Piracy-buffeted Sony BMG to revamp labels’ management

The moves come as the industry staggers through another year of declining album sales and uncertainty about the prospects of digital sales.

Even as Sony and Bertelsmann haggle about who should be the chief executive of Sony BMG Music Entertainment, their jointly owned music company, the venture is revamping management at the labels once owned by Sony, according to company executives.

The reorganization — the second for the Sony units in less than three years — relies partly on an unusual swap of executives from the two main labels, Columbia and Epic.

The moves, which are to be announced today, are aimed at shoring up the performance of an operation that, like its rivals, has been buffeted by piracy and other industry woes.

Under the plan, Columbia’s chairman, Will Botwin, who took the job in February, will resign and be succeeded by the president of Epic, Steve Barnett, said executives who asked that they not be named because the plan had not yet been announced.

Charlie Walk, a longtime Columbia executive who had reportedly been on the verge of taking a top job at rival EMI Group, will succeed Barnett at Epic.

The moves come as the industry staggers through another year of declining album sales and uncertainty surrounding the prospects of digital sales. As a whole, album sales in the United States have dropped by about 10 percent so far this year, according to Nielsen SoundScan data. Sales at Sony’s labels have declined by roughly 7 percent.

Sony’s U.S. division generated about $120 million in profit this year, a sharp reversal from losses it posted as recently as two years ago.

Columbia, its biggest label, has suffered a modest decline in its sales of new releases in recent years. Critics have said the company relies too heavily on sales from its catalog of older recordings, but it holds the top spot on the nation’s album sales chart this week with the second top-selling CD this year from the rock band System of a Down. Columbia also releases music by artists like Bruce Springsteen, Beyonce and John Mayer. Epic is home to acts like Shakira, Los Lonely Boys and Modest Mouse.

Sony and Bertelsmann have been at odds about how to resolve their differences about Andrew Lack, who led Sony Music for less than two years before being named chief executive of the new venture.

Bertelsmann does not support the renewal of Lack’s contract when it expires early next year.

Adding to the turmoil is a recent debacle in which the company was forced to recall millions of CDs outfitted with antipiracy software.

Critics say the software is invasive and potentially dangerous to the security of computers that play the CDs, and the Texas attorney general has filed suit.