Oasis Starts Up In Canada: Co. Sets Sights On Indie Music Market

TORONTO-With an estimated $15 million Canadian ($10.2 million) in start-up capital, four Canadian music industry veterans have launched Oasis Entertainment Inc.
The company is seeking to capture a healthy chunk of Canada's independent music business, which, according to Brian Robertson, president of the Canadian Recording Industry Assn., represents 10% of the country's $1.4 billion Canadian ($951 million) music retail market.
Principals in the company are Allan Gregg and Jake Gold of the Management Trust, which handles such acts as the Tragically Hip, Big Wreck, and the Watchmen; Bill Ott, former president of PolyGram Group Distribution (Canada); and Alexander Mair, president of the Toronto-based Attic Music Group. Ott is president of the new company, while the other founders will not have executive roles.
Oasis is handling Canadian distribution of Attic Music Group, Navarre Canada, and the newly formed Page Music, all in Toronto, and Montreal-based MaGaDa International Inc.
Oasis has opened its head office and distribution center in the Toronto suburb of North York, vacated by Page Music Distribution. Within the month, Oasis will open offices in Montreal; Calgary, Alberta; and Vancouver. By the end of July, the company, according to Ott, will have 38 employees nationally.
"We want to be the sixth major in Canada," says Ott, who had been with A&M Records for 15 years prior to the label being purchased by PolyGram in 1990. He will operate Oasis on a day-to-day basis.
Gregg, who is also president of Viacom Canada Ltd. until Dec. 31, has been pivotal in setting up the infrastructure of the company, which, he says, will go public this fall.
"This is part of a much larger transaction I have been working on for the past seven months," says Gregg. "We'll announce more of what we're doing in three weeks. By [acquiring] a reasonable share of that [independent distribution] market, we will have a viable business. When combined with other existing businesses, we will have tremendous top-line growth. We're projecting revenue of $16 million in the first year."
According to industry sources, Oasis is negotiating to buy several publishing and label interests and will eventually develop label lines of its own. "We're going to be an entertainment media company," says Ott.
"One thing we have agreed on is that Oasis will not take on distribution of individual artists," says Mair. "Bill's business will be with labels, not with artists."
Oasis' senior team has been drawn from former senior executives at Universal Music (Canada) who departed following the Universal/PolyGram merger. Leading the team as senior VP is 24-year A&M veteran Randy Wells. Also on board are Ken Wells as VP of operations and distribution and regional managers Tom Jones (Western division), Al Harrison (Midwestern division), Tony Tarleton (Central division), and Roland Dufresne (Eastern division).
"We want a company small enough to be able to react to the marketplace quickly and large enough to have the critical mass to employ a first-rate team handling sales, promotion, marketing, and publicity," says Ott. "Being able to shift product from point A to point B doesn't satisfy major independents anymore. They take that as a given."
According to Ott, there has been a significant gap in Canada's independent distribution sector following the bankruptcy of Montreal-based Cargo Imports and Distribution in late 1997 and last year's closure of the music distribution wing of Denon Canada, a division of the Georgia-based Denon Corp.
These factors, Ott says, coupled with the merger of Universal and PolyGram, have provided ideal conditions for the arrival of a strong independent distributor like Oasis.
"There was a need before the Universal/PolyGram buyout, but that event made the start-up of a company like this even more vital," Ott says.
"Now is the perfect time for Oasis," agrees Michael McCarty, president of EMI Music Publishing Canada. "Major labels are in the business of selling large volumes of hits. This has left a gaping hole in the marketplace for independents at every level, including for distribution."
Twenty-five-year-old Attic Music Group, which ended its distribution deal with Universal Music May 31, is the cornerstone of Oasis' business. Attic represents such labels as edel, Edel America, Roadrunner, Metal Blade, First Night, Mammoth, Paradigm Associated Labels, Handsome Boy, and Hi-Bias in Canada and has rights to product by "Weird Al" Yankovic from his Way Moby label. Attic's domestic roster consists of Maestro, Jazmin, and M-Appeal.
The first album distributed by Oasis is Yankovic's "Running With Scissors," released June 28.
"Universal was the best distributor we ever had, but since the PolyGram buyout, there's been a lot of turmoil and confusion there," says Mair in explaining his decision to be part of Oasis. "[With Oasis], Attic [product] will get more attention."
When Minneapolis-based Navarre Corp. set up its two-man Canadian operation last year, it made a distribution pact with Page Music Distribution to handle all of Navarre's distributed labels except American Gramaphone and such major titles as "The Irish Tenors," on Navarre Canada, and current albums by Vonda Shepard and Kenny Rogers.
These were distributed by EMI Music Canada, a shareholder in Page, but they will be distributed by Oasis starting July 5.
"Being with Oasis will give us a stronger footing in the market," predicts Peter Piasecki, managing director of Navarre Canada. "After Attic, we're Oasis' biggest growing concern."
Several Canadian music retailers are cautious in their response to Oasis' launch. "I'm going to wait and see how they conduct business," says Tim Baker, buyer with the 33-store, Ontario-based Sunrise Record chain. With its distributed lines, he says, "they are definitely not a sixth major."
"Attic is certainly a good label to hang their hat on, but I've seen Attic stay cold for long periods of time," says Lane Orr, head buyer with the 14-store A&B Sound chain in Vancouver. "Navarre's presence in Canada is inconsequential."
With EMI Music Canada recently ending its three-year minority ownership interest in Page Music Distribution, the company has begun to wind down its operations. It will re-emerge as Page Music in the coming weeks. Its seven-person staff moved recently to Rundle House in downtown Toronto, vacated last year by EMI-operated Virgin Music Canada.
Distributed by Oasis, Page Music will represent such Canadian-based labels as Raw Energy and Liquid Records and such U.S. labels as Blue Room America, Minty Fresh, and Radikal Records. The bulk of its business will be distributing titles from some 1,300 independent grass-roots Canadian acts.
"We've gotten rid of all of the non-exclusive distribution deals," says Matthew Page, VP of Page Music Distribution.
"After three years, nobody was making any money with Page Music Distribution," says Deane Cameron, president of EMI Music Canada, explaining the decision to end EMI's financial backing. "Our resources are better spent on direct artist development."