Craig Kallman of Atlantic Records: Listen Closely

Label heads—those at the very highest positions of power at music companies. To anyone who's spent time near the record business, they're a mythical breed. Like gnomes. Or dragons. Often, it's their vision that spells success or failure for the label they run. And what they say goes. Over the years, many a legendary creature has assumed the title: Goddard Lieberson, Clive Davis, Mo Ostin, to name just a few of those who have survived and prospered. The list of those who did not is at least twice as long.

Several years ago, the head of publicity at Atlantic Records engineered (with my help) a meeting between Stereophile's editor, John Atkinson, and Atlantic's Chairman and CEO, Craig Kallman. JA confirmed all the personal details, charming if hard to fathom, that I'd already heard about Kallman. He was an audiophile, a record collector, and someone who, without fail, spent time every week being an addicted record shopper, slogging through the bins of the proud remnant of what used to be the world's greatest collection of indie record stores, south of 14th Street in Manhattan. Most record execs aren't exactly out beating the streets, hunting vinyl, and keeping their ears on the tracks. When I asked him about his habit, Kallman never cracked a smile.

"For 25 years," he said as we sat in the one of the label's artists lounges located in a building near NYC's Rockefeller Center, "religiously, every Saturday that I'm physically in New York City, that's where I'll be from 12 to 6."

Okay, so the big-label Macha likes records.

Then there was talk that Kallman, 41, was an audiophile. A roomful of rolling eyes would almost equal my skepticism. With some obvious exceptions, the major labels virtually invented thin, lifeless, overcompressed sound. So now one label, whose catalog is among the proudest in the business, but who's also made a slew of loud (read: compressed) hip-hop and urban records, has a president who cares about sound?

"It is very difficult for me to be listening and evaluating in the MP3 format," Kallman says, his natural executive wariness beginning to stir, "but because that has become the standard by which people pass around music, that, in and of itself, is just a tricky thing. I sort of force everybody to deliver me music that I have to evaluate in an uncompressed WAV file so I can really analyze it in its best, purest form. I definitely feel like it's our responsibility to keep the standard of the output as high as we possibly can and be as uncompromising as we can, but still commercially viable in what the consumers want or care about."

Ahh, there's some labelspeak: commercially viable. How it rolls off the tongue.

My time with Kallman began in the aforementioned Artists' Lounge. He'd already canceled one appointment at the last minute. I was awaiting strike two. The Artists' Lounge was an uncharacteristic shambles for a label that most definitely is not. Founded by Ahmet Ertegun and Herb Abramson in 1947, Atlantic has been home to an extremely diverse set of artists reaching across all genres, from Ray Charles and Aretha Franklin to Led Zeppelin and AC/DC. An amusing cross between label storage closet and a nouveau-riche basement rec room in New Jersey, the Lounge was filled, in no particularly order, with oversized art books, a safe, a wine cooler set to 49°F (good for bubbly), a football signed by Bart Starr in a Plexiglas case, and a large red neon sign that read "TERROR," with a T that blinked. I wondered what this calamitous collection of kitsch says about a label that grosses somewhere north of $400 million in annual revenue and has an almost 6% market share (Atlantic is the No.3 label overall in market share). Kallman later mentioned that Ahmet Ertegun's former office may be converted into a proper reception area for artists.

Into this End-of-Disco–styled menagerie walked a trim, youngish, short-haired guy, in a hip off white, linen suit and a pair of gleaming white Adidas Stan Smiths. Immediately warm and approachable, Kallman sat down, we chatted, and I finally turned on the recorder. Twenty minutes in though, Warner Music Group's Head of Recorded Music, Lyor Cohen—no one you'd want to mess with, in a dark alley or otherwise—poked his head in and, in an exasperated tone, growled, "This is something you really need to be in on!" (Warner Music Group was purchased from AOL Time Warner by a group led by Edgar Bronfman Jr. in 2003)

Without a pause, Kallman turned and invited me to his home that weekend so we could continue the conversation.

The next pleasant surprise, three days later, after meeting Kallman's wife, Isabel, was being ushered into his study, where a pair of Wilson WATT/Puppy 8 speakers were hooked up to gear by Spectral, Linn, and SME. Too powerful for the room, it all nonetheless looked great, and I had to admit that Kallman had actually invested in a real audio system. He said he had another high-end rig in his office at work.

"I don't know how one can make records without a phenomenal system. So I outfitted office and home with systems that I thought were going to be the most accurate, revealing, transparent, and honest about what I was creating."

Seeing his system made me start in on the obvious topic: the sound of new records, and why major labels, in particular, accept or encourage less than stellar results. He says Atlantic is "thinking" about remastering its catalog in a higher resolution. In partnership with WMG's Rhino Records, Atlantic is still in the vinyl business, thanks largely to Kallman's insistence that each new release also be available on LP in limited quantities (usually less than 10,000 copies). He also mentioned that the label plans to make hi-rez downloads of at least two of its artists, Ray Charles and Led Zeppelin, available online this fall to coincide with the label's 60th anniversary.

"We have conversations about making sure we're giving higher-resolution sound. We're trying to pioneer a DVD format as the next format, so we're giving absolute highest-resolution audio.

"But is it [sound quality] talked about amongst my peers as a huge topic? I don't see that as the top topic, because I still think it's thought of, unfortunately, as that very small elitist group of audiophiles. And my issue is that it's really not. Anyone who has an opportunity to experience anything different is going to pick it. The best A/B comparison is audio vs video. Look how obsessed we are on the video side in getting that better picture, that tiny incremental difference, whether it's plasma or LCD. And I personally would bet the audiophile upgrade from whatever you're listening to is way more pronounced and profound and impactful than the video upgrade that you got.

"If you're talking about simple picture quality and simple audio quality, there's no comparison. You are moved differently. The hair stands up. The goose bumps go up. The physical, corporeal experience in the body is different hearing music in aesthetically pleasing form. It does not do the same thing when I have to listen to my computer speakers. Or my home-theater system.

"And unfortunately, the audiophile community probably has to do that education around the home-theater system. And do it in the context of a film, and put on a movie that was scored by Ennio Morricone, John Williams, or someone, and then have everyone go, 'Wow, the sound's moving me too.' From there you have to say, 'Well, if you went and bought these speakers instead of those, and these electronics, then imagine what you can do—and now let me just put in Neil Young's Harvest.' To me, that's the only chance we have of having it migrate out of the elite to the general consumer."

One thing Kallman is not is a fan of is 5.1-channel sound. Not that he's desperately opposed—remember "commercially viable"?—but, as with most of the music-consuming public, surround sound for music has never struck a nerve with him.

"I never got it. I've never really enjoyed any 5.1 experience. I never really believed in it. I believed in the original creation being a stereo experience. To me, it was aftermarket—because home theater was 5.1, let's see how we reconfigure things.

"Going to shows for 20 years, I never liked experiencing my own bands from the stage. I wanted to go into the audience and hear it. As much as I had a better view being right on stage—behind, say, the keyboard guy—I never wanted that experience."

When it comes to experience, Kallman's is unusual in today's record-label universe. For starters, he's not a lawyer or an accountant. He began as a music-obsessed teenager who made lists of records he wanted and handed them out to relatives at holidays and birthdays. "'Attack his record want lists, that's all he's interested in,' my father used to tell people," Kallman says.