Collected Writing: Music Business 2011-2012
In 2010, I put out a Best Coast 7" with my partner Mario Orduno on Art Fag Recordings. That was a partnership formed over a shared interest in producing vinyl records- we had both done it already and the fact that I could provide financial backing and Mario could provide artist relationships. A classic independent record label combination, something I had already learned in 2010. I also knew starting in 2010/2011 that I wasn't a talent guy, I was a business guy, and maybe a promotions guy. The Best Coast 7" really blew up in 2010, this must have been one of the last years before digital was even a category outside of Itunes. There was no digital agreement for the Best Coast record, so it was simply a question of producing and distributing thousands of 7" records. That is something that happened in my office which was in downtown San Diego.
Meanwhile, I reached a similar agreement with Brandon Welchez of Crocodiles and Kristin Gundred of Dum Dum Girls, that became Zoo Music. Brandon found Alex Zhang Hungtai (Dirty Beaches) on YouTube and Alex agreed to put out Badlands on Zoo Music. That record came out on March 28th, 2011, but the publicity campaign started in January, and was the first direct experience I had with what you might call the national indie scene. Through the success of that record, I got a production and distribution deal with Revolver/Midheaven in San Francisco, and digital distribution, which became increasingly important. I was also hearing first or second hand about the relative experiences of bands like Dum Dum Girls, Crocodiles, Best Coast & Wavves, even though I didn't have anything to do with their records or actual music careers, my part always being limited to the record label.
Moving into 2012 I was becoming increasingly interested in the digital marketplace for indie music. I was also watching as these local bands I knew became national bands with varying degrees of financial success.
Something that becomes clear if you actually scroll through these posts, and the stuff from the last post, is that I was definitely educating myself about the history of the recorded music industry as I was getting involved financially. I'd already had my major insights about the shell job involving paying off succesful independent artists BEFORE it became a potential issue when Badlands became a hit.
Dirty Beaches Explosion: AD Mixtape, BVegan, Johnny Cash Cover (2/10/11)
TODAY: Aquarium Drunkard Presents Dirty Beaches Trans Pacific Mix Tape- Free MP3 Download. (AQUARIUM DRUNKARD)
YESTERDAY: Dirty Beaches releasing New LP, Touring with Dum Dum Girls (who have a new EP)-- MP3's and Dates. (BROOKLYN VEGAN)
LAST FRIDAY: The Singer Johnny Cash Cover MP3 download. (PITCHFORK FORKCAST)
LAST THURSDAY: The Singer Johnny Cash Cover MP3 download. (ALTERED ZONES)
GOOGLE BLOGSEARCH RESULT ST#"DIRTY BEACHES" LIB#PAST WEEK (GOOGLE BLOGSEARCH RESULTS)
Peter Hoslin's "How to get on Pitchfork's Forkcast" (3/3/11)
How to Get on Pitchfork's Forkcast: A step-by-step guide to making it in the blogosphere. in San Diego City Beat by Pete Hoslin.
Hey while we are on the subject: What is up with Seth Combs? Here there was a new project in the works. Brand new project.
The Rise of Audience-less Music (3/11/11)
Among other oft noted impacts, the advent of digital technology has given rise to an enormous and growing class of popular music: Music without an audience. In the past, the anticipation of an audience was often times the sole reason for music being created. To give but one example, Mozart's job was to write background music for various religious services and aristocratic social events. Like, Mozart would get a letter saying, "The Duke wants you to write some music for his ball next month: Do it."
Moving forward to the early period of the 20th century in the United States, music was very much a social activity- whether played in the parlor on a player piano, a "Juke Joint" in the rural south or a Fourth of July Parade in the mid-west, the modernization of society in no way tampered with the fundamentally social nature of Music.
Change was introduced into the equation by advances in technology. Recorded and Broadcast Music created the possibility of non-social Music, i.e. music with an audience of one- a person and a machine (record player or radio.) However, the creation of music playing machines did not fundamentally destroy the artist/audience relationship, it merely reduced the average size at the same time it increased the overall size of the audience.
No, Record Players and Radio didn't create Audience-less Music, it created bigger, more attenuated audiences. The fact was is that not every Joe could create a Record, let alone get it heard, and the same thing went for Music that was played on the radio.
However, more recent technological changes have given rise of a historic first, music that is created that is completely without audience. This is now possible because recording costs have dropped to the cost of a single portable computer, and distribution costs have dropped to the cost of a high speed internet connection. All those who can afford those two things can create music, but that does not guarantee that the resulting music will have any audience, whatsoever.
In fact, the defining characteristic of this era in popular music is exactly that phenomenon: Music without Audience. It has resulted from the combination of technological progress and the complex of ideas understood as "Romanticism" as it relates to the process of artistic creation (i.e. the lonely, misunderstood, tormented poet, the beat generation outcast, Rimbaud, Baudelaire, etc.)
The utter failure of contemporary Musicians to understand the essentially social nature of Music- is their downfall. The Idea that an unknown Musician can arise from obscurity and ascend to the heights of the music industry is as old as the music industry itself, if not older.
Everywhere that Idea is bound up with the romantic myth of artistic production and the reality of the every changing modern Music Industry- it is a timeless, epic struggle that links Beethoven to the Beatles, Miles Davis to Moby and Devo to the Dum Dum Girls.
Audiences can and do respond to Music which plays upon that Idea, but they don't care about Music the way Artists care about Music. A Romantic Poet of the 19th century might have been fascinated by the idea of playing his lute in the woods, but it would be pretty tough to carry a harpsichord up a mountain, and he sure as hell couldn't bang out an EP on GarageBand in three weeks.
The fundamental mistake of would-be professional musicians is that they assume the existence of an Audience, when in fact, there is no Audience, none whatsoever, for someone posting recordings on the internet. At some point in the last five years, a higher percentage of non professional musicians have recorded and distributed music to the public then at any time in the past hundred years, probably by a factor of 50 or 100.
Meanwhile, overall Audience increase mirrors the steady but small growth of the overall population, since Music is now available to everyone, always. Thus, Audience-less Music is inevitable. Surely it is appropriate for an artist to ask whether an audience exists for his or her music before making recordings available to the general public? Publishing audience-less music to the public is sad.
I think it's worth throwing out there the idea that the "Phil Spector story" is the primary narrative in the story of popular music in the 20th century. First of all, Spector encompassed a large swath of the actual history of popular music in the 20th century: He has equally interesting chapters dealing with the pre-rock Brill Building songwriters/music industry, had huge hits DURING the rocknroll era (1953-1963), recorded a Beatles record and ended up becoming a tabloid specatacle. What more can you ask for? And like any good mythic figure, you can look at the story from multipe perspectives. I prefer to see Spector as a Pre-Christian god: Remote, Foreboding, Violent Tempered and quite monstrous at times. Not a god I would choose to worship, but embodying the kind of mythic characteristics that one associates with gods and god-like figures.
Knowing that Spector is currently serving a life sentence for murder makes the story all the more mythic. My thought though is that if you were to do say, a film, about Phil Spector, the main setting would be the mansion where he kept Ronnie Spector nee Bennett locked up for a decade or two. And who better to give a perspective on that location then Ronnie herself? At least, that seems to be the thesis behind Be My Baby, the clumsily subtitled (How I Survived Mascara, Miniskirts & Madness, or my Life As A Fabulous Ronette) "auto"-biography from Certified Rock and Roll Survivor Ronnie Spector.
This is book is fascinating because Spector is the Queen to Spector's King- quite self-consciously, I think. I mean, she kept the last name, through it all. I totally understand, but Spector's lack of agency is the headline in Be My Baby. Truly, she was manipulated from the start by a master manipulator. In my view the key to understand the Phil Spector/Ronnie Spector relationship is 1) Phil Spector hated his mother: His father committed suicide when he was very young, and it's not hard to imagine that he blamed his Mother, who was also very pushy and bossy well into his adulthood. 2) Ronnie Bennett wanted to be famous, and she believed that Phil Spector could help her achieve that goal.
The smell of race and money permeates Be My Baby. Spector places emphasis on her upbringing in a single-parent household, and her status as a mixed race child in a majority African American environment. Spector was working towards a career as a singer of popular music, but Phil Spector was the first person to really "get" the potential of Ronnie Bennett's voice/style. To give but one of several examples, an early Brilll Building affiliated writer/agent said that the early Ronettes could be like the Andrews Sisters. That guy... was just clueless. The Phil Spector/Ronnie Bennett story has some similarities to the Barry Gordy/Diana Ross story. In both instances, the male producer was LOOKING for something specific, and was operating in an environment where there was competition among aspiring musicians for music industry attention.
The Bennett/Ross figure is DRAWN to the male figure by his POWER. On the other hand, the Spector/Gordy figure is drawn to the physical characteristics of the Bennett/Ross. In one sense that is "OK"(Spector said to Bennett after hearing her sing "that's the voice I'm looking for.") and in another sense it is creepy and weighted with power inequalities and sexual exploitation. Shrug. That's life, or at least- it was back then, because the same facts repeat themselves over and over again with female popular music artists.
Flowers in the Dustbin:
The Rise of Rock and Roll 1947-1977
by James Miller
p. 1999
Simon and Schuster
If you can imagine a history of rock and roll that stops before the mp3 and doesn't mention any independent record labels after Motown written by the former 'music critic for Newsweek'(!) and possessor of a phD in the 'history of ideas' (!!) for a popular, rather then academic audience, then you already know what Flowers in the Dustbin: The Rise of Rock and Roll 1947-1977, a pretentious, fame and sales centered recollection of the key points in the history of the Rock Industrial complex written by a child of the sixties for children of the sixties.
To be totally fair to the author, Flowers in the Dustbin has it's moments, particularly before the Beatles and Hippies show up in the mid 1960s. Flowers certainly solidified my opinion that nothing particularly interesting happened in rock and roll between the Beatles and punk rock/no wave. Miller limits his discussion of punk and post-punk to the Sex Pistols and a sentence about Elvis Costello, but since the book only covers till 1977 he can be forgiven.
Considering this book was published in 1999, the year Napster went online, it's accurate to observe that Flowers in the Dustbin was obsolete before it hit the shelves- through no fault of the Author. How could he anticipate what was to come? Anyway, it's no wonder that this book can be bought for cheap.
by Fredric Dannen
p. 1990
You should know what you are in for when the back jacket of a book about the music industry has a big-up from Sinead O Connor. Although the narrative has been tarted up for sales appeal, this is basically a biography/history of the Major Label scene in the "After Hippie Rock" era. The central theme in Hit Men is the clash between music executives trying to profit from Rock music and Black Pop (R&B, Soul & Disco in this time period) and the corporate brass- uncomfortable with Rock music and doubting it's ability to generate profits.
If you're like me, you may be suppressing your gag reflex right now, but Hit Men is quite diligently researched and footnoted, and thus it works outside of it's alleged agenda to "expose" the shady business involving Top 40 Radio, Record Labels, The Network & The Mafia. Seriously, who gives a shit? You know who "shady business practices" in the Music Industry typically benefit: Indie Labels. That's right all you holier-in-thou-live-in-my-Parent's-basement types: The Mob tends to help out the little guys with suitcases of cash, not the big boys with their Federal Network Licenses (subject to renewal) and publicly traded stock.
What really struck me about this book is how much the Major Label game is based on spending "Other People's Money" in the same way that high-financiers can bankrupt a billion dollar hedge fund, walk away, and start another hedge fund because IT WASN'T THEIR MONEY. The business strategies embraced by major labels in the 80s were hardly "text book economics" of the sort one expects from such efficient allocatiors of capital.
To give but one example, I will quote direct from the book- this is in the context of a "bidding" war over the "talents" of 80s solo McCartney:
"CBS offered McCartney an unheard-of enticement, a publishing company that held the copyrights of one of America's greatest songwriters, Frank Loesser...It's hard to overstate the value of Frank Music. Loesser wrote the words and music to Guys and Dolls and other Broadway classics; his catalog included gems such as "Spring Will Be A Little Late this Year," "Standing on the Corner," and "Once in Love With Amy." p. 127
We're talking 80s McCartney, not mid 70s McCartney. (PAUL MCCARTNEY DISCOGRAPHY WIKI)
Here's another observation: With the exception of David Geffen and Irving Azoff (Live Nation Chairman) these guys are basically corporate drones: particularly with Warner and CBS, the executives are just employees- they don't even have internet era stock options. Clive Davis was actually fired over padding expense reports- and prosecuted by the IRS, over what was a TINY bit of money. It's almost comical because Dannen actually tells you what some of these guys were making when they were "President of Warner" and it's like the salary of well-paid stockbroker on Wall Street- even adjusted for inflation. They are hardly industrial tycoons.
Wavves Self-Releasing Next EP (8/15/11)
I read that Wavves has announced THEY are releasing an EP on front-man Nathan Williams' long-dormant record label GHOST RAMP. I remember reading a TWEET where Williams said "Fuck 360 Deals" so I guess we know how those talks with Warner Brothers and Columbia worked out. I think it's incredible that Fat Possum released King of the Beach and Crocodiles Sleep Forever and they both were "sales flops." Meanwhile, Fat Possum is promoting a young country and western chanteuse. I thought they cut both records off at the knees to spend money on Lissie. What the fuck- these are two of America's contenders for being a serious, viable rock band: you have to invest a little. GHOST RAMP.
AMERICAS MAJOR LABELS- YOU ARE TRULY ASLEEP AT THE SWITCH.
1) PANDERING TO YOUR AUDIENCE.
2) JUDGING THINGS.
Now, if you take the clock back 12 months ago, I had basically "given" up on writing about both stations because they always get upset about anything "negative" you write about them. FAIR ENOUGH. Today?
I now know that my friends are generating significant, measurable income from Satellite Radio, and that their music is "in rotation" on certain of those stations. Closer to home, I receive income from "streaming" services like SPOTIFY- which is a MONSTER let me tell you- don't let the haters scare you off on that one. Let's put it this way- if "sales" of SPOTIFY increases the sales of ITUNES has increased over the last decade, every indie label with a half-way relevant back catalog will be making 2-3k a month, minimum. MINIMUM.
At the same time, it is quite clear that the highest levels of music industry success are barred without "radio support." Bob Lefsetz has his flaws as a journalist, but at least when he addresses a specific subject you know it's "relevant" and he wrote to that effect within the last seven days. It's true, though- JUST LOOK AT THE 949 HOLIDAY HOOTENANNY vs. 91X WREX THE HALLS
FM 94/9 HOLIDAY HOOTENNANNY (PURCHASE TICKETS 40 DOLLARS)
Saturday, December 3rd, 2011.
JENNY CRAIG PAVILION AT USD
PRESENTED BY COORS LIGHT
MY MORNING JACKET (15 million last.fm plays)
TWO DOOR CINEMA CLUB (18 million!)
MATT & KIM (1.3 million)
DELTA SPIRIT (1.9 million)
THE BLACKOUT PARTY (3000)
The big surprise for me here is Two Door Cinema Club clocking in with 18 million, undoubtedly because of their popularity in the UK over here they have a alt rock radio hit. The other band that would fit here would be TEMPER TRAP with a similar formula: foreign, have a song currently in rotation on 94/9. I'm surprised to see that Matt & Kim are only at 1.3 million last.fm plays- that is low for the amount of "push" that they get from having a hipster magazine as their label, but their presence is a testament to the fact that they MIGHT have a song on 94/9 in the near future. Delta Spirit is the equivalent of a Dum Dum Girls and Crocodiles, but you can see the difference here in that Delta Spirit is playing this show, Crocodiles are mixing their third record in the UK, and the Dum Dum Girls are touring Europe. I would argue for all three bands they are conscious choices. I don't know if Delta Spirit is played on Satellite radio or not.
Blackout Party is the "local opener"- a nice tip of the hat, but def. not going to lead to a song being played on 94/9 in the future.
91X WREX THE HALLS
December 11th, 2011
VALLEY VIEW CASINO ARENA (EX-SPORTS ARENA)
PRESENTED BY LIVE NATION
(DECEMBER 10TH, 2011 PRESALE OVER AT LIVE NATION)
DECEMBER 10th
FLORENCE AND THE MACHINE (21 million)
DEATH CAB FOR CUTIE (128 million)
HIGH FLYING BIRDS (OASIS 94 million)
CAGE THE ELEPHANT (6 million)
THE AIRBORNE TOXIC EVENT (3.9 million)
THE NAKED AND FAMOUS (5.2 million)
DECEMBER 11th
BLINK 182 (114 million)
SOCIAL DISTORTION (11 million)
PENNYWISE (12 million)
SWITCHFOOT (17 million)
EVERLAST (5 million)
MUTEMATH (8.6 million)
So you can see it's basically a David vs. Goliath situation here. You gotta root for the little guy and against Live Nation, don't you? I feel fortunate not to need to "deal" with Live Nation or live shows generally. I'm not unsympathetic to the "feelings" of gigantic corporations, but generally I wrote for them to fail, and this show has "success" written all over it. Several of these Artists have artificially low last.fm plays due to being popular before Last.fm started keeping track: Social Distortion and Pennywise. The first show will be an interesting data point on the draw of Death Cab For Cutie without an album out and Florence and the Machine. Florence and the Machine- or more specifically, Florence herself, are on the kind of tear that ONLY a MAJOR LABEL IE UNIVERSAL REPUBLIC can provide. I think Universal Republic is just the smashing together of Universal itself and Republic.
I think the proper analysis with Florence is that SHE NEEDS ANOTHER RADIO HIT like their last one. I think if you really want to cement your status as a major league Artist in the American music industry you either need two hits off the same record OR hits off of subsequent records. SO NO PRESSURE.
Social Distortion is an underrated band- their last record was actually number 4 on the pop album sales chart when it came out in January, and their radio catalog is like four or five songs deep. You can see how 'uncool' Social Distortion is by searching their name over at Pitchfork. But if you have the catalog, radio play and fan base of Social Distortion, you don't give a fuck what Pitchfork thinks.
Pennywise is a different story, still active but not as cemented in the music industry as Social Distortion, with one enduring radio hit and a decent back catalog on Epitaph. They weirdly released a record on Myspace in 2008- I suppose it was self released and then sold by the band rather then on Myspace Records. Those were the days, huh? Epitaph must not have wanted the record- you would think an artist would stay with that kind of label but what do I know.
Everlast and Mute Math are alt rock radio favorites with major label support and middling chart success/presence. Everlast never really matched his double platinum Whitey Ford Sings The Blues, but then, it was 1998- a time of hope. "What It's Like" is an enduring alt rock radio classic, even though it topped out at #13 on the singles chart. Ends also, get's played, but nothing since. But my sense is that if you still have a song being played on alt rock radio, then you have a career in the sense that you can sustain yourself through music: advances, publishing, song writing, etc.
I think if there is one Artist that I would expect to see on ONE of the two bills it would be SHE & HIM (16 million) with Zooey Deschanel and M. Ward. Zooey's TV show is a HIT, M. Ward is a savvy music vet and this is an easy way to get one of their Xmas standards on one of the alt rock stations down here, then they play the corresponding show in LA for KROQ and Live 105 in SF and they've got a Xmas radio hit. CHA CHING. I guess Live Nation can't pull Zooey Deschanel to a radio show in San Diego.
Dean Martin's Palm Springs House. (FLICKR)
2011 My Year In Music (12/16/11)
2011 My Year in Music actually started in December 2010. It was after Christmas, I was staying with my wife at the Tambo Del Inka Rest & Spa in Valley Sagrado. You know, trying to get away from it all? It was there I discovered that the Dirty Beaches Badlands LP had "leaked."
"Leaked" in the sense that our digital distributor had released the album accidentally, reading the release date is March 30th, 2010 not March 30th, 2011. As it turns out, my view is that the "leak" actually helped the record obtain a larger audience, and personally converted me from a "leak-fearing" to "leak-embracing" mentality. That was my first lesson of the year in the music business:
If you have a product that starts with zero audience, leaking can not hurt you, because the worst thing that can happen is for everything to stay exactly the same, i.e. a product/artist combination with no audience.
2011 began to go "right" on January 14, 2011- not long after I returned from my very interesting, refreshing Peruvian sojourn. That was the day that Pitchfork named Dirty Beaches "Sweet 17" "Best New Track." As it turned out my buddy Josh Feingold over at SONG PUBLISHING was right to counsel me to not get too excited since, "The designation that really matters is Best New Music (Album) not Best New Track (Song.)" That's actually a reversal of the conventional music industry wisdom, and deserves some recognition as an independent fact, considering the vital role that the Best New Music designation plays for about 10,000 Artists and 1,000 Record Labels.
After Dirty Beaches, Sweet 17 was named Best New Track, the attention was overwhelming, especially from labels that didn't know that Zoo Music existed. Solicitations included those directed to the label itself regarding who was "putting out" the Badlands LP. Clearly something any "bedroom indie" Label needs to consider immediately on the occasion of any kind of market success is the need to react to the needs of the Artist. If you don't react in some positive way to the increased attention that results from success, you will lose your artist nine times out of ten. Or, as another, wiser person i was talking to put it, "99 times out of a hundred."
The saving grace for Zoo Music is that the attention for the Badlands LP came within the frame of time designation as the pre-release period- jan- march 2011- and PR had already been arranged, production commenced etc. From the perspective of "sharks" who wanted to put out Badlands, that was an important distinction and caused many would-be suitors to drop away immediately.
The next big mile stone was the Pitchfork Album Review of Badlands. At the time, I was aware of the fact that the mere presence of an Album in Pitchfork's Album Review section was significant, but considering that Sweet 17 had been designated "Best New Track" I that Best New Music was, if not a fore-gone conclusion then a high possibility.
As time dragged on between January 14th and April 4th, I was less and less sure of the likelihood of getting Best New Music. The "nail in the coffin" was The Weeknd: House of Ballons receiving Best New Music on March 29th, 20110- the week of Badlands release. Both reviews were written by the same writer, Joe Colly. Both Artists are Canadians? Joe Colly gave the Weeknd 8.5 and Badlands 8.2. I still think about: On my recent Hawaiian vacation to Princeville, my wife and I were driving back from Waimea Canyon on Kauai to the St. Regis Princeville, listening to this college radio/public radio station, and they played the Weeknd and I was like, "Ohhh." This was in November.
After the initial sales period in April, early May, it became clear that Zoo Music's existing capacity couldn't satisfy demand for Dirty Beaches record. That's a problem that def. fits into the category of what I outlined earlier:
Clearly something any "bedroom indie" Label needs to consider immediately on the occasion of any kind of market success is the need to react to the needs of the Artist. If you don't react in some positive way to the increased attention that results from success, you will lose your artist nine times out of ten.The simple fact is that a small, independent record label doesn't exist without its star Artist. Record Labels are their Hit Records, and that is always going to be linked to a specific Artist who will receive offers to move "up the food chain" of the music business. This is the point where having Artists involved in releasing the music is useful and a reason why an Artist owned label, other factors being equal, will have an advantage in retaining a specific Artist. Nothing about an Artist owned label cancels out the need to react to the needs of the Artist who is putting out a record, but among roughly equal competitors for a specific Artist its an advantage.
The Fall of 2011 basically involved holding my breath to see where the follow-up to Badlands would land. One of the cardinal principles of this level of indie record label-dom is the well framed one album deal, "Put out one album with us, if you want another one... we'd love to." That is the clear difference between what a Zoo Music represents vs. a larger indie or even indies of the same size.
One of the down-sides of that from the label position is that it influences you be very passive from a business perspective in the aftermath of a hit record: That's a flaw of the one record deal from the perspective of an Artist seeking to maximize Audience size. If the Artist isn't concerned about total size of the Audience, it's not an issue.
That's the only way the Artist and the Label can ever be equals, anyways. BOTH the Artist AND the Label should be concerned about overly elaborate contractual arrangements. I would argue that written contracts are really only appropriate when there is existing value to the contract. If the agreement is, "We'll try to do a good job creating an audience for an artist with no audience" you don't need to put that in writing, I'm sorry. I say that as a lawyer, with all due respect to the respect that Artists and Labels show to the business agreement known as a "contract."
You know what you need a contract for? My wife worked on a project where they built a basketball/hockey arena. It cost 150 million dollars. That's something where you need good contracts. Putting out a record with no recording budget and a pr agreement does not require written requirements- it requires honest efforts and good faith- and you don't need to write that down- or you shouldn't have to, anyway. Any Label/Artist combination should be so fortunate that they've made soooo much money that you need a contract.
I think though, my 2011 Year in Music was summed up in an interview that Alex Dirty Beaches gave to a French interviewer in response to the question, "What is indie about your music?" or something like that. He said, "It's not about a specific sound, it's about ethics and how you treat each other." I think it was shortly after that I watched that interview that Alex agreed to put out the follow-up LP to Badlands on Zoo Music. It happened... a month ago?
In conclusion, My Year in Music 2011 was basically tracked to the release of Dirty Beaches Badlands, and I spent most of my time dealing with the consequences of that release. 2012 is going to be all about the follow up album. An answer to the question of what Artists can "do" in the music business besides creating music is to maintain Artist relationships. That's a valuable skill set if it can be harnessed to market discipline. The conflict that the music business causes to Artist relationships is something like trauma.
If you think about the prototype break-out, economically viable Artist, its someone who has spent some time and energy maintaining authentic relationship with people that exist outside of a business environment. As a result of their success, these Artists are basically required to form new relationships with people who are only interested in them because of their success. The Artist wants to embrace the means to leave whatever pre-success environment they've existed in, but is cautious of potential negative consequences.
Realistically, you can't ask someone who literally didn't care about an Artist before they were successful to care about what they did and who they hung out with prior to achieving success. That goes without saying. That can be a hard lesson for "local" friends of successful Artists to learn, but it appears to be a universal principle of the relationship between Art and Commerce.
This year I was grateful that I had partners who were Artists because I know my skill set doesn't really include the kind of personal touch one needs when dealing with Artists on a daily basis.
YEAR END LISTS ARE A DRAG (12/22/11)
A phenomenon I've found distressing is over-celebration by indie labels about year end publicity via list. Here's something to consider: EVERY LABEL GETS YEAR END LIST PUBLICITY. I'm not saying that I ain't privately and occasionally keeping score, far from it. However I am not bugging people to do numerous facebook posts, tweets or website blog posts from an "official label" perspective.
I will simply observe that the sales boost that you can observe from Artist who receives some of the year-end list attention is quantifiable. Due to a quirk of supply on Amazon, I've been able to actually watch a specific Record sell 15 physical copies in a little over 24 hours. That may not sound like a lot, but trust me... at the levels I'm working at- it's a lot.
HOWEVER I did want to point out the Les Indockuptiblies 2011 year end best albums list because I have a fondness from this French, mostly Music oriented magazine. My wife would get copies sent to her from France, and I even though I can't read French, I simply admired the Magazine as a music Magazine- with a sophisticated understanding of the indie music world. I think their top 50 Albums of 2011 is my favorite year-end list thus far this year.
Fortune's Fool: Edgar Bronfman Jr., Warner Music, And An Industry in Crisis
by Fred Goodman
p. 2010
Simon & Shuster
Did you ever wonder what it would feel like to lose twenty billion dollars dabbling in the music business? If so, Fortune's Fool: Edgar Bronfman Jr., Warner Music and An Industry in Crisis, is the book for you!
Part obituary for the music business after the internet era, and part cautionary tale about the vagaries of operating at the highest levels of that business, I imagine that Fortune's Fool was a little bit much for the general Audience at the time of publication.
It also can't help that there is no redemption in the end. In fact, this book reads like it was written before the end. Specifically, it was written before Universal- run by Vivendi- who Bronfman originally sold Universal to- snatched EMI from his own Warner Music- which he had bought from Time Warner back in 2004- that happened last fall. And then on December 5th, Bronfman Jr. announced he was stepping down from Warner Music, which he sold to Len Blavatnik of Access Industries, for 3.3 billion, this summer.
To put that in some perspective, Bronfman Jr. was able to get involved at the highest levels in the music business because Seagrams acquired 20% of DuPont in 1981. At the time, Dupont traded at 7 dollars a share. Today, Dupont stock is worth 50 bucks, and the companies market cap is 45 billion dollars. Today, a 20% stake in DuPont would be worth nine billion dollars. The drink side of business was sold by UniversalVivendi in 2000 for nine billion dollars. Diageo has a market cap of fifty billion, Pernod Ricard of roughly twenty billion dollars. So Seagram's is a major part of that income, at least.
So, to conclude, Edgar Bronfman Jr. LOST at LEAST six billion dollars (what 20% of DuPont is worth today- the 3.3 billion he got for Warner Music. AND- arguably, let's say 30-40% of BOTH Diageo and Pernod- we're talking somewhere between 15-20 billion. Using the low end, that is 21 billion dollars reduced to 3.3 billion dollars. That is breathtaking in magnitude.
Is it his fault? Well, yeah because he took his money from a very stable and dependable part of the global economy and went "all in" on a market segment that imploded just after he sunk a huge amount of money into it. That is what you call "bad judgment." The sense that you get from reading Fortune's Fool is that Bronfman was motivated by something other business acumen to make the business decisions that he made.
He was also basically wrong about everything he ever did.
Bronfman Jr. is really the spiritual heir to another business man of the 20th/21st century, Steve Ross, only failing from the outset instead of succeeding his whole life and then failing like Ross did. (2) Ross started with what was essentially a parking lot company, Kinney National Services- which itself contained a parking lot and cleaning service division. In 1967 Ross acquired Warner Brothers- which had just bought Atlantic- and then they added Elektra shortly thereafter- and it was in THAT configuration that Warner Brothers assumed the structure that it would have until recently- Steve Ross running the show and adding talent as it arose- specifically adding Interscope Records and Def Jam in the 1980s- through Doug Morris.
Steve Ross's main guy at Warner Records is Doug Morris. Doug Morris is still around- he was appointed Chairman of Sony/BMG in July 2011- which is kind of like the Yankees manager taking over for the Mets: Still New York city, but not quite the same prestige level. Morris though, came to Warner Brothers Via Atlantic Records. Thus, within the Warner Records structure there was very loose association of labels, except when it came to distribution. Each label operated independently of the other labels in terms of release scheduling and even competition for Artists.
Bronfman Jrs. foray into the music business consisted of three steps:
1) Assembling his own "major label" called Universal Music Group.
2) Selling that Label, plus the rest of his families' business' to Viviendi and becoming Chairman of the combined company.
3) Buying back Warner Brothers Music from Viviendi after getting booted off the board of directors.
4. Selling Warner Brothers Music to Len Blavatnik.
5. Losing about 20 billion dollars in the process.
First, I bought this book- hard cover- brand new (remaindered) for a penny from Amazon. (1) Second, the only fact I knew about the Bronfman family before reading this book is that they used to own Seagram's, and that Edgar Bronfman Junior's son calls himself Ben Brewer, put out a So So Glo's record on his own record label, and showed really good judgment in marrying the artist known as M.I.A. Yeahhh... good call on the wife, bro.
The story of Edgar Bronfman Jr. and his simultaneously continuing AND ill fated venture into the world of recorded music is best described in this statistic:
Edgard Bronfman lost more then three billion dollars of his families money investing in the music business.
I am not talking about money that Edgar Bronfman Jr. earned himself, and then lost. I'm not even talking about money his DAD made and that he lost. I'm talking about money his grand father made, and then invested wisely. Seagrams earned a bloody mint selling Canadian booze during American Prohibition. After Prohibition ended they bought up a ton of US assets, making them even richer. After that, they made an extremely smart investment in DuPont.
None of that was good enough for Edgar Bronfman- he wanted something that would be his own. Beginning as a failed singer songwriter (in the book the Author describes James Blunt as being a close approximation to what Bronfman would have wanted to be himself.)
As Bronfman Jr., assembled his major label, Universal Music Group, he took direction from the business model that was current at the time: Over paying for talent, making a ton of CDs and selling a ton of CDs, "looking for hits." Bronfman's reaction to the Internet is most kindly described as "un-savvy." Here, we are talking about the period after 2004, when he bought Warner Brothers from Vivendi Universal. Bronfman's "second act" as it were was to introduce the "360 Deal" to the record business, and serve as a hawk on issues like "suing fans for illegal downloading."
The book actually interviewed Bronfman though really, no explanation is necessary- the facts speak well enough for how it went down. He doesn't appear to be sorry for anything. I suppose his saving grace as far as the family was concerned is that they got 9 billion to split up- although if they got it Vivendi stock we're talking about a drop between 70 dollars a share and 20 dollars a share.
As for the 360 Deal, which literally appears to be his legacy, his gift, if you will to the music industry, I would like to quote @wavveswavves on twitter, from March of 2011. I think he speaks for me when he says:
AND WHILE I'M AT IT FUCK YOUR 360 DEAL I'M GETTING $$$$$$ OVER HERE W/O ANY FUCKING LABEL! (TWITTER)
NOTES
(1) First of all, I bought this book brand new for a penny, which means that they shipped a ton (publication date was July 13th, 2010) and didn't sell many of them.
(2) Time Warner, of course, was acquired in AOL in 2000, a merger widely described as the "worst of all time." Time Warner received AOL stock, and so that didn't really work out for anyone, long term.
Romantic Aesthetics took the opposite posture, specifically attacking the allegedly unbreakable rules about what constituted good Art, and good Artists within the field of Classical Aesthetics.
This transition generally took place between the end of the Renaissance and the mid 18th century, but the debate between Classical and Romantic Aesthetics remains a valid jumping off point for evaluating the Aesthetics of a specific Artist or Art product.
Both Aesthetics have their own principles that they favor and dis-favor. A main principle where they diverge can be described as the degree to which an Artist or Art work can be said to be "Calculated."
Andy Warhol |
As an example of this debate in the field of studio Art, you can thing of the debate over the aesthetic merit of an Artist like Jeff Coons, Michel Duchamp, and Andy Warhol. In the field of Music, a relevant debate is the degree to which the work of an unknown Artist is perceived as "calculated" and how that does or does not impact the more substantial principle of Authenticity.
An Artist embodying Classical Aesthetics is one who sees a specific "truth" and seeks to provide order and harmony in his/her Artistic universe. An Artist who embraces Romantic Aesthetics would become enraged at the prospect of being deemed Calculated by a Critic, presumably because it conflicts with the core Romantic principle of Authenticity.
Andy Warhol Campbell's Soup Can |
The role of the Market in all this is to encourage Artists who can understand while ALL POPULAR MUSIC EMBODIES Classical Aesthetic principles or order, harmony and technical excellence, while paying lip service to the Romantic principles that the contemporary audience for Art desires from it's Artists: Alienation, Isolation, Dissatisfaction with "the way things are." A specific Artist given commercial success will have to adjust his or her principles with the growth of an Audience: As an unknown, it is best to embody Romantic Aesthetic principles to appeal to the "hard core" fans of a particular genre, much in the same way a Politician will "secure his base" in a Primary campaign, before "moving to the center" for a general election.
Here, the successful embodiment of Romantic Aesthetics in early Artistic products is the equivalent of "securing your base" and the shift to embracing Classical Aesthetics the functional equivalent of "moving to the center."
In this way, a young Artist is well advise to be conversant with Romantic AND Classical Aesthetic principles. A common mistake is to IGNORE Classical Aesthetics on the theory that they 'don't matter'- but they do- because Classical Aesthetics appeal to a greater portion of the Audience for any Art then those who support Romantic principles.
Sony To Buy The Orchard & IODA, Which Are Merging (3/6/12)
The Orchard is merging with IODA and Sony Music is making a major investment in the new company, according to several reports. Sources tell Hypebot that talks began with The Orchard hoping to purchase IODA, which Sony owns a major stake in. Dimensional Associates, the private equity arm of JDS Capital Management and owners of The Orchard, had reportedly hoped to roll up several distributors including The Orchard, The Orchard and IRIS into a digital music powerhouse. But Sony had other plans. (HYPEBOT)
Not sure what that means for the physical and digital distribution elements of IODA and The Orchard, but considering that IODA stands for, "Independent Online Distribution Alliance." It does not seem like a particularly positive development for independent music. Then again, Ingrooves is straight up owned by Universal Music, so pick your poison I suppose.
People ask me, "Why do you read books about music history?" and I say, "To avoid others mistakes."
Here's one from the authoritative book about Stax Records, Soulville USA: The Story of Stax Records by Rob Bowman, and published by Shirmer Trader Books in 1997.
In 1968, Stax Records had a falling out with it's major label sponsor, Atlantic Records, which resulted in them losing the rights to all of the Records they had released under that Agreement. In response, Al Bell, the head of Stax Records, came up with the idea to simultaneously release 27 LP's in May of 1969. It was almost certainly the worst music business decision of all time. Out of that 27 LP release, one record, Hot Buttered Soul by Issac Hayes was a chart success, everything else failed. This decision, the first significant decision that Stax Records made as an independent label, was, itself, enough to doom Stax Records. Bowman tells the story:
[Everyone] at Stax were in an absolute frenzy attempting to ready twenty-seven albums for simultaneous release in May. This audacious move was orchestrated by Al Bell with the singular purpose of creating an instantaneous catalog to replace what had been lost in the termination of the Atlantic distribution deal. To put the size of this release in perspective, the company had issued only forty-three albums in total from inception through the dissolution of the agreement with Atlantic.
Stax Records was bankrupt and indicted by 1972, and although they experienced interim sales success, this one illustration shows the kind of ship they were running at that label. I love a good music industry flame-out- Casablanca Records in Los Angeles CA is another classic. But Stax Records putting out 27 records in one month is up there.
I think it's accurate to compare Spotify to Netflix because they both provide the same function: streaming, Spotify for music and Netflix for film/television. Each have their own competitors who do the same thing but not as well. For Spotify that's Pandora, for Netflix, Hulu maybe...Amazon Prime.
But I agree with others who say that the appropriate way to forecast Spotify's growth is buy looking at Netflix subscriber growth. Here is a chart:
Personally, I think that Spotify should be able to post similar numbers over time. Presently, Spotify has 20 million "users" and 4 million "paid users," which is a million more paid users then they had last year.
Last Fm is the best way to measure the Audience size for a specific Artist, because of the major Social Music services (Spotify, Pandora, Last FM) they are the only one that actually publish statistics for Artists.
On this Graph, "0" is in 2008 for Spotify, mid 2005 for Last Fm, and 2005 for Pandora. So you can see here that Last Fm is a pretty big user group to be drawing statistics from.
On Last FM, Animal Collective has close to one million listeners, almost 55 million library plays and is #190 on the very excellent Last FM Top Artist Chart. The record itself comes out on September 4th, so it would be good to check on the statistics a month from now to see the rate of increase.
Bruce Springsteen and Jon Landau |
"Tonight," his column began, "there is someone I can write of the way I used to write, without reservations of any kind. Of Springsteen's recent concert in Harvard Square, he wrote: "On a night when I needed to feel young, he made me feel like I was hearing music for the very first time. When his two hour set ended I could only think, can anyone really be this good, can anyone say this much to me, can rock and roll speak with this kind of power and glory? And then I felt the sores on my thighs where I had been pounding my hands in time for the entire concert and knew that the answer was Yes.
Columbia was quick to take advantage of Landau's enthusiasm. Rolling Stone and other papers were soon trumpeting Landau's endorsement:"I have seen rock and roll's future and its name is Bruce Springsteen,"declared full-page ads. But the Real Paperreview had even more far-reaching consequences. It marked the beginning of a relationship between Springsteen and Landau that would be key to transforming the singer into a superstar.
Sources
The Mansion on the Hill: Dylan, Young, Geffen, Springsteen, and the Head-On Collision of Rock and Commerce, by Fred Goodman (Vintage Books, 1998).
I did a 2011: My Year In Music post in December of 2011. In that post I mostly discussed the experience of Dirty Beaches Badlands coming out in March of 2011. I think the essence of this post is contained in this paragraph:
After Dirty Beaches, Sweet 17 was named Best New Track, the attention was overwhelming, especially from labels that didn't know that Zoo Music existed. Solicitations included those directed to the label itself regarding who was "putting out" the Badlands LP. Clearly something any "bedroom indie" Label needs to consider immediately on the occasion of any kind of market success is the need to react to the needs of the Artist. If you don't react in some positive way to the increased attention that results from success, you will lose your artist nine times out of ten. Or, as another, wiser person i was talking to put it, "99 times out of a hundred."
This business problem is not a matter of a record label "screwing" an Artist out of royalties on purpose necessarily it just results from a business model where only 10 percent of the product line generates revenue. So let's say Record Label releases 10 records and spends 5-10k per record on physical production- that is going to cost 75,000.
Now let's say that 9 of those records break even- that is revenue of 67,500. For the tenth record, the revenue is ten times the cost of the record- 75,000. So for this time period- the outlay is 75,000 and the receipts are 142,000.
However, the label owes the successful Artist half of all the money above what the record cost- so 75,000 - 7500 /2 = 33,000. So really, under this very realistic scenario the record label makes 109,000 and spends 75,000 in this initial time period.
So now move to the next time period- the label is starting with 34,000- less then half of what they need to produce the same amount of music. In the first time period, successful artist got 33,000- or roughly the amount that Record Label needs to finance their records for time period two. Now, Record Labels often figure this out BEFORE they've actually paid the successful Artist their royalties from time period one, and that realization is at the root of all of the very many examples of record labels screwing Artists out of royalties through history
The only way to avoid this mistake is by reducing your number of releases so that you don't have as many break even records and can afford to pay the successful artist without compromising your ability to continue releasing new records. I mean, that's what I did . So paradoxically I basically spent 2012 not making new records, or making as few as possible so I wouldn't be caught in the trap that I described above.
The result of 2011 success was doing less in 2012, but hopefully that restraint will set the table for more activity in 2013- that's my hope anyway.
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