From: gregpen@crash.cts.com (Greg Penetrante)
Subject: SPARROW/WORD SOLD! DANGEROUS TREND?!
Organization: CTS Network Services (crash, ctsnet), El Cajon, CA
Date: 9 Oct 92 04:38:43 GMT
Summary: Two mainstream Gospel labels sold -> Mainstreaming warning!
Keywords: Capitalism, Sparrow, Word, LBO, Gospel


NOTE: THE FOLLOWING IS REPRINTED FROM BILLBOARD, OCTOBER 10, 1992.
      REPRINTED WITHOUT PERMISSION, for academic purposes only!

*************************************
Gospel Labels Word, Sparrow Sold
Buyers Predict Mainstreaming Of Genre
*************************************
 
 BY BOB DARDEN
  and EDWARD MORRIS
 
 
WACO, Texas -- The sales of the two largest gospel record companies, 
Word and Sparrow, were announced within hours of each other Sept. 
29.   Nashville-based Thomas Nelson Publishers Inc., the world's 
leading Bible publisher, bought Dallas based Word Inc. from 
Capital Cities/ABC for a reported $72 million in cash. Sparrow, 
another Nashville company, was sold to EMI Music for an undis
closed sum. It had earlier sold half of its publishing catalog to 
BMG (Billboard, March 7).   Sparrow was the biggest remaining in
dependent gospel label, with annual revenues of about $30 million. 
Its artist roster includes Steven Curtis Chapman, Steve Green, 
BeBe & CeCe Winans (for gospel re tail distribution), Michael 
Card, Debby Boone, Margaret Becker, Sandra Crouch, Tramaine 
Hawkins, and Susan Ashton. The company distributes Warner 
Alliance, Integrity Music, and Selah Records.   Word, the largest 
Christian communications company, reportedly had revenues in fis
cal 1992 in the $100 million range. Its music roster features Amy 
Grant (for Christian retail distribution), Sandi Patti, Petra, the 
Rev. Milton Brunson and the Thompson Community Singers, and 
Shirley Caesar, among others. 
 
  Word also distributes Reunion Records in the religious market 
place. Word is distributed in the secular market by Epic Records.   
The sale to Nelson also include Word's book publishing division 
which at one time comprised part of religious publishing's "Big 
Three' with Nelson and Zondervan. Past and present Word authors 
including Chuck Colson, James Dobson, the Rev. Billy Graham, Pat 
Robertson Charles Swindoll, and Texas Rangers pitcher Nolan Ryan.   
Rumors of potential buyers of Word have been swirling since previ
ous owner Capital Cities/ABC announced in May that the religious 
publishing giant was for sale. Among the alleged suitors was ru
mored to have been EMI Music.   Word Inc.'s corporate headquarters 
are in Dallas. The company which was founded in Waco, Texas by 
Jarrell McCracken in 1951, also has smaller offices in Nashville, 
Lo Angeles, and London. Fulfillment and warehouse operations re
main in Waco. Word has an estimated 550 employees worldwide.   The 
sale of Word to Nelson set off another round of industry specula
tion that the company may eventually move to Nashville, joining 
its main music competitors, Sparrow and the Benson Co.   In a pre
pared statement, Thomas Nelson president Sam Moore said, "This ac
quisition is strategic for Thomas Nelson because the operations of 
both companies will result in our being the industry leader in 
Bible publishing, Christian music, and Christian and inspirational 
publication." 
 
        'MAINSTREAM GENRE'
 
  At a Nashville press conference EMI CEO/president Jim Fifield 
also stressed the significance of the Sparrow purchase. "This par
ticular acquisition is a very important one for us," he said, "be
cause it puts us in a very strong position in the Christian music 
industry. We think it's a growth industry. We think that Sparrow 
and Sparrow's management, along with Liberty Records and EMI, can 
form a very strong alliance to make Christian music more of a 
mainstream genre."   Fifield explained that Sparrow will be co-
chaired by Jimmy Bowen, president of Liberty Records and Billy Ray 
Hearn, both of whom will report to him. Hearn, who founded the 
company in 1976, will be CEO.   (Bowen declined to confirm the 
rumor that Liberty Records is on the verge of signing its own 
first Christian music artist, Carman.)   While declining to reveal 
the purchase price of Sparrow, Fifield commented, "It was not a 
material transaction for Thorn-EMI," EMI Music's parent.  "It's 
great to be with a company like EMI," Hearn said, "that's go ing 
to take the Sparrow artists and gospel music out to the world like 
you have never seen before."   Hearn added that there would be no 
staff changes or reductions at Sparrow as a result of the pur
chase. Sparrow has about 160 em ployees, he estimated.   Bowen 
predicted that "Christian music is going to be just as major as 
country music. It's the biggest growth music of the '9Os. Five, 
six, or seven years from now, they're going to be calling us want
ing to know when the next Christian album is available, like they 
now call and ask about the Garth Brooks records or Clint Black 
records."   Amy Grant's manager, Dan Har rell, responded positive
ly to Bow en's prediction that gospel music will someday reach the 
sales and acceptance enjoyed by country music .
 
  "I hope it's true," he says. "I mean, I certainly think with 
EMI/ Liberty being involved now that the opportunity is there, es
pecially to broaden the sale of catalog product into secular out
lets. I don't think this can be anything but positive. Jimmy Bowen 
is ex cited about the prospects and we are, too." 
 
        RELIGION FOR K MART
 
  Bowen said his staff at Liberty would assist Sparrow in market
ing its records. "[The music] will be in the Christian bookstores 
forever," Bowen continued, "but we must get it in the K marts, the 
Wal Marts, and the Targets."   "Liberty and Sparrow aren't merg
ing," Bowen explained, "but in the initial 12 to 18 months, [Lib 
erty VP of sales and marketing] Bob Freese's marketing and sales 
people will be working with Spar row's sales people to make sure 
we penetrate into the mass market with this product."   Sparrow 
moved its operations from California to Nashville in January 1991.   
Fifield wouldn't speculate whether EMI would be making additional 
Christian music acquisitions, but added that "we want to become 
the dominant force in the Christian music business . . . I cer
tainly wouldn't rule it out." 
 
 

Newsgroups: rec.music.christian