NASHVILLE

Nashville has long prided itself on having the largest number of churches per capita in the U.S. So it's appropriate that the city's studio business in
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Nashville has long prided itself on having the largest number of churches per capita in the U.S. So it's appropriate that the city's studio business in the last decade is prefigured in the Bible. In the mid-1990s, Allen Sides and Gary Belz begat Ocean Way/Nashville, and Masterfonics begat The Tracking Room, and Reba begat Starstruck, and many major new facilities were born as country music rose in the pop charts.

At the turn of the century, however, the city flipped pages, from Genesis to the Apocalypse, and all hell broke loose. The worldwide business trend of consolidation began to affect Nashville. It started with the record labels, and several closed their doors. That, in turn, had impact on the studio base, which had benefited from the attention Nashville had received during country's golden years between 1990 and 1995 when more non-country artists than ever came to record in Nashville and its environs. The studio business, nonetheless, remained dependent on country for a primary source of clients and revenue. It wasn't long before consolidation began to cull the swollen number of Nashville facilities.

Some of the most prominent transactions provide a sense of scale. In 1997, as the first effects of label budget and roster cuts began to be felt, Nashville started to lose upper-tier studios. Sixteenth Avenue Sound, one of only two SSL G-Plus facilities in the city, shuttered that year. Closings continued for the next two years, with Nashville losing Music Mill and Zomba-owned Battery Studios.

In early 1999, a wave of mergers and acquisitions began and is only now beginning to slacken. Seventeen Grand bought the assets of Love Shack. Emerald Sound Studios purchased the assets of Masterfonics, which had sought bankruptcy protection the year before. Emerald owner Dale Moore also acquired the businesses of the Workstation and created a joint venture studio called the Parlor. Gary Belz purchased the SSL 9000 J-equipped East Iris Studios, not long after Moore had attempted to do the same. Lou Gonzales, owner of Quad Studios in New York City, bought the serendipitously named Quad Recording in Nashville.

These examples illustrate the forces and the strategies at work in Nashville at the moment and reflect the situation facing the studio industry at large.

EMERALD'S ISLEEmerald's tale is most complex. Since owner Moore returned to Nashville full-time after developing and selling a string of radio stations in Montana, he has dramatically changed the studio business landscape through a series of acquisitions. Moore bought a one-room facility from producers David Malloy and Even Stevens in 1985, and he had kept it out of the Nashville studio "arms race" of the mid-1990s. So when Moore sold his radio holdings, he had capital at a time when much of Nashville's studio owners were in debt. Moore's Emerald acquisitions now include eight studios in four buildings in a single city, and it's the largest studio complex in the Southeast, rivaling in size Ocean Way in Los Angeles, Chicago Recording Co. in Chicago and Hit Factory in New York City.

But perhaps more important than mere size, Moore and former Masterfonics partner and Emerald studio manager Milan Bogdan (who left Emerald earlier this year and is now working for Nashville/New York-based Quad Studios) oversaw functional and business expansions. Emerald has created new businesses within the organization, including a direct-to-satellite radio promotional service, a Webcasting service, a digital audio post-production venture, a talent agency, and a marketing division, which seeks to match corporate sponsorships with artists and record labels. Emerald has also introduced a tiered pricing structure in which unit costs for studio time decrease as the number of services used within the Emerald system increases.

"There was a tremendous opportunity in Nashville at that time, and there still is," says Moore. "We felt that the consolidation that was going on made sense from a business point of view. The city had been overbuilt. But the opportunity that we created was to acquire properties that would allow us to close the circle and offer a range of services within one company that clients used to have to go to several facilities for. An entire project-from tracking to overdubs to digital editing to mixing, mastering, video post-production and post-production business services like radio and Internet promotion and artist bookings-could be handled [in one enterprise]. And that brought economies of scale to the record-making process that were very appropriate for the way the record industry was going."

Moore refers to the fact that, while country music as a genre had taken a nosedive in recent years, the larger music industry was consolidating. Multibillion-dollar transactions, such as Seagram's acquisition of Universal and PolyGram, have been followed by huge cost-cutting exercises resulting in layoffs and album budget cuts. "What we were offering the record industry at that moment was just what it was looking for," Moore says.

Emerald has most recently focused on upgrading their technology. The studio installed Nashville's first Euphonix System 5 digital console in mid-March.

Moore acknowledges that he is taking a chance introducing such a radically new console platform to Nashville. The area tends to be staunchly conservative in terms of boards, because the nature of country music production tends to favor fast completion of projects, and engineers-who move daily between studios-want consoles they already know.

"That's the way it's always been in Nashville," says Moore. "I know-we took a chance by putting in an SSL E Series console back in 1985 when everyone here was working on Neves. And we now have to do the same thing as we did then: educate the engineering community here about the console and why we think we made the right decision."

Moore says he polled Nashville area producers and engineers about the console, which was introduced at the 1999 AES Show in New York City. He also had Euphonix put the console into the studio for a period of time prior to finalizing the sale so engineers could preview it in situ.

"When you put in a piece of equipment like this, you're selling to a group of people-record labels, artists, producers, engineers," Moore says. "The mixing engineer especially has considerable influence over where mixes get done. You want to get as many of them to check the console out as possible. So there's both a technical and a marketing decision that has to be made."

Moore also says he is hiring a dedicated assistant for the Euphonix room, and that Emerald employees will be trained by Euphonix. No rates have yet been set for the newly outfitted Mix Room at Emerald. Moore says, however, that he is likely to go with an introductory type of rate for the first several months, and he expects to increase that rate after the console gains some traction in the market.

THE SHIFTING STUDIO SCENEStarstruck Studios also beefed up its broadcast services in the last year. The facility, part of the multifaceted Starstruck Enterprises group owned by singer Reba McEntire and her manager/husband Narvel Blackstock, has two SSL 9000 J-equipped studios. But what started as a relatively small audio media promotional services two years ago expanded in 1999 to encompass video, and now both Access Hollywood and Entertainment Tonight take regular Nashville feeds from Starstruck, routed straight to Burbank, Calif., via satellite transmissions and fiber-optic connections.

Studio vice president Robert De La Garza declined to discuss rate comparisons between the studio and the broadcast operation, but did note that the margins on the broadcast services were higher than those in music. This year, the broadcast division, which De La Garza heads, has expanded its marketing efforts into the medical industry, corporate narrowcasts and book publishers sending authors on electronic media tours. "It's another service that we can offer clients who use the studio, because they'll need to promote the records they make here," he explains. Looking further ahead, De La Garza says that the studio has been wired for 75 ohms for high-definition broadcasts.

Other facilities in Nashville have realized that the business model is changing. Seventeen Grand has staked out a leading position in the Nashville and national market as a surround mixing facility, and the studio did a dozen surround projects in 1999. The facility also bought the midscale Love Shack facility in order to broaden its client base. "It's given us a more stable cash flow situation, because we can provide services for more clients," explains Seventeen Grand co-owner Jake Nicely. "Love Shack lets people come in at a lower rate level and start projects, or use the room for affordable overdubs, then come back to the main studio for mixing or surround work. It's a wider range of services people can access."

The same principle drove Sound Stage owner Ron Kerr to expand into the former Nightingale Studios. "That location gave us access to a new client type-the upper mid-level client," says Sound Stage studio manager Michael Koreiba. "It filled a hole in our range of services and also addressed a hole in the market. We've found that there are a lot of clients out there who are in the market for a good studio in the $800- to $1,200-a-day range."

That market niche, Koreiba continues, is a potentially large one. Its ranks have grown with both major-label, first-record artists who might have had larger budgets during country's headier days a few years ago, and by rock, Christian and alternative artists working on mid-career records.

Sound Stage also made other service moves, including the establishment a format transfer service, which Koreiba says is bringing work in on a national basis. The facility also formed a joint venture deal with engineer/mixer Chuck Ainlay: The partners have created a new studio called Back Stage, equipped with an SSL Axiom-MT digital console.

All agree that the studio industry is changing dramatically in the wake of new technologies and business models sparked by the Internet, and they concur that bigger seems to be better. The ability to provide new services within a vertical organization is a valid strategy for surviving in a changing landscape. "People have gotten used to running out to Wal-Mart when they need something. They can find everything they need there under one roof," says Koreiba. "That same concept is now being applied to the studio business. You just have to decide which services your market needs, and how many services you can supply and do it well without overstressing the business. And that might be the art of it right there."

Still, some of Nashville's changes are unique to the city, Nicely says. "[Nashville] still basically relies on what's in its backyard, and that's been country up till this point," he says. "But even if that continues to be the case, it's whatever country happens to be that could affect things. Right now, it's crossing over heavily into pop, with records like Faith Hill's 'This Kiss.'

"But more than what country becomes, when it was hot, it attracted a lot of people to Nashville, and some of them are having an effect on the city," Nicely continues. "People like [producer] Dann Huff, who produced Faith's record and who has another pop hit with Lonestar. People like him are part of the reason that country is crossing over the way it is right now. Dave Thoener, who won a Grammy this year [engineering for Carlos Santana's "Smooth"]. Adrian Belew lives in Mt. Juliet [a Nashville suburb], and we did part of the last King Crimson record here. Country music as we knew it growing up-the Don Williams and Conway Twitty country-will probably become a small niche market, like bluegrass. But the part that's becoming like pop music and the people who are leading it that way all use the facilities here."

THE NEW MIDDLE CLASSIf there has been significant activity in the upper tier of facilities, the same goes for the emerging middle class in Nashville's studio community. Antarctica, a Pro Tools-based recording studio that also offers graphics and Web page construction services, underscores how new business models are rising from the ashes of the old. The studio moved into the site of the former Sixteenth Avenue Sound, and owner John Trevethan says he purposely targeted a middle ground in the Nashville market precisely because there was so much consolidation activity above. "There's a lot of high-end competition here, but that made for opportunities in the middle level," he explains. "Also, the Pro Tools thing in Nashville had been mainly for editing. We created something new by making it a primary recording system. This is a level of the market that's really been overlooked."

Trevethan says he has no ambitions to grow into the bigger leagues. He notes that Nashville's music market has become more diverse and more technically oriented and is now less reliant on large consoles and big tracking rooms. "To quote Robert Fripp [who recently gave an online Webchat, hosted by Antarctica], the small mobile unit is the way to go in the future," says Trevethan.

New Yorkers "Void" Caprio and Keith Spacek saw the potential in Nashville's underground rock and pop scene, which has been oft-discovered but rarely leveraged with success. Caprio and Spacek decided to open a studio that could provide them with a base for developing productions with local bands and built most of the single-control-room facility themselves. The result, InterZone, has three sizable recording spaces with 12-foot ceilings and hardwood floors, and the equipment includes a Mackie 8-bus console and a vintage 3M 2-inch 24-track, along with three 20-bit Alesis ADATs.

Caprio believes InterZone can be a successful hybrid facility: It houses the partners' music production work and Caprio's music library productions, and it is available for hire at between $300 and $500 per day. InterZone has also built in several of the services that are becoming a hallmark of these kinds of facilities, including on-site CD-R duplication and Internet promotion.

IN THE BURGEONING 'BURBSThe other story in Nashville isn't in Nashville at all. It's in Williamson County, Tennessee's affluent suburb, about 16 miles from Music Row. Several facilities, old and new, have been thriving in Williamson County, partly because the neighborhood doesn't carry the implicit cultural connotations of country music the way Nashville does, and partly because many of country's success stories have moved to the South's affluent equivalent of Fairfield or Orange Counties.

In Franklin, the genteel, antebellum county seat of Williamson County, the landscape is now dotted with several facilities that are thriving. The most notable is Sound Kitchen, which has grown from two rooms in 1994 to six studios today, with two more under consideration by co-owners John and Dino Elefante. John is a successful Contemporary Christian recording artist and former lead singer with the band Kansas, and Dino is a prolific producer of Christian records and the senior vice president of Pamplin Records in Portland, Ore., and the pair had originally predicated the studios' revenues largely on their own work.

Dino says that's changed considerably in the intervening years. He also estimates that as much as 25% of the recording in the area is now being done in Williamson County at Sound Kitchen, Dark Horse, The Castle and a handful of other facilities that are near the upscale homes of producers and artists who don't want to drive to Music Row every day.

"We had a gut instinct about [the area]," says Dino. The Elefantes backed up that intuition with a business approach that focuses on proven and widely accepted equipment choices. The Sound Kitchen console complement includes new and pre-owned Neve VRs and SSL G-Plus desks, and the newest, largest room sports an API console. The Elefantes have also taken great pains to cultivate business relationships with area producers, offering them what Dino Elefante describes as "time shares" in the facility, an arrangement that guarantees availability and rates in return for consistent use. "It's a form of buying into a studio, but without the liability," Elefante explains. "It's a time-share mentality."

Franklin's other successful facilities include Dark Horse Recording, which is based at owner Robin Crow's home. Crow has a theory about why people record in the area: They work there because they live there.

Now that population makes up more than half the bookings for Dark Horse, and the studio has grown from a private single-room studio to a three-room facility. Much of its work comes from the still-growing Contemporary Christian recording market. Several Christian record labels have set up shop in the Maryland Farms office park in northern Williamson County, and artists and producers seem to like the suburban setting.

In addition, Crow says that, at the moment, two of his three studios are booked with clients from outside of Nashville. "To some degree, we're able to float above what's been going on closer to town," he says. "But there's a price for that-we never stop spending money on upgrades."

At the Castle Studios, owner Jozef Nuyens is more skeptical about the suburbs' ability to remain aloof from the developments on Music Row. "I don't think you can separate [Williamson County studios] from the Row," says Nuyens. "The business affects us all the same way. It's just that out here, we have a better image appeal than the Row. The studios aren't necessarily better, but the settings are. Overall, though, we've all been affected by what's been going on. I don't know that the mega-studios are going to change things all that much. The fluctuations in the business here are easing. When it's all said and done, things will be calmer but at a lower level than they were."

Nuyens has hedged against that by increasing his in-house production activity and pursuing music publishing interests. Last year, he concluded a joint venture with Warner Chappell Music.

THE FUTURENashville is churning. But most say it's for the better. For example, new Internet-based companies have cropped up such as Tappedinto.com, an online music venture co-developed by Preston Sullivan, the former Sixteenth Avenue Studios manager, and Judith Newby, former personal manager for Everly Brothers, Tom. T. Hall and Johnny Rodriguez. Tappedinto.com might prove to be the model for the future of multimedia in Nashville, a model in which music becomes a content source for the 144 URL channels Tappedinto.com operates. The company also creates marketing and sales packages for independent and major label artists and its own burgeoning roster of recording artists.

Tappedinto.com's audio arsenal is Spartan-a Mackie mixer, a few microphones, Real Audio for MP3 encoding and Adobe Premiere video editing software. But that's about all it takes, Sullivan says. The company can always use the studio resources of Nashville, which continue to become more affordable as consolidation continues, as well as Full Scale, a Seattle recording studio that is one of Tappedinto.com's partners.

Nashville has also become the North American headquarters for the sprawling School of Audio Engineering (SAE) empire. SAE took over the former Arista Records building just off Music Row, and the 14,000-square-foot facility is now the flagship for the school's invasion of U.S. shores, which began last year.

There is much that is unique in Nashville's situation. But there is just as much here that can be applied to the larger studio business picture. Although The Hit Factory's acquisition of Miami's Criteria has been a headline-maker, Emerald's business plan has been just as compelling, in a more complex and nuanced way. Perhaps the most important lesson of the last decade is the notion that, for the first time in its 50-plus years as a recording center, Nashville's developments in its studio infrastructure and the developments in country music may not be one and the same.