Click Here to: Listen To the Audio PoochCast™

 

Professor Pooch's

"State of the Music Business Address"

© 2011-15 David J. Spangenberg

I know you’ve all heard all the complaints from the Major Record Labels and their subsidiaries, especially from the RIAA [ R ecording I ndustry A ssociation of A merica – Label’s Lobbyists] that represents them, saying that because of the Internet and all the illegal free downloads associated with it, plus piracy, etc., that “… sales have gone way down.”

But in reality, do those numbers actually reflect the actual state of the Music Business?

What you aren’t hearing, is that Music Sales have actually been increasing the last few years - just not always using the traditional paths, means, people and sources.

Question: How many Musicians/Bands/Groups/Songwriters do you know who are on MySpace, Reverbnation or wherever who sell their Recordings, either by Digital Downloads or CD sales at gigs, etc? And how many of these musicians you know, actually get their Recordings “scanned” to become part of this number sold that the RIAA uses to measure sales?!

Right to the point, the Major Labels now have competition from an unlikely source - the masses. And the direction the masses are taking is often called: “the New Model”.

Due to the advances in technology, especially relating to recording, plus all the Social Networking available through the Internet, there are now many more people showing an interest in being in the Music Business than ever before. At last count, there were estimated to be 7–10 million Musical Artists on MySpace alone.

It is fine if you are interested in going through a Major Label, but realize there is rarely such a thing in this century as them spending time, money and effort on “Artist Development” anymore. The Major Labels have become so paranoid about their “bottom line”, that most of them will expect you to be able to jump right into 500,000 sales in a matter of months after they release your product - or they’ll drop you with a thud!

And they rarely sign an Artist anymore who hasn’t racked up at least 50,000 sales going the self-label or Indie route, and/or created a giant buzz of talk and publicity. Then, when the Record Labels see that you are already semi-successful on your own, they will come to you directly.

But, this leaves you with an interesting decision to make - should you, or shouldn’t you even want to go with a Major Label?

Yes, there definitely can be major advantages going with a large label, such as possible financial advances, maybe quicker large-scale fame through wider Distribution, Radio and Promotion, etc.

But why are more and more Major Artists purposely not re-signing with a Major Label when their deal ends?

It’s simply because they’ve realized that they will probably make way more money selling 50,000 records on their own than selling 500,000 through a Major. And with way less restrictions. And they don’t have to wait for the label to first recoup [get back] what they spent to help them record and sell all those records, adding to that the much smaller percentage they’d eventually receive than if they would pay themselves.

And all the while retaining “Creative Control”, plus ownership of their songs [Publishing], and ownership of their recordings.

Yes, I realize these Major Artists are already known, but if you still need those 50,000 sales for the Majors to even blink at you, anyway…

Lots to think about nowadays, isn’t there?

To complicate matters, those who want to, or are forced to, go the “Do It Yourself”, route, will soon find out, if you haven’t found out already, what you call “DIY”, actually means “not aiming for a Major Label Deal”. You are going to find out that you will still need two major things if you wish to be truly successful – while still having the time and resources necessary to spend on your music:

1. Some money! Yes, studio time, promotional merchandise, traveling, living expenses, etc., do take some money… and,

2. Some knowledgeable, energetic help – with contacts. That is, you still need some form of a “Team”…

So how can we get around this situation – without going to a Major Label?

Well first of all, what the Major Labels “used to do”, doesn’t work anymore – it’s being proven by them, and to them, everyday. So now, to make money again, it’s become all about 360 Deals, where the Label takes a piece of every part of your Music Income [such as Live Performances, Publishing, Merchandise/Branding, etc.].

And, as the Major Record Company business is failing, they’ve had to lay off a lot of people - people that used to do the stuff that the Artists needed to have done. Realizing someone had to do this kind of stuff, the labels have been leaning towards signing Artists that are Managed by very knowledgeable Management teams, or "Super-Managers".

[Note: I covered this extensively in my essay called ”Artists, Their Managers, and Getting a Major Label Deal” - in the Free Library section]

These Major Managers, in the Label’s mind, should take over and handle many of the operations that the Labels want to get paid for, since these Managers have the facilities, staff, knowledge of the Industry, and the contacts to be able to take over many of these Label functions.

So, to sum it up, nowadays, more and more, the Major Label has become pretty much “a Bank”, while the Manager is often relied on to make that Record Company a lot of Money.

And because of this new situation, a new trend is already in progress. As Bands are finding out: “Why do you need a Major Label for the money needed to launch your career, if you can either find a knowledgeable Management Team who has, or has access to, enough money to at least get things started and on a roll?”

Now, you must keep in mind that, when you sign with a Manager, you are still signing a 360 deal with them. He/she/they will get, on average, 20% of the Gross of everything you do… As one of my Management Agreements states:

Artist hereby employs Manager's services as Artist's exclusive personal manager with respect to all of Artist's activities in the entertainment industries including, but not limited to: nightclubs, theatrical engagements, fairs, road shows, tours, and all personal appearances; motion pictures, television, radio and all other productions; phonograph records, prerecorded tapes, remixing and all other sound and audiovisual recordings; musical compositions, and all other writings; publishing; endorsements, commercial merchandising, tie-ins, and all other commercial use of Artist's name, likeness, and other aspects of Artist's personality.

Errr… does that cover everything, or does that cover Everything?! It’s a 360 deal to the max!

Except there’s a couple of major differences that make the situation much more fair:

1. A Record Company normally owns your Recordings and most often, your Songs. A Manager doesn’t have to…

2. The Record Company gives you, maybe up to 15-20% of the profits, maximum. In the case of the Manager, you give him/her/them about that same percentage!

So, in this scenario, the Artist remains the owner of their life and properties. That is, in effect, the Artist is the Record Company, Publisher, etc., and the Manager is the person who simply runs the operation for you...

Yes, this could be the answer to an Artist’s dream - except for one factor: How do I know I can trust this Manager???

Well there are things you should do before you sign with anyone - including a Manager, to protect yourself! So, check out: “Before You Sign With Anyone!” [Everything You Need To Do To Be Prepared for Anything You Want To Do In the Music Business!]

To me, no matter which Music Industry route you decide to take, whether it's with or without a Major Label, with or without a Major Manager, the “Do It Yourself” way, no matter which direction you wish to travel, you still must make sure you are prepared to safely take on your career.

And, no matter what, you must keep in mind that, even when starting out, it really helps to be talented musicians and performers, with great songs, capable of standing out from all the insane amount of musicians out there, let alone all the other entertainment diversions that are popping up every day in our lives …

But everyone has access to the Internet just like the Majors, where you can put your music up with the idea of having fans bring in other fans through word of mouth and hearing your recordings and seeing your videos, and buying your recordings and merchandise, and telling them where you’ll be performing next.

And by using Companies/Sites such as Tunecore.com and CD Baby it makes it even easier for you by offering services dedicated to helping you with your sales and placements on all the important sites, such as I-tunes – with the benefit that these type companies and many more are now willing to help you while using a completely different type of business deal.

Many are even non-exclusive deals, meaning you can sell your products through more than one company. And you can retain ownership of your songs! And there may be no “recoupment” to worry about - you get paid from sales starting at record #1!

There are also “community sites” where people can read all about you and listen to your music as well as see where you are playing next, and see your Videos and can “spread the word”, such as MySpace, FaceBook, Reverbnation, and You-Tube, for example.

To me it’s quite clear: Since most people now have the capability to accomplish quite a lot without a Major Label or Major Manager, and since neither will want you until you create a large buzz anyway, you can have and keep a large amount of creative, business and legal control, and be in a much better bargaining position if and when you want them – or they come to you.

However, how do you take advantage of all these opportunities, if you don’t have the time or expertise to learn them, let alone do them – while still making amazing outstanding music and products?

The answer? You can’t take the term “Do It Yourself”, literally… “Do It Yourself” does not mean not having Help! You DO need a Team! But you’ll find you may want and/or need a different type of team, nowadays, than what’s been the Music Business Norm. Your Team should fit You and what You want to do.

Now that doesn’t mean YOU are not doing anything! As I said, you still must produce excellent materials and products, and just as importantly, you must communicate, as personally as possible, with your fans.

But by associating yourself with the right people who can handle the constant responsibilities and things you can’t for whatever reason, you have as good a chance as anyone in the Music Industry…

-----

If you have any questions on any of the points I've covered, feel free to contact me at

pooch@professorpooch.com

 

Share/Bookmark  


Author's note:

You are welcome to post this Commentary, or PoochCast, on any website, e-zine, or in any print magazine, if you include a link directed to

http://www.professorpooch.com

with writer's credit and copyright notice...


"Our aim is to help guide you, protect you,
and to answer any and all of your questions regarding
the Creative, Business and Legal sides of the Music Business,
in plain, easy-to-understand "People-Talk".
No matter what style of Music, no matter what you do,
no matter what stage of your career - we're here for you!
Let us help you save wasted time and money.."

David J. Spangenberg
["Professor Pooch"]

Music Business Consultant,
Educator & Advisor
Contract Specialist




Subscribe to our mailing list

* indicates required
Email Format