DMW: Digital Music W...

That was not a typo. EMI actually showed real earnings in the first part of 2008. Amazing what cost-cutting, fat trimming and good ol' fashioned house cleaning can do to a company. Now the hardest part is to keep this going and to continue the bloodletting, I mean, the layoffs.

Here's an excerpt from the memo to staff:

"These are early days," Hands said. "And it can be misleading to look at just one quarter in isolation due to the timings of releases. "As we all know, the recorded music business is extremely volatile and we cannot count on future quarters always being this good. Nevertheless I believe these numbers are a demonstration of EMI Music's significant progress and all your enormous efforts to transform this business."

The quarter ended just when Coldplay's Viva La Vida or Death and All His Friends was released worldwide. So the next earnings report should bode well since it would show the carry over of sales from Coldplay units.

Its still too early to pop champagne corks though. There's still too much work ahead and more cost cutting to make. Plus on the flip side, EMI is hiring the best talented executives from various sides of the entertainment and tech biz to get EMI fitted for a digital future. And let's not forget Guy Hands' vision of corporate sponsorship of musicians. The artist advance will have to be re-invented in such a way that certain corporations will end up being matched with particular artists. That's my view. Instead of EMI taking the risk at 100%, the advance will most likely come from a corporate sponsor or 50% from the sponsor and 50% from revenue share sales. I can see that happening.

Source: Reuters