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When Lil’ Flip was given a chance to contribute a verse to “From the South,” a scene-boosting number that appeared on fellow Houstonite Z-Ro’s Let the Truth Be Told last April, he used the guest spot to do what rappers often do: throw insults at an unnamed rival. Most of the put-downs were unsurprising, broad swipes of the your-grill-don’t-gleam-like-mine variety. But in the song’s penultimate couplet, Flip moved from criticizing his foe’s dental hardware and rhyme skills to calling out his record label. “These rappers finally get some fame and think they got it locked,” he taunted. “After your album flop, nigga, you gon’ be on Koch.”

In an interview with hiphop news site SOHH.com in October 2005, Flip implied that his attack was aimed at Paul Wall, another Texas MC who also appears on the track. But before Flip provided the clarification, Houston’s self-described Big Boss of the South, Slim Thug, believed the rhyme to be directed at him.

Flip’s short stanza on “From the South” tells his intended target that he’s “embarrassing Texas,” adding, “nigga, you ain’t trill/Nigga, you been on my dick way before you got your deal.” But when Slim responded to Flip’s words, he seemed unconcerned with any of these accusations. The line that stuck in his craw? The Koch reference. “I don’t fuck with Flip,” he told SOHH.com in May. “Him and this dude named Z-Ro [have a song,] and he shooting a slug at me on the song saying, ‘ni[gg]as thinking they made it before they album dropped/When they album flop/They might be signed to Koch.”

The real or imagined rivalry between the two MCs was no more noteworthy than any other hiphop conflict, but the squabble did introduce a new set of fightin’ words into the lexicon of the hiphop beef. Though failure to rep one’s ’hood and dick-riding still amount to slander, the disrespect du jour is condemning a rapper to a deal with Koch Records.

The New York–based indie, which falls under the umbrella of the Koch Entertainment empire, had 25 Billboard-charted titles in 2005—the most of any independent label. Its roster includes both underground-mix-tape kings the Diplomats and such solid, well-respected hiphop acts as Sheek Louch and M.O.P.

So where’s the insult? Well, Koch started out as distributor of imports and classical music, which isn’t quite the same as getting founded in Rick Rubin’s dorm room. Its release calendar for 2005 included everything from a kiddie disc by cartoon cutie-pie Strawberry Shortcake to the latest from the Beatle everyone hopes won’t be the last, Ringo Starr. Worst of all, in the six years since Koch started its urban division, the label has inked deals with many rappers who have been discarded by the majors, creating the previously unheard-of category of oldies hiphop. In a recent interview with Vibe, 50 Cent called the company an “artist’s graveyard.”

Ever since DJs first soaked the labels off of their 12-inches, hiphop has been obsessed with staying ahead and being inside. When rappers brag that they once worked with DJ Screw, it’s less to show us they’ve got a past than to show us they were the future—before we even knew what the future would be. But prophecy is a tricky thing in the music business—one reason that mainstream MCs tend to diversify—and sooner or later, even the most talented lose their ability to play the industry. There have always been exceptions, of course, rappers who continue to turn a profit on major labels well beyond their youth. But those with the longest shelf lives have tended to be either conscious, such as A Tribe Called Quest, or pop, such as LL Cool J. The former persevere because they work in a subgenre that has always had a thing for wisdom, elders, and other indicators of enlightenment. The latter manage to stick because their widespread success means they’re no longer at the sole mercy of the heads.

The sort of rappers Koch has been signing are more street-friendly. And gangstas are notorious for flaming out fast. Even Koch’s publicity department couldn’t have put much stock in the line it used to peddle Based on a True Story, the 2004 comeback attempt by late-’90s hard-core rapper Silkk the Shocker: “Master P’s baby bro has been gone for three years. But hey, guess when you’ve been rapping professionally since you were 14, you need some time off.”

Alan Grunblatt, general manager of Koch Entertainment and head of its Rap, Hip-Hop and R&B Division, resists the idea that he runs a retirement label for rappers. He points to the success of acts such as the Diplomats and Jim Jones as proof that the company caters to both time-honored and of-the-moment acts. “We want to be seen as both,” he says.

When Koch began signing hiphop acts to its In the Paint imprint several years ago, Grunblatt noticed that many artists wanted more control than most major labels were willing to give them. Koch’s urban division, he says, was designed to meet that demand. “I started something called the Koch Entertainment Label Alliance,” he explains. “[Artists] own their masters, control marketing—it gives them the sense that it’s their own label. We distribute, help market it, and from there, everybody came in. I invented a model that everybody wanted.”

Of course, Koch didn’t pull together a roster of major-label refugees to be altruistic. “No one is that forward-thinking,” says Grunblatt, who points out that signing older rappers isn’t fraught with the same risks as nurturing new talent.

“If you sign an established act—let’s say I did a deal with Joe Blow, and Joe Blow’s base is 100,000 records, I know I’ll ship 70,000. That’s $700,000 in volume from my distribution—and Koch is a label and a distributor. That’s our unique strength,” Grunblatt says. “With an established artist, my risk is lower. If I know I can get 75,000 [units], that’s three quarters of a million dollars. If I sign a new artist, I could sell 800 pieces and lose my shirt. Honestly, that’s the reason.”

One of Koch’s biggest deals to date is a multialbum joint venture with Snoop Dogg’s Doggystyle Records it announced in October 2005. The Doggfather himself still belongs to Geffen, so the arrangement applies primarily to Snoop’s mix-tape series and the artists in his Dogg Pound Gangsta Clique. But naysayers were quick to mark the move as a sign that Snoop is slipping—even though “Real Soon,” the first single from Snoop’s first Koch release, December’s Bigg Snoop Dogg Presents: Welcome to tha Chuuch—Tha Album, is all over the radio.

On the hiphop Web site Nastack.com, a story about the deal carried the headline “Snoop Dogg Is a B-List Rapper.” Nastack blogger Will “Ill Will” Fields announced the partnership thus: “Snoop Dogg has officially signed his own Death Certificate and signed a deal, a MULTI-album, deal with Koch Records.”

Fields says that he appreciates Koch’s dedication to hard-core rap and the level of autonomy it gives its artists. But he stands by his assertion that Snoop Dogg’s newly forged relationship with Koch marks the beginning of the end. “If Snoop was hot right now,” he says, “there’s not any way he’s signing to Koch.”

Fields suggests that line of thinking has everything to do with Koch’s business strategy. Signing established artists, he reasons, is somewhat parasitic, a departure from the credibility-earning way indies usually work: finding a few artists they strongly believe in and building a brand around them. “Unlike other independent labels that are focused in one area—building a name—and want distribution with a major, Koch signs people other record labels don’t want,” Fields says. “They’re not like the Southern independents—SwishaHouse, Cash Money—that were built from the ground up.”

But what of the argument that Koch helps protect hiphop’s icons from obscurity and recognizes that, even when certain rappers are no longer attractive to majors, they might have relevant things to say?

“I never thought about it like that,” Fields says. “Back in the day, you got dropped and we pretty much didn’t hear from you after that.”

Diplomat Records co-founder and MC Jim Jones has been a vocal spokesperson for the Koch business model. So have New York rapper AZ and LOX member Sheek Louch. In November, Sheek bragged to SOHH.com about the dough that his Koch album After Taxes had earned him: “I got the #1 independent record in the country right now,” he said. “I sold 40,000 records in 7 days. That’s $8 off of every record. That’s the reason I went indie. I’m not trying to see 33 cents off every record.”

Grunblatt won’t reveal exact sales figures for any Koch signee, but he says that the label’s distribution function allows greater profit margins for artists. “We give [artists] essentially a distribution deal,” he says. “From that, they have to cover marketing—there’s nothing magic there. It’s 10 bucks [gross per CD]—they gotta split it so many ways. We take three bucks, they get what’s left, but they cover marketing, mechanicals.”

But for all of the ills attributed to hiphop acts’ working with the majors, the rejection of aging artists might be more consumer- than company-driven. “In rock, alternative—you don’t have it in other genres. It’s really, really bizarre,” says Grunblatt. “I deal with some big artists, and you can see [it]. Everybody [used to get] to 29, 30, and all the sudden, they’re 27, 28. And you wanna say, ‘Where did those two years go?’”

On his 2004 album, Death Is Certain, Royce Da 5’9”, the Detroit rapper and friend-turned-foe of Eminem and D12, decided to point out his status as a Koch artist before someone else could do it for him. On the song “I & Me,” Royce, who once looked forward to a long, prosperous career under the tutelage of Em and Dr. Dre, ponders the chain of events that landed him on Koch.

“How can I go from rocking with Dre to falling out with Shady?/To popping my Glock on the block to dropping on Koch?” he wonders, blasting the very label that has released these words into the world.

In a March 2004 interview with Canadian magazine Eye Weekly, Royce attempted to qualify the line, but he didn’t defend Koch so much as express acceptance of his lot. “I don’t regret dropping my album on Koch,” he said. “[I]t’s a blessing considering where I’m at in my career….I haven’t been listening to the radio or going out to parties so it wouldn’t feel natural to me to do those kinds of records. Koch is the ideal place for me right now.”

If he’d waited a couple of years, Royce might have had more options. Sony recently signed old-timers DMX and Scarface. And 50 Cent’s G-Unit, currently distributed by the Santa Monica, Calif.–based major Interscope Geffen A&M, snapped up three vintage ’90s acts in 2005: Ma$e, Mobb Deep, and M.O.P.—the latter two from the graveyardy clutches of Koch. Now that they’re associated with the popular, unstigmatized Fiddy, both groups will make good test cases for whether hiphop fans will accept a second go-round from the genre’s big names.

The commercial success of records such as Sheek Louch’s After Taxes, which debuted on the Billboard charts at No. 23 and sold more than 36,000 copies in its first week, show that Koch and other labels testing the oldies market may be onto something. But other projects—say, the latest from Public Enemy—raise a question: Is what’s good for rappers good for rap?

Financially, maybe. But then again, musicians aren’t necessarily good at doing their own marketing, which is one reason record labels exist. Artistically, the answer is even less certain. Koch has yet to release a great album—something that makes listeners reconsider a previously written-off artist the way Scott Walker’s Tilt, Johnny Cash’s American Recordings, or Prince’s Musicology did. There’s no reinvention happening Koch. Kool G Rap’s 2002 The Giancana Story was concerned mostly with legacy-burnishing. Ditto for M.O.P.’s 2005 St. Marxmen and KRS-One’s 2003 Kristyles, over which the legendary MC battled his label in court. Initially claiming that Koch was releasing an unrepresentative recording behind his back, KRS later stated that “[d]espite the most recent events, Koch…is still a great label.”

Not quite yet. But it could happen, especially if Koch’s business model works for cred-building outfits such as G-Unit. “They’ve got their pros,” Fields says of Koch. “Their cons really aren’t their fault—the way they are perceived by industry is not their fault. A lot of people couldn’t [produce] albums any other way than Koch. If Koch wasn’t around, I’d probably miss ’em.” CP