03/28/2008 02:45 am ET Updated May 25, 2011

EMI's $400,000 Coke And Hookers Budget

Buried in a "music-industry-screwed" roundup in the Economist is this nugget: An allegation that music label EMI was spending $400,000 a year on party favors (booze, drugs, women, whatever) for its talent:

Now, having got rid of most of EMI's senior managers and revealed embarrassing details of their spending habits (£200,000 a year went on sundries euphemistically referred to in the music business as "fruit and flowers"), Terra Firma is due to produce a new strategy later this month. But many observers reckon the private-equity men are out of their depth.

Prior to reading the article, we've heard two different versions of the EMI "flowers" story: One is that Guy Hands, the private equity boss who bought the company last summer, didn't understand the term and couldn't figure out why EMI was spending so much on floral arrangements. The more flattering version: This was exactly the kind of excess, unheard-of anywhere but the entertainment industry, that Hands was planning on cutting after he bought the company.

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