Retail Track: Sony Bmg Continues Melding Operations

Sony BMG has finally begun to merge its manufacturing and fulfillment operations.

According to a customer letter dated July 19 as well as account sources, it sounds like the company began fulfilling BMG hit product Aug. 1 from the Sony distribution facilities in Pitman, N.J.; Carrollton, Ga.; Bolingbrook, Ill.; and Fresno, Calif. The BMG catalog titles will still be shipped from the Bertelsmann Sonopress facility in Duncan, S.C., until mid-September.

This represents the last piece in the integration of Sony Music Distribution and BMG Distribution. Although the two sales forces were combined last fall, the actual integration was still playing out this year. Part of that was because of the integration of systems that took longer than expected, according to sources, and part of that was because of uncertainty as to which company would actually perform manufacturing and fulfillment in the United States.

As you might remember, the manufacturing and fulfillment operations of Sony and BMG were not included in the merger of the two music companies. In the early days of that merger, Sony Manufacturing was expected to pick up the U.S. piece, while Bertelsmann's Arvida company, which includes Sonopress, was targeting the European business in that area.

That integration was delayed when Arvida also made a play for the U.S. business, according to sources, and bid lower than Sony's initial offer. After some back and forth on price and service levels, Sony DADC finally won out. Since then, however, the sales force was dealing with two different inventory systems, and until recently, carrying two different books into accounts. Moreover, the accounts themselves were receiving separate billing statements from Sony and BMG.

Finally, with the customer letter, accounts were instructed to begin electronic data interchange orders for BMG hit product July 29.

Interestingly, even though the BMG catalog is expected to transition to the Sony warehouses this fall, there is some speculation that Bertelsmann's Duncan facility might have a role going forward, maybe for returns.



EXCLUSIVE DVD: With all eyes on exclusive product offerings on the music side of business, Trans World has landed an exclusive version of a movie.

Tartan Video put together an exclusive version of the Japanese horror film "Tetsuo: The Iron Man" for Trans World. Dubbed a collector's edition, the version Trans World offers includes a bonus music CD compiled specifically for the promotion that includes tracks from Gary Numan, Front Line Assembly, Zeromancer, Rosetta Stone and Fear Cult.

Also included are filmographies, the original trailer and digital surround sound, according to the packaging. The movie, which is likened to the works of David Lynch and David Cronenberg, is listed at $19.99 and available at fye.com, Trans World's online store, for $16.99.



MAKING TRACKS: As expected, Dean Tabaac, late of Sony BMG's RED, has moved to Florida, where he will be VP of sales for Alliance Entertainment Corp., reporting to senior VP Mike Donahue. Before joining RED some 16 or 17 years ago, Tabaac came from the one-stop sector, having been employed once upon a time at the long defunct Richman Brothers operations. ••••