Stevie Wonder, Motown, and the First ‘360 Deal’

Wonder’s recommitment to Berry Gordy was a commercial coup and a creative crescendo

By Adam White

Stevie’s always made it clear that he would like Motown to survive.” The words are those of Johanan Vigoda, the attorney who induced Motown to change — and therefore to survive — by re-signing his client, Stevie Wonder. Without change and without Wonder, the largest black-owned company in America would have been severely impaired in the 1970s. At the very least, Berry Gordy’s legacy would have been lesser, his sale price lower and the galaxy of Wonder linked to another marque.

“All things may not be exactly as people see them,” said Vigoda, “but they need heroes, heroines, ideals. All monuments make a difference.”

As it is, the bond between Stevie Wonder and Motown lasted for more than half a century. It was first sealed in 1961, after Stephen Hardaway Judkins gave a dazzling audition at Hitsville. Initial contracts with the 11-year-old offered him a four-year recording deal and a three-year artist management agreement. In the first of these, Judkins/Wonder was to earn a two per cent royalty on the retail price of his recordings sold by Motown. In 1961, the list price of a 45rpm single was 98 cents.

These were common terms of business for aspiring recording artists of the day. The Beatles’ first contract with EMI in 1962 provided them with a one-penny royalty rate for both sides of a single, on eighty-five per cent of sales. The remaining fifteen per cent covered promotional copies and pressings damaged in manufacture or shipment. In Wonder’s case, royalties were paid on ninety per cent of sales. In both deals, the companies committed to an annual minimum of three single releases. Also, the artists’ royalty was halved for sales outside their home country.

One significant difference was that Motown charged back to the artists the costs of recording, such as studio time and musicians, while EMI paid all such fees. Moreover, for developing and managing Little Stevie Wonder’s career, Berry Gordy Jr. Enterprises took twenty-five per cent of total earnings, the same commission rate charged by Brian Epstein’s NEMS Enterprises in his five-year management contract with the Beatles.

Seen alongside Wonder’s Jobete publishing pact and, in later years, the merchandise that Motown peddled, Gordy’s business model can be regarded as an early version of the “360-degree” template introduced at the start of the 21st century by major record companies. The approach sought to compensate for revenues lost to unauthorized file-sharing of their artists’ music by insisting on a share of new talent’s publishing, merchandising and concert income. By contrast, Gordy’s enterprise was a start-up, looking for every income opportunity in a sector where capital was elusive and risks, particularly for a black businessman, were high.

Motown’s first contracts with Wonder included an option for a further four years of his recording services, and a further three years of career management. Raynoma Liles, Gordy’s second wife, signed the original paperwork in 1961, while the musical minor was represented by his mother, Lula Mae Hardaway, and guardian Charles King.

“When Ronnie White of The Miracles first brought Stevie to Motown for Berry to hear him,” remembered the company’s marketing chief Barney Ales, “someone said this kid was another ‘Sugar Chile’ Robinson, who could play the piano unbelievably. Sugar Chile was great in concert, but never sold records. That’s what I told Berry: that Stevie was certainly capable of playing all these instruments, but was he going to sell?” The answer came in 1963, with the conversion of Wonder’s catalytic Chicago concert performance into Motown’s largest-selling LP and single to date.

After a difficult two years during which his voice broke, Wonder matured with a convincing crossover smash, “Uptight (Everything’s Alright).” Soon, he was accelerating towards adulthood. Ales’ son Steven was 10 years old when he accompanied his father through Hitsville’s Studio A to the car park, and saw his namesake seated at a piano. “When my dad introduced me, Stevie said, ‘Hey, Steve, how you doing?’ He had more of an older sense. I don’t think a normal 16-year-old would have that mentality, knowing he was shaking a kid’s hand.”

Barney Ales—who rose to become executive vice president and eventually served as Motown’s president—signed the contracts renewing Wonder’s recording deal at the end of 1966, with a royalty rate improved to eight per cent of ninety per cent of wholesale, and to ten per cent in a series of subsequent one-year options. The star also renewed with International Talent Management Inc. When it came to promotional duties, he was among Motown’s most personable artists: before a drop-in to Robin Seymour at WKNR Detroit, for example, Wonder wanted to know the color of the disc jockey’s tie. “I told him,” recalled Ales, “and then Stevie said, ‘Nice meeting you, Mr. Seymour, and that’s a great red tie you’re wearing.’ It threw Robin back, especially since they were on the air, and it was typical of Stevie’s sense of humor, his personality, that everyone loved him for.”

Musically, Ales gave a lot of credit for Wonder’s crossover impact to songwriter Ron Miller, co-writer of “For Once In My Life,” a huge hit in 1968. “Ron took him in a completely different direction compared to Clarence Paul, Mickey Stevenson, Hank Cosby. Stevie was like a sponge then, absorbing everything that was going on around him.” This emboldened Wonder, helping to prepare him for the moment when he would determine the direction of his music and career himself.

By coincidence, that day arrived exactly seven years after Mary Wells had earned the identical opportunity; both performers turned 21 on May 13 (1964 in her case, 1971 in his). Gordy threw a birthday bash in Detroit for Wonder, as he had for Wells. The venue reflected how far Gordy had come since ’64 — it was his Boston Boulevard mansion — but the evening was followed by the curse of déjà vu. Party or no party, on 14 May Wonder’s lawyer sought to disaffirm the artist’s original Motown contracts by reason of his minority, just as Wells had done. “That’s what happens when you build people, [when] you pull out the potential in them,” Gordy mused. “You have to be prepared for their independence.”

No one at Motown was prepared for Vigoda.

An early joke at the label was that if Wonder could see the lawyer, he’d fire him. He appeared chaotic, informally dressed to the point of peculiarity, spilling energy and spitting out sunflower seeds, sometimes carrying work in aging airline bags, at other times losing his car keys. At Harvard, he learned the art of distraction; at Woodstock, the value of idiosyncrasy. And he earned the last laugh, going on to represent Wonder for three decades, netting riches for both of them.

Stevie Wonder with Berry Gordy, Wonder’s attorney Johanan Vigoda and Barney Ales in April 1976

“Vigoda was weird,” affirmed Roland Rennie, who helped EMI Records to secure its 1963 deal with Motown, “but quite brilliant. An inverted snob, but a lovely, lovely man.” If the brilliance came from Harvard, the accent came from the Bronx. “It was ‘dis, dat, dose,’ the way he talked,” said Rennie. That may have been a professional requirement when Vigoda worked at the Legal Aid Society of New York, handling the problems of crooks and conmen. He advanced to a music subsidiary of Warner Bros., followed by a partnership with fellow attorney Paul Marshall and a merry-go-round of entertainment clients.

“Paul and Joe, each in their own way, were unbelievably neurotic,” said Bob Young, whose time at Famous Music saw him become acquainted with Vigoda. “And if you sat in a meeting with him, all kinds of litter materialized.” He represented singer/songwriter Richie Havens and Michael Lang, co-creator of the Woodstock music festival. Depressed after a younger girlfriend ran off with the singer of a rock band for whom he had struck a deal, Vigoda dropped out of sight for months. “He returned 40 pounds lighter,” said Young, “on a steady diet of fruit and nuts, and nothing else.”

In negotiations, however, he remained a heavyweight. “To see him negotiate with Motown was amazing,” remarked Jay Lowy, Jobete Music’s vice president and general manager. “He’d say, ‘This is what I want, this is how it’s going to be, goodbye.’”

Vigoda’s introduction to Wonder came via two of his clients, Malcolm Cecil and Bob Margouleff. Wonder was captivated by an eclectic instrumental album made by the pair, featuring a synthesizer built by Cecil. After serving notice to Gordy (in which Vigoda was not involved), the Motown star tracked down the two musicians in New York and enlisted them in a partnership that would eventually span three years and four landmark albums: Music Of My Mind, Talking Book, Innervisions and Fulfillingness’ First Finale. He was bursting with ideas and the desire to channel them; the three began working together on Memorial Day, 1971.

The accepted wisdom is that, during this period, Wonder was in no rush to sign new pacts with anyone, that he was entirely focused on his music, and that he took his own sweet time to weigh options, including an impressive offer from CBS Records. Certainly, some of Music Of My Mind was made while the star was out of contract, but, in fact, he swiftly decided to renew with Motown. A new, three-year agreement for Wonder’s services as a recording artist and producer took effect from 1 July 1971. The musician’s royalty rate increased to fourteen per cent and he received an advance of more than $900,000, plus substantial annual guarantees. A new Jobete publishing deal was agreed, and Motown also gave Wonder the option to buy shares if the firm went public (it never did).

Gordy had not previously consented to a package so rich and autonomous, but Wonder’s short spell out-of-contract implied that he wanted to stay put anyway. The renewal certainly blessed Motown with continuity as it moved west. Moreover, although The Four Tops and Gladys Knight & the Pips signed to other record companies in the early 1970s — followed by The Jacksons, The Miracles and The Temptations — these departures felt less destructive, albeit regrettable, because Wonder had stayed true. So had Marvin Gaye, renewing with Motown a year earlier, before the release of What’s Going On.

Wonder’s recommitment was a commercial coup and his quartet of albums released from 1972 to 1974 represented a creative crescendo. Two of them netted a total of ten Grammy awards. In the USA, Music Of My Mind sold 500,000 copies during its initial run, followed by Talking Book at 1.6 million, Innervisions at 2.1 million, and Fulfillingness’ First Finale at 1.5 million. In the 1970s, this was impressive math. Overseas sales topped up the tally: Innervisions was Wonder’s first Top 10 album in Britain. “It wasn’t just a question of him selling more than other people,” remarked Vigoda, “it was that he was in a bigger league — he had the potential, musically, to be the heavyweight champion of the world.”

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Excerpted from Motown: The Sound of Young America, by Adam White with Barney Ales and a foreword by Andrew Loog Oldham. Available via Amazon, Barnes & Noble and other fine retailers.

Reprinted by permission of Thames & Hudson Inc,