But it was not only by offering larger sums than he could afford that Richard Branson succeeded in raising the profile of his record label. He also paid attention to an aspect of the business that most of the other British independents had neglected: foreign distribution. While A&M Records were modestly established in America, almost all Virgin’s other competitors were entirely domestic companies. When they had records to sell abroad, they relied on licensing deals. Branson was not happy with that idea. He knew that licensing a record to another record company overseas brought with it an advance, and required no managerial effort. But in the long term, a record company that relied on foreign licensees was putting itself in a similar position to the musician: instead of making the bulk of the profits on a successful record, it was taking only a modest commission.
Richard Branson therefore devoted much of his time from the end of the 1970s onwards to establishing a network of record companies across continental Europe. On every trip to France, Italy or Germany, he would have his eyes open not only for licensing deals, but for the key people whom he would be able to hire in future to run a Virgin company in that territory. At first it took time to win over Ken Berry and Simon Draper to the idea. But by the end of the decade, the structure was in place and the strategy was agreed. With Luigi Mantovani in Rome, Patrick Zelnik in Paris, and Udo Lange in Frankfurt, Virgin was now able to sign up artists and guarantee them not only good distribution in Britain, but also entry into the most important European markets. This made Virgin a more attractive business prospect to top-ranking musicians than the other independent labels. Despite the combined efforts of Branson, Draper and Berry, however, one thing was holding the record label back. Having failed to win 10cc, there was now no really exciting new act for Virgin to acquire. That was to change in 1977, when Richard Branson signed the Sex Pistols.
Malcolm McLaren, the eccentric and unstable talent who was responsible for the Sex Pistols, never liked Richard Branson. In fact that was an understatement; he hated him, with a loathing that was incomprehensible to others. Years after the Pistols had broken up, he would paint a series of fascinating but wildly improbably stream-of-consciousness pictures of his dealings with Virgin. The first concerned how he had taken his demo tape of the Pistols to Virgin’s offices in Vernon Yard early in 1976, and had rudely refused when Simon Draper suggested that he leave it for Branson to listen to. ‘No,’ said McLaren. ‘He either listens to it now or forget it.’
‘I didn’t trust Richard,’ said McLaren. ‘I looked into his eyes and didn’t even want to leave without my demo cassette with me. I was thinking: this is a guy who could bootleg me tomorrow morning and have it on a stall in the Portobello Road … I didn’t like the feel of the place. The chairs were so uncomfortable … I was asking for £15,000 for a couple of singles, and see how we go … I thought creative accountancy is definitely going to be a problem with this company.’
McLaren was by no means a professional manager. He had spent eight years at different art schools before opening a shop in the King’s Road selling rubber and leather bondage gear. His principal experience of the record business was of managing an unsuccessful New York rock group in 1974; and the package that he brought to Simon Draper that day in 1976 was hardly the sort to appeal to an A&R man known for the sensitivity of his ears.
The Sex Pistols were, to put it bluntly, a band of yobs. Their sole musical talent, Glen Matlock, had been dropped as bass guitarist in favour of the more startlingly thuggish Sid Vicious. Johnny Rotten, a misanthropic teenager whose complexion and posture had been ruined by a bout of childhood meningitis, was the lead singer. The prime talent for which the band’s other two members were famous, and which they had displayed to disastrous effect at pubs across London, was to belch, spit and swear at their audiences.
Simon Draper hated the music. ‘It was all style and all aggression,’ he recalled. ‘To me, coming from a musical perspective, it just seemed like a great big noise. I went to see them at the 100 Club. [When we] came back after the gig, it was very exciting. There was such an air; it was so aggressive.’ In the car on the way home, Draper commented that they couldn’t sing – and then remembered, with a sinking realization, that people had made the same complaint of Mick Jagger when they had first heard the Rolling Stones. One magazine had described Jagger’s voice as being like broken bottles. With the Pistols, however, the shards of glass was a literal rather than a metaphorical part of the act.
Rejected by Virgin, McLaren signed the band he was managing to EMI. Their first single, ‘Anarchy in the UK’, convinced Draper as soon as he heard it that he had been wrong. There was an energy and a directness in the Sex Pistols’ music that was lacking in any other pop music of the time. More importantly, the group were packaged brilliantly. Jamie Reid, an art school friend of McLaren’s, produced album-cover designs that were revolutionary in their mixture of passport-sized photographs and letters cut from tabloid newspapers, in the style of an anonymous letter.
McLaren himself, meanwhile, contrived a series of incidents that were designed in equal measure to offend the old and the middle class, and to attract the young, disgruntled and unemployed. The greatest of them was to have the Pistols invited to appear on ‘Today’, Bill Grundy’s afternoon magazine programme on Thames Television. A few ‘fucks’ and ‘shits’ from the boys in spiked haircuts and ripped jeans, and punk rock was promoted from something unpleasant that happened in private music clubs to a national controversy.
Branson did not need to be alerted by Draper to the commercial possibilities of the Pistols’ ability to shock. The very day of their appearance on Grundy’s show, he had telephoned the managing director of EMI to offer to take this turbulent band off his hands. Since the EMI executive would not take his call, Branson left a message; the following morning, he was called to a meeting at EMI’s offices.
Branson was ready to make a deal there and then; McLaren was determined to play cat and mouse. He shook hands on a deal with Branson that day, earning £50,000 in compensation from EMI for the record company’s decision to assuage public anger by pulling the single from record shops. But McLaren then signed the Pistols to A&M Records, in a public ceremony outside the gates of Buckingham Palace. A&M paid £200,000 for the group, but had second thoughts when the group trashed its offices after a signing party. It took several more months, and five telephone calls a day from Richard Branson himself, before McLaren would condescend to accept a second compensation payment, this time from A&M, and sign his boys with Virgin Records.
Virgin entered into the spirit of things with enthusiasm. The group’s next single, ‘God Save The Queen’, was given a loudspeaker performance from a boat on the Thames just outside the Houses of Parliament during the week of Queen Elizabeth II’s Silver Jubilee. The police and the popular press obediently played their parts in the publicity stunt: McLaren was arrested, and the name of the group was all over the papers for a week. The record reached number two in the charts (some saying that only chart manipulation denied it the triumph of becoming number one), and sold over 100,000 copies in that week. Further success followed with the predictable controversy surrounding the Pistols’ album, Never Mind the Bollocks, and the unsuccessful prosecution for obscenity that followed its release.
By the end of 1978, however, the phenomenon of the Sex Pistols had worked itself out. McLaren had made a revolutionary film about the group and its handling, The Great Rock ’n’ Roll Swindle. He had briefly appointed Ronnie Biggs, a former train robber resident in Brazil, as the group’s lead singer; and the group itself had begun to fall apart. Sid Vicious died two months later of a drugs overdose, before he could be tried for stabbing his girlfriend to death with a knife. And Johnny Rotten, reverting to the name of John Lydon with which he had been born, repudiated McLaren as a manager and began an action in the High Court to have his company’s assets liquidated.
For Branson, Sid’s death was a disaster, but