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As Record Companies Go…
So goes the media industry. For the past several days, I have been working on a history project. Ever wonder how the media industry came to be what it is today? One can start to lay out the family trees of CBS, NBC and other television properties by looking back ninety-plus years ago to what was happening to the nascent recording industry in the United States. Following are a few examples that I found while conducting my data search that I thought might be of interest.
The granddaddy of today’s existing record labels is Columbia Records, which is currently owned by Sony Music Entertainment. The Columbia Phonograph Company, its name derived from the District of Columbia where it was headquartered, was founded in 1888. It distributed and sold phonographs and phonograph cylinders produced by Thomas Edison’s company until 1894. Afterward, the company continued producing and selling its own product. In the early 1900’s, Columbia began selling discs in addition to its cylinders.
Fast forward to early 1927. The Columbia Phonograph Company was petitioned to help financially rescue a small radio network, United Independent Broadcasters, from insolvency. Once the deal was transacted, the company was renamed the Columbia Phonograph Broadcasting System. By the end of 1927, the Columbia Phonograph Company opted out of the broadcasting business due to the high operational costs. The broadcast properties were then sold to the owners of WCAU in Philadelphia and William S. Paley was brought in to run the new organization, which he renamed the Columbia Broadcasting System.
Move forward once again to 1938. Columbia Records, and its existing parent the American Record Corporation, were purchased by William Paley’s CBS. Columbia was then positioned as the CBS subsidiary responsible for the company’s repertoire of recorded music. Over the next 50 years, CBS retained ownership of Columbia Records and its affiliated labels, renaming them the CBS Records Group. In 1988, the CBS Records Group was sold to Sony, which re-christened it Sony Music Entertainment in 1991.
For the first 30 years of the 20th century, the Victor Talking Machine Company (founded in 1901), was a major competitor of the Columbia Phonograph Company. In 1929, the Radio Corporation of America (RCA) purchased the Victor Talking Machine Company and renamed it RCA Victor. For over 50 years RCA Records was owned and managed by RCA much the way its competitor Columbia was by CBS. Today, RCA Records is also owned by Sony Music Entertainment, which it gradually acquired through its joint venture with Bertlesmann (Sony/BMG) in 2004.
Broadcasting history buffs will often mention that RCA was also the corporate parent of the National Broadcasting Company (NBC), which it formed in 1926. In 1986, General Electric acquired Radio Corporation of America and along with it took possession of NBC. Today, NBC is known as NBC Universal and is co-owned by both Comcast and GE. It is interesting to note that GE had previously owned RCA and NBC until 1930 when it was forced to divest itself of the properties due to anti-trust regulations.
Gugelplex TV sees the process of corporate parents becoming corporate offspring, corporate offspring becoming corporate parents and corporate competitors becoming corporate siblings continuing on as major media owners continue to shuffle the decks in hopes of achieving high profits and a competitive advantage. Consider Viacom. Originally CBS Films, the television syndication division of CBS, Viacom was renamed in 1971 and was spun off from CBS due to FCC rules forbidding TV networks from owning syndication companies. This, only to be reunited once again with its former parent CBS Corporation in a 1999 merger. And finally in late December of 2005, the Viacom/CBS tandem was once again demerged into separately traded NYSE companies. They remain separate to this day.
It was Grace Slick of Jefferson Starship who sang in the group’s 1985 song “We Built This City,” “Someone’s always playing corporation games. Who cares they're always changing corporation names.” How true she was but don’t go away and stay tuned. As Sonny and Cher once sang in the mid-1960’s, “the beat goes on!”
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