19
Mar
08

HypeBot’s One Dollar Challenge.

Edgar Bronfman Jr., CEO of Warner Music Group, is over-paid. According to an SEC filing this week, it was revealed that WMG has extended CEO Edgar Bronfman’s contract through March 2013. According to the filing, his annual base salary is at least one million dollars. With incentives, bonuses, and stock options, his total compensation could end up being between $15-$20 million over 5 years. Wow.

What the hell, man. How does Bronfman get to command such a salary, when he’s been CEO of one of the big four labels, and helped to run it into the ground? His failed experiment with high-end concert promotion, BullShit BullDog, lost 16 million dollars in a year. On top of which, according to HypeBot, Bronfman and his henchman Liar Lyor Cohen have been in the rear when it came to pushing new innovations in technology that might have helped WMG’s over all outlook (like WMG being the last company to embraced DRM-free MP3 sales).

I say again, what the hell, man. Talk about rewarding failure! I knew the majors were completely corrupt and incompetent, but this is a shock even to me!

Hypebot did come up with a good idea, though. According to their story, “Apple’s Steve Jobs works for a base pay of just $1 per year. But stock options and bonuses awarded when the company soared have made him a very rich man. ” So they’re proposing that all music execs follow Steve Jobs’ example and re-set their base pay to $1.

Not only do I agree, but when I do get around to re-building Red Zone Records, I’m doing the exact same thing. All of my executives will get $1 in base pay, but they’ll have huge earnings potential in incentives and bonuses. in other words, it will be performance based. If execs at my company want to get rich, they’ll have to earn it by making sure the company is successful. Bravo to HypeBot on this one. I think all recording industry execs should take this challenge.

Update (3-21-08): According to Billboard.biz, “The Warner Music Group has re-signed Lyor Cohen for a five-year contract…As part of his new contract, Cohen gets a raise to $3 million from the previous $1.5 million annual salary level.”

That’s a LOT of dollar bills.

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