Festival Records (Australia)
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| Festival Records | |
|---|---|
| Parent company | News Limited |
| Founded | 1952 |
| Founder(s) | Paul Cullen |
| Distributing label | Now defunct |
| Genre(s) | Various |
| Country of Origin | Australia |
| Location | Sydney |
Festival Records was an Australian music recording and publishing company which was founded in Sydney in 1952 and operated until 2005. A wholly owned susidiary of News Limited from 1961 to 2005, the company was highly successful for most of its fifty-year life, although as much as 90% of its annual profit was reportedly siphoned off by Rupert Murdoch to subsidise his other media ventures.
Festival was established by one of Australia's first merchant banking companies, Maingugard, founded by Paul Cullen, a former army officer. Mainguard had a wide range of investments including one of Australia's first supermarket companies, and a whaling business. It also backed famed Australian film-maker Charles Chauvel.
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[edit] History
[edit] Early years
The origin of Festival was Mainguard's purchase of a small record pressing company, Microgroove Australia, one of the first local companies to produce the new vinyl microgroove record format. After buying Microgroove, Cullen founded Festival Records on October 21, 1952 and he appointed popular bandleader Les Welch as artists and repertoire (A&R) manager. Another early staff member was Bruce Gyngell, who was later hired to help found Australia's first commercial TV station, TCN-9 in Sydney. The connection between Nine and Festival would reap great benefits for the label in the late 1950s and early 1960s.
Festival was able to gain a foothold in the Australian music market mainly thanks to Welch, who cannily acquired the Australian rights to the epoch-making Bill Haley record "Rock Around The Clock". The single had originally been turned down by EMI in 1954, when it was first released in the USA, but Welch was able to beat out EMI, securing the Australian rights for Festival in 1955, after the song became a smash hit in America and Britain thanks to its inclusion in the film Blackboard Jungle. "Rock Around The Clock" went on to become the biggest-selling record ever released in Australia up to that time, reportedly selling over 100,000 copies, and it established Festival as a significant player in the emerging pop-rock market.
When Mainguard began diverting Festival's profits into its other businesses, Welch resigned. He was replaced by disc jockey and former record store clerk Ken Taylor. Like Welch, Taylor didn't like rock'n'roll, but he was an astute spotter and marketer of new talent. Thanks to Taylor, Festival was the first local label to sign Australian rock'n'roll acts, including Australia's "Big Three" of the 1950s -- Johnny O'Keefe and the Dee Jays, Col Joye and the Joy Boys and Dig Richards and the R'Jays. Festival's sales trebled but by this time Mainguard was in serious financial straits and in 1957 Cullen sold Festival to property magnate L.J. Hooker.
Hooker was a music fan and reportedly took a keen personal interest in the company, even establishing his own boutique imprint, Rex, named after the Sydney hotel he owned. During this time Festival had its first home-grown hit, Johnny O'Keefe's "Wild One" (aka "Real Wild Child"), a song later covered by Iggy Pop, and this was followed by four #1 hits in 1959 for the Col Joye & the Joy Boys. But despite the chart success, Festival continued to lose money due to poor management and a lack of international acts on its roster, and Hooker eventually sold it on to Rupert Murdoch's News Limited in 1961.
As with the Bill Haley single, Festival was again saved by an unknown U.S. act, in this case Herb Alpert & the Tijuana Brass, who had been recommended to Festival in 1962 by top Sydney DJ Bob Rogers. The Tijuana Brass' breakthrough record, "The Lonely Bull" became a worldwide hit and its success iu Australia enabled Festival to sign a crucial distribution deal with Alpert's label A&M Records, who went on to supply Festival with a stream of top-selling U.S. acts such as The Carpenters.
Under the astute direction of long-serving company chairman Alan Hely, Festival quickly rose to become one of the top pop labels in Australasia, and by the late 1960s it rivalled and often surpassed market leader EMI. Hely built up a strong roster by cultivating Australia talent and establishing distribution deals with important local independent labels like Spin Records and Clarion Records in the Sixties and Mushroom Records in the Seventies. He also signed crucial distribution deals with major overseas labels like Island Records, Chrysalis Records and Virgin Records that gave Festival exclusive Australian rights to a steady stream of international hit albums and singles.
Festival dominated the Australian pop scene of the mid-to-late 1960s, recording and/or distributing some of the most popular Australian acts of the decade, including Normie Rowe, Billy Thorpe, The Bee Gees, Ray Brown & The Whispers, Tony Worsley & The Fabulous Blue Jays, Jimmy Little, Noelene Batley, Mike Furber, The Dave Miller Set, Johnny Young, Wild Cherries and Jeff St John. Many of these recordings were made by producer Pat Aulton, initially the producer for Spin and Festival's house producer from 1966 untilthe early 1970s, and he was probably responsible for more Australian-made hits than any other record producer of his era.
[edit] 1970s-1990s: growth and consolidation
In 1970, Festival established a new progressive music label, Infinity Records, and early releases on the label included Kahvas Jute, the "new" Billy Thorpe & The Aztecs and Blackfeather. Infinity's biggest success was Sydney band Sherbet, who became the most popular and successful local band of the early Seventies and one of the most successful Australian groups of all time.
In the late 1980s change swept through the music industry as vinyl was supplanted by the CD and independent labels like Island, A&M, Virgin and Chrysalis were bought by major labels like CBS-Sony, Philips and EMI. The loss of these overseas labels took a sizeable chunk out of Festival's profits, and this was compounded by Murdoch's consistent siphoning off of Festival's profits, leaving it without the cash reserves it needed to invest in new plant, new acts and new labels.
In 1995 Hely was nearing retirement but he agreed to stay on to tutor Rupert Murdoch's younger son James, then only 23, who was appointed as Festival's new managing director. James had a reputation as the Murdoch family rebel -- he bleached his hair and for some time sported an eyebrow stud, and to his family's dismay he had just dropped out of Harvard University to set up a hip-hop label, Rawkus Records.
According to journalist David Higgins, James' appointment to Festival was essentially a ruse, with Murdoch Sr exploiting his son's interest in music as a means to coaxing him back into the family business. Hely was quoted as saying that he found Murdoch "a nice enough young man" but added that he considered James "naive and full of himself".
Alan Hely stayed on for some time, but he resigned earlier than he had planned, after a disagreement with Murdoch. He was replaced as chairman by Roger Grierson. Under Grierson and Murdoch's management, Festival bought out Michael Gudinski's controlling 51% share of Mushroom Records in 1999 for a reported AU$60 million. The two companies were then merged and renamed Festival Mushroom Records (FMR). The company also established an online music site, Whammo, which folded in late 2003.
According to Higgins, Grierson admits that mistakes were made and money was wasted. New labels and artists were signed, but few succeeded. In 1997, exasperated by chronic distribution problems, Michael Gudinski cancelled his long-standing deal with Festival and moved Mushroom's distribution to Sony. As a result, Festival was forced to retrench half its staff and Murdoch and Grierson reportedly spent over $40 million getting Mushroom back. Over the next few years Festival's Australian artist roster was slashed from about 120 artists to just 16.
[edit] 2000s: financial issues leading to folding
In 2000, just before the scandal of the One-Tel collapse hit the headlines, James Murdoch was appointed to head Star TV and he moved to Hong Kong. He was replaced by Michael Parisi. Festival celebrated its fiftieth anniversary in 2002 with a major museum exhibition and a series of commemorative CDs, but only two years later it was obvious that the company which had been Australia's leading record label for more than forty years was struggling to survive. By that time most of its assets had been sold off, including the company's famous studios and its offices, located in Pyrmont, Sydney, which it had occupied since 1966.
News undoubtedly poured hundreds of millions into Festival in the decade between 1995 and 2005 -- the buy-out of the Gundinski's controlling share of Mushroom reportedly cost around AU$60 million alone. Yet, in spite of all the money invested, by late 2005 FMR was virtually worthless, and much of the blame for this must rest with Grierson and Michael Parisi, Murdoch's successor as Festival MD.
The combined Festival-Mushroom recording archive contains a major proportion of the most important Australian pop and rock music of the late 20th century, and its archives are said to contain more than 20,000 master tapes, including works by Johnny O'Keefe, Peter Allen, Sherbet, Olivia Newton-John and Kylie Minogue. Despite its immense historical value, the catalogue was sold to the Australian division of the Warner Music Group in October 2005 for a mere $AU10 million. The company's other major asset, Festival Music Publishing, was sold to Michael Gudinksi a month later for an undisclosed sum.
