company. The official reason for his departure was succession. It was time for a new CEO. However, published reports claim that Davis was ousted because he was 67 and had reached the retirement age set by company policy. Reports say the news was delivered unexpectedly, even poorly, considering Davis’ position in-and relationship to-Arista. The suddenness of the decision even sparked rumors that some of the label’s top-selling artists, among them Whitney Houston, had threatened to leave. When all was said and done, a few executives-including Charles Goldstuck, the general manager-had left, and Reid was thrust into the limelight as the new chief music maker.
Reid has felt a chill from folks in the industry since replacing Davis. Davis has since founded J Records-a 50-50 joint venture with BMG, worth a reported $150 million, of which Goldstuck is now president and COO. “I come from a purely creative background and I stepped into a position that was truly controversial,” explains Reid. “My guess is that I have about six months to make a difference, as opposed to the three to five years most CEOs get,” he says, responding to the pressure he’s been feeling since starting in the post in July.
Nonetheless, he speaks confidently about his new position. “I may not get those three to five years, but that’s okay. It won’t take me that long anyway,” he says.
In accepting the post, Reid sold the remaining 50% interest of LaFace records to BMG for $100 million. Reid believes LaFace was responsible for most of Arista’s high points over the past 10 years, because LaFace’s artists composed the majority of Arista’s roster. “To be quite honest, I’ve made a huge contribution to Clive’s career,” says Reid, referring to the 50 million albums LaFace artists sold for Arista in that time.
Despite a history with Arista, Reid still has to prove himself as a businessman capable of managing a $500 million record company. Arista proper has around 41 domestic artists, plus 11 more on its international roster. Now that LaFace has been acquired by Arista, that roster will increase by 17. There are also three other labels, including Sean “Puffy” Combs’ Bad Boy Records, that Arista promotes and distributes.
“There’s definitely going to be a lot of people sitting on the sidelines watching, and a lot of Monday morning quarterbacks second-guessing everything he does,” says Elektra CEO Sylvia Rhone, who is the only other African American CEO of a major record label. “Obviously, he will be compared to Clive Davis and the mythological aura that has surrounded him,” she states. But she believes “L.A. will be able to forge his own path, and create his own legacy.”
James “Jimmy Jam” Harris, of the producing duo Jimmy Jam and Terry Lewis, knows the details of Reid’s résumé as well as any biographer. He explains why Reid is the best choice to succeed Davis.
“At his age, there’s nobody more qualified,” says Jam, who knew Reid before the LaFace years when Arista’s CEO was a member of the