LOS ANGELES - Ringing in the holidays on a sleigh full of Grammy nominations (26 for Def Jam overall and five of his own, including best rap album for "Kingdom Come" and song/record of the year for his featured role on Rihanna's "Umbrella"), Def Jam president Shawn "Jay-Z" Carter has more than music on his mind.

He's set to open his third 40/40 Club in Las Vegas on Dec. 30 and recently invested in a real-estate development venture called J Hotels. Billboard.com caught up with an ebullient - and frank - Jay-Z, who addressed those deafening rumors about his executive future at Def Jam and what else 2008 holds for him.

Q: So, 26 Grammy nominations, that's not too shabby. Were you surprised?

A: Yes, I was. But we definitely put the work in and it's great to be recognized for it. And "Umbrella" 's nominations for song and record of the year were fantastic. Rihanna came out of the gate with huge records; our whole thing was to make sure she didn't get buried under those records and become the " 'Pon the Replay" girl. So to see her come full circle and get her Grammy nods was an incredibly rewarding feeling.

Q: What was your reaction to the public's reception of "American Gangster" versus last year's "Kingdom Come"?

A: "American Gangster" seems to be overwhelmingly a critics' darling. I knew immediately it wouldn't sell more than "Kingdom Come." It could, but who knows? If I were a cynical person, I'd just say that people are hypocrites. [They'll say] I want a record with no obvious singles but just great music. Well, here it is. It should sell more than 10 million copies, more than any of the other albums I've ever made. It's just the way this industry works. But of course, I love the reception to "American Gangster."

I wasn't completely surprised by the reception to "Kingdom Come."

I knew it wasn't for everybody. I was trying to do different things sonically and with the subject matter, stretching the things you can talk about as far as being an adult.

And I know that's not popular because hip-hop is a young man's sport.

Q: Does it have to remain a young man's sport? You're still recording.

A: That's the cross I have to bear. I have to take those shots to keep doing it. And I'm going to keep doing it. I have no choice, whether it be me or the artists I align myself with.

Q: Where do you see hip-hop a year from now?

A: As a person who is optimistic about hip-hop, I look at albums like "American Gangster" and Kanye West's "Graduation" as albums that people can emulate because they were made with nothing but the highest of integrity and passion about putting your all into the music. People tend to emulate success, so hopefully they'll emulate the blueprint of those albums and we'll have some great music.

Q: What do you think of the Radiohead model, asking consumers to pay what they think is appropriate? Will any acts on the R&B/hip-hop front embrace that model?

A: What Radiohead did shocked everybody. It was a genius idea. I'm sure someone [in R&B/hip-hop] will follow that model.

Q: Would you?

A: Of course.

Q: It sounds like THE party to be at will be Dec. 30 in Las Vegas when you launch another 40/40 Club in the Palazzo.

A: I'm very excited about that. The club is right there on the strip, and it's our third in four years. Macau is next and then Singapore. We were working with Magic Johnson on a 40/40 in Los Angeles, but it never materialized. So we moved on to Las Vegas. We hope to start building in Macau in 2008 and maybe open it at the end of '08 or the beginning of '09.

Q: So, what about all the rumors that you're leaving Def Jam?

A: The rumors are about only because my contract is up. If we can work something out that's beneficial to all parties involved, we'll see. But it's not about money. It's really about trying to invest in the future, trying to invest in maybe coming up with a new model. Because going in hard making records with artists and throwing those records into a system that's flawed is not exciting for me.

It's not the music; people ingest music the same way. It's just that the model of selling CDs has changed. So doing things the typical way is not in the best interests of anyone and not exciting for me. My whole thing is, how do we invest in the future? If everyone is committed to doing that, then I'm sure there's a deal to be made. *