John Branca: Q&A

Bud Scoppa hitsdailydouble.com 2/18/14

Marty Bandier called John Branca “the #1 publishing lawyer in the country.” 60 Minutes described the work we he’s done for the Michael Jackson Estate as “the most remarkable financial and image resurrection in pop culture history.” Jackson himself hailed his longtime advisor as “the greatest lawyer of our time.” And in the eyes of Berry Gordy, Branca is “the Smoky Robinson of deal making.” When reminded of the effusive praise he’s received, Branca laughs uneasily. “It’s a wonder I have such a small ego,” he quips. The fact that Branca, a partner in the firm of Ziffren Brittenham LLP, reps or has repped 29 members of the Rock and Roll Hall of Fame puts further demands on his attempts to keep his head from swelling to the size of a basketball.

With all these accolades being heaped on him, and all these all-star clients, you might expect to see Branca sitting among the Hollywood fat cats sitting courtside at Staples Center for Lakers games—he could certainly afford it. But this proud UCLA alumnus prefers to be on the floor at Pauley Pavilion, which he helped renovate, to watch his beloved Bruins ball. Our own Bud Scoppa recently challenged Branca to a game of one on one and was wowed by the attorney’s ability to score from all over the court, including his deft inside moves; what follows is the play by play.

You’ve been involved with the music business since the 1970s, and from a relatively objective vantage point. During that time, how has the economic landscape of the business changed?

It has changed substantially. When I got started, the primary delivery system for music was 33 RPM LP records that retailed for $7.98, $8.98 and $9.98, and touring was a way to help promote the records. With the introduction of CDs, technology actually helped increase dollar volume from record sales. The labels were charging $17.98 and $18.98 for the same albums they previously had charged half that price for. So, for record royalties and record sales for both labels and artists, it was a boom time. I can recall a period in my own practice before prevalent technological piracy where we had multiple artists who were selling over 10 million albums in the U.S. and 20 million worldwide, such as Michael Jackson, Celine Dion, Carlos Santana with Supernatural, The Backstreet Boys, TLC and Usher.

Adele is the one exception, and look, there have been artists recently—Justin Timberlake, Nickelback and Michael Jackson, among our clients, and Katy Perry and Taylor Swift—who still sell a lot of records, but record sales are not what they used to be. Obviously, revenue is now moving into streaming and other delivery systems. The other thing that has changed dramatically is that where tours were once a way to promote records, it’s now the other way around for artists. Records are now an advertising tool to sell concert tickets and merchandise. I laugh, because when I represented Michael and the Jacksons on the Victory Tour, there was outrage at $28 ticket prices. If Michael were to go out today, it would not be surprising to see ticket prices in the $500 to $1000 range, so the revenue potential has expanded dramatically for artists in touring and in merchandising, while it has shrunk with record sales.

So that means the superstar artist is getting more money relative to the label, which has always been dependent on record sales. How does the traditional music business survive in the midst of present-day economic reality and the technological revolution?
It adapts and takes advantage of new opportunities as they present themselves, like streaming. It’s interesting, but every technological change underscores the value of great artists, great catalogs and great songs. Having worked with Michael, the Elvis Presley Estate, The Rolling Stones, Santana, The Bee Gees, The Beach Boys, The Doors and others, the value of those brands and those catalogs never goes away, so it’s just a matter of repositioning.

Given the critical importance of touring as a revenue stream, where do you stand on the labels’ attempts to strike 360 deals?
The issue and the problem with label 360 deals is expertise. Most labels, without significant additional staffing and investment, do not have expertise outside of the record area. They certainly don’t have expertise in touring. They’ve acquired expertise in merchandising by acquiring merchandising companies. They may have the leverage at the beginning of an artist’s career to be involved with touring income, but, by and large, they don’t have the ability to add value and to deliver on those rights.

That’s where Live Nation has a leg up on the labels in terms of the high-end artists.
Yes, both Live Nation and AEG from the artist’s point of view, which is where I sit. I was involved with The Rolling Stones in helping to bring in Michael Cohl, who then pioneered the model of when an act went on tour, they would sell multiple rights to one promoter and, in The Rolling Stones’ case, that involved tour sponsorships, merchandising, advertising, etc. That was the Steel Wheels tour. We did the same with Korn with EMI, with a record label. Then we did that with Nickelback and Shakira in their Live Nation deals. Those deals are not perpetuating. I think 360 deals are now rare, certainly at the top level of the business.

These days, you’re best known as the executor of the Jackson estate. What does that job entail, and what have you accomplished?
I’m co-executor with my good friend and brother, John McClain. We started as co-executors, but the Probate Court appointed us as co-managers, so John and I are the managers of Michael Jackson and the Michael Jackson brand. That encompasses everything from making business decisions on which projects to pursue, and creative decisions on the content of those projects, as well as overseeing the financial arrangements of the Estate. I think John and I are most proud of several things. First, we co-produced the movie This Is It, which has become the largest-grossing documentary and largest-grossing concert film in history. We’re very proud of the Michael Jackson Immortal World Tour, which has grossed approximately $350 million and is now coming back to North America, and it’s certified as one of the biggest grossing tours in history. And now, we’ve got a brand new show in Las Vegas, Michael Jackson ONE at Mandalay Bay, which has been met with critical reviews and incredible box office success. Those are just the projects. What we’re most proud of is the passion that we have for Michael. We both had intimate relationships with Michael, and to be able to both help perpetuate Michael’s legacy and introduce him to a new generation of fans has been perhaps the most exciting part of the job.

You’ve done that, to a large extent, in conjunction with Epic, I assume, or with Sony, as a whole?
Yes, certainly on the record side. I think the key to managing any artist or any brand is picking the right partners. Certainly, in the record area, Sony and Epic have been an outstanding partner, as Sony Pictures was on This is It and Cirque de Soleil is on the two shows. Also, on the Jackson Estate, we’ve been fortunate in being able to work with many great individuals, including Karen Langford, Howard Weitzman, Joel Katz and Dave Dunn, who help to make us look good.

Branca with his two idols, longtime client Michael Jackson and the Wizard ofWestwood, legendary UCLA basketballcoach John Wooden.

How and when did you become involved with Michael Jackson, and how did that relationship evolve?
Michael and I started working together in January of 1980. It was just after the release of Off the Wall and he had just turned 21. Over time, it evolved to the point where, on the Thriller album, I was able to assist him on many projects, including making the “Thriller” video and buying the Beatles catalog, among other things.

In retrospect, it’s mind-boggling that the Beatles’ catalog was even on the block.
Back in the 1960s, The Beatles had participated in a corporate structure to minimize taxes that resulted in them losing control of their copyrights. Over the years, those copyrights were bought and sold and, ultimately, were owned by ATV, which was an English company controlled by an Australian millionaire named Robert Holmes à Court. When he decided to sell the catalog, it was marketed widely, and when I found out it was for sale, Michael and I talked about it We were, at that time, embarking on a campaign to purchase copyrights. We had already bought the Sly and the Family Stone catalog, for example. Michael had me check with both Paul McCartney and Yoko Ono to see if they were bidding and they were not, so we went after it, and we ultimately got it.

Nice one. What did you pay for that?
$47,500,000, and we sold off Bruton Music, a background music library, to Clive Calder for about $6 million, so Michael’s net price was $41,500,000. That was in 1985. We merged it with Sony in 1995, creating Sony/ATV Music, which Michael owns half of. Then, last year, I was fortunate enough to represent and consult Sony and Marty Bandier in the acquisition of EMI Music Publishing, which created the biggest music publishing conglomerate in history.

Was that a complicated set of maneuvers?
It was very complicated. A lot of credit goes to Rob Wiesenthal, as well as Marty Bandier. Rob was one of the financial engineers of that transaction.

In your practice, you wear several different hats. Can you describe the various roles that you play in terms of specific clients and undertakings?
Well, one of the things that I enjoy most is helping to buy and sell assets, and I don’t do this in a traditional sense. We are not traditional lawyers at our law firm, in the sense that if somebody has made a deal and they want somebody to paper it, we’re not the right guys for that. We’re proactive in helping our clients strategize their business and maximize their income opportunities not just in music, but in motion pictures, television and the digital space as well. So I’m often brought in to help engineer the purchase of assets like EMI Music, and the sale of assets like Virgin Music or Elvis Presley Enterprises last year. That’s one of the things I enjoy the most. Over the years, we were involved in the formation and sale of Interscope Records, for example, and we were consultants to Vivendi in the acquisition of Universal Music. Also, we work side by side with the best personal managers, in terms of strategizing a client’s brand and business opportunities, so we’re often brought in as lawyers and co-members of the management team, as we did with Michael and The Rolling Stones, and as my partner David Lande does with Justin Timberlake and Alicia Keys. These are the kinds of things that we enjoy over and above our traditional role as music lawyers.

Can you explain the value of having cross-disciplinary team?
It is critical in this day and age to be able to cross boundaries and assemble a great team. Our firm is known as being preeminent in all areas of entertainment, with such outstanding attorneys as David Lande, Skip Brittenham, Ken Ziffren, Sam Fischer and Matt Johnson, among others. Thus we have been at the forefront of deal making in many areas. We helped form and sell Pixar for Steve Jobs, for example. We helped spin off DreamWorks Animation, also, and we represent DreamWorks. We represent Oprah Winfrey in strategizing her TV business. We represent A-list Academy Award-winning actors and filmmakers, like Ben Affleck, Matt Damon, Sandra Bullock and Tyler Perry. We’re involved with Simon Cowell, and we represent American Idol. We’re involved in all areas and all facets of entertainment business.

Wow, you’ve been in the thick of a lot of the most significant moves of the last several decades. That’s remarkable. To a certain extent, that is a marketing gig, right?
Yes. For example, I was hired by the Rodgers & Hammerstein organization a couple years ago to sell Rodgers & Hammerstein. Something like that is especially exciting to me, because I grew up loving musicals like The Sound of Music, so we’re brought in not just to do the paperwork, but actually to help put together the offering materials and the marketing of the company to the financial marketplace, just as we assisted Apollo, Core Media and the Raine Group last year in selling Elvis Presley Enterprises.

Can you explain the Grammy nominating process, which has puzzled a lot of people during the last couple of months? What’s your involvement with that ball of wax?
I do not have direct involvement with the Grammy nominations, but I was the Chairman of MusiCares and the MusiCares fundraising campaign and in that position was able to work closely with Neil Portnow and Ken Ehrlich. And knowing Neil and his whole team, they are very conscientious and to do the very best job. I have noticed a

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