EMI has announced that it will cut 1,500 jobs, drop one fifth of its recording artists and outsource most of its CD and DVD manufacturing to reduce costs.
The measures may be a result of continued strife in the recording industry, beset by piracy and declining music sales, according to Reuters.
EMI Music's Chairman Alain Levy said: "The time is right to further reposition EMI Music. Exiting manufacturing in our two primary regions of Europe and the US will allow us to lower our costs while flexibly meeting our supply needs. We believe that by concentrating our efforts on a tightened roster of artists we will increase our revenue-generating potential while reducing our costs."
EMI confirmed that niche and under-performing artists would go, but refused to give names, according to Reuters. The company said the dropped artists would represent "a low single-digit percentage" of EMI's total music volume, and the company will take a cash charge of 75 million pounds and a non-cash charge of around 80 million, tied to writedowns and its downsized artists roster, in 2003/2004.
The culling of its artist roster could cause EMI to drop in the ranks of the world's largest music companies, suggests Reuters.
EMI forecasts savings of at least 50 million pounds ($92 million) a year from the cost-cutting plan.
Investec analyst Kingsley Wilson told Reuters: "EMI's outsourcing of its manufacturing in Europe and the United States is long awaited and the company's nearly flat annual sales represented a significant outperformance of the market."