Toronto Mike

Playing For Keeps

With maverick CanCon entrepreneur Al Mair's passing, I shared my conversation with him this past summer. 30 years prior, FOTM Gare Joyce spoke with Al, and wrote this excellent piece on the Order of Canada recipient. This was published on April 24, 1992.

The head office of Attic Records Ltd., Canada's most successful Canadian- owned recording company, is located in an unfashionable district of warehouses in Toronto's west end. Safety glasses and steel-toed boots are de rigueur among the local workforce. But into one refurbished building streams a daylong procession of labourers and salespeople wearing Ray-Bans and studded leather jackets-trademarks of youth culture.

"This isn't a trendy neighbourhood," says Attic president Al Mair. "But our location reminds us that we're in a business, not a lifestyle."

En route to the kitchen at the Attic offices, Mair strolls past an impressive measure of the firm's performance-gold and platinum albums lining the hallway walls. What astounds more than the number of successful records is the diversity of the product. The precious metal commemorates sales by the Nylons (retro a cappella quartet), the Irish Rovers (mock Celtic pub ensemble), Patsy Gallant (onetime disco queen), Lee Aaron (leather-and-lace hard rock diva) and performers of almost every other stripe. "For Attic to be viable," Mair says, "we have to be open to a variety of sounds and to alternative sources of revenue."

Mair takes great pride in these offbeat alternative contributions to his cash flow. On the wall beside the coffee machine are four platinum cassettes. Pointing to them, Mair explains, "Burger King Canada contracted us to produce greatest-hit compilation tapes-Motown, oldies, FM stuff, the works." Slipping into a breathless, caffeinated cadence, he describes Attic's low-key triumph. "Burger King distributed them in a promotion to customers. We had no idea what to expect-sales over a half million units." Mair revels not only in the novelty of the contract, but its lack of glamour. "It's the stuff of Attic-opportunistic, unorthodox."

Back at the reception desk, Mair stops in front of the gold and platinum albums recognizing the sales of his label's latest phenomenon, rapper Maestro Fresh Wes. Mair has an esthetic appreciation of MFW but the bucks are the backbeat. "More than 150,000 units sold in Canada for Symphony in Effect, Wes's first album," Mair says with obvious admiration. "Bestselling rap album by a Canadian ever." Maestro has created a buzz in the street. And in the industry, Attic's acquisition of MFW has caused a scramble by other labels to assemble their own rosters of Maestro wannabes. Not long ago, the idea of a Canadian rapper was unthinkable. Now the question that's asked is not, "How did Attic pull off this coup?" but rather, "How did Attic do it again?"

A common belief among international cultural experts is that a nation of fewer than 100 million people can't support its own culture. That's difficult to argue with in Canada's case, where, even after more than 20 years of federal policy requiring that 30% of AM radio airplay be Canadian content, our recording industry is dominated by foreign firms less interested in developing local talent than in simply distributing the mostly American and British acts signed up by their parent organizations. The one significant legacy of the landmark 1971 airplay rule imposed by the Canadian Radio-television and Telecommunications Commission (CRTC) is the opening it provided to independent labels with no ties to the big six foreign-owned record firms that dominate the Canadian industry-Sony Music Entertainment Inc., Warner Music Canada Ltd., BMG Music Canada Inc., Capital Records-EMI of Canada, Polygram (Records) Canada and MCA Records Canada.

In the United States, independent labels, or "indies," date back to prehistoric times-that is, before Elvis. Exploiting niche markets defined by region and sound, indies such as the fabled Sun Records of Memphis signed Presley and rockabilly acts for audiences in the South, while New York's Blue Note label pioneered in jazz and blues titles. The small fraternity of Canadian indies until recently consisted of regional labels in Atlantic Canada and French-language record firms in Quebec.

In contrast to foreign independents, Canadian indies have been forced by the small size of the market to discard the indies' usual practice of focusing on one type of music in favour of vertical integration. "In the States you narrow your sound and chase a certain type of record buyer," says one indies veteran, "but in Canada you have to become vertically integrated, you have to do everything. If you have to take in laundry, you take in laundry."

Among the indies, the most common strategy for diversification aimed at creating a reliable source of cash flow has been to combine record production and management of artists-a practice which in the United States has commonly been regarded as a conflict of interest. Yet in Canada the practice probably originated from managers' dissatisfaction with the low priority given their acts by major labels, and the management-label combination has usually worked well as a means of allowing artists and management a greater degree of influence in shaping an artist's career.

To a large extent, indies have been responsible for piloting the careers of Canada's most important acts. Bernie Finkelstein, who once operated his management service from a phone booth in Toronto's Yorkville district, set up True North Records-both a label and a management group for Bruce Cockburn and until 1986 Murray McLauchlan. Also notable in the one-stop, total-care game are Anthem Records Inc., whose principal act, the Toronto band Rush, has sold more than 30 million records worldwide; and Manta, which operated initially as both a label and a studio. None of the indies have installed coin washers and dryers. Yet.

But frugality and prudence have been the guiding principles of the most successful indies, and this is particularly true of the biggest indie, Attic Records. The label came about in 1974, when Alexander Mair, then the manager of Gordon Lightfoot, and Tom Williams, then an executive with Warner Bros. Records Inc., were scrambling to find the $300,000 in start- up funds for their new independent label. After reaching into their own pockets, they recruited a consortium of investors, including the Irish Rovers, to help stake the nascent enterprise and secured a $100,000 loan from the venture capital firm of Canadian Enterprise Development Corp. Thrift rather than musical creativity was uppermost in the founders' minds. Attic's first office was a converted kitchen in a house owned by Lightfoot. As a moniker, Kitchen Records didn't catch Mair's fancy, but Attic conveys the spirit of a claustrophobic launch.

The pragmatism that now characterizes Attic owes much to a run of bad luck it had with its early efforts to build a label in the traditional way, by assembling a roster of talented acts. Attic's first signing, a Toronto band called Fludd, was an ill-fated dud. Then Mair tried to re- create his success with Lightfoot by signing a slew of singer-songwriters, including Ken Tobias, Ron Nigrini and Shirley Eikhard. Though Eikhard would prosper 15 years later, penning songs for Grammy-winner Bonnie Raitt, the discoveries on Attic's earliest rosters were faltering. "We were going to go broke fast if we kept signing singer-songwriters," Mair says.

Luckily, though, Mair soon happened on a strategy that has bolstered Attic's treasury ever since. This consisted of obtaining the Canadian rights to foreign artists who had been overlooked by the giant foreign labels. In Attic's first year, it netted the modest but instructive sum of about $1,000 from buying the Canadian rights to an "easy listening" tune by an obscure U.S. artist-and the strategy was born. Purchasing Canadian licencing and publishing rights for established foreign artists didn't require the capital needed to sign and develop domestic talent. "Buying rights removed much of the speculation," Mair says. "All costs were certain. No overruns in the studio. Promotion costs slashed."

Rights acquisition has proved to be an enterprise similar to futures trading. Based on the artist's track record in the United States and other foreign markets, Attic can forecast Canadian demand for artists, and assign values for their rights. If Attic can negotiate a price below the projected return on rights, it signs an agreement. Since it started, Attic has managed the publishing rights to The Beatles, collecting royalties on Canadian airplay, sheet music and sales of The Beatles recordings and cover versions (remakes of Beatle tunes by other artists). Though Attic retains only 10% of the gross, The Beatles' rights were vital to its cash flow in the early days. "The income for six months might have been about $100,000," Mair says, "and we only kept 10% in the end. But the whole sum sat in an account for six months each time, collecting interest for Attic." In addition to The Beatles, Attic has acquired the Canadian rights to Elton John, Phil Collins, The Cars, Genesis, Abba and some James Brown tunes. Attic has also bought rights to artists in niche genres-including blues and reggae and what amounts to a near-monopoly of the Canadian market for marching band music.

Where Attic differs from the few foreign indies that have hit on the same strategy is that it makes the effort to build its own roster of Canadian artists whose work sells beyond Canada's borders.

Rather than banking all the profits from its lucrative foreign-rights acquisition business, Attic has consistently used them to underwrite its losses on the development of Canadian talent. Its domestic roster has been as diverse as its acquired foreign product. In the mid-1970s, Attic's Canadian lineup ranged from the metal meltdown of Anvil to the ersatz Celtic dross of the Irish Rovers. It was fitting that Attic's first Canadian hit, and an international bestseller, was found near the centre: The Homecoming, a middle-of-the-road number by a Toronto jingle writer named Hagood Hardy.

Attic progressed more rapidly than its business plan's projections, reaching profitability in its second year. And while it weathered a few bad business deals in the late 1970s, by the mid-1980s the label had established itself as the Canadian independent with the largest number of releases, and in 1986 Mair bought out his partners to become sole owner. Though the recession has reduced industry unit sales by as much as 30%, Attic sold an estimated $7 million worth of records, CDs and cassettes in its latest fiscal year. Few independents in Canada do as much as $1 million in annual sales. Along the way, Attic's image has been transformed. Today, Attic is regarded less as the label of Hagood Hardy than as the home of hot new acts such as Maestro Fresh Wes.

The accidental means by which Attic became involved with MFW speaks to the spirit of the label. Rap music uses sample snippets of other artists' recordings that go into the mix of a rap song. To satisfy the original artist's copyright, permission should be negotiated prior to recording the rap's sample.

It came to Attic's attention that one of Maestro's songs on his debut album lifted a guitar solo and chant from an album by Haywire, one of Attic's hard rock acts five years ago. "As owners of the publishing rights and the original master, we gave the U.S. label Maestro had signed with notice that Haywire had been sampled without permission," Mair explains. "Maestro had recorded the album in Canada and had not cleared the sample. Haywire and Attic were due compensation, and we negotiated a settlement-a couple of thousand dollars." After Attic and Maestro's U.S. label, Lefrak- Moelis Records (LMR), agreed on the sum, Mair inquired about obtaining Maestro's licencing for Canada.

This was a curious and mildly galling turn of events. After all, Wes Williams, the future Maestro Fresh Wes, had begun his career under Attic's nose, as a member of the rap duo Vision, which made its debut on Toronto's Queen Street West in the mid-1980s. Wes performed in several Toronto clubs and produced demo tapes at a cost of about $200 each. "There were things happening on the street but the big record companies didn't want to know," says Wes. "I sent our demos to Canadian companies for the hell of it, but from the start I planned to go to the States. The only interest in us from the Canadian industry was a couple of labels that wanted to make us into a novelty act. They didn't understand rap." Wes got his hoped-for U.S. break when executives from LMR, then a New York-based niche marketer in dance music, saw him performing on CITY-TV's Electric Circus. At a modest cost of $30,000, LMR recorded MFW's first album, which became available in Canada as an import in the fall of 1989.

Enter Attic, audaciously to be sure, but better late than never. "None of the big six had contacted us about Maestro," says Larry Moelis, who is vice-president of operations at LMR. "Attic beat them to it." Maestro has done better in Canada than in the United States, in part because Attic has made MFW a unique case among its "foreign" licencees. "We have overseen production on Maestro's videos, videos that LMR helped fund," Mair says. "There's no doubt that on a day-to-day basis we're more involved with Wes than with, say, James Brown."

Mair, to borrow a phrase from godfather-of-soul Brown, might "feel good" about his acquisition of Maestro. But Ivan Berry, Canada's foremost manager of rap acts, calls it a case of-to quote Brown again-"talking loud and saying nothing." While Mair claims the signing of Maestro proves his label's prescience and commitment, Berry has accused the Canadian recording establishment-Attic included-of inefficiency, ignorance and, possibly, racism.

Berry, a 28-year-old Toronto courier who moonlighted as an impresario on the emerging rap scene, guided the North York, Ont., duo Dream Warriors to a contract, rumoured to be worth about $680,000, with Britain's Island Records. Long before the Warriors were recognized in Canada, they had sold more than 200,000 units of their first two singles, Wash Your Face in My Sink and My Definition of a Boombastic Jazz Style. The Warriors' triumph struck Berry as a stinging indictment of the Canadian music moguls, who have long been criticized as being out of touch.

In the British press, Berry heaped scorn on the Canadian record companies and their artist-and-repertoire (A&R) staffers, those charged with signing and developing new acts. "All the A&R guys in Canada are 50 years old, big-bellied and have four kids at home," Berry told Select, a rock industry magazine. "They have 9-to-5 jobs and never visit the clubs, never support the groups."

"If I was in his shoes I'd probably say the same thing," says Steve Waxman, former vice-president in charge of promotion and publicity at Attic and now head of national publicity at Warner Music. "If I had to go to England to get a deal, I'd rub it in when I got back." Waxman, a 32- year-old, slim, unmarried, club-hopping gadfly, disproves Berry's stereotype in a literal sense. And Attic's signing of Maestro Fresh Wes disproves the idea that all executive suites are indifferent to the street.

The success of MFW has energized the Canadian rap scene. "Until three years ago, we had never received an application from a rap artist," says Julie Thorburn, program director of Videofact, a private-sector agency that funds the production of music videos. "Now about a third of our applications are from independently produced rap acts. Maestro and the Dream Warriors might be the next generation's Neil Young and Joni Mitchell-Canada's future international stars."

Attic's success with MFW has attracted the attention not only of other indies, but of the big six. "The majors in Canada were lame on rap," admits Tim Trombley, Canadian vice-president of A&R at Capitol Records. "But Capitol, and I think all the majors, have been motivated to sign Canadian rap acts." Capitol has signed the Montreal rap group MC J & Cool G, and expects it will soon sign more urban music artists.

Last autumn, Mair said he was determined to make Attic "the Canadian industry leader in rap, hip hop and dance music." No longer. He recognized the flaw in his strategy. An effort to sign artists to fill this musical niche probably recalled Attic's disastrous singer-songwriter phase. Other industry insiders agree. "Rap is going to go away for a while and reinvent itself," says one. "It's entering a down cycle just when those labelsthat avoided it are now embracing it."

Last May, the Canadian Independent Record Production Association sponsored a one-day seminar at which industry experts offered advice to would-be rappers, managers and producers. Speakers included Maestro Fresh Wes and the Dream Warriors. The day's highlight was the Slam and Dis session, during which members of the audience-a crowd who were mostly in their teens and early 20s, decked out in team hats and black satin jackets-were invited to direct provocative questions at members of the industry panel.

Ivan Berry sat in the middle of the 13-member panel. Inevitably, he was asked, "Ivan, did you really mean what you said about Canadian executives being fat and 50?"

Berry, casting a sidelong glance at fellow panelists Al Mair and Tim Trombley, looked exasperated. "I didn't mean that they all are fat and 50," he said, the crowd hooted derisively. Berry quickly regrouped. "What I mean is that they might as well be fat and 50 for all they know about rap." The young people in the crowd applauded. Berry had spoken to his constituency.

His own nascent label, Boombastic Music Inc., is exclusively dedicated to "urban" music, that is, rap, hip hop and reggae. The great risk in hitching his business to a single niche is any fall-off in rap's cachet. Berry knows rap and recognized the Dream Warriors' talent, just as Al Mair knew singer-songwriters and guided Gordon Lightfoot. And now with a deal tying Boombastic to the big leagues of A & M Records of Canada Ltd. and its parent Polygram, it appears rap will be Berry and Boombastic's launching pad.

During the seminar, Mair explained that Attic's policy is to "think global, act local." Such was Attic's success with Maestro Fresh Wes. Al Mair has a 36-inch waist, is 51 years old, and has a couple of kids. But Attic's acquisition of the hottest rap act in this country proves that you don't have to be part of the youth culture to understand and profit from it.

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