Sunday, November 30, 2008

The Major Bypass



The business model that the Majors have been using is akin to a goat track when compared to The Information Super Highway. Hey I’m not saying that what they’ve done in the past was all wrong, but it has served its purpose and it can now be done better. There is a certain amount of resistance to change within the culture of the Majors and that in itself is ironic almost to the point of hypocrisy, remember when the lawyers and accountants took control from the music folk? They forced that change in the 80s and now simply can not accept that it’s now their time to step aside and let the IT whiz kids, the younger, more in touch free thinkers and dare I say it, MUSIC folk take control and steer this baby on a new course home.


But it isn’t only new (garage) Artists doing it this way, it’s not even Artists we would consider indie. Madonna, Prince, Radiohead, and Paul McCartney just to name a few are now bypassing the traditional Major Record Company Model. Radiohead famously released In Rainbows online with a “Pay What You Feel” model, Madge is now signed with Live Nation, a company better known for events and touring, the Paul McCartney is signed with Hear Music “aka” Starbucks, yup, you heard right Starbucks, a coffee house is now a recording house, (is there nothing sacred?) and Prince saw the light and gave his latest platter away as a premium with a UK Sunday news paper to, in essence, promote his impending tour of the UK and it worked wonders, he sold out Twenty One, yes that’s TWO ONE dates at the new O2 arena, breaking not only new ground, but a heap of attendance records for a single tour in a single arena. And they’re not the only ones bucking the trends and searching for a better deal, but they are certainly at the forefront, mind you, they do have the profile and financial backing to undertake such daring adventures.


The internet has also opened up a plethora of opportunities for artists that would normally have a more regional, almost exclusive following, these niche or boutique artists are finding fans in all corners of the globe, from all walks of life thanks to a great extent to the World Wide Web. Sites like MySpace, You Tube, last.fm and Facebook are giving Artists like The Reverend Horton Heat, My Morning Jacket, Elliott Brood, COG and Whitley a grand platform from which to peddle their wares. Yes folks the niche market has never looked so healthy, there are so many sub-genres benefiting from the Information Super Highway (ISH), that the Majors are seeing their top sellers not selling quite as much as they have in the past and the high ranking Record Company Executives are falling over themselves, fumbling, trying to get to the panic button, granted, some of that is due to file sharing, illegal downloads, etc. but a lot can be contributed to the rise and rise of the niche artists, labels and market.


The traditional business model of the Major Labels is failing, right or wrong, the fact is, it is. They spend way too much on the recording process, they haven’t embraced the internet and they are simply trying to hold onto a ghost. The Indie Artists, Labels and Managers on the other hand are, for necessity sake, tight fisted when it comes to financing a recording, a tour or merchandise, they are svelte, efficient and effective in getting the message across and that message is we have a quality product, you need to be apart of it. In the words of Bob LefsetzOne of the reasons the major labels missed the Net revolution is those who ran them were not computer-savvy. When they finally got e-mail, they had their assistants print it out, and type responses. Is it any wonder they couldn't understand the merits of file-trading? They never used it!”


In a desperate grab for revenue, the Major Record Companies are now making a play for the Touring and Merchandise dollar. For an untried or relatively unknown Artist to get any type of deal from any of the Majors, they need to accept that it will be the dreaded 360 deal, this is where the label will front the tour with an advance and the Artist might receive 20% of profit after the label recoups. The Majors are doing this because 10 years ago, two thirds of the Artist income was derived from CD sales and the other third was from touring and merchandise, this made the Majors fat with wealth and they knew that if an Artist ended up to be rich beyond their wildest dreams, the Label was a hell of a lot richer, today however, those figures are reversed and the label wants its cut of a pie that historically wasn’t theirs to have. This really can’t be good for anyone, concert ticket prices will continue to increase to the point where going to see your favorite Artist may well require the fan to take out a personal loan or sell a body organ on the black market (ok that may be an ever so slight exaggeration but you get my drift right!) Hell, the Police Reunion Tour of the US saw the top shelf tickets go for $900 US, you could buy their entire back catalogue on CD for less than $100 US; no wonder the Majors want a slice of the Touring pie.


So how do all these developments affect the new burgeoning Artist? Well it certainly limits the earning capacity for the Artist if they’re signed to a 360 deal with a Major Record Company, but on the other hand, should the Artist choose to go the Independent, Alternate route, with a good publishing deal, they will have more artistic control, more transparency and likely have a career beyond one or two albums, sure they may have to put their hands in their own pockets, or the pockets of a wealthy benefactor that truly believes in them, but the rewards are proving to be worth it. But is recording the be all and end all? I put it forward that the CD will in the not too distant future be used as purely a marketing tool to get heads at the gig, or a premium of sorts, “come to our show and we’ll give you a CD” unless you’re Mariah the Pariah (who doesn’t sing live anyway) or some other false prophet who can’t cut it live without Auto Tune, they will always need to put out CDs so there is something for their vapid, shallow image to grace and so they can push whatever product that is being cross promoted with their brand.


So it may well be worth Bypassing The Majors, if that is what the Artist decides to do, they’ll need to take the wheel and steer their own course, in search of the Last Lost Highway to a career in the music industry.

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