Stay Tuned By Stan Cornyn: Jack and Jim Go Down The Hill

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Thursday, February 7, 2013
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Stay Tuned By Stan Cornyn: Jack and Jim Go Down The Hill

Every Tuesday and Thursday, former Warner Bros. Records executive and industry insider Stan Cornyn ruminates on the past, present, and future of the music business.

1959

Even with Tab and Kookie’s sales, the non-TV-from-Warner stream of albums had sold few. Jack Warner clearly saw that “his” new label was deep in the hole, deeper than his original criterion allowed (“the cost of one movie”). Warner’s co-leaders within the studio, notably the feisty-tough Benny Kalmenson (pictures distribution) and Herman Starr (music publishing), had growled at the new label’s costs, lack of revenues, and utter hopelessness.

Warner heard. After 365 days in the market, Billboard ran a special chart: “How many of a label’s releases do stores actually stock?” Biggies like Columbia and Capitol (both of which Conkling had earlier managed) got “90 percent.” Teenie labels like MGM and Dot got “30 percent.”

Warner Bros. was listed at 5-to-9 percent. Which meant that, of those 150 Vitaphonic! Albums that WBR had so far released, maybe 7.5 of them were stocked in any record store. And 142.5 of them were not.

Warner Bros. Records’ distributors, mostly independents across the land, slow-paid. They had 150 “huh?” albums sitting still in shipping boxes, never opened. Warner Records had shifted to setting up its own branches in major cities, trusting that would stop “returns.”

This meant zilch to Warner, Kalmenson, Starr, and company. Jim Conkling got a phone call from New York. Come East, we need to talk budget.

Conkling, along with financial head Ed West, flew to New York, where sales cohort Hal Cook joined them. In hand, they carried their new, “1960 Budget” with its common sense answers. The trio walked into Kalmenson’s office. Jack Warner wasn’t present. The trio shook hands and spread out their budget for all to nod “yes” to.

Benny Kalmenson stopped with an opening line to remember: “Gentlemen, before we begin, I just want to say that Warner Bros. has become disenchanted with the record business. We want you to fold up your tent and get the hell out as quickly as possible. Liquidate.”

Conkling, West, and Cook sat. Stunned. Then Ed West, who’d been sent by Jack Warner from his studio accounting staff to watch WBR’s nickels, spoke. “That won’t work, Ben,” he started. West spoke financially: need to collect our receivables, need to sell off our inventory, need to release just-finished albums. “We need to get through a few months first.”

After a short discussion, that reprieve became agreed to, providing that... (1) WBR got rid of all expensive contracts; (2) After finishing its currently-in-the-studio 15 albums, stop recording; (3) sell the inventory, for cash; (4) close all WBR’s new branches; (5) drop excess personnel; and (6) Conkling’s to make no moves without Starr’s OK.

Conkling even pledged to cut his own salary in half.

Back in Burbank, on February 12, 1960, the 130 employees of Warner Bros. Records heard the news one-by-one. Joel Friedman, retained as head of merchandising/advertising, had to tell his whole staff, one-by-one, “We’re letting you go.” The staff cleaned out their desks, stammered to their colleagues, and headed home.

Friedman later looked back on that day, February 12, 1960, as “It’s Lincoln’s Birthday. The day we freed the slaves.”

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Overhead now was reduced, and continually got fine-combed by a smiles-free Herman Starr. His vision, over and over: “stop all spending.” Jim Conkling had never experienced having such a boss: not at Capitol, not at Columbia, not even back in the U.S. Navy.

Conkling kept his casual smile, and waited for something, anything, to get his new company out of this bind.

His phone rang. His secretary calling. “It’s Wesley Rose, calling from Nashville.” So, Jim shrugged, why not see if this call’s a plus.

It was.

Stay tuned.