Other than How do I get a record deal? or How can I License my music? the question that comes up the most is How do I make it in the music industry?”
“Making it” to me just means making a living playing, writing and recording music.
Top 5 Behaviors that will help you make it in [...]
Michael Goldstone is one of the most successful A&R executives still in the business. During his career he has signed artists like Pearl Jam, Rage Against the Machine, Buck Cherry, Regina Spektor and Tegan & Sarah. After having many senior positions at labels like Epic, DreamWorks and most recently being the president of Sire Michael has started a label called Mom & Pop records with Craig Winkler and the Q-Prime Management team (Metallica, RHCPs, Muse etc).
Tell me how Mom and Pop came about and what is it like to run a modern label? Why did you opt for a new situation given that you were the President of Sire and working side by side with the label’s founder Seymour Stein?
MG:
I think the Sire experience was incredibly empowering and very satisfying. Previously, I had been thinking of starting my own label. But when you’ve grown up listening to KROQ and Depeche Mode, Echo and the Bunnymen, and The Replacements, and somebody calls you up and says, “Hey, we want you to be the president of Sire Records,” well, I couldn’t resist!
How was it working with Seymour Stein?
MG:
We both worked for Tom (Whalley), which allowed us to both thrive and build a relationship. I will forever look back on the experience with Seymour as being one of the most gratifying of my career. Anyone that has worked with Seymour knows how inspiring and amazing he can be. It was one factor that made it extremely difficult for me to leave. With Sire, which had been so revered, we respected the history of the label. We were able to sign Regina Spektor, Tegan and Sara, and Against Me, building up a diverse roster. I remember at one point we did an Alternative Press ad with eight bands. To be able to do a two-page ad and have all eight bands on there and a) not get any calls from any of them saying, “I can’t believe you put me in an ad with this band or that band,” and b) to have it be diverse was a validation of our ambition. That year, having three acts at Coachella and three acts at Bamboozle the very next weekend was really satisfying.
Why Mom and Pop? What was the catalyst to make you start, and what’s different about your new label?
MG:
For major labels, deals revolving around the delivery of four to five albums, as well as access to 360 rights are important for sustaining that model. A lot of the artists I was gravitating to were artists that were probably not pre-disposed to wanting to do those kinds of deals. When you’re in a bigger company, 180,000 units is often perceived to be a bit of a disappointment. In a smaller label, however, 180,000 is a huge accomplishment. That can make money for both the artist and the label.
I felt like I was sending a lot of artists down the street because we didn’t have the ability to do short-term deals or deals that didn’t have 360 components in them. It was extremely limiting. I wanted to be in a situation where whatever we were able to build and grow, which would be satisfying and exciting to everyone. It just seemed like the time to try to be in a situation that allowed more flexibility.
I’m having a blast doing this, and we like the ability to interact with RED Distribution and make the decisions. Not having to go through long, complicated meetings with large numbers of people is a welcome relief. The lack of politics is so incredibly liberating I cannot even tell you. I enjoy having the freedom, deal-wise, and support from Peter [Mensch] and Cliff [Burnstein](the founding partners of Q-Prime).
Tell me how the company works. Tell me about what the process is and how the process has changed for you, not only since the landscape has changed, but since you’re at a new label. Is there a philosophy or is it case by case?
MG:
Developing and breaking acts is somewhat subjective. The benchmarks that define a broken or developing act are different now. Artists that are able to sustain their careers can do so through selling fewer records and building strong touring. Lucrative careers can be built through publishing and sync deals. The rules and criteria of success and breaking bands are changing as we speak. Remaining flexible is of the utmost importance.
What is the process of furthering an artist’s career in this age where artists have so many tools available to them?
MG:
The bones of Mom and Pop come from management DNA. The second you walk into a management company and you’re building out a recorded music division from it, the value and benefit of that management DNA is undeniable. Sitting with Peter, Cliff and Craig Winkler is great. I remember with Joshua Radin’s deal, I was thinking to myself, “This is the craziest and most user-friendly proposal I’ve ever done.” It was interesting because I got most of it right. Cliff marked off two or three things, completely in the artist’s favor. With the history of looking at hundreds of record deals, he’s saying, “Okay, this is how we’re going to make it more fair. This is how we’re going to make it more equitable.” I knew I was with the right people. He ultimately inspired me when he said, “If we do great work for great artists, over time it will all come back.” Cliff (and Peter) have allowed and pushed me to make decisions that are completely antithetical to what bigger companies do in certain situations.
Is your company staffed, or are you hiring consultants case by case?
MG:
Where appropriate, we can utilize the QPrime staff. Depending on the artist, there could be an additional three to twelve bodies. Everyone here is jumping in. There’s a lot of opportunity that creates itself when people are making calls looking for Metallica, the Red Hot Chili Peppers, Muse and Silversun Pickups. Our radio is powerful. Cliff and Peter set up the promotion department ten years ago in order to have their own relationship with radio. When other people are going in the other direction and getting smaller, they’ve been more aggressive with providing extra support for their artists. Look at Silversun Pickups on Dangerbird Records; they did a great job developing the band. But Dangerbird would probably be the first to tell you that they would hit a ceiling at a certain number and that number would be far below the 300,000 records that they’d be able to sell at the time without good partnering. So when you’re sitting with bands and you have the infrastructure that can go compete and have the upside, and sell as many records as anyone else – it really helps. Of course it’s dependent on finding the right acts and the right songs.
How has A&R changed? Are you finding you’re doing more deals based on who has existing movement, or are you doing deals purely out of love with kids just out of art school?
MG:
I think it’s somewhere in between. I would like to say it’s more of a mindset than it is a sales threshold. There’s a band we’re just signing right now that hasn’t put a record out yet, but they’ve done all the right things to move themselves along. Even though they don’t have a sales base, we’re walking into a situation where there’s a lot of natural inertia. I think what we’re also focused on is finding really strong managers and bands that understand what we’re trying to do, and building on that. In theory, the artists we sign, and their managers, are becoming part of the label. We’re making all the decisions together and we’re empowering them to build the team. We find, sometimes, that a team of 10-12 people is far more effective than a team of 75-100, especially when you’re trying to get everyone on the same page. We’ve been working really well with RED, and we have a strong relationship with iTunes.
What are you seeing that artists are doing that’s working? There is so much conversation about rising above the noise now that international distribution is only a couple mouse clicks and $50 away. Talent aside, are you seeing anything that is a reliable delivery source? Is it touring? How are you seeing artists build a business? You’ve clearly identified at Mom and Pop people who have built something. How are they building these things? Has it changed?
MG:
We think we’re dealing with a generation of musicians and managers who are more forward thinking, more resourceful, and willing to be pragmatic. They are finding alternative ways of exposing music. We think the ones that are truly committed to building a connection with their audiences are the ones that are building careers.
We think people are figuring out they don’t necessarily need to be flying Top 10 records in order to go build touring bases. We may be speaking specifically to the aesthetic of what we like and what we’re doing. You could be having a totally different conversation with somebody if they wanted to go make a pop record. They do need those drivers and big record companies with promotion and a willingness to go put the energy of 200 people behind it to go sell 150,000 records that first week. In terms of what we are trying to do, it’s a proof of concept. We took an artist off a bigger label that had sold 90,000 records and that wasn’t enough. Whether it was creative or artistic reasons that they let him go, we were thrilled to get that opportunity, and we’ve done really well with it. This is an artist that played enough shows, shook enough hands, signed enough CDs and got enough opportunities for himself. He networked a lot of relationships for himself. Joshua Radin is someone who works hard.
The 200,000+ units he sold between these two records did not come from having a hit. And now he’s starting to get into bigger rooms and build a career outside of America. I went to England to see him play Shepherd’s Bush Empire off TV syncs and word-of-mouth. He drew 1300 people, and he didn’t even have a record out. The stories are all different, but the one thing they have in common is the ability to move themselves along.
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Check out Mom & Pop Records
Samantha Cox is the Executive Director of Creative at BMI. As the process of getting paid as a songwriter tends to be complicated I thought she would be interesting to speak to about how it all works from her perspective on the inside of one of the major PROs (Performing Rights Organization) in the U.S.
You are the executive director of creative at BMI, tell me what the creative department at a performing rights organization is about. What does your job entail?
SC:
My job mainly consists of A&R, management/administration and events planning. That means, first, maintaining relationships with the songwriters and publishers that we currently represent while acquiring new talent. Secondly, putting together everything from showcases and panels at conferences and festivals to speaking at universities. And finally there’s management/administration which involves affiliating songwriters and publishers, registering their works, helping to put their team together, hooking up co-writes, working with attorneys, producers, booking agents and music supervisors and above all making sure the artists get paid. I could go on and on but that’s the big picture gist of it.
Let’s talk about that. It’s not even just kids fresh out of art school who don’t do this correctly. It is often musicians that have been playing for years and years and have never set up their corporation correctly. What do you need to do to be properly paid by your PRO?
SC:
The first thing to do is sign up as a writer and publisher at BMI.com. It’s super easy and every songwriter should take the 20 minutes and do it. Basically what everyone needs to know is that you need to sign up as a writer, sign up as a publisher and register your songs if you want to get paid. Then when you start getting airplay – whether it’s radio, TV, the internet, whatever — you’re good to go. I can’t tell you the number of really smart people who overlook this basic step and end up missing out on performance royalties. Go to the website, click “join” and follow the instructions. If you have questions, we’re here to help. But the minute you’re done, you’re in the game.
Do you need to set up a formal corporation or can you do it under your social security number or…
SC:
It really depends on who you are. For the vast majority of writers, I advise setting up individually owned companies using their social security numbers. If your career is farther along and you have a business manager or an entertainment attorney, they may advise you to set up a corporation or LLC. But what’s important to remember is that the moment you write a song, you are the owner of that song and therefore the publisher of that song. Now what you want is to get paid for that song. That’s where we come in.
So when people do deals with a large publishing company, they are basically doing a deal for the publisher’s share, and it was divided that way so artists wouldn’t get ripped off. Correct me if I’m wrong.
SC:
That’s absolutely right.
Just a few more basic questions about the way money moves to the artist. BMI pays their artists and they collect this money by laying down a blanket fee on radio stations, TV channels and so on and so forth. Companies have to pay to play music – live venues, different websites, etc., etc., and that’s where all the money comes from, correct?
SC:
Pretty much. BMI collects license fees on behalf of our songwriters, composers and music publishers and distributes them as performance royalties. I think it’s important to remember that BMI operates on a non-profit-making basis so we’re not out to make money like a record company or publishing company. We don’t own the songs or recordings. We just enter into an arrangement where we collect and distribute royalties on behalf of our songwriters and publisher.
Music Consultant: How is that enforced on the local level?
SC:
Basically there are a few different ways. TV stations and internet sites provide us with detailed performance logs. Radio stations, we use a complex sampling system that’s proven super accurate over time. Concert venues are up to the artists to provide set lists. And everything else – airlines, sporting arenas, etc. – pay blanket license fees. On the really local level, we actually have people who walk into restaurants and sit there listening to music just to keep everybody honest.
There are really only three companies in the U.S. that do this; to my knowledge it’s ASCAP, BMI and SESAC. As a result you must see and meet tons of people. From your perspective, what are some of the mistakes that you see artists making?
SC:
I’d say the biggest one is that songwriters don’t really utilize us like they can. Not only can we help administratively but we can help creatively. We do showcases and panels and seminars and they can get involved with all of these. Especially the educational seminars. They’re open to everyone. We do them about every other month, sometimes more often. We just did one about production. How do you produce a record? How do you get a producer? It was awesome and we got a ton of positive feedback.
That sounds great.
SC: It’s really exciting. That’s the great part about this job. When it comes to the creative side it’s a lot of fun.
I hear a very common gripe: “I can’t get anyone on the phone at BMI or ASCAP.” Is the best way to make a relationship is to attend one of the things?
SC:
I think it’s a great way to do it. I have to admit it’s hard to get people on the phone at BMI or ASCAP. We operate on a non-profit basis so our staff is limited. I do my best to return every phone call and email that comes in, but it can be overwhelming. I could answer emails 24 hours a day, seven days a week and still not get to everyone. That’s why I encourage persistence and patience. It may take a while, but eventually I, or someone else, will get back to you.
Now the tough question. Why BMI?
SC:
That’s a great question. The U.S. is unique in that we have three performing rights societies. Everywhere else in the world, there’s one per territory. I think it’s great that here in the United States you have a choice. Basically, my answer is that it comes down to relationships. You want to know that there’s someone inside the company who can not only walk you through the process of affiliating but can guide you creatively. Someone to push you in the right direction. Someone who believes in you and your music. It’s extremely important to have an advocate. Everyone always asks me, “Does one pay out more than the other?” Well, if one paid out more than the other, everyone would run to that society. We all pay out pretty much the same. So, again, it just reinforces what I’ve already said – relationships are key. That’s why I spend so much time getting to know our writers, to learn what they want to do and figure out how to help them get there.
Here’s another question. All of the changes with the record business that are leaking into the publishing business and leaking into the touring business; how is the big shift in technology starting to affect BMI and performance royalties organizations? Are you starting to feel that shakiness? Does that really affect you, other than the fact that so many of our peers are now freelance?
SC:
I have to say we’ve been very fortunate in the business that we’re in. In the past, we negotiated some very good radio and TV deals. Our income has continued to go up steadily. We’re about to renegotiate another radio deal soon, which could affect some of that, but we feel we’re in a strong position and feel good about the future.
Is that a blanket negotiation or something specific within the radio industry? When you say you’re renegotiating a radio deal, is that with radio in general or just a large conglomerate?
SC:
It’s not just one specific radio station; it’s a conglomerate of radio stations. Let’s face it, their advertisement dollars are shrinking and so their income is going down – and that’s where our income comes from. We’ve taken that into consideration and have streamlined internally and cut back expenses so that our payments will continue to be strong no matter what happens. Our goal is to have the best payments. Yes, it’s affecting us, but I would say it’s more about the economy than technology. Technology has actually worked pretty well for us. We’re in the streaming business, not the downloading business, and the internet is becoming all about streaming. Our internet income actually continues to get bigger each day and that’s the future. So I’d say on that front, we’re looking pretty good.
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Check out BMI
This is part 2 of 2 of an interview with Jeff Price, the Founder and CEO of Tunecore. If you missed part one you can read it here.
Fair enough. From the TuneCore stats it sounds like the unbundling of the album really has completely changed the playing field. You have people buying one track, five tracks, an EP; it’s all over the map I’m guessing.
JP: It is. The other thing I would stress is in defining if a musician is breaking or successful, I think it’s rather narrow for anyone outside of the artist to determine that on their behalf. I think each musician and each band has their own definition of success to a certain degree.
Other than conducting a world-wide musician audit, I don’t think we’re ever going to have a metric that covers it anymore.
JP:
Exactly. And even if you did come around to some, there’s so many different income streams now, so to suggest that “breaking” or fame is predicated on album sales when you have record labels themselves doing 360 deals, because they’re doing deals where they get to participate in revenue that are outside of music sales because they now know when they make an artist famous, they don’t make money off the music the way they used to. So they have to partake of revenue that’s coming in from new income streams, like merch or gig.
How does a former record guy like you feel about that? Do you think that’s a justifiable approach, that these record companies become music companies?
JP:
Honestly, I think a management company is a record label. There’s no difference anymore. The only difference that now exists is distribution, but with something like TuneCore, it levels the playing field. Managers used to take X% of an artist’s revenue across all income streams. Now granted, they used to like to try to get those big advances from the majors, because a bird in the hand is better than two in the bush, and they could just take a big slice off the top. If the artist failed, they still made their money. But that’s the way they operate. It’s a manager’s job to go out and provide the artist opportunity that they couldn’t otherwise get on their own, or manage their affairs for them, or provide them new opportunities they couldn’t get. And they serve the musician, and they take a portion of that money for their services. The two are very similar.
Musician Coaching: Even towards the end of my label run I used to say, “If you were doing any real work, you were doing some kind of management.”
JP:
Absolutely. That’s what we did at SpinART. And frankly, it excites the hell out of me, because what I see is an explosive growth in the music industry. I’m not a “doom and gloom” guy on this at all. What I see is more music being created, produced, released, shared, discovered and bought than at any other time in the history of the world. And more is better; more is healthier. No one’s suffering because there’s more music. No one’s getting hurt because there’s more music, and I don’t buy it for a second that because there’s more it means no one can find the quality. That’s the joy of social networking.
The only thing I would say is it really does make somebody like a taste maker or a DJ much more special. It’s a much harder job now to be good in that role, because the amount of sifting can be overwhelming.
JP:
I agree with you to a certain degree. But on the flip side what you’re finding is the collective population is doing that sifting for us. What I mean by that is, the A&R source becomes society. You’ve got – I don’t know how many people tweet and how many people on MySpace and how many people on Facebook – over 100 million, and that’s a lot of people. What happens is, here I am, looking at a report, and I can tell you, the artist called Boyce Avenue at this point have sold over 1.2 million songs within the past twelve months, no record label. They now have management. In the month of November, they sold over 36,000 additional songs across their catalogue of nine different albums. Colt Ford sold over a quarter million songs over the past eight months. And here’s a funny one. Monsters Halloween Party, the Ultimate Scary Sounds or Music for Your Halloween Bash – it’s just spooky sounds – 1,700 albums, 10,000 singles. Never Shout Never – kid I mentioned before – 1.5 million songs in the past thirteen months, 32,000 songs sold across three EP’s in the month of November. Kim Zolciak, “Tardy for the Party” – I don’t know who she is yet, but maybe others do – 20,000 songs. This is just one month, by the way. This is the month of November I am describing right now. John LaJoie – a French Canadian comedian, uploads a video to YouTube for a song called “Show Me Your Genitals,” I kid you not, and another song called “Average Everyday White Guy.” He has now done over a quarter million songs in four months, and in the month of November, 1,000 albums and 12,000 songs. I’m looking at a list here that goes on for 3,000 artists. It’s every artist that earned over a certain dollar amount.
As a guy who helps democratize this process, you have to have a pretty interesting vantage point on what those people at the top of the list you just referenced are doing. To have international distribution for under $50 is phenomenal. But I do think there is a certain point that the landscape has changed so much by pure volume. What do you see that people are doing to distinguish themselves from everybody else who it might be their first month with a guitar, and their stuff is up on MySpace? What are you seeing that’s working?
JP:
The answer isn’t one that anyone really likes. I wish I could give you the silver bullet. The reality is, there’s nothing you can do to cause your music to sell beyond making sure it’s out there. Out there means, MySpace page, Facebook page, a TuneCore media player that you post all over the place, making your music available to buy in digital stores. If you’ve got a video, upload that video to YouTube. Communicate that the media is out there. You have access now as an artist to get your music out to the media points. It used to be you couldn’t get to MTV without going through multiple gatekeepers to get programmed. Now anybody can go to YouTube and upload a video. The trick is, the art you create has to cause a reaction. If it doesn’t cause a reaction, it doesn’t matter how much exposure you get. It doesn’t matter how many people hear it, because no one’s reacting to it. I always use “Smells Like Teen Spirit” as an example. If “Smells Like Teen Spirit” wasn’t a song that caused reaction, it wouldn’t have mattered how many times you heard it on commercial radio, it wouldn’t have mattered how many times you saw the video, it wouldn’t have mattered how many hundreds of millions of dollars were pushed at shoving it down your throat. If it doesn’t resonate with the consumer, with the music fan, people aren’t going to buy it.
Gone are the days of “spends double-platinum to get gold.” I remember those days not so fondly.
JP:
As you also probably remember, there was a 98% failure rate at the major labels. That’s the other point, which is sort of buzzing around the Internet, it used to be that you could only break if you had lots of money and connections. Bullshit. Even with lots of money and connections, you usually lost lots of money. 98% of the major record labels released failed. They didn’t take. And it wasn’t because of a lack of access. It was because the art didn’t cause a reaction. And the art has to cause a reaction. What’s so cool now is that with everyone having access to the media outlets – and I’m not trying to be vague, but upload a video to YouTube, go to iTunes and create an iMix, put in three of your own songs and nine songs by more popular artists in the same genre, because that’s how people discover music in iTunes. Name your song in a specific way to service the search engines, or do a cover version of somebody else’s song. People go to iTunes and look up songs they know. We have one band, as one example, to get sort of off the point, that uses us called “ACDB.” They sold 47,000 songs and over 1,000 albums in the month of November. The reason they sell so well is because ACDC isn’t in iTunes. So when someone looks up an ACDC song, they by default show up. That’s an extreme to make a point, the point being, keep in mind the way search engine technology works. If you call your song “Let It Be,” which you’re perfectly, legally allowed to do, your song “Let It Be” will show up next to other songs named “Let It Be.” You can also name your band in particular ways, or put “klezmer” in parentheses after song names. So there are ways to – I don’t want to say game the system – but there are ways to get yourself to surface or pop up using the fame of others or niches. The Internet is about niches. People are logging in usually because they want to hear Celtic or heavy metal dwarves doing opera songs, or whatever it is. If people are into that, you name your band, “Celtic Heavy Metal Dwarves Playing Opera Songs” and you’ll surface within the search engine.
Musician Coaching: Sorry, what? I completely tuned out. I was half-way on my way to sending out e-mails to start the Celctic Heavy Metal Dwarves band…
JP:
iMixes are one thing, media in particular, putting it out into the world and video. Don’t be afraid of video. You can flip out your phone now and film Paris Hilton, if you happen to bump into her on the street, it doesn’t matter the quality of the video capture, you’ll still get a bazillion people looking at it. Make a flash animated video game set to your music. Use the game as way to get people around the music. We now do digital distribution into Rock Band, where your song becomes able to be played in Rock Band. There’s a lot of people that play Rock Band, and there’s not a lot of songs to buy. The probability is, you could probably sell a whole bunch there and gain some fame through that. By the way, all that is not tracked by Nielsen. There are some bands that play video game conferences where they have 5,000 screaming gamers come to see them play. But when they go out and play at a regular venue, maybe they’ll have 100 people paying for them. It’s kind of funny.
Here’s a question for you. I also read in recent press that you guys partnered with Universal. How does that work?
JP:
Basically, we’re an A&R source for them, because the data we have – despite what others might suggest – on the musicians indicates those artists that are breaking.
They used to do that with radio spins on indie artists. I can see that working well.
JP:
It actually has. Since that deal has launched, there have been five signings by Republic in the last five months all coming from the top-selling TuneCore artists. Boyce Avenue, Jaron and the Long Road to Love (which I think that deal has closed), Colt Ford and there are a couple more. There are five of them that just happened. Prior to doing the deal with universal, there was Drake. Then before that, there was Soulja Boy and there was MGMT and Secondhand Serenade and Neveshoutnever and Medic Droid. The number of artists that have used TuneCore that chose to work with an outside company, primarily record labels or what used to be record labels is 20-25 bands in the last year and a half.
How does that work being that you’re non-exclusive?
JP:
This is a stunning part of the Universal deal. There’s now a website called Interscope Digital Distribution. There’s a website called IDJ (Island Def Jam) First Look, there’s Republic Digital Distribution and UniMo Digital Distribution, which is Motown. And TuneCore hosts and serves those Websites for those major label imprints. And any artist on the planet can go to those sites if they want and get worldwide distribution of their music under the exact same terms and conditions as TuneCore. You keep all your rights and get all the money. But if you choose to go through that site, what you’re agreeing to is to allow Interscope Records to see how you’re doing. You increase your opportunity of being discovered by them, and then they have to work their asses off and present you a deal to sign you. There’s no first look and no catch.
And it doesn’t cost any additional money to be a part of that?
JP:
No, it does not. And the reason I did the deal is because I feel that it’s not my place to tell an artist what they should or shouldn’t be doing. I want to provide options and opportunities and information. If you want to go and get signed to Interscope Records and strike a deal with them, and I can help you facilitate that, that’s my job. You want to get on iTunes? I’ll get you there. You want to get into Rock Band? I’ll get you there. You want to get into eMusic? I’ll get you there. You want to get paid for your streams on MySpace Music? I’ll get you there. You just hit the website, you upload a song, you click a button, and I get you there. So what this is, it gets you the worldwide distribution, but you have more direct access to the A&R people, who literally log in and troll through the data to see what’s going on with the artists that come through their site. And if there’s a band they want to reach out and contact, then they have to reach out and contact that band, or woo that band and provide the right deal that makes sense for that artist. And hopefully, with this empirical sales data under their belt, when you’re Nevershoutnever or Boyce Avenue and you can say, “Look, I sold over a million songs. What are you going to do for me?” It puts you in a better negotiating position.
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Check out Tunecore at http://tunecore.com
Jeff Price is the Founder and CEO of the digital distribution company Tunecore. Prior to founding Tunecore Jeff ran a label called SpinART Records for seventeen years and also worked at E-Music in their very early days.
Jeff, thanks for taking the time to speak with me. Take me back to five years ago when you saw this need and created TuneCore.
JP:
While at SpinART I crossed paths with Frank Black. It’s the Pixies really that get credit for all this. The Pixies get credit for TuneCore! In 1995-96, I was trying to get a band that SpinART had released called Lotion on tour with Frank Black. Frank Black was going on a solo tour, and through the booking agent I got the name of the manager, a guy named Ken Goes. I called Ken Goes, and while we were on the phone, I was telling Ken why we should have the band Lotion open for Frank Black. Ken put me on hold, and came back and said, “Well, that deal just fell through.” And I said, “What deal?” He said, “Well, we have a new album called ‘Frank Black and the Catholics,’ and we were negotiating with Stone Gossard from Pearl Jam to put it out through his record label, but the deal just fell through.” I asked him why, and he said, “We had done a deal with a company called Good Noise, where they had the exclusive rights to the ‘Frank Black and the Catholics’ album in the digital format, and we only had the physical to offer them, and they wouldn’t do that unless they had all the rights.” Mind you, this was 1995-96.
Digital rights didn’t mean too much in 1995-1996…
JP:
Yes, and there was dial-up, not a lot of broadband. And with mp3, people thought, “Huh?” So I told Ken, “Well, I can release it.” He said, “Well make me an offer,” and I did; and we ended up releasing the next seven Frank Black and the Catholics album, and the Pixies record, and the Frank Black/Francis double-disk DVD. More importantly what came out of it is a gentleman showed up at my office from a company named Good Noise named John. John is now the chief financial officer of TuneCore, but John at the time was consulting for Good Noise, and he said, “You have the physical, we have the digital; we should talk.” And Good Noise is the company that became eMusic. I met John, and we hit it off, and I was involved in writing the business plan for eMusic. They also used me to help raise venture capital. That’s how I got into the whole digital distribution realm, was through this Frank Black album, and my introduction to Gene Hoffman and Bob Kohn, the founders and CEO and Chairmen of eMusic. Ultimately I was the interim vice president of content acquisition for eMusic, where I would pick up the phone and call other record labels to attempt to license their music for sale at eMusic.com. Then I got into the business development and intermittently ran the New York office. Then I moved out west for a year and lived in San Francisco during the whole Dot-Com boom. That was a treat. (That’s sarcasm in case that’s not picked up by readers.)
I really got immersed into the digital download culture, because that’s where it all began, with eMusic. Moving on from there, after being with eMusic from 1996-2000, I came back East, and I no longer worked for eMusic. They laid me off; they actually laid everybody off. I continued to focus on SpinART, my record label until around October 2005, where I literally was sitting around watching my label go under. I was trying to figure out, “How can I stay in business and be involved in the music industry? What can I do?” Record labels make people famous, and then they monetize that fame by selling the music, but so much music is being given away for free, and this whole thing is chaotic and confusing. I wanted to come up with a way to remain in the music industry which wasn’t predicated on whether or not the music sold, but would still be of value to the musicians. The second thing that occurred was my record label spinART got pitched by what’s called digital distributors, also known as aggregators, to do the digital distribution for the label. SpinART had a deal at that point through Warner to do the physical, but it didn’t have anybody to do the digital. We did all our own direct digital deals. These aggregation companies showed up and said, “We want to do spinART Record’s digital distribution.” I asked them what the deal terms were, and they said, “Well, we have to control the rights to your master recordings exclusively for a minimum of three years or five years, and every time the music sells, we want to take a percentage of the money just like a physical distributor and take anywhere between 15-30% of the revenue. And we’re going to account back to you quarterly, 45 days after the end of each quarter even though we get paid monthly and we’ll only pay you if we determine you’ve made enough money, and we’re going to do all the collection and administration.”
So you basically said, “Where do I sign up for that abuse?”
JP:
That’s what I heard. That’s probably not the way they put it, but that’s what they were saying. To take a step back before I move forward, realize that up until digital distribution, if you wanted to have a career as an artist you had to get signed to a record label, because the record label had the deal with the physical distributor, and the physical distributor was the entity that could put your record onto the shelf of a store to allow it to be bought. If it wasn’t there, it couldn’t be bought. And to do physical distribution is tremendously expensive and has huge overhead and a huge knowledge base. You need a 500,000 square foot warehouse with 50-foot high ceilings; you need people running around picking and packing and shipping music. Everything in the music industry is on consignment, so all those CD’s that get shipped out to the 10,000-plus record stores across the 3,000 square miles of the United States can all come back for a full refund at any point. And when they come back, they can be broken or they could have stickers on them. They could need to be destroyed or refurbished or alternatively you need to deal with the billing cycles on them, so if someone has a 60-day credit term and return a portion of their inventory, you have to give them their credit back. This is a huge nightmare. And that’s just the warehouse and the invoicing and the returns processing.
Then you need the other 30 people running around the country walking into the record stores, going to the store buyers and trying to get the product in the store and putting it on their limited shelf space. You beg, you borrow, you plead, you pay the money to rent their real estate in the form of cooperative advertising like a listening station, or you take the guy out to dinner. You know the sort of things one would do in order to gain access to that shelf space. Some of it was unseemly, and some of it was very expensive. But the gatekeeper to the success of the sale of the artist in some way could be the buyer at the store; because if the buyer at the store didn’t put the record on the shelf, it couldn’t sell, and if it couldn’t sell, money wasn’t being made. The physical distributor made their money when the record sold. So, if Tower Records took it in and put it on its shelf, and they paid $10 back to the distributor and sold it for $15, the distributor would take 25% of that $10 — $2.50, give the other $7.50 to the label, and the label would then give the artist their share, which was anywhere from $1.35 – $1.75. That was the food chain.
What happened with digital distribution is you had two fundamental changes in the industry. You had unlimited shelf space, where everything could be in stock at no detriment to anything else. So for the first time there was no more fighting for shelf space. With iTunes, if you run out of room, you just plug in a new hard drive. So everything can be in there, and it doesn’t hurt anything else. So people that talk about, “All this other music in the world is causing other music not to sell,” with all due respect – bullshit. If your music isn’t selling, having half a million less tracks on iTunes isn’t going to cause it to sell.
The other thing that occurred had to do with inventory. It used to be that if you wanted to sell 100,000 copies of something, you had to manufacture 100,000 copies and then hope to God they sold. Now you don’t have to manufacture anything. There’s no upfront cost for inventory. You have infinite inventory that replicates on demand as a perfect digital copy. It’s always in stock, it’s always available, and it’s always ready to be bought and duplicate itself. So with unlimited shelf space and unlimited inventory being the new way record stores stocked music, you just circumvented and dis-intermediated the music distribution system. You don’t need that big warehouse with the pick, pack, ship and so-forth.
And it became much easier to become a music distributor, because all you needed to do now to become one was to get a contract with a store like iTunes. Once you got that contract, you could deliver the music to them via Internet, moving the digital file from Point A, to Point B. The contracts are hard to get, and they’re not given to just anybody, but distribution got wider as soon as digital stores popped up because for the first time you began to have music and artists and labels gain access to distribution and be available in stores to be shared or discovered or bought where they were never there before. But even that had a limit to it, because the digital distributors that popped up also made money when the music sold under that model that I previously described. And if the music didn’t sell, then they weren’t making any money, and if the music did sell, they made an unlimited amount of it off of other people’s hard work. If you’re a band, you go out, you play a gig. Someone sees you, and they go out and buy you. Well, if you went through a digital distributor that takes a percentage of the money, when your fan buys your music through your gig, you just paid 15%-30% of it to somebody else.
I had a real problem with that back-end model and with the distribution fee in the digital world. I didn’t think it made sense. I thought artists were getting screwed. I really did. And I got really pissed off. So when these people came in and told me how they would do spinART Records digital distribution and control our rights and take an unlimited amount of money, and control the collection of it and so forth, frankly, I told them to go f*ck themselves. It was wrong. We had just at that point released a band called The Dears, and I put $50,000 into tour support and $100,000 into cooperative advertising. The band was sleeping on floors and eating ramen, and we were all busting our asses. And I’m going to give this company over here 15% of the money from the sale of the music for moving a digital file from Point A, to Point B? They did claim they were going to market and promote our stuff, but that’s all smoke and mirrors. You can’t actively market and promote 10,000 releases per month, which is what they claimed to have. You can’t.
Glad you said it out loud…
JP:
Not only that, but when I pointed that out to them, they said, “Well, no, we’re going to prioritize spinART’s releases.” And I said, “Really? So you’re going to f*ck everyone else and just promote me?” And they said, “No, no, that’s not what we meant.” And I said, “Well what did you mean?” And they said, “Well, we only get to market and promote those releases that are doing well.” So I said, “Oh, so you’re going to market and promote things that are already marketed and promoted?” So I thought, “Not to mention this is an unlimited amount of revenue coming in off the sale of this music for the entire five years, and you’re going to stop marketing and promoting – if you’re even doing that in the first place – within a couple weeks.” And marketing and promoting in the digital world, really, to be honest is, you pick up the phone and you call the guy – there’s one of them – at iTunes..
So that was that, and I got so incensed about it that I literally picked up the phone in October of 2005, and I called my friend Gary that I worked with at eMusic. He was a coding engineer there. I said, “I have this idea. Why don’t we create a website where anyone on the planet can go – anyone, with no filter – and they can just go there and sign themselves. They can have worldwide distribution, they upload their music, they upload their cover art, they pick the store they want to go to, and they pay a simple up-front, flat fee for the service. That’s it. They get 100% of the revenue when the music sells, it’s non-exclusive, they can cancel whenever they want, but we’ll help get them there. ‘Where do you want to go? You want to go to iTunes? Great. You click a button and go to iTunes and pay the up-front flat fee, and that is it.’” I almost say it’s analogous to Federal Express. You pay a postage fee to deliver a package. That is it. I am a service industry, and I’m serving the musician. Technology has made it possible to have infinite shelf space and infinite inventory, so let them all in! No more filter. Do it under a service model. Serve the musician.
That was the idea, and we launched January 26, 2006. Four years later – and this is kind of weird – TuneCore artists represent one of the highest revenue-generating music catalogues in the world. There were over $32 million in digital download revenue generated through TuneCore artists in 2009 alone.
Put some kind of framework, because generally speaking I’m a guy who, $32 million and pretty much anything over $5 million is lottery winnings that I can’t even fathom. What is that compared to any of the big four labels?
JP:
TuneCore artists, or TuneCore as an entity by market share, is the fifth largest music entity in the world. It goes Universal, Sony, Warner, EMI, TuneCore, in regards to market share, in regards to number of releases and amount of revenue generated solely off digital sales. Within four years, this entity – which is sort of the democratization of an industry – represents everybody else, that long tail that apparently people claim has no value, or claim aren’t “breaking” on the Internet actually does and has become a monster force. It’s exciting, and it’s not just 50 million people selling one song. It is hundreds of thousands of artists selling tens of thousands of songs.
While we’re here, and mind you Tommy (Tom Silverman) went out on a limb and set out a certain criteria of, of albums released in 2008, there were only twelve that sold 10,000 or more according to Nielsen. Now, Nielsen has never been 100% accurate, and I’m sure that as people like yourself have democratized the artist, getting their music everywhere, it’s become even less accurate. But, by whose criteria – whether you agree with it or not – how far off was he?
JP: I don’t know how to answer the question, because people don’t buy music by the album anymore. They buy music by the song across the artist’s catalogue. For example, Never Shout Never has three four-song EP’s. And across those three four-song EP’s released within four months of each other, they sold over a million songs. That’s not album sales. That’s song sales across a catalogue. It’s not even the right question anymore. I struggle with it because it’s like, “What does that have to do with the price of tea in China anymore?” It has nothing to do with it. Suggesting a band is or is not breaking because they did not sell an album is insane.
I think the most interesting thing about what resulted in the debate was that the one criteria, which was in fact the standardized one doesn’t hold the water it used to for sure.
JP:
Nielsen is a great company. And SoundScan, which is now a Nielsen-owned property really was the litmus test. If Nielsen indicated through SoundScan sales – after 1992 when it actually became institutionalized and moved off the handwritten Billboard chart – it really did represent accurately those bands that were “it” and that were breaking and relevant. It reflected the popularity of an artist, because the popularity of an artist was reflected by album sales. The two were together. What’s happened now is you’ve had a decoupling between music sales and fame, or between album sales and fame. You can have people more famous and more popular than anybody, going back to – and let’s ignore the Beatles for a moment – Sponge, or The Bloodhound Gang, who were literally at the top of the Billboard Charts. Sponge if I remember correctly was one of the most played songs on commercial modern alternative rock radio, yet by today’s standards they were less popular and less famous than Nevershoutnever. The reason for that is specifically because the Internet has enabled people to get that fame, which is then monetizable on a global basis from their bedroom. And there is no editorial filter, and there is no gatekeeper from allowing people access, and then social networking picks it up from there. That’s what’s so cool.
I’m not trying to sidestep the question. I just don’t know how to answer it. I wouldn’t say an artist is or is not breaking predicated on album sales, because that’s just not what people do anymore.
—–
Part two of this interview will run in the next few days. In the meantime
Check out Tunecore at http://tunecore.com
Mike Shea is the president and founder of Alternative Press, a magazine that he started as a fanzine in his hometown of Cleveland Ohio in 1985. I thought Mike would be an ideal interview as he knows first hand what developing artists need to do to get press and was likely to have an interesting world view about what it takes to migrate a business from an old media model to a new media model.
How did the Alternative Press start?
MS:
It started as a fanzine here in town [Cleveland]. We used to cover a lot of the stuff that was here locally, and then we found there were kids in Detroit, Pittsburgh, Columbus and so forth that wanted to read us. They wanted to write scene reports for us. They started contributing, and it just started growing from there, but we didn’t know what we were doing as business people, so we were draining a lot of money. We started producing punk rock shows at a local old theater here, and that made money for us for a little bit to keep things going, but eventually the promoters in town saw us taking away some of their money, so they started cross-promoting against us to wipe out our night. That fell apart after a while, and we stopped printing for about a year. Then one of my writers came up out of the blue and said, “Hey, we should do an anniversary issue,” and he asked me how much it would take to produce it. I figured it out and said, “about $800 or so,” and he said, “I’ll donate the money.” He just really missed the paper and the writing. I got a hold of some record companies and said that we might be coming back for one issue, and during that time period that we were gone, we had built a reputation and it had spread nationally. A lot of the people in the underground music scene really liked us.
This was about 1987-88. I called up some record companies, and they said, “Oh, we’ll buy full page ads.” They were throwing the money down, and prior to that we were begging most of the time. So we had gotten our success and our profile had grown considerably while we were gone. We came back with a vengeance. We used to be a large newspaper, and we did that for about a year, and then we swapped down to the Rolling Stone size at the time, which was 10×12. Then, that’s when alterative music and Alternation on MTV really picked up in the 90’s. We kind of got swept up with it, and our name was always about being an alternative to the papers and the media that was here in Cleveland. So it had nothing to do with alternative music. We were called Alternative Press before there was alternative music. We got tagged with that, and then we had a nice little FedEx thing going on, and kids were calling us “AP.” So, we decided to try and detach ourselves from getting stuck with a genre like alternative music, because we always knew that with the cycles of music, it comes and goes down, and comes and goes down. We started focusing on the letters “AP” and redesigned our logo, and it’s stuck ever since then, and we’ve just grown, and grown, and grown. We didn’t make any money until about 1996.
We finally got our act together by then, and we went through the new metal phase, and then in about 2001 we were all pretty miserable, and I was very miserable. The whole industry just turned into money and selling the most units, and especially even on the magazine end, it just got so silly with the way magazines are distributed. I really thought about just shutting it all down and going off and doing something else. I was in New York City at the Sony building, and I just had an epiphany. I said, “I can probably close this, and I’ll be fine.” Prior to that I was just very reluctant to. I didn’t know what to do because it was my identity as a person. So, I went down to Century 21 to get some underwear like I usually do when I’m in New York City, and I walked outside. It was about 5:30 or so, and I saw all the suits come out of the World Trade Center going home, and I said, “You know what? I can’t do that. I can’t go into Corporate World. I’m too damaged, in a way.”
So I came back to Cleveland, and I said, “Okay. We’re going to give this one more shot. But we’re going to do it our way, and if we’re going to go down, we’re going to go down doing it the way we wanted to.” A couple of my editors and my marketing director were talking about having been on a “Warped” tour, and they noticed there was a new sound that was coming up, and the kids were really fanatical about it. They started throwing some band names out there like Save the Day and AFI, and they said, “We should maybe think about this.” So I said, “Okay. Find me the two bands that have a very, very dedicated fan base behind them. They don’t have to sell a lot of records, but they have to have really crazy fans.” Part of that was, we were always looking at who was Platinum and who’s the biggest artist. We picked Save the Day and AFI and put them on the cover, and it went through the roof. It sold triple what the Red Hot Chili Peppers or anyone else had been selling for us. So the first year we kind of tip-toed our way back into our roots with alternating covers, and the response from our fans and from our readers was just fantastic. The bands were just so much more appreciative than a lot of the alt rock bands we had been working with who couldn’t have cared less if we were writing about them. We shed our skin and went from there. We’ve found our punk rock roots again, and it’s worked out really great. Now we’re just getting ready for the new technology.
I was going to ask you that. I definitely want to get to your perspective on helping get artists to develop. But how are you switching to the digital switchover, as magazine subscriptions probably across the board have been kind of hurt?
MS:
I think it’s early still. This morning Interview magazine just released their little promo of what Interview would look like with the iPad. It’s a very basic, stripped-down version. I think what we’re trying to see and do some research on is where websites are going to play into this, because we’re absolutely convinced that Pay Walls on websites won’t work. So then you start to get into, if you have a digital subscription, and you put it up on iTunes and Amazon, people, including kids, are used to going to those sites and paying for things. So we feel really confident that that will be the model. What we saw with Interview and those sorts of things were just the elementary school of digital magazines. The digital versions will be multi-media and will have video, interactive advertising, etc. They will be the future, and you’ll get paid for it. Will there be piracy with digital magazines just like some of the publishers are having to deal with, with their books? Yeah, there will be. But by and large, as the next generation starts to go from being eight-years old to 18-years old, they’ll start naturally buying magazines and subscribing to publications and that sort of thing via iTunes and so forth as these digital readers – whether it’s an iPad, or whatever the hell it is – become more affordable, and become standard things that are sitting on your coffee table at home. And you’re sick with the flu, and you’re just on there dorking around on the Internet. Because that will be the future. For us, that’s interesting, because you’re taking the paid model of somebody buying a $4.99 magazine, and now you’re going to surpass the websites and transfer that, but make it a lot cooler, and put it in as a digital magazine. And your magazine – your printed version – will have less copies, and will be better looking and better produced. So it will be thicker and better-quality paper, but it won’t be $4.99, it will be $7.99 – $9.99, depending, and going to be a keepsake thing. It’s going to be very Web proof. There will be a lot of photographs, a lot of long stories that don’t work very well, even on an e-Reader at this point. For us, that’s what we’re kind of seeing is going to happen. Of course, Steve Jobs could sneeze tomorrow, and a whole new system and something else could happen.
It’s so funny how that can happen so quickly. But I wish you luck with the transition. It doesn’t sound like you are off to a good start.
MS:
It’s a transition in our heads. I’m dealing with people here that are in their 40’s and people in their early 20’s. The older you get, the more resistant you get, so there are people here that say, “No way! Print’s not going to die! There’s no way!” And I’m telling them, “Look, anybody who was born in the year 2000 and forward don’t have a romantic attachment to print like we do.” To them, a book, a newspaper or a magazine doesn’t mean anything. Once they hit 18-years old, it’s over, at least as much as new product. Once Generation X drops dead, print will be pretty much dead. You’ll still have it being produced in a very small quantity, but by and large things will be in a digital format. You’re looking at the last generation of a mass-produced print. You’ll have boutique print, but in terms of mass publication, you won’t have that after the next 25-30 years, tops. It all depends on how the Generation X-ers want to get rid of print. If they want to just go straight to digital and make it convenient, it will accelerate even faster. We’re going to have lots of trees left on this planet.
I guess that’s something to look forward to. Transitioning awkwardly – you’re a guy who is and has been in the position to take a band from complete and total obscurity and really expose them to a nationwide if not worldwide platform. What would your advice be to somebody who just can’t get arrested in the blogosphere. What are the common mistakes you see with artists trying to get the attention of journalists?
MS:
Don’t send your demo CD to our home address. I just had that happen to me about a week ago. That was fun. The kid had balls. Unfortunately they were horrible. If they were good, it makes a great story, doesn’t it? Unfortunately there’s a fine line. We’re starting to see that there’s a difference between assertiveness and aggressiveness when you’re promoting. A lot of these bands that we’ve been writing about now for ten years are getting dropped, their labels are going under, they’re choosing not to renew. They want to start over and do it on their own and do the Band Camp or TuneCore etc. I think what they need to do for those bands is that they’ve made friends in the industry that work in publicity, marketing and A&R, and they need to have a conversation and learn publicity and marketing and A&R 101, 102 and 103. We’ve had some bands that approach us with their own stuff, and are very cool about it and know how to do it. And we’ve had other bands that every other day I’ll get an e-mail or a tweet or something on my Facebook saying, “Hey, did you check out our record? Can we get a feature now, can we get into ‘Most Anticipated?’ Can we stop by your office?” And it’s as if they haven’t learned how to balance that out, and when you start to pester too much. I think bands, on their own, have to learn that fine line between being assertive and making sure your product gets in front of somebody vs. being aggressive.
Is that a frequency thing, or is that just having something new to say or the way they’re asking?
MS:
I think it’s the way they’re approaching it. We have a few bands over the past couple months that have new records coming out. Sadly, one of them is on a label, who fired their publicist and never rehired. So the label has no publicist and the band is more or less doing it on their own. So, they’re approaching us. The record is okay, and we already gave it a review, and it got a decent review. But one of the members is just constantly hitting us up. It’s getting to the point now where we’re starting to not like it. I think it’s just a matter of learning curves. I think this was naturally about to happen, and it’s what you were talking about earlier with having to adjust. I think bands need to learn how to adjust to having to promote themselves in that way. It’s one thing to be assertive and somewhat aggressive sitting outside the House of Blues handing out fliers for one of your shows. But you have to learn how to approach different types of situations differently with that assertiveness. I think that’s one aspect of it.
For bands in general, I don’t think there’s really anything new as compared to the way it used to be back in the day because it isn’t going to mean anything unless you have some talent, or you can write good songs or anything. We get sent mp3’s and CD’s all the time, and you can tell that one of the band members just was doing his part of the job in the band, and just sending them out to everybody. There was no follow up whatsoever. So, half the time we stumble upon it buried amongst all these other things that we got as well, and we love it. We reach out to the band, and then we start covering them. Other times, you get people that haven’t really clicked yet. They don’t have good songwriting abilities or something like that, and they’re just constantly all over you. Unfortunately, I don’t really think anything’s changed in that respect. It just comes down to whether or not you have a good product. That’s what you need. If you have that, that’s more than half your battle, as far as I’m concerned.
As a major press outlet, is it a selling point for you if bands came to you with a bunch of lesser publications having covered their story? Is that relevant? Is that part of the story when they can point to a dozen blogs?
MS:
You’re definitely right. They’ll come to us with some music specific person’s blog or something that was off Absolute Punk or Punk News or Buzznet or something like that. It definitely does help. Sometimes an editor will have that kind of bias. You’re trying to hire somebody, and you say, “You better have some job experience first.” I try to keep my ears open regardless, because you just never know who you’re going to stumble across. But, does it help if a band comes with some material? Sure. I think it’s sad, but it does help, even if it was just some postings that were on a blog site and you have the comments from the other kids saying, “I love this band” or something like that. In this day and age, it’s not really what the press has said about something; it’s what the fans have said about it. My editors were recently just all about, “We should put Muse on the cover,” and I took a look at Spin magazine’s sales for when they had Muse on the cover last year, and I compared them to when we had some smaller bands on our cover, and we actually out sold them. Sometimes editors can be wrong.
That’s surprising….
MS:
They’re one of my favorite bands, and they were the critics’ darlings. Sometimes music critics tend to get into a school of fish and they all start going on something, but it doesn’t necessarily mean people want to read about it or watch it.
Do you have any final words of advice? You’ve had a really interesting career and have a really unique vantage point. Is there anything you would suggest artists focus on besides developing great product?
MS:
I had a young musician approach me on Facebook the other day, and he said, “I’m getting depressed.” And I said, “Why?” And he said, “Because I don’t know how I’m going to make it. I can’t make any money. I want to try to do something revolutionary and do it on my own, because I know the labels aren’t going to sign me, but every time I start focusing on a particular business model, the business changes and I don’t know what to do. Should I just try to stick with one business model for a little bit, or should I just keep dropping everything every time everything changes?” I think the point is to just grab a fundamental business core method that is true all the way through. If people really like your product, they’ll buy it, especially if they feel an intimate connection to you. That’s the fundamental belief with music or anything artistic.
I said, “You start there, and then you allow yourself to be adaptable, because you’re right. Everything is going to change. You could go run off and have fans raise money for you and you can make a record, and you build a website where there’s a PayPal account and all this other stuff; but that all could be changed in a year. You’re definitely right about that.” I said, “You have to be flexible. Maybe you need to play it safe for a while. Maybe you need to go through Band Camp or TuneCore and sit back for a while and let the industry figure itself out. Focus on what you know is the core, fundamental truth, and that is, fans will buy from you if they feel an intimate connection to you, and if they think it’s going to benefit you personally. Maybe you need to play it that way. But to get depressed and throw your hands in the air because there isn’t one business model that’s working for everybody, that’s tried and true, you can’t let that happen.” It’s definitely a wild west out there right now. Everything is wild west. The movie studios are going through wild west, print, music, radio. The only thing that’s not wild west is concert promotion, because it is basically just one company. You just have to hold on tight and persevere. Stick to the basics on that, and let the business models figure themselves out. I said, “Somebody that has a lot more power than you or I will figure out some system and spend millions on it and blow it and work out all the kinks, and everybody will be able to benefit from that.” We’ll see. That’s what we’re doing right now. We’re sticking with the core beliefs and remain adaptable to it and play a little big safe. For us, we think websites are going to become network TV. They’re doing to be basics. The cable television will be the digital editions for pay. All the cool stuff will not be on websites anymore. It will be in the digital editions. The websites will just have breaking news and basic stuff, and how-to-get-through-your-morning stuff. To us, that’s exciting because it shows there is a way to transfer the money we were making from the print edition to the digital edition. Because there was no money in a website. You have to remain adaptable. The core belief that people want good-quality information is still there; and they will pay for it. You just have to find the way.
Tom Silverman responds after returning from MIDEM:
If you missed parts 1-3 check out the interview that started here
Parts 1-3 were discussed here and mentioned on:
Music Think Tank , Hypebot , Digital Music News , TechDirt, Billboard.Biz , Cnet, Lefsetz and several other blogs. (email me if I missed yours)
TS:
It occurred to me that part of the reason I may have been misunderstood by some in last week’s MusicianCoaching interview is that many people may have missed the third installment that I wrote on January 20th in response to so many people wanting to know who the few artists that broke the obscurity line in 2008 were.
In that response I mentioned that there are other indicators to the escape from obscurity besides album sales including concert ticket sales and singles sales and there are certainly others such as being featured on a huge TV show.
When the flamers came to the party, I had already donned my asbestos suit. Their outrage at the analytical results that I uncovered is not surprising but shooting the messenger does not invalidate the message. In fact, I felt the same way that they did when I first began delving into the numbers. I thought there would be many more than 225 artists out of 1515 albums that sold over 10,000 and I was sure that nearly half would be DIY artists. The fact that almost none of the 225 artist breaking 10,000 albums for the first time in 2008 did it themselves was hard for me to believe but it is true nonetheless.
What upset me most about the reaction to the data was that some thought I was being pessimistic on the future of the music business or at least the DIY artist part of it. That could not be further from the truth.
Dave Lory and I brought back the New Music Seminar again out of dedication to the artist community and a belief that music and artists should be able to rise to their maximum potential regardless of gatekeepers or investors. That was the original promise of the web and I still believe it is possible. On Tuesday, February 2nd, in Los Angeles, the architects of the next music business will convene at the Henry Fonda Theater to discuss new ways and even some old ways that artist can break through. Daniel Ek, founder of Spotify, the streaming service that has taken parts of Europe by storm will talk about what Spotify will be doing to help artists get exposed. Michael Doernberg from ReverbNation, Derek Sivers founder of CDBaby, Ian Rogers of Topspin, Bruce Houghton of Hypebot, Christina Calio of Microsoft, Alexandra Patsavas of Chop Shop, Producer Rodney Jerkins, Jason Bentley of KCRW, Kevin Lyman of the Warped Tour, Corey Smith manager Martin Winsch, the ever popular Martin Atkins of TourSmart, Justin Tranter of Semi Precious Weapons and many more will all be trying to come up with solutions to artists trying to build manage and monetize a fan base in this new era.
The record business has an inflation-adjusted value equal to that of the late 60’s and it is still dropping. Anyone getting in the music business now is clearly not doing it for money. Anyone getting into the music business now is doing it for passion and that is the right reason. Labels have always invested in artists and still do, although they invest much more cautiously due to the compromised risk/reward ratio that currently exists and that reduction in new artist investment has certainly contributed to the reduction in new artists breaking out of obscurity. At the New Music Seminar, we hope to uncover new business models that enable music labels to increase their investment in new artists and give more artists opportunity.
I am more than optimistic. I know that within five years that number will no longer be 12 DIY artists a year breaking through but 50 or 100. The overall number of new artists breaking out of obscurity will be over 500. I believe that we are on the cusp of a golden age of music. We finally have come to understand that it was never about records, it was about the passion of the artist and the passion of the fans for music and their favorite artists. Finding new ways to track fan passion for artists and empower those fans to spread their passion are some of the tools that NMS will explore with cutting edge technologies.
What unites us all is our love for music and artists a quality that even Shakespeare mourned the lack of. In the Merchant of Venice he wrote.
The man that hath no music in himself,
Nor is not moved with concord of sweet sounds,
Is fit for treasons, stratagems and spoils;
The motions of his spirit are dull as night
And his affections dark as Erebus:
Let no such man be trusted. Mark the music.
How can you not embrace anyone who loves music and shows passion for the business of music? I love what TuneCore has done for artists and the paradigm shift it has contributed to and I adore Jeff Price’s passion. Anyone who has seen Lefsetz veins pop out when he is speaking knows that passion is at the core of his being and whether you agree with him or not, you gotta love him.
There are no bad guys. There are just artists and fans. Artists have to learn to serve fans better and the rest of us have to learn to serve artists better. And we will. You can count on it.
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If you will be in the L.A. Area or willing to travel to the L.A. area you should check out the New Music Seminar on February 1st and 2nd. Readers of MusicianCoaching.com can get a two for one discount by going to www.newmusicseminar.biz. and entering the code “nmsla2”.
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