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Hollywood Records was founded in 1989 by Michael Eisner with the idea of expanding the music operations of Disney Enterprises Inc. (then reduced to the release of the soundtracks of Walt Disney, Touchstone, and Hollywood Pictures films) and to develop and promote the careers of a wide variety of artists in various genres. However, the label struggled to launch a successful artist, and in 1991 the label had significant financial loss. The only major success was the agreement to be the catalog distributors of Queen, a fact affected by the death of vocalist Freddie Mercury. Label problems continued and even years after the acquisition of Mammoth Records in 1997 was seen as a sign of the search by Disney for a record label that would give success to the company. However, Mammoth Records was dissolved and integrated into the label in 2003, after little success.
In 1998, the company decided to integrate the operations of Walt Disney Records with Hollywood, Lyric Street, and Mammoth, with Walt Disney Music Publishing, creating Buena Vista Music Group, now Disney Music Group, and appointing Bob Cavallo as chairman of the group, and president of Hollywood Records. The newly formed group then set out to create a more traditional music industry management structure and involvement with Disney Enterprises Inc. was minimized. Cavallo retired in January 2012, and Ken Bunt was appointed to his position.
It was not until 2003, with the launch of Hilary Duff's musical career that the label would be a real success. Her debut album sold more than 5 million copies worldwide and was the beginning of a successful business model for the label. A partnership with ABC, SOAP Net, A&E Networks, Disney Channel, and Radio Disney was encouraged and brought its artists to have strong media exposure. Duff was the best-selling artist of the successive record label with 13 million albums sold, until Miley Cyrus debuted. Cyrus has sold over 20 million albums worldwide to date. Artists such as the Cheetah Girls, Raven-Symoné, Miley Cyrus, Demi Lovato, and the Jonas Brothers replicated this model of marketing. At the same time, the label continues to develop the careers of artists with a profile less commercial such as Grace Potter & the Nocturnals. The label also releases soundtracks from Marvel Studios, Touchstone Pictures, and Hollywood Pictures films and ABC television productions.
In 2010, Hollywood absorbed the country music label Lyric Street Records and subsequently inherited its roster of acts. In 2011, Queen's music was distributed by Universal worldwide for the first time, as outside the US, Queen left EMI for Universal-owned Island Records.
It was announced in early 2012 that Hollywood Records would sign the winner of the ABC talent competition "Duets" coming this summer.
In March 2012, Hollywood Records underwent a management overhaul with a new managing director appointed. The label is currently trying to pursue a new marketing strategy separate from its traditional Disney-based market. Many new artists were signed in recent months.
Hollywood BASICHollywood BASIC was Hollywood’s short-lived hip-hop subsidiary, run by Dave Funkenklein, which existed from 1990 to 1995. It did not survive the distribution transition its parent made to PolyGram Records, and all of its recordings were deleted, save for those by Organized Konfusion, which were repressed under the new deal. It was the first label to record DJ Shadow, releasing his "Lesson 4" (a reference to Double Dee and Steinski) as the B-side of a 1991 single by Lifers' Group, a hip hop group composed of convicts serving sentences at Rahway Prison in New Jersey. It also released Shadow's Legitimate Mix on the B-side of a single by the group Zimbabwe Legit in 1992. Other notable releases came from Organized Konfusion; its challenging second album, Stress: The Extinction Agenda (1994), was widely acclaimed. The label was also home of Charizma and Peanut Butter Wolf, although, following the shooting death of Charizma in 1993, the music the duo recorded for the label was not released. This would later inspire Peanut Butter Wolf to found Stones Throw Records in order to make this music available. Acts on Hollywood BASIC's roster included Charizma and Peanut Butter Wolf, Lifers' Group, Organized Konfusion, Raw Fusion, and Zimbabwe Legit.
Upon its 1989 launch, Hollywood was distributed by Elektra Records in the United States and Canada. Distribution in North America switched to PolyGram (now Universal Music Group) in 1995. Today, Universal Music Group markets and distributes Hollywood Records catalog in North America, Canada, Europe, Asia, South America, México and India; while Avex markets and distributes Hollywood Records catalog in Japan. Also, several Hollywood artists including Miley Cyrus, Jonas Brothers, Demi Lovato, Selena Gomez & the Scene, Nick Jonas & the Administration, Joe Jonas, Lawson Connect 3 and Annel Cereceres are directly signed to Universal Music UK's Fascination Records. In other territories, EMI, Disney's partner in Europe, Africa, and the Middle East, distributes the label. There were reports in 2011 that Disney Music Group would start an independent US distribution arm for its label's releases, but as of February 2012, those plans have yet to be enacted. Miley Cyrus still records for Hollywood Records, and her picture is on its official Web site.