The album was dying. Doug Morris, however, was doing fine. Presiding over an industry in free fall, he was still earning almost 15 million dollars a year. He owned a waterfront mansion in Syosset with a tennis court, a boat dock, and a pool. He owned a condo on a key in Sarasota. His new apartment in Manhattan had an incredible view. He traveled by private car and private jet, and he sat on the boards of the Robin Hood Foundation and the Rock and Roll Hall of Fame. He inhabited a world of privilege, populated by celebrities and powerful CEOs. The world’s most famous musicians dropped everything to speak with him, and even Steve Jobs returned his calls.

During his time at Universal, he had so far grossed more than a hundred million dollars in aggregate, and this by a considerable margin made him the highest-paid major label CEO. His fortune began to attract attention from outside the insular recording industry world. Trade organs like Billboard and Variety had always gone easy on him, but he had a target on his back now, as Bronfman once had, and the mainstream press was after him.

In late 2007, Morris agreed to an interview with the journalist Seth Mnookin for Wired magazine. The resulting article portrayed Morris as the clueless relic of an earlier age. Morris, as always, tried to hide behind the hits, and insisted there wasn’t a thing he could have done differently. Mnookin let him hang himself.

“There’s no one in the record company that’s a technologist,” Morris explains. “That’s a misconception writers make all the time, that the record industry missed this. They didn’t. They just didn’t know what to do. It’s like if you were suddenly asked to operate on your dog to remove his kidney. What would you do?”

Personally, I would hire a vet. But to Morris, even that wasn’t an option. “We didn’t know who to hire,” he says, becoming more agitated. “I wouldn’t be able to recognize a good technology person—anyone with a good bullshit story would have gotten past me.” Morris’ almost willful cluelessness is telling. “He wasn’t prepared for a business that was going to be so totally disrupted by technology,” says a longtime industry insider who has worked with Morris. “He just doesn’t have that kind of mind.”

Morris was furious with Mnookin’s portrayal of him. He felt the article was a hatchet job meant to appeal to Wired’s technologically savvy reader base, complete with an unattributed quotation that implied he was kind of dumb. Morris felt he had a fine mind, particularly for the business he was in. The vet analogy was a poor one. A better one would be to compare the music business to Mnookin’s own: journalism, perhaps the only field that had handled the digital transition worse than music.

The quotes from the interview weren’t hypotheticals. Several people with good bullshit stories had gotten past him, and he’d watched both Vivendi and Time Warner squander tens of billions of dollars of capital. Shareholders at those companies would have been better off if management had never even heard of the Internet. Morris himself had wasted tens of millions of dollars on online ventures like Pressplay that had effectively generated zero revenue. The aggregate investment experience in technology threatened to do the unthinkable: to make A, the capital he drew, greater than B, the capital he returned. And that was the one thing Morris would never let happen.

And, really, what could he have done differently? If there was some other record industry executive who’d done better, who’d taken a different path, maybe the case could be made. But the decline of the music industry had affected every player, from the largest corporate labels to the smallest indie. Morris had once been a gatekeeper, the guy you needed to get past to get into the professional music studio, and the pressing plant, and the distribution network. But you didn’t need any of that stuff anymore. The studio was Pro Tools, the pressing plant was an mp3 encoder, and the distribution network was a torrent tracker. The entire industry could be run off a laptop.

As an arbiter of cultural trends, Morris remained unimpeachable. In the past two years, his labels had signed Rihanna, Rick Ross, Taylor Swift, Lady Gaga, and—best of all—Justin Bieber. Doug Morris didn’t understand the technology, but he did understand how to turn an unknown YouTube busker with microwaved hair into a global superstar, and his hot streak was now almost twenty years long. Universal had done everything right, everything a label was supposed to do, investing in and grooming A-list talent from around the globe and outsmarting all its competitors. And now, in addition to that, he was supposed to be some kind of tech guru? If so, was Karlheinz Brandenburg expected to sign Lil Wayne? Was Seth Mnookin expected to invent the Kindle?

Maybe. One thing was certain: the interview was a low point in Morris’ career. He was the target of satirical cartoons and a great deal of vicious Internet flaming. The website Gawker, reblogging other people’s work with characteristic restraint, called him the “World’s Stupidest Recording Executive.” The anger was shared by many of his employees, some of whom in fact were gifted technologists who had passed up jobs in Silicon Valley to work for him. “He made the company look ridiculous,” Larry Kenswil, the chief of Universal’s digital strategy at the time, would later say. “That was insulting to a lot of people inside the business.”

The chorus of criticism that Morris was too old, too out of touch, began to crescendo. He was 69. Vivendi had a mandatory retirement policy for all of its executives, effective at age 70, and the company’s management board had informed Morris that, while they were willing to stall for a couple of years, ultimately he was not exempt from this policy. Already, Morris had begun training his own successor, the British music executive Lucian Grainge. In 2010—two years—he would be done. For his critics, the deadline couldn’t come soon enough.

But for Morris, redemption was always just around the corner. Perhaps Mnookin’s public shaming of him was ultimately a net positive. Perhaps it jolted him out of his complacency. Perhaps it took this kind of widespread embarrassment to make him change direction. He denied this, of course, but in the period immediately following the Wired interview he began to innovate as never before. Whatever his motivations, the business decisions he made over the next two years laid the framework for the economic future of the recording industry.

It began with a visit to his teenage grandson. In a hands-on experiment in consumer demographics, Morris had asked the kid to show him how he got his music. Morris’ grandson explained that, while he didn’t pirate anything—promise—neither did he buy any albums nor even many digital singles. Instead, for the most part, he just watched music videos on YouTube from the computer in his room. Soon the two were seated in front of the screen.

Watching rap videos with Grandpa sounded like the premise for a comedy skit, but in Morris’ case most of the videos were ones he had green-lit and budgeted himself. After a bit of searching, the two opted on a mutual favorite: 50 Cent’s “In Da Club,” which Morris’ grandson liked because it bumped, and which Morris liked because it had moved eight million units. The video had a clever conceit. It featured 50 Cent reclining in a nightclub, surrounded by his entourage, while on the dance floor gorgeous models waved snifters of expensive cognac in the air. The camera then panned through a dummy wall to reveal that the dance floor was actually located in the “Shady/Aftermath Artist Development Center,” a secret desert laboratory where Dr. Dre and Eminem, standing with lab coats and clipboards, watched through a one-way mirror, perfecting the science of the club banger.