wax&wires » record labels

SubPop Finally Realizes What Music is Worth: Nothing

admin — Wed, 04 Aug 2010 15:52:12 +0000

I first referenced this concept over a year ago, when talking about the resurrection of the album. Ultimately, the premise becomes: “Like it or not, your music is free. Now, what can you sell that’s attached to your free music?” A bare minimum, as Trent Reznor suggests, would be to trade your music for something like an email address, like on noisetrade. As we’ve come to realize more and more over the past few years with data mining and all that, information about people is VERY valuable. Each email address is a sales lead for concert tickets, promotional events, and a myriad of other means to sell a product… just not your music.

Here, SubPop is one of the first decent-sized labels to begin to realize the futility of fighting for music sales in themselves, and starting to adjust their business model accordingly.

[via hypebot]

From early Nirvana through Mudhoney and on to Fleet Foxes and The Postal Service, indie label Sup Pop has been putting out interesting and often fabulous music for decades. But just like the rest of the recorded music industry, they’re having trouble these days getting people to pay for it.

To combat the problem, the venerable indie label is considering flipping the basic music sales proposition on its head. “Although Sub Pop is primarily known for its many fine artists and their really very fine recordings (also grunge), we’re not at all opposed to expanding into the fine world of t-shirts, hats, beer cozies, and key chains,” says Sub Pop general manager, Megan Jasper. “We used to give many of these tchotchke items away for free in an effort to entice people to pay for the music, but we’re considering flipping our strategy so that people pay for the toy and receive the music for free.”
Indie bands have already been experimenting with the concept of bundling downloads with a physical item, but this would be the first time that a substantial label made the shift.

Selling “A Thing Associated With The Music”

Jeff Kleinsmith, Sub Pop’s longtime art director already has a few unusual ideas for bringing Jasper’s sales strategy to market. ”Regardless of age, there’s always going to be people who prefer to touch and make stuff that’s like, physical,” says Kleinsmith. “CDs may end up being little books. We’ve talked about this at work, where you might spend the time to do a cool package, it just doesn’t have a disc in it. And instead of a disc, you’ve got a little piece of paper that says ‘go here for your download.’ So you’re getting everything about it except for that plastic disc, you know. I would love to see that.”  But Kleinsmtih’s creative juices are just getting warmed up, “That could be a magazine, it could be a shirt, it could be a sticker on a banana, it could be anything, really, that has that download. It could be a poster, a thing associated with this music.”

EMI Asks For $500M Bail Out

admin — Mon, 13 Jul 2009 18:23:44 +0000

I predicted back in January that one thing to watch for in 2009 would be Guy Hands to pawn off EMI to the highest bidder, with Warner as a strong contender. You would think with a roster touting artists like Daft Punk, Beastie Boys, Coldplay, Lily Allen, and more, that EMI parent company Terra Firma would be swimming in more gold than Scrooge McDuck. Rumors have them puppy guarding a gold mine of unreleased Michael Jackson songs as well. In spite of all the stellar product, EMI finds itself in for £2.5B to creditors.

Before Terra Firma gives EMI nearly a $500M shot in the arm, it has sent CEO Guy Hands to ask Citigroup for a Bail Out. Hands has asked Citigroup to write off close to 500M pounds of the label’s debt.

In a long career of successful investing, Hands will count EMI as the worst deal he ever made. Hands has now sunk more than £2.2B into a company on financial life support, including £1.7B for the original deal, £500m in additional capital, and £170m on restructuring and desperate attempts to turn EMI around.

Enter WMG’s head, Edgar Bronfman. He has been public about his desire to merge WMG and EMI for quite a while, and if Citigroup denies the erasure of debt to Terra Firma, Bronfman may just have his wish of cutting the “big four” down to the “big three” record labels.

Bronfman has strategically set up housekeeping in London, where EMI is based, under the guise of culturing his kids and giving them a broader world view. If you believe that, I think he’s got a bridge and some water for sale in New York too; you might want to call your realtor about picking it up. WMG has just come out of a restructuring of their own debt, and maybe in a place to pick up EMI should the timing and price be right.

Technically, Terra Firma has until 2015 to bounce back and pay their debt back to Citigroup. Should Citigroup deny the bail out, I don’t see how they can continue to hold onto the bleeding investment that EMI has become.

Elektra Records To Be Fueled By Ramen

admin — Thu, 04 Jun 2009 19:12:10 +0000

Way back in high school, I was all about random little punk bands here and there. Good punk albums were synonymous with compilations that you could pick up at the local record store for a couple bucks each, and I had more than my fair share. One of my favorite comps was called “Mail Order is Fun” (which seriously sells for $0.01 used on Amazon now… ha) put out by Asian Man Records and Fueled By Ramen. It featured artists like the Impossibles, Link 80, Let’s Go Bowling, Alkaline Trio, Less Than Jake, The Hippos… you get the idea. I never expected ska or punk to dominate the airwaves or become a mainstream moneymaker, but I had fun with it, and that’s all I was in it for anyway.

After falling out of the genre for a while, I was shocked to see FBR bathing in cash after Fall Out Boy’s success earlier this decade. They had released Jimmy Eat World’s self-titled EP back in 1998, but hadn’t really established a legacy of success up to that point. Since then, they’ve had more than a few successful artists: Yellowcard, Jimmy Eat World, Fall out Boy, Panic at the Disco, Cobra Starship, Paramore, etc. many of whom were on the Decaydence imprint started by Pete Wentz (Fall Out Boy) and FBR founder John Janick in 2004, which is also the year that Elektra Records went dormant.

Now owned by Atlantic (WMG), Elektra will be revived by Janick and Atlantic Executive VP of A&R, Mike Caren (who is creditted with launching the careers of T.I., Flo Rida, Twista, Juvenile, Asher Roth, and other hip hop artists). Janick, who championed intimate artist and fan relations at FBR, should be able to bring a bit of high touch to a label notoriously terrible at artist relations, even coining the moniker “neglectra” by its own artists in the late 80s.

The new label has made some key signings, including French duo Justice, Gnarls Barkley’s Cee-Lo Green, and UK Dance artist Little Boots (PS, check out this vid of Little Boots).

We are planning on building an eclectic brand. We’re looking for artists with potential. We’re not an incubator label, we’re going to develop artists and get them to the next level.

- John Janick

It’s great to see the rise of Janick. As indie labels falter all around, he has continued to rise. From starting his own label in a dorm room back in 1996, Janick will now be heading one of the more storied labels in music, with a legacy 6-decades long. From what I’ve read, Janick also plans to still head up FBR.

TechDirt’s Mike Masnick On The “Reznor Business Model”

admin — Fri, 01 May 2009 20:50:07 +0000

I had no idea how much Reznor actually made last year. Here, Masnick breaks down why Reznor’s business model works, and if and how it would work for lesser known artists.

Few people are still arguing that you need a major label to make it as an artist these days. But as an independent artist, how do you compete with free? How do you get your music out there and create a loyal fan base?

It’s a solid half hour long, but Masnick does a good job at keeping it entertaining, and it’s very informative.

If Payola’s Been Slain, Why Does Big Radio Still Sound The Same?

admin — Thu, 30 Apr 2009 21:35:26 +0000

Remember a few years back when that big payola scandal on the radio had everybody decrying Clear Channel as the devil? For those of you that don’t recall, payola is an illegal practice where big record labels pay radio stations to play certain songs by their artists, as if it were part of the regular broadcast. In interest of full disclosure, labels ARE allowed to pay radio stations for playing particular songs, as long as they clearly state it as a sponsored slot. So where the labels got in trouble was in that they were paying radio stations to play songs as if they were the only songs on Earth, which is why radio grew to be so devastatingly mundane across all stations.

In case it’s not clear enough, payola is bad news bears because it creates a structure in which only bands with major label backing have a realistic shot at getting radio airtime. Ever wonder why your local college radio station and public radio have such a broader range of content? There you go. Well, we’re running out of graves for the few indie radio stations left, so it seemed about time for a check-in on big radio.

Back in April of 2007, the FCC and New York Attorney General Eliot Spitzer put a beat down on major radio to shut down the practice of payola. They hit the radio stations with about $12.5 million in fines and required that they set aside over 4,000 programming hours for independent artists. Maybe big radio just thought “indie” referred to the genre rather than the label, because they haven’t changed their ways.

The Future of Music Coalition just released a report comprised of four years of research finding virtually no change in radio practices between 2005-2008.

FMC looked at each playlist and calculated the “airplay share” for five different categories of record labels to determine whether the ratio of major label to non-major label airplay has changed over the past four years. The data in the report indicates almost no measurable change in station playlist composition over the past four years.

While that may prompt many a cynic to conclude that payola is alive and well, FMC has another, albeit related, explanation.

The playlist data analysis underscores how radio’s long-standing relationships with major labels, its status quo programming practices and the permissive regulatory structure all work together to create an environment in which songs from major label artists continue to dominate.

So in essence, with their “risk-averse programming practices,” and culture of payola-tainted music selection, big radio simply doesn’t know how or where to fit in new independent artists, try as they might. Think of them as the Detroit Lions. It’s not that they don’t want to win, they just don’t know how not to lose because it’s all they’ve ever done.

So what are some steps to take in order to help reshape terrestrial radio?

I don’t think terrestrial radio will be a major media market for too much longer, as internet radio becomes more readily available on the go. I also think that internet radio is daring, and even forcing, terrestrial radio to become more creative and risky with their content or die. FMC suggests that radio stations expand the “number of voices on the public airwaves.” I think this is the biggest key to whether or not terrestrial radio can be salvaged. By increasing the number of DJs, you’re giving an opportunity for more variety to be heard, assuming you stop making every DJ play the same 20 songs on a loop. Then, think through what terrestrial radio has that internet radio doesn’t. For most music shows, it’s the DJ. The personality and song selection of the DJ will be what wins people over; something they won’t find on last.fm or Pandora. DJs that are hip to local music on the rise, have good energy, and engage their audiences well will connect to a listener base that net radio can’t yet reach. It’s worked with Talk Radio, and it could be the saving grace of our FM friends.

Photo: Mark Sebastian

VIDEO: “Why Radio & Music Industry Sucks Nowadays”

admin — Fri, 24 Apr 2009 22:01:20 +0000

I snagged this video from Kyle Bylin. There are some very interesting points made in it, and a fair amount of animosity to boot.

I was glad to see that Jonny Greenwood at least cited the positives as to why they signed to a label. Given that by now the marketplace has changed and the labels have changed, thus the perspectives from many of these musicians have changed since the days they signed on the dotted line. To assume that the major labels are the devil incarnate, and have been from day one, is a misconception though. If it were as such, all of the successful musicians we know, that now campaign against the majors, would have to be cited as fools for having gotten on board with the bigs in the first place.

I’m not for or against the major label. I think whether or not a given artist would be better off independent is completely dependent upon how hard they are willing to work to get their product out there, how long they hope to stay on the scene, and how much of their artistic freedom they are willing to bend on.

With regards to the music industry and music distribution, I think a new means of music acquisition can only happen as fast as the consumers allow it to. So long as labels see force feeding bands to the radio working, they will continue to do it. Independent terrestrial radio is on its last legs, and I think terrestrial radio in general will be soon to follow. With the increasing availability of wi-fi, and the infinte access to custom tailored stations that comes with it, we’re only counting the days until AM, FM, and Sattelite are all brought down by net radio.

Before The Music Dies – Watch The Full Documentary

admin — Mon, 13 Apr 2009 19:02:08 +0000

Check out the full feature of the music documentary exploring why only a handful of companies control the majority of music played on the radio and held in retail stores. It’s a bit dated of a film; if you are a regular here, chances are you won’t find any staggering new info in the film, but it was a decent watch. I don’t need to rehash all of the good points or exhausted arguments here, as they’re all in the film. Give it a go, I think you might dig it.

Amy Winehouse’s New Album Rejected

admin — Wed, 01 Apr 2009 16:49:38 +0000

After 3 months writing in the Caribbean, Amy Winehouse’s label has asked her to return to the recording studio to put out an album with a sound that’s… well… not reggae.

With a lot of pressure to follow up her 2006 LP “Back to Black,” label execs aren’t taking chances with a new sound. Why should they? Amy’s vintage soul sound was a smash hit, setting the bar for all other artists riding the trend to be compared to, including Duffy, Adele, etc.

Rumor has it that the lyrics on Amy’s new album are also much darker than her 2006 hit. Sources told welt.de:

The lyrics are very dark indeed. While she’s known for her conversational style and has been very successful with it, many of the tracks are near the knuckle. In the past, she’s written frequently about broken hearts and boyfriends, but this time round she’s delving into harrowing terrain.

Perhaps he meant heroin terrain, as Winehouse has developped a tragic public image as an un-remorseful addict. That persona is also cause for alarm from the label regarding Amy wanting to pursue a reggae sound. The source added:

It is crucial Amy’s return is handled properly. If she puts out a record that is in any way half-baked, that could severely damage her long-term prospects, so everyone’s focus at the minute is getting it right, even if that means telling Amy some things she probably won’t want to hear.

So what can we learn from all this?

Lesson #1: Find out what you do best, and do it. It’s one thing to pursue artistic integrity, but another to shoot yourself in the foot and sabotage your career. I’ve always struggled with balancing the music I want to play with the music I’m best at playing. My advice would be to play whatever genre will give you the biggest platform, keeping your passion as a hobby. From that platform, you can gain new resources (financial and personnel) to develop the genre you’re more passionate about.

Lesson #2: Don’t do drugs. Seriously though. Don’t do it.

Michael Rapino Wants To Replace The Record Label With Live Nation

admin — Mon, 23 Feb 2009 05:22:45 +0000

There’s been a lot of buzz about the Ticketmaster/Live Nation deal, especially after the fallout concerning Bruce Springsteen tickets in New Jersey. Just prior to all of that, WSJ had an article on Live Nation’s Chief Executive Michael Rapino, and how he hopes to replace the record label as the artist’s primary industry partner. Rapino has already landed some of the so-called 360-deals with Madonna and Jay-Z locking up revenue for their future ticket sales, recordings, and merchandising rights. U2 has also set up a similar deal, though they elected to exclude rights to their recordings. It’s a big gamble forking out $120M+ to an artist for a product yet to be seen, and Rapino has been pretty selective about who they’ve approached for contracts.

Artists used to tour with the goal of selling more albums, which were their primary source of income. With revenue from album sales in the toilet, have the tables turned to where an artist’s primary income is earned from live performances? We’ve already seen artists going indie to try and increase their cut from album sales. Clearly, that’s an indicator to the fact that the old model of artist sustenance is not going to cut it today. If that is the case, is Rapino on to something by trying to capitalize on other aspects of an artist’s market?

[From WSJ]

It was well after midnight and Jay-Z was presiding over a private dining room at Katsuya, the Philippe Starck–designed Los Angeles sushi restaurant, following a sold-out show at the nearby Hollywood Palladium. The concert marked the historic 1940 venue’s reopening, after a yearlong, $18 million renovation—it is now operated by concert-promotion giant Live Nation. Seated on the rapper’s right was 19-year-old Hayden Panettiere, star of the television series “Heroes.” Jay-Z’s bodyguard, a towering 34-year-old veteran of the Dutch Special Forces named Norm, watched over the phalanx of security guards keeping paparazzi at bay on the sidewalk outside. Lakers center Andrew Bynum, who had spent much of the concert dancing shirtless with three young women, had disappeared.

When Live Nation Chief Executive Michael Rapino strode into the restaurant, Jay-Z had a waiter squeeze in an extra chair on his left. He then gestured for the server to fill Rapino’s glass with Armand de Brignac “Ace of Spades” rosé—after having told another guest not to even look at the $500 metallic-pink bottle of Champagne. But Rapino, 43, isn’t just any music exec, despite his three-day beard, black T-shirt, jeans and leather motorcycle jacket. He has suddenly become one of the most closely watched figures in the music industry.

Read the full story.

Sony Music Woes Extend To Digital Sales

admin — Thu, 12 Feb 2009 01:38:54 +0000

The struggling music units of Sony Corp. and Bertelsmann AG merged in 2004 so that a combined company could better fend off illegal file sharing and shrinking CD sales.

The new recording company, named Sony BMG, was expected to wield the kind of resources that could challenge Universal Music Group as the largest of the four top labels. Sony BMG would own a chunk of U.S. music sales almost as big as Universal’s.

To say the deal failed to deliver on the promise is probably an understatement. More than four years after the merger, there isn’t a more troubled major label around.

Read the full story.

Indies Win 50% Of 2009 Grammy Awards

admin — Wed, 11 Feb 2009 23:59:53 +0000

Whether it’s due to their stronghold in current popular genres (folk, blues, and the aptly named “indie” rock), or a genuine democratization of the playing field, independent music seems to be on the rise.

[via dailyswarm]

Independent artists and labels had a banner year at the 2009 Grammy Awards winning 56 of the 110 awards given or just over 50% of the total prizes.

“The continued growth of independent music is underscored by the success of independent artists and labels at this year’s Grammy’s. Music released by artists on independent labels scored 56 Grammys Sunday night out of a total of 110 awarded including Album of the Year and Record of the Year (Robert Plant & Alison Krauss), Best Alternative Music Album (Radiohead), Best Reggae Album (Burning Spear), Best Comedy Album (George Carlin) and Best Jazz Instrumental Album (Chick Corea & Gary Burton). Last year, independents won 36 awards,” stated Jim Mahoney, VP of the American Association of Independent Music (A2IM).

I think a number of factors could be contributing to the rise of independent music, not the least of which is the internet. It’s no surprise that the net has provided a new distribution avenue for artists to get their music directly to fans without the help of labels. The 4 big labels were notoriously slow in getting on the right side of YouTube, MySpace, and other online means of streaming media. Independent labels were much more keen on trying anything that could get them closer to fans. Fast forward that trend over the next decade, and the music industry might start to look a lot more like it did in the 70s. The 4 bigs are slowly coming around to embrace social media and the influence it has on the arts and pop culture, but the tide may have already turned.

What do you think caused the sudden spike in independent music’s success? How can you apply that trend to your business model?

Equal Vision Records Tries New Means Of Album Sales

admin — Sat, 24 Jan 2009 02:51:54 +0000

Would you pay a couple hundred dollars for every CD and DVD a label is going to release this coming year, sight unseen?

Indie label Equal Vision Records is asking fans to do just that. With the launch of EVR365, fans can select from 3 packages allowing them to get prereleased copies of EVR albums through the whole year. They throw in some other schwag like t-shirts and such too, to add incentive. The packages are priced between $60 and $200. At the $60 price point, the purchaser gets a digital download of every EVR album released, and to be released, in 2009. Future albums will be given to EVR365 members one week before the street release. The deluxe package sells for $200 and includes an EVR T-shirt, a signed copy of every CD and DVD for 2009 plus the corresponding pre-order shirt, and free shipping after the first order sends out.

I applaud Equal Vision for considering a new means of album sales, but I’m not sure this one will fly. I don’t know that I spent $200 on any single label’s releases last year, much less a smaller indie label like EVR. Who this will appeal to is the younger scenester crowd who would buy every EVR release anyway, and is anxious to gain bragging rights for getting albums early, and having them all signed.

The cool thing about this, from the label’s end, is it essentially lets them raise revenue to fund future product. If they’re making a ton of money on it, they know ahead of time that they can splurge on a particular album or two. If it tanks, then they know to return to the usual mode of operation. It takes some of the risk out of the risky business of record labels since you have some sort of idea as to your take before you go forking out the money to make the albums. Well played EVR, and kudos for breaking out of the norm to try and find new means of sales in this tough climate.

You can see the details of EVR365 here.

Judge: Illegal Downloads Don’t Equate To Lost Sales

admin — Tue, 20 Jan 2009 03:42:39 +0000

US District Judge James P. Jones has ruled that copyright holders cannot equate each illegal download with a lost sale. Just because somebody downloaded your song, doesn’t mean that they would have purchased it otherwise. Practically what that means is that you cannot seek restitution based on the amount that hypothetically would have been gained if the person would have purchased your song through legal channels.

Via ArsTechnica:

Record companies cannot collect restitution for every time a song has been illegally downloaded, a US District judge has decided. Judge James P. Jones gave his opinion on United States of America v. Dove, a criminal copyright case, ruling that each illegal download does not necessarily equate to a lost sale, and that the companies affected by P2P piracy cannot make their restitution claims based on this assumption.

I’m not sure how much I like this ruling. While I can see the point that the judge is making, the essential argument on the part of the defendant is, “Well, I wouldn’t have downloaded the song if I couldn’t steal it.” That’s the equivalent of me stealing a Ferrari from the local dealer and my defense being, “Well, sir, I definitely wouldn’t ever have bought that car, so I stole it. Therefore, I can’t be forced to pay the dealer for how much the car is worth.” Seriously?!

“Those who download movies and music for free would not necessarily purchase those movies and music at the full purchase price,” Jones wrote. “[A]lthough it is true that someone who copies a digital version of a sound recording has little incentive to purchase the recording through legitimate means, it does not necessarily follow that the downloader would have made a legitimate purchase if the recording had not been available for free.”

So now it’s the copyright holder’s fault for not making their content avialable for free? Take that back to my Ferrari analogy, “Well, sir, I wouldn’t have stolen the car if they would have just given me the pink slip for free.” That makes no sense.

I should point out that this does not absolve defendants of criminal charges, but severely limits the restitution that copyright hodlers can seek. Civil suits can ask for monetary damages based on some other scale, but it appears that copyright holders will not be able to calculate that value based on the price of their content. How then should they determine what they’re owed? I don’t want to see people steal songs, but I don’t want to see copyright holders abuse this ruling the other way either, and start collecting thousands of dollars per song shared instead of the actual value they would have charged for the song. Make sense?

read the full article here

Steve Bowman On Record Labels

admin — Thu, 01 Jan 2009 23:00:36 +0000

Steve Bowman (stevethedrummer.com)Steve Bowman, the acclaimed drummer of Counting Crows and Third Eye Blind, gives us an insider’s perspective on record labels. He breaks down bands’ label options into three categories, and breaks the posts up the same way:

Part 1 – The Majors

Part 2 – The Independents

Part 3 – Creating Your Own Label

These are great reads if you’re weighing any label options. I know they’re a bit long, but the information is invaluable. Obviously, Steve can only present a unique perspective based on his personal experience, but that’s certainly a lot more experience than many of us will ever have the fortune to gain.

I’d love to get your comments and pros/cons if you have any. Enjoy!

Warner Orders YouTube to Pull Videos

admin — Sun, 28 Dec 2008 03:55:28 +0000

Contract negotiations between Warner Music Group and YouTube broke down last week prompting Warner to order the removal of all WMG content from YouTube. The order pertains not only to artists currently on Warner Music’s major labels, but also extends to all songs published on Warner/Chappell music.

Warner was the first major media company to negotiate a contract with YouTube back in 2006. Warner, along with Universal Music Group and Sony Music, took stakes in YouTube back in that same year as part of contract negotiation deals, and profited when Google purchased YouTube for $1.65 billion shortly thereafter. Warner feels that their 2006 contract brought legitimacy to YouTube, strongly contributing to the Google acquisition.

YouTube currently pays WMG on a per-play basis. WMG has argued that numbers negotiated in 2006 are no longer applicable given the success of YouTube and Warner’s perceived role in that success, and is thus seeking a higher revenue per play.

“We simply cannot accept terms that fail to appropriately and fairly compensate recording artists, songwriters, labels and publishers for the value they provide,” Warner claimed in the official statement released on Saturday.

With over 100 million video views per day and 13 hours of content uploaded every day, YouTube accrues huge bandwidth expenses of over $1m each and every day. Undoubtedly, YouTube sees their service as an assett to WMG and wants to keep more of the revenue for footing the tab on those huge bandwidth bills and operational expansion.

Now that WMG has begun pulling content, many expect Sony and UMG to follow suit in demanding higher rates per play at the threat of content removal. Should that come to fruition, it would undoubtedly hamper YouTube’s efforts towards being the one hub on the net for all things video. The bigger question from there is, who will the labels turn to to host their content?