K-tel
Encyclopedia
- For the Albuquerque Telemundo station, see KTEL-LPKTEL-LPKTEL-LP is a Spanish-language low-power television station in Albuquerque, New Mexico, broadcasting locally in analog on UHF channel 47 as an affiliate of Telemundo. Founded November 28, 1994, the station is owned by Ramar Communications. The station formerly transmitted on UHF channel 53, but has...
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K-tel International is an "As-Seen-On-TV" company, which is most noted for its compilation music albums, such as "The Super Hits" series, "The Dynamic Hits" series and "The Number One Hits" series. It is also known for "The Record Selector," "The Micro-Roast," "The Tote-a-Tune portable stereo," and many other products.
History
The company has been in business since the late 1960s and is based in Winnipeg, Manitoba. They also have subsidiaries or other controlled entities in the U.S., the UK and Germany. In the UK the company is known as "K-tel UK Limited." In the U.S. and Canada it is known as "K-tel International," with US-distributed compilation albums distributed from Plymouth, MN.The founder of K-Tel was Philip Kives
Philip Kives
Philip Kives is a Winnipeg business executive and innovative marketer. He is best known for founding K-tel, famous for it "As seen on TV" marketing strategies....
. Kives, a demonstration salesman who had previously sold cookware door-to-door and in a department store, used television advertising in 1962 to sell Teflon-coated frying pans to a large-scale audience. Kives bought and marketed a number of other products from Seymour Popeil, father of Ronco
Ronco
Ronco is an American company that manufactures and sells a variety of items and devices, most commonly those used in the kitchen. Ron Popeil founded the company in 1964, and commercials for the company's products soon became pervasive and memorable, in part thanks to Popeil's personal sales pitches...
founder Ron Popeil
Ron Popeil
Ronald M. Popeil is an American inventor and marketing personality, best known for his direct response marketing company Ronco...
such as the "Dial-o-matic," a type of food slicer that allowed the user to "dial in" the thickness of slices produced, the Veg-O-Matic
Veg-O-Matic
Veg-O-Matic was the name of one of the first food-processing appliances to gain widespread use in the United States. It was invented by Samuel J...
, and the "Feather Touch Knife." The combination of inexpensive goods, mail-order distribution and a simple sales pitch were a novel combination in television advertising in the early 1960s. Kives took his "Feather Touch Knife" on the road to Australia starting in August, 1965 and by Christmas had sold one million knives with a net profit of one dollar a knife.
K-Tel was formally founded in 1968. After a successful decade in the 1970s, the company expanded rapidly both through acquisitions in its core area of business and diversification into other areas. Kives' cousin Raymond Kives was president of K-Tel USA from 1967 to 1977, and president of K-Tel Europe from 1977 to 1984. K-Tel diversified in its early years, and Raymond began to concentrate on building the USA market and music sales while Phil concentrated on housewares. The company acquired rival Candlelite Records in 1980, and also formed subsidiaries in areas such as real estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
and oil
Oil
An oil is any substance that is liquid at ambient temperatures and does not mix with water but may mix with other oils and organic solvents. This general definition includes vegetable oils, volatile essential oils, petrochemical oils, and synthetic oils....
exploration. By 1984, the high-risk ventures had sapped the company's fortunes and K-Tel was unable to meet the payroll. The publicly-traded U.S. entity K-Tel International filed for Chapter 11 bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
protection.
Mickey Elfenbein, Mr. Kives' nephew was appointed CEO of K-Tel International in 1993 Elfenbein remained CEO of the company into the late 1990s, during which period the company achieved a resurgence in worldwide sales primarily of music-related products and had a successful NASDAQ
NASDAQ
The NASDAQ Stock Market, also known as the NASDAQ, is an American stock exchange. "NASDAQ" originally stood for "National Association of Securities Dealers Automated Quotations". It is the second-largest stock exchange by market capitalization in the world, after the New York Stock Exchange. As of...
IPO trading under the symbol KTEL. Elfenbein was recognized by Business Week Magazine in 1994 as the CEO of the 7th best publicly traded company in the US, based on growth and profitability.
Music Business
In 1966, Kives released the company's first compilation albumCompilation album
A compilation album is an album featuring tracks from one or more performers, often culled from a variety of sources The tracks are usually collected according to a common characteristic, such as popularity, genre, source or subject matter...
, a collection of 25 country
Country music
Country music is a popular American musical style that began in the rural Southern United States in the 1920s. It takes its roots from Western cowboy and folk music...
songs titled 25 Great Country Artists Singing Their Original Hits. Kives never intended K-Tel to be a music business, saying "I had to do something else, I thought why not do a music album? I thought it'd be a one-off. Everybody said 'that won't work'. Now all the major labels do compilation albums, but mine was the first."
Ray and Phil Kives and K-Tel recruited Australian Don Reedman (Don is the twin brother of Peter Reedman who was already working in the Australian office) help set up the UK-based division of K-Tel Records in the early 1970s, with Ian Howard as Managing Director of the U.K. operation. Ian Howard recommended to Phil Kives that he hire Don Reedman as Ian Howard and Peter Reedman worked together as Managers' of the Australian boutique at Expo 67
Expo 67
The 1967 International and Universal Exposition or Expo 67, as it was commonly known, was the general exhibition, Category One World's Fair held in Montreal, Quebec, Canada, from April 27 to October 29, 1967. It is considered to be the most successful World's Fair of the 20th century, with the...
in Montreal
Montreal
Montreal is a city in Canada. It is the largest city in the province of Quebec, the second-largest city in Canada and the seventh largest in North America...
, both worked together back in 1966 for Australian retailer David Jones Limited
David Jones Limited
David Jones Limited , colloquially known as DJs, is a high-end Australian department store chain.David Jones was founded in 1838 by David Jones, a Welsh immigrant, and is claimed to be the oldest continuously operating department store in the world still trading under its original name. It...
prior to joining K-Tel.
The company built the business of releasing compilation albums that combined material from a number of popular artists onto a single theme album using the tag line "20 Original Hits! 20 Original Stars!". The company could earn revenue
Revenue
In business, revenue is income that a company receives from its normal business activities, usually from the sale of goods and services to customers. In many countries, such as the United Kingdom, revenue is referred to as turnover....
in this way, because they negotiated directly with artists and labels for the rights to reproduce their original recordings, in the process also securing a long-term asset through adding those recordings to their catalog. The compilation albums largely relied on the pop charts of the time but concentrated on a specific musical genre: 20 Power Hits, for example, released in 1973, mostly concentrated on rock, though it had "Yesterday Once More
Yesterday Once More (song)
"Yesterday Once More", written by Richard Carpenter and John Bettis, is a hit song by The Carpenters from their 1973 album Now & Then. Composed in the key of E, "Yesterday Once More" preceded an "Oldies Medley" on the album, consisting of nine songs from the 1960s. At the end of the song a...
" by The Carpenters
The Carpenters
Carpenters were an American vocal and instrumental duo, consisting of sister Karen and brother Richard Carpenter. The Carpenters were the #1 selling American music act of the 1970s. Though often referred to by the public as "The Carpenters", the duo's official name on authorized recordings and...
on it. Some compilations were made for the disco music market (Night Moves, 1979), whereas others featured older music (Summer Cruisin, made in about 1976, featured mostly 50s music).
The company also created original records, the most notable of which were the Hooked on Classics
Hooked on Classics
Hooked on Classics was a series of record albums first introduced in 1981, toward the end of the disco era's peak in popularity.Louis Clark, former arranger for Electric Light Orchestra, conducted the Royal Philharmonic Orchestra playing a collection of very recognizable extracts from classical...
series of classical recordings with the London Symphony Orchestra. In 1995, the company released the "Club Mix" dance compilation series, which became the highest selling music series in the company's history, with several RIAA Gold and Platinum certifications. The Club Mix dance series was created and initially produced by Elfenbein's son, Mark Elfenbein, who was VP of A&R
A&R
Artists and repertoire is the division of a record label that is responsible for talent scouting and overseeing the artistic development of recording artists. It also acts as a liaison between artists and the record label.- Finding talent :...
for the company in the early 1990s.
Today, K-Tel remains a memorable brand associated with TV marketing and the music industry. The company now leverages their significant back catalog in a digital rights and distribution offering that supplies content to large online music retailers such as iTunes
ITunes Store
The iTunes Store is a software-based online digital media store operated by Apple. Opening as the iTunes Music Store on April 28, 2003, with over 200,000 items to purchase, it is, as of April 2008, the number-one music vendor in the United States...
, Puretracks
Puretracks
Puretracks is a Canadian online music store, which launched officially on October 14, 2003. Puretracks works as a behind-the-scene music partner. Now a division of Somerset Entertainment, owned by Fluid Music, Puretracks has U.S...
and Amazon.com
Amazon.com
Amazon.com, Inc. is a multinational electronic commerce company headquartered in Seattle, Washington, United States. It is the world's largest online retailer. Amazon has separate websites for the following countries: United States, Canada, United Kingdom, Germany, France, Italy, Spain, Japan, and...
.
Dot com Bubble's effect on K-tel
In mid-April 1998 during the Dot com bubble, news that the company was simply expanding its business to the internet sent the thinly traded stock shooting from about $3 to over $7 in one day (3:1 split adjusted). In spite of the early gains, the company was deemed by many to be a complete bomb, and the short interest of the stock swelled. The price of the stock peaked at about $34 in early May, and began to decline, reaching $12 in November and eventually pennies. The vicious advance was fueled mainly by a massive short squeeze that financially devastated traders who held short positions and were either "bought in" or simply forced to cover the positions at very high prices because of the great losses.K-Tel was unable to sustain the growth and profitability. The company completed a 1 for 5000 reverse split on July 18, 2007, reducing the number of public shareholders to under 300 and allowing the company to delist itself.It changed its symbol to KTLI and moved from the NASDAQ
NASDAQ
The NASDAQ Stock Market, also known as the NASDAQ, is an American stock exchange. "NASDAQ" originally stood for "National Association of Securities Dealers Automated Quotations". It is the second-largest stock exchange by market capitalization in the world, after the New York Stock Exchange. As of...
market to the Over-The-Counter
Over-the-counter (finance)
Within the derivatives markets, many products are traded through exchanges. An exchange has the benefit of facilitating liquidity and also mitigates all credit risk concerning the default of a member of the exchange. Products traded on the exchange must be well standardised to transparent trading....
market.