Adele blitzkrieg

AdeleAs we watch the inevitable impact of 25 with its hit singles, videos and acres of tabloid waffle, bear in mind that “the album is dead” and “music has lost its value”.

Nobody buys music any more. The recording industry is finished.

Except of course when an artist makes records people want. I wonder how the pundits will explain Adele?

Two themes and a reprise, part 2

Here’s a short coda.

I wrote previously about independent labels as a growing source of successful new music and the Majors as a declining developer of in-house talent, possibly leading to a stronger licensing role for the latter, Adele being just one example.

Although this seems advantageous for all parties there are legacy problems to deal with. I mentioned the eye-watering pay cheques of Major label managers and their yearning for big margin in-house successes.

There is also the changing role of online retail. While the Majors still have a strong territorial role distributing physical recordings they will be much less important in future as sales move onto the web.

Then there’s online entertainment. Today, the Majors are significant gatekeepers to traditional broadcasting and offer a useful service for licensed material (such as Adele) but that role will be diluted by the growth of new channels.

So, as time goes by independent labels won’t need to license their big successes to Major labels quite as much.

Finally there’s the whole question of the master license. Major labels own the master licenses for all their artists but they aren’t necessarily the best agent to work every aspect of a master these days. And there is a real question about value-for-money when they take half or more of the master income for transactions in which their ownership seems incidental. For example, say Rihanna has an album with Mercury who provide access to distribution and broadcasting, should they also take a big chunk if one of the tracks is used over the credits on a film? Your attitude probably depends on how you see the artist—as someone working for a label or someone with a label working for them.

Today, when anyone can make a sound or video recording, ownership of the master is a very blunt tool for simply getting the product to market or the media. I would argue this is another reason why closer partnerships between artists and independent labels are better all round.

The Majors would probably argue it’s only by owning all their artists’ masters that they can negotiate strongly with new licensees such as Spotify. But who benefits when such deals are struck? Do the Majors look after their artists’ interests or their own?

There are similar questions hanging over 360° recording contracts. The Majors certainly offer a number of very strong services to their artists but they are by no means the strongest in every sector.

From my perspective this makes the licensing solution sound even more attractive. An independent label seems far better able to tailor a number of licenses with different service suppliers rather than lumping the whole thing with a Major. But obviously not everyone will see it the same way.

Two themes and a reprise

Is this were the Major labels need to go next?

money bagI’m going talk about two long term record industry trends and how they might be heading back to where it all started. It isn’t about the Internet, although that does come into it briefly.

Things don’t happen quickly in society or industry. It took technologists most of the 19th century to get from the principles of recorded sound to a record player in 1895 and another decade to knock out a million seller (Caruso, 1907), then twenty more years before amplified sound in 1925. I’m not going back that far but it’s a good illustration of how progress progresses slowly. A lot of that time—about 90 years—was spent on distractions that went nowhere but that is only obvious with hindsight. Engineers at Edison, working on new phonograph cylinder resins for decades, probably thought they were the cutting edge.

It’s fashionable to say our technological society is moving faster than ever but it isn’t really the case. Someone born in 1905 would have had the passive record player and telephone but by the time they were 20 years old, international air travel, radio broadcasting, amplified music and cinema had arrived, and a world war had taken place. A mere 10 years after that we had TV. Progress only seems slow when we look back, at the time it appears overwhelming but day-to-day changes amount to very little.

So I’m highlighting two trends that are long enough to be real, with early signs they could amount to a new milestone.

Our first trend is independent recorded music, which has a 60 year history of growth. After World War Two a number of things came together: new vinyl formats and multi-track recording became available, and a large number of trained engineers left the armed services. These new resources fed a post-war boom in American recording (Sun, Elektra, etc.) and radio—although BBC radio wouldn’t be challenged until the mid-Sixties. In the following decades independent labels became more common and although they were often bought up by bigger labels, numbers increased. The Sixties pop boom in the UK (Immediate, Charisma, Virgin, etc.), punk in the late Seventies and home recording in the Eighties were all good times for independent labels and by the Nineties (Creation, and others) the independents were firmly established. Now, whether they are one-man DIY operations or multi-national independent groups they are a substantial source of new recorded music.

It’s hard to imagine now that there was a time when a handful of companies owned all the technology and resources for making records and that before 1950 independents were almost non-existent. What’s important about independents is they’re not the same as Major labels. They have a strong connection with artists and audiences the Majors have lost since the post-1970 corporate mergers made investors money rather than making music.

So, our second trend is corporate recorded music, which has a 40 year history peaking around 2000 and declining thereafter. I’m not talking about the original Warner Brother records—which was another kind of corporate—I’m talking about the motley corporations founded around 1970 when Steve Ross’ Kinney cleaning and parking empire bought Warner’s and Elektra. That marked the start of an era when outside investors and shareholders drove Major labels to grow by buying up competitors. They adopted the inevitable trappings of big business: de-risking, repetitive processes, micro-management, limited individual freedom, layers of authorisation, corporate strategy and a mass market mind-set. Their focus was never the artist or the fan.

Whatever age you are and whatever music you’re into you probably know the charts around 1970 were very different from what we have today. There were fewer genres then but a wider range of styles. One week’s top ten albums might include teen pop, soul, heavy rock or blues, prog rock, a stage musical soundtrack, classical, folk and jazz. Fans knew what to expect from the record labels and artists re-invented themselves from album to album. That variety has gone, replaced by safer more predictable output. And whereas 1970’s pop, folk, jazz, musicals and classics sold to all age groups very little of today’s corporate music is marketed to anyone over 35.

The charts matter because that’s where the volume is, and diversity matters because that’s where the audience is.

The reason chart music narrowed is that a smaller number of Major labels now control content. They spend a vast amount marketing their own ideas rather than licensing music, even though innovation is something they don’t do very well. Successful new music is frequently from independent labels and management companies. Narrowing output isn’t just a weakness in the record industry. We see it in cinema, book publishing, radio and TV. Every corporate entertainment giant has the same problem. As Kick Ass says in the independent masterpiece of the same name:

Jesus, doesn’t it bug you? Why do thousands of people want to be Paris Hilton, and nobody wants to be Spiderman?

The corporate record industry has come a long way in the past couple of decades but they still don’t have a strategy for growth—at least not one that shows any sign it’s going to work. As revenues fall year after year UMG’s big idea is that streaming will get thousands of times bigger. In some ways that is wanting to be Spiderman but it’s the wrong fantasy.

So where is the new milestone coming from? Let’s rewind to 1895 for moment. When Berlinner launched his genius spiral track flat disc start-up he didn’t have time to dream up the content as well. His record producers pulled in musicians from music halls, concert halls and dance halls. The art of selling recorded music was making and distributing it, not designing the content. He didn’t have to make his artists popular he just signed artists that were already popular. You might think that approach would be impossible today—if a record company only distributed music how could it make money? Well, the Columbia imprint is 125 years old and now part of Major label Sony—one of its best selling artists is Adele. Adele is not a Columbia act, she’s signed to independent XL. The biggest selling artist of the past few years isn’t a Major label act, so it’s not really far fetched to imagine the Majors could return to their roots.

The upside for Sony would be considerable. Adele came through the door with content and all the other stuff taken care of, all Sony had to do was distribute a licensed package.  Licensing from independents would eliminate a lot of risk—something corporate music doesn’t like—and a lot of overheads. They could jettison large numbers of costly A&R and artist management staff, and cut 100% of the losses on their homegrown flops. Most of the acts launched by Major labels flop apart from the TV show celebrities, and I can’t see the indies fighting to sign them.

The downside is that Adele’s contract is with XL, so Sony couldn’t take 80% of the profits but let’s be clear, the golden age of the record industry is never coming back, this is about survival. Another significant drawback for the Majors is they would no longer own any of the masters for licensing, but most of their licensing is not this year’s model so that wouldn’t be an immediate problem. Of course, demystifying the business would make it hard for the multi-million dollar superstar CEOs and their million dollar minions to justify their pay but you can’t make an omelette without breaking some eggs.

Steve Albini on Amanda Palmer

So, Steve Albini talked about the Amy letter on his forum, and later clarified his remarks in an interview with Stool Pigeon.

I like Steve. He often makes a lot of sense and has a down to earth approach to engineering and production.

He mentioned a range of different music economies and says he favours self-sufficiency and efficiency. Fair enough.

Then he said:

“Given that the typical budget for albums I work on is less than $10,000, you can take your pick of line-items in her budget, divide by ten and still have an order of magnitude worth of waste from my perspective. I haven’t looked at the breakdown since I first saw it so don’t quote me on it (haha, “don’t quote me”, I just said something funny) but I recall that she skimmed a couple of hundred grand off the top for her pleasure prior to beginning to make the record.”

“Don’t quote me” isn’t particularly funny when you’re providing information for people making up their mind on this. Steve is well aware of the shortcomings of the media and I’m sure he also knows the Albini brand carries a lot of weight. Remember AFP is getting hate mail, this is no laughing matter. Here’s what she said originally:

“for the past 8 months or so, i wasn’t touring – and therefore wasn’t making much income – but every step of the way, there were expenses. so, during that time, i borrowed from various friends and family who i’d built up trust with over the years.

i had to pay my staff and crew to get this album ready as well as keep the ship afloat and headed in the right direction. i also needed to come up with the cost of the recording itself (which was pretty whopping), and any other expenses the band racked up in the meanwhile.
to put a number on all of that behind-the-scenes stuff which just got us to DAY ONE of kickstarter: $250,000.”

Steve says she “skimmed a couple of hundred grand off the top for her pleasure” because he works on albums with a $10,000 recording budget. Electrical Audio Studio doesn’t record an album for $10,000 including living expenses for the band and artist’s staff for 8 months.

On the basis of a flawed recollection about recording budgets he happily extrapolates every line-item in her budget. The gigs, the art shows, the downloads, the CDs, mailbox invasion, the vinyl, the book, the world tour, the USB record players, the one-to-ones… He could have done the lot for 10% (specifically $120,000, and that figure will include an “order of magnitude of waste”). Will someone be checking his budget for that in the press? Sadly not.

I think Steve forgets he has a day job. Amanda has one too but this is it, she is just an artist. When Steve goes on tour to Australia with his band—self-sufficiently and efficiently of course—he owns a recording studio and has a job as a producer to go back to.

That doesn’t mean he’s wrong. Maybe Amanda Palmer did pay over the odds for recording the album. I haven’t seen the recording budget and Steve doesn’t claim to have seen it either. We just don’t know. Does it matter? I thought this debate was about paying volunteers. Is everyone now expected to record albums for no more than Steve Albini? How many classical string players does he include in that $10,000?

What started with one disgruntled musician has returned to the question of “Amanda Palmer millionaire”. Well, I grew up loving music. From Eric Burdon and The Animals to Steely Dan, through XTC and The Bevis Frond, to Amanda Palmer. Why do I care whether she got her studio time for a competitive rate? Did Yes get stiffed by Advision? Or maybe Eddie Offord played it straight but Atlantic A&R fiddled the budget? I’m pretty sure Ahmet Ertegun wouldn’t rip-off his artists or their fans, maybe we should look into the Accounts Department? I always suspected Steve Ross was living beyond his means. Hold on a sec, what kind of car does Chis Squire drive?

All these years I’ve been getting artists completely wrong. Instead of loving the music I should have been scrutinising their ledgers for self-sufficiency and efficiency. Now I think about it I’m sure I could’ve got giant polystyrene dinosaurs that worked properly, and for less money.

DIY doesn’t mean “do everything”

DIY doesn't mean do everything Bemuso BlogAmanda Palmer has announced Cooking Vinyl will handle European distribution and marketing for her Kickstarter album Theatre Is Evil.

Unhappy people criticised her fund-raising (how dare she ask for money?) and her short-lived record deal (obviously responsible for her entire career) now they complain she’s not really DIY because she’s using a distributor.

I first saw uncertainty about the meaning of DIY when I started this site in 2002, and I covered it in several places. But many music biz commentators and people in the industry appear not to know what DIY is about.

DIY music dates back to punk and probably before that. It’s all about record labels. A DIY label is one you do yourself. It doesn’t mean you must press the CDs, drive the delivery van and work behind the shop counter. And it doesn’t mean you work entirely alone. It simply means you run your own label—just like any other but yours. All the big record labels use other big labels and distributors when it makes sense. Most indies use big label distribution somewhere.

You provide the music and own the label, everything else can be done by others (design, pressing, marketing, distribution, fulfilment, retail, etc.). In fact, as long as you can afford anything someone can do better than you it should be bought-in, sub-contracted, outsourced or licensed.

So, you own all the rights and owe nothing unless you choose to pay for it. Nobody else dictates the lyrics, the song selection, the running order, the producer, the studio, your image, the sleeve design, the launch, the gigs. You decide, that is DIY.

The point was never to “do everything yourself” it was always to avoid “getting signed”, and the Pitchfork interview with Amanda Palmer linked above demonstrates why that can be a very good idea indeed.

A bunch of music biz links

 9 music biz stories from the past week…

The Recording: It's Been Losing Its Value Since 1962...

Big Four Music Labels Hire Students To Chase File-Sharers

Why are The Sex Pistols still the voice of anarchy in the UK?

A Record Label With A Midas Touch

When iTunes Becomes Obsolete

Map of the World’s Most Dominant Websites: Who Rules Asia?

Can Artists Get Rich In A Streaming Music Industry?

Recap: “The Future of Audio” Congressional Subcommittee Hearing

Did an Indie Band Inspire a Volkswagen Ad?