How To Make Money In The Post Recording-Business Environment

Record executive stereotype.

Redmonk, a person I’ve been acquainted with through the music scene for a while made a comment on my post ‘I’m Doing It For The Scene Maaaan’ which was relevant to the thesis he’s working on. He posted a few thoughts and links in the comments to that post and rather than type out my reaction as a super long comment that people might not see I decided to do a post about it.

Generally the thoughts are all circling around how artists will make money after the business of selling recorded music, what I call the recording business, finally dies. I use the term recording business rather than music business because there are plenty of businesses about or around music which are making lots of money including gear manufacturers, educational institutions, makers of music listening devices etc. The biggest casualties I see in all this are the labels and at some level the artists. Redmonk is italicized below, my thoughts are interspersed.

Hey Matt, you might have seen this:

http://labs.timesonline.co.uk/blog/2009/11/12/do-music-artists-do-better-in-a-world-with-illegal-file-sharing/

Predicts that artists will supposedly soon be making more from gigs than selling physical copies of their music.

There are more and more theorists (including Gerd Loenhard – http://www.mediafuturist.com/) essentially arguing that we should be heard first, build an audience and then once the trust is there, they’ll pay to see our gigs, buy our merch etc. So give the music away for free (cos if people want to, they’ll get it for free somehow) and make money through other streams.

Firstly I don’t think giving all your music away for free is a valid model for first time artists. It creates the perception that that music has no value and makes it look like un-filtered amateur spew (which it often is) and makes people not think of it as professional. People still place great respect in the idea of ‘getting signed’ or ‘having a record deal’ even if it is just to some bedroom label putting out 12″s or digital singles. There is still an important role for the record label to play as a creative force, and it’s important to know that MOST labels are run by enthusiasts who are contributing to the dialogue about style and sound (like for example my label with Rupture Dutty Artz) by picking cool emerging artists and giving them a platform and helping to filter their output, not by guys in pin-striped suits sniffing coke in some big office trying to make money. Using ‘the record industry’ as a blanket term for some kind of exploitative boogie man is stupid.

I think that for most underground artists it’s not a prediction that gigs are more lucrative than sales of recordings, it’s a reality. You don’t need a crystal ball for that one. The fact is though that I think we have not yet seen an actual picture of the post-recording-business era yet since the majority of these artists making money from live shows are subsidized by the promotional budgets of record labels. Very few underground artists I know have the money to pay for PR (which can cost $2000-3000 US per month of working a release) and therefore are not earning the same performance fees as better promoted artists on labels. Promotion it seems to me is a big part of the question and while the internet does make all kinds of new promotional models available and necessary it will not work for many artists who due to their artistic nature are too busy making music to learn internet marketing, master the latest social media platforms and become a viral sensation. This applies to non-internet marketing as well with ‘artists’ like Puff Daddy – who are actually business people – rising to incredible heights due to their promotional and business acumen. Many artists are not destined to be moguls and in the past this is where a record label came in. A label specialized in marketing and promoting artists so that artists could do what they do best, be artistic and not spend most of their time promoting themselves on the internet.

One of the major societal trends of the past several milennia since the introduction of agriculture is specialization. Once we moved past everyone growing their own food through subsistence farming, invented barter and then markets people were able to now delve into increasingly specialized niches and make a living in that niche. While the larger society continues overwhelmingly in that direction with people creating careers as dog-groomers, clowns and psychiatrists the music business is moving away from it. Now, in order to be a recording artist you have to be a top-flight performer, internet marketer, creator of viral content like YouTube videos, have a line of apparel, run your own label and eventually become a film actor if you’re a rap artist.

Now, I for one, don’t WANT to do all those things, although I recognize that I should for the good of my career. If I had a choice what I would do is this: sit in my simple, inexpensive studio in my house in Brooklyn and make hundreds and hundreds of tracks. It’s my specialty, it’s what I’m best at and what I love doing more than anything in the world. In another era of the recording business that MIGHT have been possible. Now, it seems pretty clear that it isn’t. As I result I teach music, I consult on internet stuff, edit video, do DJ gigs, run a record label and when I have a few hours in between all that dash into my studio and make some beats as fast I can.

The aforementioned Gerd Leonhard has a convincing argument that treating music like a utility and introducing a flat-rate music tax (say 20 quid/year/person) would generate massive amounts of money that we could distribute to musicians on a ‘per click’ basis (which would be much easier to track than the current royalties/airplay dinosaur). This is all great, but will it filter down to niche artists as well or just look after the big guns (who seem to be getting smaller or are people’s tastes getting more and more specialist? http://www.guardian.co.uk/music/musicblog/2009/dec/07/musically-fragmented-decade)

I am STRONGLY in favor of this model and at the moment think that the best model would be a not for profit entity like the government (I know, shudder, open to suggestions here) get involved and implement this very scheme. I’ve talked to a few people who think about this and this is the best thing I’ve heard. I advocate a HIGH tax on things like iPods, iPhones, broadband connections, websites that are used for file sharing and anyone else who is making a profit by facilitating massive un-stoppable piracy. I think that Apple needs to pay me for making devices that make my job as a person selling recordings obsolete. The whole appeal and justification of paying for any of these things is that it will then enable you to tap into the gusher of great free content that is squirting onto the internet. The film industry needs to get focused on this too, since they’re next.

So how can people afford to take time off from work or whatever and make their music in the first place? Have you any experience of using platforms like Fundable (http://www.crunchbase.com/company/fundable-com) to finance releases? There was a punk label that ran here in Ireland that used to announce a release, everyone sent postal orders for their copy, this money financed the recording and pressing of the vinyl, and then they sent everyone a copy. Supply built on exact demand. If there were 127 people financing the project, there were 127 records made (although I think the guy in charge had his own little pressing plant).

Kickstarter is another one. I have not used these platforms but see them as potentially viable on a very small scale, with a very dedicated supporter community, like you describe. I am interested to try them and am working on conceptualizing some releases which could take advantage of this. I’m very interested to hear thoughts from anyone who has been thinking about this as well.

Redmonk provided a couple more interesting papers, including an abstract of his thesis, which when I have a little more time I plant to look at and see if I feel like I have something to say about them. In the mean time what do you think?

PS: All this talk got you inspired to support a working artist? Buy my album here or from the image link on the right>>