as the new CEO last September and in February took over for Steve Cooper, who left the company after 11 years. Kyncl for years had bridged the tech and entertainment worlds in major roles at Netflix — including overseeing the company’s shift to streaming — and YouTube, in which he was pivotal in repairing the streaming giant’s formerly contentious relationships with music companies. His unexpected move into the top position at Warner ushers in a new type of tech-forward leadership at major labels.

While Kyncl has spoken broadly of the industry’s and the company’s needs to evolve in an ever-changing environment — the financial boom the music business has seen from streaming is leveling off, whether executives admit it or not — he has demurred from specifics, saying he needs to study the situation more thoroughly before making moves. It would appear that Wednesday’s announcement is one of the first such moves.

Kyncl’s memo follows below in full:

Hi everyone,  

As I mentioned at our first All-Hands meeting last month, I’m committed to direct and honest communication with all of you. The music business is filled with new possibilities: more fans are engaging with artists and songs than ever, our reach is enormous, and new business models are constantly emerging. WMG is positioning itself for this new phase of growth at the intersection of creativity and technology.   

In my discussions with our leaders across the company, many of them came to the same conclusion – that to take advantage of the opportunities ahead of us, we need to make some hard choices in order to evolve. Consistent with this direction, we’ve made the tough decision to reduce our global team by approximately 270 people, or about 4%. At the same time, we’re reallocating resources towards new skills for artist and songwriter development and new tech initiatives. We’re also reducing discretionary spending and open positions to provide us with additional flexibility for our future. 

  

I want to be clear that this is not a blanket cost-cutting exercise. Every decision has been made thoughtfully by our operators around the world, who considered the specific needs, skills, and priorities of each label, division, and territory, in order to set us up for long-term success. The leader of your division will either be holding a town hall or sending an email to explain more about this path forward.   

I’m also acutely aware of how unsettling this can be. Having to say goodbye to talented colleagues is always difficult. For those of you who will be leaving WMG, please know that we’re deeply grateful for your hard work, dedication, and all you’ve contributed to this company. In all territories, except where you are explicitly told there will be a review or consultation period, anyone affected will hear from your leaders, supervisors, or People team reps within 24 hours. I know this transition will be tough, but we’re committed to supporting you during this process.  

In times of great disruption in our world and society, artists and songwriters who have something original to say, who rise to the occasion, will resonate the loudest. Equally, the rapid changes in our economy and ecosystem create the conditions and opportunities for innovation and breakthroughs. I learned when I joined WMG that this is a gritty, incredibly resourceful, and highly impactful team that I want by my side every day of the week. We deliver for our artists, songwriters, and labels with laser focus, inventiveness, and care. And now, more than ever, we need to double down on that.   

I’ll have more to say about all of this at our next All-Hands meeting, including more details on our plan.   

Let’s support each other with empathy and integrity as we work through this process.   

 Thank you,  

  Robert

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