Disney to Close Lyric Street Music Label

Reprinted from The Wall Street Journal

By KATHY SHWIFF
Walt Disney Co.'s music division said it will close Lyric Street Records, its label in Nashville.

Lyric Street has produced recordings by artists Rascal Flatts and Shedaisy, as well as Aaron Tippen, Love & Theft, Sarah Buxton, and "American Idol" alums Josh Gracin and Bucky Covington since it opened in 1997.

"Given the changing nature of the music business and the more streamlined priorities of the [Disney] Studios, we need to find alternative ways to create and market new artists and their music to consumers," said Bob Cavallo, chairman of Disney Music Group.

Disney said it will phase out Lyric Street operations while keeping a core promotions team to market and promote the label's current records. Rascal Flatts will be moved to another Disney Music Group label, which will release the group's fall album. Disney Music Group handles all Walt Disney Studios' recorded music and music publishing operations, including Hollywood Records, Walt Disney Records and Walt Disney Music Publishing.

Disney Studios, which for two quarters last year reported its first operating losses since 2005, has shifted its strategy to focus on films that are essentially brands--like a planned Muppets movie--that can be exploited across its network of theme parks, videogames and commercial products.

Chairman Dick Cook was replaced last year by Disney Channel head Rich Ross, whose mandate from Disney Chief Executive Robert Iger was to redefine the studio in much the same way he had rebuilt the company's cable-TV network. Mr. Ross reinvented the cable network--formerly a sleepy outlet for old Disney movies--by creating tween-oriented entertainment like "High School Musical" and "Hannah Montana," that drove profits for the radio, consumer products, recorded music and live-events divisions.

Write to Kathy Shwiff at kathy.shwiff@dowjones.com