After years of being off the radar, Fania Records is experiencing a rebirth. The label is employing a host of strategies like re-mixing new versions of songs for live dance events, making its classic catalog available for digital download, and partnering with Spotify to create the first Latin music app.
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For the first time in decades in 2013, Fania is actually profitable. In the early 1980s, when the label essentially went dormant and before physical sales of albums ground to a virtual halt.
Founded by Dominican bandleader Johnny Pacheco and lawyer Jerry Masucci in 1964, Fania rose to prominence alongside the salsa style made popular by musicians from New York's diverse neighborhoods of Latin American immigrants and their extended families.
At one point, the label was a clearinghouse for some of salsa's biggest names, including Cuban "Queen of Salsa" Celia Cruz, as well as Hector "El Cantante" Lavoe.
"It was a powerful movement" said Claussell. "And it instilled hope in the youth in the urban Latino neighborhoods. They were inspired by this music"
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Claussell grew up in a musical family of Puerto Rican heritage in Park Slope, Brooklyn. "At home, we listened to all kinds of music, but Fania was the heartbeat," he recalled, citing artists like Cruz, Willie Colon and Ruben Blades. The now deceased Cruz was one of several big name headliners in a global concert tour in the 1970s dubbed the "Fania All-Stars."
"We always knew the value of this catalog," said Rucker, who has been with Fania since the original catalog and music rights were released from probate court. That followed the death of one of Fania's founders, resulting in the label's purchase for a reported $9 to $12 million by a group of investors in 2005, assisted with financing by Morgan Stanley. The current owners, Miami-based Codigo Music, purchased Fania in 2008.
After painstakingly cataloging and archiving the label's nearly lost material, Codigo sought new revenue streams that positioned the music itself as a commodity, rather than producing vinyl albums or compact discs with less opportunities to earn money.
In the first six months of 2014, sales of physical recordings made up just 28 percent of the music industry's total revenue, according to the Recording Industry Association of America. Streaming revenue was 27 percent, while permanent downloads comprised 41 percent. With that in mind, Fania's future—and its path to profitability—became clear.
"We made a concerted effort to focus on the digital space, and it's the best thing that ever happened to us," said Rucker. "The world became our market."