Here we go with video #3. Complete with transcript below.
Musician’s Chances – Then vs Now
A friend of mine, a professional musician and a producer of many years, wrote to me the other day, and one of the things he said wound up being today’s topic for this video. He said “If 30 years ago we had what young people have now we would have changed the world.”
So I decided to record this as my reply.
“Do artists have it better today?“
In the old days – that is up until the days of the Internet – aspiring artists really didn’t have much choice. It was either get signed to a label – major or indie – or suffer eternal obscurity as an unsigned act. And if they wanted to screw you – you let them.
And if you got really – really lucky and didn’t merely get signed but also had hit records and a large following, then you had a chance of actually making some money on it too!
A few dozen artists made millions, we all know that.
But a typical, average, lesser-known SIGNED artist (one of hundreds) made the equivalent of maybe 12 bucks an hour when you add everything up and recoup everything he owes.
And as for the rest of the signed artists – many thousands of them – they were typically in the minus, that’s if they even got released at all.
So it’s clear that in the old days things didn’t really look all that great for most artists. This is not to say that the record labels were all bad guys – far from it. Many were fabulous, dedicated and extremely talented people. But the realities of the market and available technologies at the time made it difficult for things to be any other way.
Record companies of old only really had just one job to do: sell records (which included doing the A&R for their artists, recording them, manufacturing the records, distributing and publicizing them – all of which was recoupable from the artist’s earnings, needless to say). That’s it. Oh and they also paid artists advances on sales – which were also recoupable.
For all that, they charged the artist anything between 80 and 95% of a typical retail price of a record, depending on the case and geographical location. Yes, there were 3 or 4 artists who had a bigger cut. So?
Most labels back then didn’t make anything on the artist’s touring, merchandising, endorsements or sponsorships, TV or movie appearances, also in some cases publishing – all that was separate and in many cases it was the ONLY way an artist could hope to actually make at least SOME money on the side.
In the era of the Internet, the labels were suddenly faced with a free market competition made possible by the technology that computers and the worldwide web represented.
Indie labels as well as unsigned artists could now do their own A&R and research, record and produce themselves, and even manufacture, distribute and publicize their music, shoot their own videos… – for relative peanuts.
So now the majors discovered they had two enemies – the public, which increasingly shared music with their friends without buying it – and the artists who were earning more than they were supposed to – while the labels were losing money.
Rather than adapt to the new realities, the “major” music industry responded to this challenge in two ways. First, they sued the listeners for copyright violations and piracy, next, they introduced the so-called “360” deals which require that artists share ALL of their incomes (including of course, touring, merchandising, sponsorships, tv and movie appearances, publishing, and so on), basing on the argument that if the labels didn’t make the artist famous in the first place, there would be no way for them to make money from all these other things!
I know where they’re coming from, even though there are powerful arguments against that position, which we can look at some other time.
The main problem with the 360 deal, of course, is that the record company might not have the optimal expertise in, say, organizing merchadising or TV appearances or any of the dozens of things it wants a cut from – but you still have to pay for it. Even if it sucks.
And the average rate for an typical signed artist on a 360 deal remains… about 12 bucks an hour, once you count everything right up to full recoupment! But now he can’t hope to improve on that with all those extra incomes that used to be his! Or hers!
Leaving aside the fairness – or otherwise – of 360 deals, the problem is that it’s just another heavy-handed, unimaginative and blinkered solution concocted in an effort to maintain the status quo.
Rather than embrace the free market of the internet, the majors fight it with all they’ve got. And… surprise, surprise… they’re always on shaky ground – while the indies are growing.
That’s because the trouble with the major record labels is that they’re run by non-musicians and unimaginative suits who don’t give a shit about music and only know how to conduct crony business. They hate to compete. If the government doesn’t help them squash their competition, they cry like little girls. They’re comrades who fancy themselves to be businessmen!
The market changes all the time and as the majors refuse to accept this, their relevance continues to decline. Today more than 34% of all music sales are generated by the indies – nearly 10 times as much as a mere 10 years ago!
The major labels today function, in effect, more like bureaucratic government departments than bona fide businesses! You’re gonna have a music zar before you know it!
And thus they insist on repeatable results in order to satisfy their bottom line. Consequently, whereas in the old days you wouldn’t get signed if you sounded just like “X” – today you won’t get signed if you don’t!
Another problem is that the major labels, all run like military operations by cry-babies, sissy lawyers and yes-men, are unable to cope with failure. If they sign you, they’ll only dare release a single for you – and if it flops – that’s it. It’s curtains for ya, no second chances.
NONE of the biggest artists of yesterday would have been launched today, because almost NONE had a hit straight out of the gate. It took time to develop them.
And that is why more and more artists no longer look for record deals and go their own way.
Shockingly many achieve a greater financial success – if not fame – than most signed artists! And their numbers are growing. They’re beginning to awaken to the possibilities that parallel monetization strategies on the internet can offer!
Most major labels don’t like this new model because it means work and staying outside of their comfort zone. And rather than exploring these new possibilities, they much prefer to lobby the government for anti-free-market restrictions.
But it’s not all roses either for the independents and unsigned artists.
They don’t have the bank that the majors do and they often don’t have the specific expertise in the dozens and dozens of areas that need to be addressed for a musical career to take off. They learn on the job and – as can be expected – fail more than they succeed. But if they have a good plan – they’re in with a solid chance!
And what about indie labels? Well, even though they may be “labels”, most are a completely different animals from the major labels. They’re much more similar to unsigned-but-well-organized artists than to the major record companies as we know them today.
They have to fight in pretty much the same way that the unsigned musicians do. They have no choice but to embrace the freedom and free market options that the Internet has to offer. And there’s an infinite supply of those – if you just have the vision to see them!
One or more of them will eventually become the next “majors”, but hopefully with a back-to-the-roots, more free-market mentality. But even before they do – they’ll probably be taken over by some majors with the brilliant idea that success can be bought. Major labels buy or license more indie labels than they sign new artists!
So do the indies and unsigned artists have it better today?
The don’t usually have the expertise and the funding that the majors provide – and unless they’re beautiful and near-identical to an already existing hit artist – they’re not about to get it.
But what they DO have is unprecedented freedom and affordable tools which give them a fighting chance and ability to be creative without restraints. They also have time for trial and error and their contract with themselves doesn’t end if their first release isn’t a hit.
So what matters to you more? Having someone lead you by the hand and give you everything on a silver platter, in exchange for your blind obedience and the contractually-guaranteed life of perpetual fear that you can be dropped like a hot potato at ANY time they like — AND be prevented from looking for another deal for years?
Or having the freedom to become your own record company and – if you’re patient, persistent and just moderately business savvy – earning a better living than almost ANY signed artist that you know?
It’s a no-brainer!
You DO have it better today. But you still have to have a solid work ethic – and make a choice.
You can be a sheep and try to be yet another Miley Cyrus – OR – you can live the dream of running your own label the way it’s supposed to be run, with focus on artist development. Your artist. Your label. Your dream. YOU.
And the odds are 1000 to 1 that you’ll do better than you ever could with a major label.
Act today. After all today is the tomorrow that you worried about yesterday.
http://meermusic.com/get-the-crusher/ – Do you have better chances today with the new music business model than artists had “yesterday”? In this video we look at what has changed, what’s remained the same and how all that matters to you.
Find out much more about this and other topics in the Online Music Business Crusher – http://meermusic.com/get-the-crusher/ – it’s free to dive into and get started, so just do it! This program will teach you how to set up a thriving business online, based around your music. It’s NOT some get-rich-quick scheme, but rather a thorough step-by-step guide to how to set yourself up on the web in the right way. It can be a lot of fun and won’t cost you and arm and a leg!
Among the sources for the above video are: