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Phonogram Inc.
Phonogram Inc.
Phonogram Inc.
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Phonogram Incorporated was started in 1970 as a successor to Philips Phonographic Industries, a unit of the Grammophon-Philips Group (GPG), a joint venture of Philips N.V. of the Netherlands and Siemens AG of Germany. It was a holding company for labels which owned record labels such as Philips, Fontana, Vertigo and Mercury and distributed many other licensed labels.

Key Information

History

[edit]

In 1972, Grammophon-Philips Group was reorganized as The PolyGram Group. Following PolyGram's acquisition of Mercury in the United States, the corporate name was changed from Mercury Record Productions, Inc., to Phonogram, Inc. In the U.S. Phonogram artists were generally released on Mercury Records, but the label is independent from its U.K. counterpart. By 1982, Mercury and all other PolyGram owned labels including, RSO, Polydor, Total Experience and Casablanca carried the following wording "Manufactured And Marketed by PolyGram Records" with the PolyGram Records logo.

In the United Kingdom, Phonogram was the holding company for Philips Records, which was established in 1953 and also launched the Fontana label in 1958. As well as producing their own recordings many of which became U.K. hits, Philips/Fontana licensed the rights from Columbia Records (U.S.) to release and distribute their product from 1953 until the end of 1964. After that time, Columbia U.S. set up their own marketing and production unit in the UK in Theobalds Road, London, having acquired Oriole Records and its record-pressing plant that had prospered in manufacturing discs for U.K. budget labels including Embassy, sold through Woolworths. U.S. Columbia was unable to use the "Columbia" trademark outside the United States and Canada as it had already been copyrighted overseas by EMI. Therefore, U.S. Columbia product was released in most territories on the CBS record label.

In 1977, Frank Zappa negotiated a distribution agreement with Phonogram for his Zappa Records label. Due to legal pressure from Zappa's previous distributor Warner Bros. Records, Zappa and Phonogram were forced to shelve a planned four-LP box set called Läther (pronounced "Leather".) Phonogram did distribute three Zappa albums in the US and Canada, but the agreement ended in 1980. According to Zappa, this was because a Phonogram executive objected to the lyrics of a Zappa single titled "I Don't Wanna Get Drafted". Phonogram president Robert Sherwood disputed Zappa's version of the story, insisting that they did not want to release a single without the support of a full-length album.[1]

Releases in Europe were issued by Vertigo and Philips and carried the "Marketed by Phonogram" wording with the Phonogram logo. Phonogram also licensed recordings from small U.S. record labels for European release. Among these were Avco, Sire, Janus, Westbound, All Platinum, and Chess.

De-establishment

[edit]

In 1997, all PolyGram units still using the Phonogram name moved to Mercury Records[2] whom by that time, had become PolyGram's flagship label. PolyGram continued until 1998, when the company was purchased by Seagram and merged with Universal Music Group.

See also

[edit]

References

[edit]
Revisions and contributorsEdit on WikipediaRead on Wikipedia

Phonogram Inc.

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Phonogram Inc. was an American record label distributor and marketer incorporated in New York on April 20, 1973, as the U.S. successor to Mercury Record Productions, Inc., and operated as an affiliate of the Dutch-based Phonogram International B.V. within the group. It primarily handled the U.S. distribution, sales, and promotion of the Mercury, , and Vertigo record labels, playing a key role in bringing international and domestic music releases to the American market during the 1970s and early 1980s. The company was renamed Records, Inc. on July 29, 1981, marking its integration into the broader structure, and its entities were dissolved in 1984 and 1992, with global phase-out completing in 1997. As part of the larger N.V., which was reorganized in 1972 from the 1962 Grammophon-Philips Group—a joint venture between Electronics N.V. and A.G.—Phonogram Inc. benefited from ' innovations in audio technology, such as early cassette distribution through starting in 1966. Under 's umbrella, it contributed to the group's expansion in the U.S., including key deals like entering the Phonodisc distribution system in 1975 to strengthen market presence for its labels amid growing competition in the music industry. By the late , Phonogram Inc. supported notable releases across genres, from rock and on Vertigo and to pop and R&B on Mercury, helping solidify its position as a global leader before the 1998 acquisition by , which merged it into .

Formation and Early History

Founding and Predecessors

Phonogram Inc. was incorporated on April 20, 1973, in New York as the U.S. successor to Mercury Record Productions, Inc. (Chicago-based), operating as an affiliate of the Dutch-based Phonogram International B.V. within the group. This followed ' acquisition of in 1961, which established the foundation for PolyGram's U.S. presence in the music industry. The broader corporate structure traced its roots to the international predecessors. Phonographic Industries (PPI), formed in the early 1950s as part of N.V.'s music division, oversaw the production, marketing, and international expansion of phonograph records, building on ' post-World War II entry into the industry through acquisitions and distribution partnerships. PPI had been established around 1953 to manage these activities, including the launch of the Philips label. The Grammophon-Philips Group (GPG), a founded in 1962 between N.V. of the and AG of , consolidated the companies' record operations. acquired a 50% stake in ' Deutsche Grammophon Gesellschaft (including its Polydor label), and took a reciprocal 50% interest in PPI. The GPG acted as a to coordinate global manufacturing, licensing, and . Prior to the U.S. entity's formation, PPI handled marketing and distribution for ' labels and affiliates such as Decca and its U.S. counterpart London Records. This included European distribution for Decca after ' 1942 acquisition of Hollandsche Decca Distributie and related agreements, positioning PPI as a major player in classical, , and popular music releases. PPI leveraged ' innovations, such as long-playing records, to develop an international network. The international Phonogram entities, including Phonogram International B.V. headquartered in , , provided oversight for global subsidiaries until the reorganization into in 1972.

Initial Organization and UK Operations

In 1971, Phonogram Records was established in the through the amalgamation of the , Fontana, Mercury, and Vertigo labels, creating a unified entity under the slogan "The Best Sounds Around." This reorganization streamlined operations within the Grammophon-Philips Group, consolidating imprints to enhance market presence in the and internationally. Phonogram's early UK operations focused on established imprints like , launched in the UK with its first releases in January 1953 after setup in autumn 1952. Philips initially emphasized pop and international , building its catalog through productions and licensing. The , introduced in as a , specialized in and but also handled imported material. Under Phonogram's structure, these labels retained their identities while gaining from centralized oversight, including improved distribution via Phonodisc, which relocated its warehouse in 1970. A key pre-Phonogram UK activity was a distribution agreement with (US) from the late 1950s until 1962, licensing American releases for issuance on the Fontana label without using the Columbia name due to EMI's control in Britain. The agreement ended in 1962, after which Columbia launched its own CBS label in the UK. In the , following the international reorganization in 1972, the for American labels—previously Mercury Record Productions, Inc.—was renamed Phonogram Inc. in 1973 to align with global branding.

Operations and Label Management

Managed Record Labels

Phonogram Inc. served as a overseeing several key record labels in the , primarily handling the operations, promotion, and distribution of , Fontana, , and . These labels formed the core of Phonogram's portfolio, allowing the company to cover a broad spectrum of musical genres from pop and classical to rock and . As a of the Dutch-based Phonogram International B.V., Phonogram Inc. managed these imprints to leverage ' global resources for recording, manufacturing, and market reach. Philips Records, one of the foundational labels under Phonogram's control, specialized in pop and , drawing on the parent company's electronics expertise to produce high-fidelity recordings. Fontana Records complemented this by focusing on , classical, and international music, initially emphasizing ethnic and cultural releases before expanding into pop, R&B, and in the mid-1960s. Vertigo Records targeted rock and genres, particularly emphasizing artists during the as the label evolved to capture the era's experimental and album-oriented sounds. Mercury Records, with a strong emphasis on pop and rock, operated primarily in the market, benefiting from Phonogram's integrated structure to amplify its domestic presence. In addition to directly managing these primary labels, Phonogram Inc. distributed licensed imprints such as Decca and London Records until PolyGram's acquisition of Decca in 1979, after which they became owned subsidiaries, extending its influence into classical opera, vocal recordings, and emerging pop formats. This distribution role enhanced Phonogram's market coverage by integrating external catalogs into its sales and promotional networks. The company's manufacturing and distribution infrastructure was closely tied to Philips Electronics' technological prowess, including advanced pressing facilities and audio engineering capabilities that supported efficient production of vinyl records and later formats across its labels.

Distribution and Licensing Agreements

Phonogram Inc. facilitated the global distribution of licensed labels, notably for and its American counterpart London Records, which specialized in classical releases in the market. As part of the broader structure, Phonogram managed the international rollout of these catalogs, leveraging established networks to ensure availability across multiple regions following PolyGram's acquisition of Decca's interests in 1979. This arrangement allowed for coordinated promotion and sales of high-profile classical repertoire, enhancing Phonogram's presence in specialized music segments. Phonogram's international reach was bolstered by ' extensive manufacturing facilities, which supported record production and enabled distribution across , , and the . These plants, including those acquired or developed under , facilitated efficient pressing and for licensed and owned content, minimizing delays in global markets. Through Phonogram International B.V., the company oversaw (A&R) management for affiliated entities, coordinating talent acquisition, development, and rights oversight on a worldwide basis. This central role ensured cohesive strategies for scouting and nurturing artists across Philips-linked operations, integrating A&R with broader distribution efforts.

Expansion and Key Developments

Acquisition of Mercury Records

In the early 1970s, Phonogram Inc. emerged as part of Philips' broader reorganization of its recording operations, culminating in the acquisition of Mercury Records from the North American Philips Corporation (NAPC). This transaction, completed in 1972, transferred full control of Mercury—a key U.S.-based label founded in 1945 and initially acquired by Philips in the early 1960s—to the newly formed PolyGram group, a joint venture between Philips and Siemens that integrated various European labels like Philips Records and Deutsche Grammophon. The move aligned with PolyGram's establishment that same year, enabling centralized management of international music assets under a unified structure. Following the acquisition, Mercury Record Productions, Inc. was renamed in the United States to align with Phonogram's existing international branding, particularly its operations, while retaining the Mercury imprint for artist releases. This renaming reflected the integration of Mercury as Phonogram's primary vehicle for U.S. distribution and production, leveraging its established infrastructure including pressing plants in . The change marked a pivotal step in post-1970 reorganizations at , where disparate subsidiaries were consolidated to streamline global operations. The acquisition significantly bolstered Phonogram's entry into the U.S. market, positioning Mercury as the flagship label for pop and rock genres and complementing European-focused imprints like Fontana and Vertigo. By incorporating Mercury's roster and facilities, Phonogram gained immediate access to a substantial American audience, enhancing its competitive edge against domestic giants like RCA and Columbia. This expansion capitalized on ' pre-existing U.S. presence through NAPC, fostering financial synergies via shared manufacturing and distribution networks, as well as operational efficiencies in promotion and licensing.

Notable Artist Deals and Releases

Phonogram Inc. entered into a significant distribution agreement with Frank Zappa's newly founded Zappa Records in mid-1977, handling releases in the United States and Canada. This partnership enabled the issuance of key albums, including the double live recording in March 1979, which featured satirical tracks and became a commercial success, peaking at number 21 on the 200. The deal concluded in early 1980 when Phonogram refused to distribute Zappa's single "I Don't Wanna Get Drafted" in the U.S. due to concerns over its lyrical content, leading Zappa to sever ties and pursue independent distribution. Under its managed labels, Phonogram Inc. supported a diverse roster that bolstered its standing in artist and repertoire (A&R) during the vinyl era. On Mercury, Phonogram oversaw pop and rock acts, including , whose 1974 hit "The Night Chicago Died" reached number one on the , and Bachman-Turner Overdrive, whose hard rock albums like Not Fragile (1974) achieved multi-platinum status. Phonogram's notable releases in the highlighted its rock and jazz catalogs, drawing on the Fontana Records heritage for the latter. In jazz, Phonogram reissued and distributed Fontana's legacy material, such as Roland Kirk's Rip, Rig and Panic (1965, reissued in the ), preserving influential works that bridged avant-garde and mainstream appeal during the vinyl-dominated market. These efforts enhanced Phonogram's A&R reputation by prioritizing artistic risk-taking, fostering long-term artist development amid the era's format-driven sales.

Reorganization and Dissolution

Integration into PolyGram

In 1972, the Grammophon-Philips Group (GPG), originally formed in 1962 as a between and , underwent a significant reorganization and was renamed N.V., with each parent company retaining a 50% stake. This expansion provided the framework for the incorporation of Phonogram Inc. on April 20, 1973, as the U.S.-based subsidiary of Philips Phonographische Industries, serving as a core operational unit responsible for international production and distribution. Headquartered in , , the new entity centralized oversight while allowing regional autonomy, marking a shift from fragmented operations to a unified global structure for the music industry. Under 's decentralized federated model, Phonogram Inc. was renamed PolyGram Records, Inc. on July 29, 1981, and continued to handle core record production and label management, overseeing imprints such as , Fontana, and Mercury for artist development and releases. Corporate entities were dissolved on April 3, 1984, and December 23, 1992, though operations persisted under the PolyGram umbrella. The broader structure diversified beyond music, incorporating divisions for filmed entertainment—such as Polytel Film N.V., established in —and other media ventures, which complemented Phonogram's focus on audio content. This integration preserved Phonogram's creative and operational identities, enabling it to function as a key pillar in 's rights-based multinational approach. Phonogram units maintained their roles in label management and international distribution throughout the and , adapting to 's growth through acquisitions and market expansions. By the , these units still operated semi-autonomously, contributing to 's portfolio of over 100 labels worldwide. This structure propelled to become the world's largest by 1997, with annual sales exceeding $5.5 billion and a workforce of 12,549 employees, reflecting a 17% sales increase and 11% rise in operating profits that year.

Merger with Universal Music Group

In 1997, as part of PolyGram's ongoing restructuring of its U.S. music operations and phase-out of the Phonogram name, remaining Phonogram units were merged into the newly formed Mercury Records Group, which was designated as PolyGram's flagship label in the United States. This consolidation oversaw the management of key imprints including Mercury, Island, A&M, Motown, and Def Jam, effectively ending Phonogram operations as a standalone entity and aligning them under the Mercury banner to streamline costs and focus resources. The following year, on May 21, 1998, Seagram Company Ltd. announced its acquisition of N.V. for $10.6 billion in cash and assumed debt, marking one of the largest deals in the music industry at the time. This purchase integrated 's extensive catalog and labels, including the former Phonogram assets, into 's existing music holdings. Shortly thereafter, in December 1998, consolidated with its (UMG) subsidiary, creating the world's largest music company by market share and further embedding Phonogram's operations within UMG's global structure. Following the merger, Phonogram's labels and artist rosters were fully absorbed into UMG, with retaining a prominent role as a core imprint while other Phonogram-associated entities were reorganized or phased out. This transition marked the end of Phonogram Inc. as a distinct operational entity, with its vast catalog of recordings—spanning rock, pop, and international artists—transferred to UMG, significantly influencing the company's modern distribution and licensing strategies for legacy content.

References

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  28. https://variety.com/1998/music/news/seagram-nears-polygram-deal-1117470668/
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