How private equity firm will make EMI profitable

Sometime when a great business is not running properly, private equity companies sees an opportunity to make profit out of chaos that is what happened when private equity firm, Terra Firma bought EMI (Electric and Musical Industries) for £3.2 bn. EMI has a very long history in musics industry and perhaps has played a great role in giving direction to the whole industry through its innovations for over a century. But it was not profitable and it was sold and made private company after delisting it fromt the London Stock Exchange (LSE). Now PE company has started its operation of cost cutting to make it lean and it is reported in BBC that they are planning to fire around 2000 staff members in different divisions of the company. No doubt there will be redundancy in the company (every company develops some redundant jobs over the years) but cutting jobs to such a high degree just after buying the business six months back seems to early. Because of this some of the talented people might leave the company and that will be permanent loss for the company. No doubt 80-20 rule can be applied anywhere and we can find that 80% of the revenue come from the 20% artist and losts of records are going unsold, as Hands recentely said, but sometime in music industry talent has to recognised and groom and its not always about profit. Every artist will not become hit from very first album. There are always some up and downs and many of the successful artist have phenomenon sales after a few bad recods. New management of the company should think what to do with the company othere than cutting jobs. It might have some partnerships with other companies for recording, distributing or sells (They already have with Apple, they can try to have deal with Amazon too). It may terminate some contracts where they are losing money and getting little or chances of return are not high. It can trim the army of artist based on their public apeal. Of course marketing jobs can be axed because it will not hurt the core business of the company. Sometime just fear of having PE as the boss might make some people runaway, like EMI's UK chief executive Tim Clark left the company recently.

I just think sometimes that if a private equity had known about the total worth of copper wite AT&T had underground in America, they have bought and stoped the telephony service because the worth of copper wire was more than the profit it was earning at that time. Lets see what happens with EMI.