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New Music Boss, Worse Than Old Music Boss 567

Posted by timothy
from the ok-but-it-all-beats-laying-brick-in-ancient-egypt dept.
frank_adrian314159 writes "David Lowery, musician (Cracker, Camper Van Beethoven), producer (Sparklehorse, Counting Crows), recording engineer (Archers of Loaf, Lamb of God), and geek (programmer, packet radio operator, ex-CBOT quant) talks about the economics of the music business and how the 'old boss' — the record labels — have been replaced by the new boss — file downloading services, song streaming, and commercial online music stores. His take? Although the old boss was often unfair to artists, artists are making even less money under the new boss. Backed with fairly persuasive data, he shows that, under the new distribution model, artists — even small independent ones — are exposed to more risk while making less money. In addition, the old boss was investing in the creation of new music, while the new boss doesn't. This article is lengthy, but worth the attention of anyone interested in the future of music or music distribution."
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New Music Boss, Worse Than Old Music Boss

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  • by CAKAS (2646219) on Thursday May 24, 2012 @02:31PM (#40101921)
    Even indie artists have campaigned against these new services. For example, take Spotify [spotify.com], well known European free music service that gained lots of attention.

    Many indie artists tried the service for several months and when the payout time came, they found out they only got a few hundreds (if even that) from the service. It was serious degrade from their previous earnings.

    At the same time, Spotify shareholders and investors include EMI, Sony BMG and Universal Music Group. Since Spotify only paid small share to artists, the labels profited from increased stock prices. Because of this, they didn't need to pay artists any share but still profited greatly.

    So yeah, there you go. Do you really think you're wiser than these guys? Keep trying to get around them, and they will assfuck you even more. Seriously. Do it. If you want to destroy any nice music we have.
    • by Anonymous Coward on Thursday May 24, 2012 @02:35PM (#40101953)

      So where's this new boss? I see new method of old boss at work here.

      • by pixelpusher220 (529617) on Thursday May 24, 2012 @04:00PM (#40103011)
        The new 'boss' can be used to drive people to buy things from you that can't be freely copied. The 'boss' is you. Spotify are indeed just a revamp of the old, but the tools now exist for anyone to be able to produce/record quality music and distribute it far and wide at very little cost.

        You don't *need* the labels anymore. It's the known and comfortable thing, but if you change the business model from selling music to selling actual 'stuff' using the music now your potential market is as vast as the internet.
    • by TheLink (130905) on Thursday May 24, 2012 @02:37PM (#40101989) Journal

      Spotify shareholders and investors include EMI, Sony BMG and Universal Music Group.

      Aren't those the old music bosses? So not a good example.

      • by MightyMartian (840721) on Thursday May 24, 2012 @02:49PM (#40102115) Journal

        Yup, and they've innovated a new way to rob artists blind.

    • Re: (Score:3, Interesting)

      by arbulus (1095967)
      The thing is, the old model is nearly dead. There are not going to be "rock stars" and big record company profits anymore. Those days are done. And it's a good thing. The record companies kept a strangle hold on the distribution of music for decades. They used that hold to make millions of dollars and made it look like they were a good thing for artists. But they aren't. And their hold is now broken. But instead of trying to adapt, the labels are taking more and more money from the artists.

      Are we going t
      • by Bootsy Collins (549938) on Thursday May 24, 2012 @03:02PM (#40102283)

        Are we going to see millionaire musicians anymore? Absolutely not. Those days are done. But is music dead? Certainly not. But the record labels are no longer needed. An artists can make it on their own. Will they make the same money? No. But this is the point: yes it's less money than before, but it's either that or nothing. The old days are gone and people are going to have to accept it. But it's good because now the artists will own their own creations and can sell directly to the fans and keep all of the profits.

        The problem isn't that we aren't going to see millionaire musicians anymore. The problem is that your statement that "an artist can make it on their own" is, for the most part, not true. Never mind millions -- almost no artists are making a basic living selling music anymore. I am a musician -- only an amateur, but I get around enough to know and meet lots of professional musicians, some of whom are pretty well known; and I nobody that makes enough money to eat and pay their rent/utilities from music sales. And this is pretty pervasive -- I've talked about this with lots of artists that are big enough to sell out venues that range in size between 500-3000 people and they all say the same thing: no artists, except those at the absolute top of the heap, are making a living selling their music anymore. You curse the big labels and champion the independence the modern era has allowed artists to have, and those are worthy sentiments to have, and I agree with them. But it's important to remember that perversely, the practical effect of these changes has been that only a small number of artists are making money from music sales, and by and large they aren't independent artists.

        These days, to the extent that an artist or act is able to make enough money to continue to make music, that money isn't coming from music sales. It's coming from shows: what they make playing shows (including merchandise sold at shows) minus the costs of doing them. It used to be the other way around: shows existed to promote record sales, and record sales were where the money came from. Now, if you like an act and what them to continue to make music, the best thing you can do for them is go see them live and buy their stuff at the merch table. If I go to a show and I really, really like a band, I'll almost always walk out with a CD (even if it's music I already have -- I'll give it to someone as a gift) because I know that that's what will keep them going.

        • by cpu6502 (1960974) on Thursday May 24, 2012 @03:15PM (#40102427)

          Then maybe you should pick a different career where you CAN make money. If there are too many musicians, just as there are too many hamburger & fry flippers, than the income will plummet and be crappy. So choose a higher-paying income, rather than being a musician or McDonalds employee.

          NOBODY is owed a living just because they want to do something. *I* happen to like writing science fiction but I'm not stupid enough to think I can make a career out of it. The field of writers is waaaay too full. So I became an engineer instead..... something few people can do, so I get paid big bucks. You (and others) ought to try the same if music isn't working out for you.

          • by Bootsy Collins (549938) on Thursday May 24, 2012 @03:31PM (#40102621)

            Then maybe you should pick a different career where you CAN make money. If there are too many musicians, just as there are too many hamburger & fry flippers, than the income will plummet and be crappy. So choose a higher-paying income, rather than being a musician or McDonalds employee.

            NOBODY is owed a living just because they want to do something. *I* happen to like writing science fiction but I'm not stupid enough to think I can make a career out of it. The field of writers is waaaay too full. So I became an engineer instead..... something few people can do, so I get paid big bucks. You (and others) ought to try the same if music isn't working out for you.

            Your response strongly suggests that you didn't actually read what I wrote. So just to make a couple of things clear:

            1. I'm not *trying* to make any money in music; my "real job" is as a physicist. I'm paid just fine. My post wasn't about me or my situation in the tiniest bit.

            2. In no way did I assert that anyone deserves to make money at something simply because they want to do it. How you got that out of my post, I'll never know.

            • by Missing.Matter (1845576) on Thursday May 24, 2012 @04:21PM (#40103321)

              1. I'm not *trying* to make any money in music; my "real job" is as a physicist. I'm paid just fine. My post wasn't about me or my situation in the tiniest bit.

              I think cpu6502 means the plural "you," as in you artists in general, the people you're referencing in your post.... not specifically you individually.

              2. In no way did I assert that anyone deserves to make money at something simply because they want to do it. How you got that out of my post, I'll never know.

              You said "The problem is that your statement that "an artist can make it on their own" is, for the most part, not true. Never mind millions -- almost no artists are making a basic living selling music anymore." To which I and my GP say "So what?" No one is paid to do what they love just because they love it; they're paid to produce a product that has demand. If your friends aren't making any money, then there's either too much supply or not enough demand.

              • by DeathElk (883654) on Thursday May 24, 2012 @08:30PM (#40105369)

                If your friends aren't making any money, then there's either too much supply or not enough demand.

                Or too many people downloading valuable product for free.

        • by w_dragon (1802458) on Thursday May 24, 2012 @03:21PM (#40102499)

          no artists, except those at the absolute top of the heap, are making a living selling their music anymore

          This is fairly common in a lot of areas. No one makes money playing sports except the few at the very top. Actors are the same way. The issue is that anyone can do these things. Most of us can't do them overly well, we don't practice enough, but people play music for fun and can achieve a pretty decent level of expertise without ever expecting to be paid for it. In order to make money you need to be significantly better than the laymen that do it for free for their own enjoyment.

          Want to make a living wage in a creative field? Go work for Disney, or Paramount, or some company that makes commercials, or any other established industry that needs those skills constantly. No, you don't get to decide what kind of music you're writing if you're writing the background track for a movie, but that's part of making money without taking a major risk.

          • by LandDolphin (1202876) on Thursday May 24, 2012 @03:30PM (#40102597)

            In order to make money you need to be significantly better than the laymen that do it for free for their own enjoyment.

            I disagree. There are many artists that make money that are less talented then artist who are not making money. I would say that it is more about who you know then what you know. Sure, you have to have enough talent to perform, but talent will only take you so far. You have to have the right connections to get to the point that you start making real money.

        • by pedropolis (928836) on Thursday May 24, 2012 @03:23PM (#40102509)

          True story:
          A friend of mine and I were at the 9:30 Club in DC circa... July 2006 to see Cracker play. The opening acts finish up and here comes this tall, lanky, scruffy-looking dude who is laying down cable and taping up mics. He's setting up guitars and stuff, roadie jobs. I turn to my friend between sips of beer and say, "You know, that's David Lowrey." At the 9:30 Club you're about 10 feet from the stage once up front, max. We've got a clear view of this guy and sure enough, it's David Lowrey, roadie.

          As you'll read in the article, David Lowrey is a math grad. If he's calculated that his band can't pay a roadie to do set-up, then you know they're making next to nothing for these shows. I'm not saying he's supposed to have a designated cape handler like James Brown, but a roadie - sure.

          Point is - I'm not sure they were making anything off this show. He was his band's roadie, and they drove Johnny Hickman's microbus to the show from Richmond. This was a harbinger of things to come.

          • by Bootsy Collins (549938) on Thursday May 24, 2012 @03:52PM (#40102911)
            Related story: at a sold out Sebadoh reunion show I went to maybe a year ago, also in DC (hi neighbor), my wife pointed out when we arrived that Lou Barlow was working the merch table. I've seen a lot more of that lately -- big artists working the merch table themselves. It's probably good for all parties: fans get an opportunity to meet and actually talk with performers they love; performers save money on another person in the van during the tour, and likely sell more stuff because people enthusiastically come to the table and interact.
          • I'd say naming his band Camper Van Beethoven was the harbinger of things to come. He's smart and witty, but Lowery's a not-great-looking guy who doesn't sing that well, and if we're being honest, never wrote a song after "Take the Skinheads Bowling" that had anywhere near as much commercial potential... probably on purpose.

            I'd say he had a pretty good run. The music industry was littered with guys 10+ years into their careers, who played to an increasingly "more selective demographic," long before mp3 was

        • by lgw (121541) on Thursday May 24, 2012 @03:26PM (#40102547) Journal

          that money isn't coming from music sales. It's coming from shows: what they make playing shows (including merchandise sold at shows) minus the costs of doing them. It used to be the other way around: shows existed to promote record sales, and record sales were where the money came from. Now, if you like an act and what them to continue to make music, the best thing you can do for them is go see them live and buy their stuff at the merch table.

          Most musicians made their living from live performance for all but 60 years or so of human history. It's always a pain when technological changes screw over the way you're in the habit of making money, but that comes to just about anyone in any industry - no reason for musicians to be immune. However, I think long term it will work well, and we'll have as many milionaire musicians as we've ever had (a few each generation), as any musician can now reach a vast potential audience, and it doesn't take much when you have 10 million fans.

        • Re: (Score:3, Insightful)

          by Anonymous Coward

          I distinctly remember hearing more than one music artist say over the last 20 years that they made their real money on concerts and merchandise and very little on record sales. So perhaps this hasn't really changed all that much.

        • by NeutronCowboy (896098) on Thursday May 24, 2012 @03:30PM (#40102591)

          Quick question: how many people are selling entertainment? It seems to me that there's a glut of entertainment, which means that supply completely overwhelms demand. The result: very low prices for a product, with only a select few making lots of money in it.

          That's the free market for you. If there would be only a few hundred musicians in the world, I can guarantee you they would make out like bandits. Put since there are a few millions, most live hand-to-mouth.

          I think what happened with the new bosses is not so much that they are worse than the old bosses, but that there are now far, far more musicians around chasing that same entertainment dollar. Before, supply was artificially constrained. Now, it's not, and people find out that it is even harder to make a living - because suddenly, the competition got that much fiercer.

          • by IamTheRealMike (537420) <mike@plan99.net> on Thursday May 24, 2012 @04:55PM (#40103759) Homepage
            Well, there's certainly some truth to that, but you're assuming that there is a free market at work here. That isn't the case. Markets require property rights - if I can pay you or not pay you for something depending on, basically, whether I give a crap or not, what you have is not a market in the capitalist sense. That is what has happened to music and is happening to other types of creative works due to the failure of the tech industry to implement strong DRM, or to stop file sharing networks. There is no market any more. Only beggars and charitable individuals.
        • Re: (Score:3, Insightful)

          by Local ID10T (790134)

          That is not a problem, its a paradigm shift.

          The musicians who are making a living are doing it by performing music, instead of by selling recordings of music.

          Recordings can be infinitely copied for very little cost (once the original is created). The market recognizes this even if the industry does not. Thus selling recordings is no longer profitable. Performances are so much more than a recording, and a recording of a performance falls far short of the experience. The market recognizes this as well, an

          • That is not a problem, its a paradigm shift.

            I think both are true. I agree that it's a paradigm shift. Where I think the problem lies now is that much of the music audience doesn't realize this -- doesn't realize that if you like an artist and want them to keep making music, the best path to see this happen is to go to shows and spend money at shows.

        • by lars_stefan_axelsson (236283) on Thursday May 24, 2012 @03:39PM (#40102707) Homepage
          That artists made any money from recordings was never really true, except for a few really big acts. Witness Roger McGuinn of the Byrds (testimony [gpo.gov] before the house judiciary committee) to name just one:

          In 1973 my work with the Byrds ended. I embarked on a solo recording career on Columbia Records, and recorded five albums. The only money I've received for these albums was the modest advance paid prior to each recording. In 1977 I recorded three albums for Capitol Records in the group "McGuinn Clark and Hillman." Even though the song "Don't You Write Her Off" was a top 40 hit, the only money I received from Capitol Records was in the form of a modest advance. In 1989 I recorded a solo CD, "Back from Rio", for Arista Records. This CD sold approximately 500,000 copies worldwide, and aside from a modest advance, I have received no royalties from that project.

          So there's nothing new there. Live gigs were always the life blood of any musician in the "recording era".

        • by KhabaLox (1906148) on Thursday May 24, 2012 @04:24PM (#40103357)

          I've talked about this with lots of artists that are big enough to sell out venues that range in size between 500-3000 people and they all say the same thing: no artists, except those at the absolute top of the heap, are making a living selling their music anymore.

          We bought our house from, and are friends with, a couple who are both symphonic musicians - she with the LA Phil and he with Long Beach. AFAIK they don't have other jobs, yet they are doing fairly well.

    • by Pecisk (688001) on Thursday May 24, 2012 @02:49PM (#40102131)

      "Many indie artists tried the service for several months and when the payout time came, they found out they only got a few hundreds (if even that) from the service. It was serious degrade from their previous earnings."

      In tradition of claiming problems without giving us any kind of reference, I still was kinda interested how big their previous earnings are and what kind of contracts they had with their publishers before going online? :) Just really want to know, already thanks for any reply.

    • by danomac (1032160) on Thursday May 24, 2012 @02:50PM (#40102139)

      However, the cost of creating recordings has gone down. I sure wish I could do a week's or month's worth of work and get paid for it over my entire lifetime (and maybe even my kids' lifetimes.)

      They can always go live and get paid for concerts. The days of being paid for a lifetime over a month's worth of work is going the way of the do-do.

      • by 0123456 (636235) on Thursday May 24, 2012 @02:53PM (#40102189)

        They can always go live and get paid for concerts. The days of being paid for a lifetime over a month's worth of work is going the way of the do-do.

        Bingo.

        The situation is similar with e-books. A few people can upload one book and make a million bucks, but the majority will make a few thousand per book, if it's well written and the writer isn't particularly unlucky. Which means they need to actually do a normal work week writing multiple books a year if they want to make a living at it.

        Expectations are hideously skewed by the experiences of the last few decades, which are far from the historical norms. For most of history musicians did actually have to work for a living rather than perform once and go on vacation for a year.

    • by Dan667 (564390) on Thursday May 24, 2012 @02:52PM (#40102175)
      your example is the music industries reactionary response to itunes and the rest of the online music migration? There are lots of services that are not just more of the same from the big music companies where the artist gets a fair share like http://bandcamp.com/ [bandcamp.com]
    • by Tharsman (1364603) on Thursday May 24, 2012 @02:53PM (#40102193)

      Jonathan Coulton was talking about this a few months ago in the TWiT podcast.

      Streaming services pay garbage to independent artists because the big studios (the old boss) bullied them into accepting horrible terms or literally take them out of business.

      Make no mistake; the big studios get a generous split of the Spotify profits. But for Spotify to survive with such a "generous" deal, they had to screw someone else: the indie musician that "can't really bully" them.

      Mind you, in some ways, if all indies got together and left Spotify, they would suffer (right now they average their profits with a mixture of indie and big studio playbacks.)

      I would not be shocked if the studios want it to work this way, to discourage the next gen of artists from pursuing an indie career.

    • by tnk1 (899206)

      So yeah, there you go. Do you really think you're wiser than these guys? Keep trying to get around them, and they will assfuck you even more. Seriously. Do it. If you want to destroy any nice music we have.

      Music isn't going away, not even good music. Music has value and will be paid for and people will be able to make a living at it. It is a valid question to ask how individual artists are affected in specific cases, but probably no more than being concerned with how robots are now doing the jobs that assembly line workers used to do.

      People will always pay for good music. In the bad old days, when no one but the richest could afford an orchestra or even a quartet, music was still made and it was damn fine

    • Dear Mr. Lowery (Score:5, Interesting)

      by Mathinker (909784) on Thursday May 24, 2012 @04:10PM (#40103179) Journal

      Dear Mr. Lowery,

      The Internet is so, so sorry if you are having a harder time because it exists. However, in general, it seems that it is easier for many other musicians because it exists.

      Details can be found at the Techdirt article where you prove, in your reply posts [techdirt.com], that you're an idiot, in either your business skills, your public relation skills, or both.

      Oh so sincerely,
      The Internet

  • by alen (225700) on Thursday May 24, 2012 @02:38PM (#40101995)

    the bosses aren't the problem, the problem is the amount of product

    i like most rock from the mid 60s to present day. there are so many good bands to listen to that its impossible to buy it all on CD. too expensive.

    recorded music is your advertising and you should be making money on live performances from the real fans

    just like almost every line of business these days. break even or lose on 90% of your customers and make your profit on the rest. something like 4% of dropboxe's customers pay them, yet they make A LOT of money

    • just like almost every line of business these days. break even or lose on 90% of your customers and make your profit on the rest. something like 4% of dropboxe's customers pay them, yet they make A LOT of money

      I really wish Hollywood would wake up and realize this, and stop fighting Netflix. They're ruining their own industry, and blaming it on piracy.

      What was the quote from Tywin Lannister when he heard they had killed Ned Stark? "Stupidity. Stupidity and Foolishness." Something like that. :P

    • by Beerdood (1451859) on Thursday May 24, 2012 @03:06PM (#40102321)
      Exactly the problem here. Until digital distribution was available, most of the music being purchased prior to that came from a select few artists. The record store would carry material from maybe 100 artists or so (rough estimate). They simply couldn't carry music from 10,000 different bands there, due to size constraints. 1% of the artists making 99% of the money.

      The amount people spend on music hasn't really changes by that much of a factor - it's just that there's more available artists now. The other 9900 artists that weren't popular enough to get in the record industry are now getting heard. They're just starting to get a cut now, via spotify or whatever
    • by Zontar_Thing_From_Ve (949321) on Thursday May 24, 2012 @03:16PM (#40102439)

      the bosses aren't the problem, the problem is the amount of product

      i like most rock from the mid 60s to present day. there are so many good bands to listen to that its impossible to buy it all on CD. too expensive.

      recorded music is your advertising and you should be making money on live performances from the real fans

      This is quite right in my opinion. Roughly 2 years ago I read an article on the BBC's website where they interviewed Mick Jagger. He shocked them with what he had to say. This is not in any way, shape or form an accurate word for word account of what was said but my paraphrase covering the main points.
      BBC: So what do you think of digital music such as MP3 files?
      Jagger: It's not a problem for me. (note: The Stones were on iTunes long before the Beatles were and were serious about their web presence earlier too.)
      BBC: (stunned) You don't think you're being ripped off by illegal downloads?
      Jagger: Look. The truth is that for all of our years in the industry, for very few of them did we really make good money just from the music. There was a period of about 10 years from the 1980s into the 90s where we got paid a lot of money, but for most of my career the actual royalties from music sales have not really been all that good. We have always made the majority of our income from touring.

      The music companies hate this because they don't make money from touring so they are still trying to make the old models work in a world that rejects them. Paul McCartney can't sell CDs any more like he used to but whenever he feels like playing a concert he regularly sells out 50,000 seat or larger stadiums throughout the world and I've not once heard him bemoaning the current state of the industry.

    • by Kjella (173770) on Thursday May 24, 2012 @03:19PM (#40102469) Homepage

      recorded music is your advertising and you should be making money on live performances from the real fans

      Which kinda defeats the purpose of having fans from all over the Internet, there's many many bands that won't come to my little corner of the world and you'd have to be a pretty big fan to travel very far just to go to a concert. And even then they still only get one ticket. And maybe that one weekend they are there it doesn't work because you got another important event. You can't live off just a handful of fanatic fans who'll go to any length to see you.

      just like almost every line of business these days. break even or lose on 90% of your customers and make your profit on the rest. something like 4% of dropboxe's customers pay them, yet they make A LOT of money

      Where the analogy breaks down is that it's easy for everyone who wants to get dropbox's paid service to do so. With a live performance there's probably 4% that'd pay and 4% that easily could go (remember anywhere you hold a concert is where >99.9% of the earth's population doesn't live) for a total of 0.16% that actually came and paid.

  • by QuasiSteve (2042606) on Thursday May 24, 2012 @02:42PM (#40102025)

    But this is what 'we' want, right?

    We don't want there to be multimillionaire 'artists', or hundreds of supposedly indie (but really signed with GenericIndieLabelX that's part of IndieGroupY that is a wholly-owned subsidiary of QuirkyMusicZ, a division of SONY Music Entertainment).

    'We' want bands to be able to stand on the merit of the quality of their music - be that through being highly popular at the whim of the way the 'popular' wind blows, or through a devout share of followers who will buy merchandise and go to concerts. We want the remaining artists to perform music not for the money but because they want to perform it for their own joy (either out of performing or out of the reactions of the crowd) and any money they get out of that is just a nice little bonus.

    'We' don't care if that means most current artists will just have to find something else to do, and others will just have to make it their hobby next to an 'honest' job.

    And if that situation is not to particular people's liking, they would be more than welcome to become patrons of the (musical) arts if they have the wealth to do so.

    As long as 'we' get to enjoy music for next to nothing or completely nothing, and certainly with as few middlemen as possible - because that is what the process induced by technology has allowed us since the days of the cassette tape, which the internet has merely accelerated.

    tl;dr: Something about horse-and-buggies and all that.

  • Competition? (Score:5, Interesting)

    by Zaphod The 42nd (1205578) on Thursday May 24, 2012 @02:43PM (#40102029)
    There are more music acts than ever, and they are each individually able to reach a FAR greater audience than before. The number of people and the amount of spare money the public has to spend on entertainment has been fairly constant. So, of course, each individual artist is going to make less. There's new genres and new artists every day.

    Futhermore, now we have videogames and other new media competing for our entertainment dollars.

    Its not that artists are making less money. Its that there aren't as few mega "rock stars" as before. You don't have the beatlemania where people are going crazy for a particular one act, who effectively has a monopoly on popular music.

    Finally, they can't force us to buy 12 song albums with 2 hits and 10 crap songs anymore. We've broken their hold on that business model. Now we expect to be able to pay .99 cents to get the 1 song we want. That isn't "unfair" to artists, rather, it was unfair to the consumer before, and now its been made right.

    I'm so sorry you can't afford to drink top shelf champagne on your private jet anymore.
    • by Anonymous Coward on Thursday May 24, 2012 @03:28PM (#40102575)

      You know, with all their creative vision, artists don't necessarily know which songs are going to be crap songs and they certainly don't try to write them. They still had to invest time and money into the songs you don't like: maybe one in five turns out good, and those good songs are what they make their living from. You're subsidizing their efforts to make more good stuff by also paying for the ones they developed but didn't turn out. The artist is assuming a hell of a lot of risk when you come out and say "I don't ever plan to buy most of what you make, and I won't know what I want until you put it on the shelves".

  • by Zaphod The 42nd (1205578) on Thursday May 24, 2012 @02:44PM (#40102045)
    If the artists aren't making as much money as they used to, how about they do the logical thing and vertically integrate? With music stores like iTunes now, there's almost no need for a publisher, where before you were completely dependent on one.

    Cut out the middle man, sell directly to consumers, keep all the profits, and probably end up making more money.
  • Marketing (Score:4, Insightful)

    by Pecisk (688001) on Thursday May 24, 2012 @02:46PM (#40102061)

    It's quite simple - in online, you have to handle your marketing yourself. If you just replace old model with new one, but keep old way of doing things, sorry, it won't fly. Online gives posibility to compete a lot more bands than old system. And in result of course you get less money. Don't like it? Then try to stick with old system. Didn't like it too? Do pros and cons then and see what's working for you.

    Also sorry, while I recognize that artists should get something about their efforts - but only then if their art is "consumed". There's tons of music out there. Tons of CC (lot of them really good ones). And it's a pitty, but some of artists can crunch really high class stuff without any sweat, but some has to do lot of pushing. So maybe it's not worth then.

  • by Zondar (32904) on Thursday May 24, 2012 @02:46PM (#40102071)

    Not to be prophetic or philosophical, but it will be in the end like it was in the beginning.

    In the beginning, bands formed and recorded music in their garage, with the best equipment and recording technology that they could afford. The collaborated in the best space they could find (someone's garage) and they self published the recording they made. Maybe they made money, maybe they didn't.

    Today, musicians can record with (nearly) the same quality in their house as they can in a major studio. Musicians can collaborate over the internet either directly or with the help of a collaboration service that helps musicians find each other and exchange / submit tracks. Musicians can publish their tracks on services where they either get money per track or as a donation model (see http://coryjohnson.bandcamp.com/ for a perfect example of this).

    Musicians can self-promote on the internet, and perhaps reach greater audiences than they can through traditional media and distribution channels.

    The musicians simply need to embrace these new ways of doing things and be willing to take on these tasks directly instead of having someone else do it (and probably rip them off in the process).

    • by sdavid (556770) on Thursday May 24, 2012 @03:06PM (#40102315)

      Today, musicians can record with (nearly) the same quality in their house as they can in a major studio.

      Just to be clear: they can't. The recording equipment has become much cheaper, but the the cost of making an acoustically designed studio has not. Nor has the cost of hiring an experienced engineer for the recording. I love what can be done with today's PC-based recording equipment, but a real studio is still a real studio and a garage is still a garage, even if the tracks ultimately end up on a Mac either way.

      • by Pecisk (688001) on Thursday May 24, 2012 @04:18PM (#40103279)

        Just to be clear: they can, but I wholeheartly agree on having good engineer at least and/or recording producer for it. Having acoustically perfect studio is overblown. You can record vocals in it, but for rest lot of interesting tricks can and is used. Radiohead recorded their last LPs in various places, most of them wasn't studios.

        But having good engineer at least is a must, because it speeds up things considerably.

  • I can believe it. (Score:5, Interesting)

    by cpu6502 (1960974) on Thursday May 24, 2012 @02:47PM (#40102083)

    The internet is hurting everybody, by making things cheap. DJs, singers, authors of books..... Correction: Not everybody; it helps the billons of people who are lower and middle incomes to afford buying entertainment and education online.

    So it's a matter of choice: Do we choose to help the small 0.1% of singers, artists, authors by protecting their income with ~$15 CDs and ~$25 hardback books. Or do we help the other 99.9% by offering them cheaper $3 albums or $5 books that you can download from the comfort of your chair? (And also a lot of free material like college lectures.)

    I choose the 99.9%.

  • by spiffmastercow (1001386) on Thursday May 24, 2012 @02:49PM (#40102129)
    So now you can't do something that both gets you laid *and* makes enough money to live on. I here the waaambulance coming..
  • by starworks5 (139327) on Thursday May 24, 2012 @02:51PM (#40102157) Homepage

    Just because what you do is time consumptive and requires skill, doesn't mean that your somehow special and entitled to make large sums of cash. I mean the food that you eat is inherently more important than any music you make, however people slave at near or below minimum wage to produce it for you, and somehow you presume your labor is more important? Because you have the force of government on your side to protect your interests, because you end up lobbying them with massive amounts of money to do so? The idea that you should limit a limitless resource, so that you can extract alot more value out of it, sounds alot like extortion to me. Just because that sort of extortion is propping up our economy doesn't mean that its right, its a form of non productive consumption and people would rightfully so, switch to a form of production that the market finds more valuable and scarce otherwise.

  • by SmallFurryCreature (593017) on Thursday May 24, 2012 @02:52PM (#40102177) Journal

    This is rather fundamental to the entire copyright debate when it starts to focus on artists being unable to make a living anymore.

    Well, how is that different from ANY other profession being unable to make a living anymore? In Holland it has been decades since the coal mines closed and not because of lack of coal. How would you, or indeed any artist, support any law dictating the installation of gas networks to keep the demand for goal high?

    It goes further. With printing and the translation of the bible came the possibility for the faithful to get their fairy tales from outside the church and my my did the church hate that and not just try to ban this but committed murder on a massive scale to stop this.

    Tech, changes, the, WORLD. It is not just about you holding a computer in your pocket now more powerful then early spaceships BUT it is about our very society changing because of tech. Anything from the pill, to the automobile and the post office box (before the post office box, women could not post without everyone knowing about it, mail became a great liberator long before the Internet).

    And that change isn't always good for everyone. Modern artists have taken the bread away from many of their predecessors. Recorded music? Took the place of live music. Once every movie theater had a small band playing and of course movies took the place of real life artists on the stage.

    You can't stop tech, well you can, red flag in front of cars and all that but ultimately, tech will prevail because for the majority, the good outweighs the bad. The Internet will continue to be. You can't stop the digital age just because you don't like that bits can be copied at near zero cost and be distributed for only slightly more.

    And if you argue different then why do you care about artist who make millions while ordinary factory workers are unable to feed their families because that same tech has outsourced all their jobs? When those same millionaire artists flee the country to tax heavens and buy foreign goods?

    Oh sure, not all artists are like that, they just dream of being like that one day.

    There is still a normal average salery to be made as an artist, you just got to work hard, just like everyone else and not hope people will just buy your 1 good song with ten crap ones for what amounts to several times minimum wage EVEN if you had to perform it live. 5 minutes 1 dollar == 12 dollars an hour wage. Takes more time to write it? Take me more then 8 hours to keep an 8 hour job to and I know who is in more danger of throwing in his back.

    The world has changed, either change with it or get steamrolled. If the artists cared that much about it all, let them strike. I will happily they get the same treatment as the coal workers around the world.

    And if I sound angry? In Holland we have a recession, so how does the leftist (elitist) green party react? Impose taxes on public transport reimbursement payed by employers so you can make art and antiques have a lower tax rate. FUCK THAT.

    And you might think I am extreme but when I voice this in real life, you see people going... well I don't agree, sure I don't buy any music anymore either and I am totally untouched by any plea from the industry or artists... oh wait... I do sorta agree.

    Once people loved artists and were fans of record labels. Now that is no longer true except for the future burger flipper generation.

    And if you don't believe me... do you have adblocker installed? Yes? So it is okay to steal from websites but not artists?

    See? Once the people have been pushed to far, they can stand by and see a group destroyed with no remorse whatsoever. Human beings ain't nice and the world does not owe you a living.

  • This Part (Score:5, Interesting)

    by Herkum01 (592704) on Thursday May 24, 2012 @02:53PM (#40102195)

    It took a while to find anything solid but these I considered informative,

    Under the new digital model I calculate that most label artists get between 15%- 35% of wholesale. For example the most recent of my recording contracts says I should get a total of 20.5 cents on a 99 cent song (including mechanical royalties). This works out to 29.7% of wholesale. So this part of the new digital paradigm is about the same as the old record label system.

    So when you compare share of revenue for artists on record labels under the new digital system to the old system it looks pretty good. At least until you consider the fact that the price of music has dropped. For instance, an artists royalty on an album is now calculated at 6.90 not at a $10.00 wholesale price as it was in the 1980s. . This drop in the price of music was inevitable. But the record labelâ(TM)s expenses fell considerably in the switch from physical to digital products whereas the artistâ(TM)s expenses (the recording budgets) did not. So this had the effect of reducing artists net revenues and shifting revenue towards the record labels. For the new digital distribution model to be as âoefairâ to the artist, the artist share of download revenue should have increased. It stayed the same or increased only marginally.

    and

    And then there is that iTunes store 30%. Seems kind of high to me. What is their risk? Today in 2012? Do they really deserve more per album than the artist? At least the record labels put up capital to record albums. At least the record labels provide the artist with valuable promotion and publicity. Historically in the music business when someone was taking more than 20% of gross revenues that had some âoeskin in the gameâ. They risked losing a lot of money.

    This does show a problem with the economic system that the industry has set up. Consumers ran screaming from one oligopoly to another. Is it this really surprising that artists are still taking the brunt of it when you are still dealing with the same businesses?

  • by xrayspx (13127) on Thursday May 24, 2012 @02:59PM (#40102253) Homepage
    Amanda Palmer [amandapalmer.net] just posted a very long and informative blog about where all the money goes when people donate to her Kickstarter effort to finance her upcoming tour/album. In that post, she references Steve Albini's classic rant [negativland.com] against an industry churning through young talent and keeping all the candy for themselves (well, one of his rants on the topic, anyway).

    I'm glad to see these issues starting to get major traction and hopefully change can come from without, since it will never come from within.
  • by rudy_wayne (414635) on Thursday May 24, 2012 @03:01PM (#40102265)

    The real "problem" is that musicians and record companies con no longer make as much money selling crap as they used to.

    Prior to iTunes and other legal methods of downloading music, there was only one way buy music -- you went to a store and bought an album. Whether it was a CD, vinyl LP. 8 track tape or whatever, and it didn't matter if half the songs where crap. That was your only choice. Period. And that was a great deal for both musicians and record companies because it meant that they sold a lot of albums and made a lot of money. And lets be honest. Even the all time greatest "classic" albums have some filler on them. Songs that absolutely nobody cares about. In the past, it didn't matter, you bought the whole album and the musicians'/record companies got the maximum amount of money

    But now, that's no longer the case. Only like 3 songs from an album? You just buy those 3 songs. And the math is pretty simple:

    -- A million people buy those 3 songs from the album -- the artist royalties from 3 million songs sold on iTunes is a lot less than 3 million albums sold.

    -- A million albums sold with 12 songs per album = $1,080,000 in publishing royalties for the songwriter (9 cents per song). But if a million people just buy those 3 songs publishing royalties = $270,000.

    In the end, it's really no different than any other technological change. You can't make a living delivering packages by stage-coach anymore either.

    • And here I am with no mod points. You're absolutely correct. I'll go even further and say the market for recorded music will shrink even more whether it's record companies or Apple doing the distribution. The days where you can add a gimmick and Autotune & then foist off on the musical consumer a talentless flavor-of-the-month so-called 'artist' that doesn't even play an instrument are hopefully gone. Musicians will have to make their money honestly by playing in front of live audiences. There will alw
  • by gman003 (1693318) on Thursday May 24, 2012 @03:04PM (#40102305)

    A lot of his criticisms of the current "new" system are valid. But the fundamental problem, as I see it, is that instead of truly "breaking the paradigm", everyone is treating the business the same way it had been.

    In short, they know the players have changed, but nobody's realized that the game can be changed. Artists still expect some form of publisher to pay for their studio time, they still go to some publisher to publish their music. And now they complain that the publisher is still taking too much money.

    Here's an idea (and it's just that, an idea): Go completely, 100% independent
    Use Kickstarter or the like to get the cash to record an album. Having a demo of one or two songs should suffice, if you can market yourself properly, and you can self-fund demos easily enough.
    Once you have the album, sell it on your own site instead of iTunes or Amazon. Maybe Humble-Indie-Bundle it with other, *similar* bands, if that can give you more publicity.
    Either use the profits from the album, or ticket presales (Kickstarter may work well again), to go on tour. Get merchandise to sell - t-shirts, physical CDs, posters, etc.
    Make sure to have some sort of contact for licensing. If Hollywood Director Q wants to use your song in Summer Action Movie Part XIV, you shouldn't make it hard for him. Commercials. Radio play. Anything - if someone wants to pay you to use your music, it needs to be possible. And price yourself lower than the Big Media bands do (since there's no publisher to take a 90% cut, it should be easy).

    Between album sales and concerts, it should be possible to make a good living. The era of the multi-millionaire superstar is probably over, but honestly, I won't mourn them.

    There are some problems with this. The publisher is normally the one to do all the advertising, so you'd have to do that yourself. It means a band *will* need some sort of marketing person to succeed, from Day 1. Music critics will also have to do a much better job - they can't just look at the list of what Big Media inc. is publishing this month, listen to the CDs mailed to you, and write down 4 stars for all of it.

    There's probably a million other problems, too, but we won't find them until someone at least *tries*.

  • by mypalmike (454265) on Thursday May 24, 2012 @03:07PM (#40102331) Homepage

    Write songs that are catchy enough to be picked up by ad agencies to be used in TV commercials. Best if they have choruses about freedom, cars, or hair. Niche songs might obscurely allude to feminine pads.

  • He had me until... (Score:5, Insightful)

    by R3d M3rcury (871886) on Thursday May 24, 2012 @03:18PM (#40102457) Journal

    It’s usually after someone like myself suggest that if other people are profiting from distributing an artist’s work (Kim Dotcom, Mediafire, Megavideo, Mp3tunes,) they should share some of their proceeds with the artists.

    Maybe I'm not hep to the way you kids are getting music these days because I have to spend time keeping you all off of my lawn, but these services advertise a way for me to access the music that I bought from any device anywhere that I happen to be.

    Is he implying that Mp3tunes should be paying him to store my music and make it accessible to me from wherever I am?

    Let's see...I have a SanDisk MP3 player. I have a bunch of music on it. Should he be getting paid by SanDisk? After all, SanDisk made a profit selling me a device to listen to their music. Without that music, why would I buy a SanDisk MP3 player? Shouldn't some of that go to the musician? How about that CaseLogic case I have to hold CDs? They made a profit from that. Shouldn't some of that go to the people who make the music that I hold in that case?

    You made your money selling me the music. Now go away.

  • by jjo (62046) on Thursday May 24, 2012 @03:27PM (#40102555) Homepage

    This guy does make some reasonable points, but for all that he thinks himself an uber-geek, he is apparently disconnected from the realities of the tech world today.

    I’ll make technologists a deal, I’ll give up my song copyrights if you give up your software patents. Software patents are even less unique than your typical song.

    He thinks that technologists like software patents. Most technologists who are familiar with the issue are strongly against them; the only group consistently in favor of software patents is the patent lawyers.

    The downside of his proposed deal, in my view, is not abolishing software patents (which would instead be of tremendous benefit), but abolishing music copyrights. For all that the strength of copyright protection has weakened in the Internet era, it is not zero by any means, and still plays its role of promoting the 'progress of science and the useful arts'.

    The big problems come if you attempt to recreate, via stringent and draconian restrictions, the strong copyright regime we had before the Internet. These attempts are doomed to failure, and will create significant collateral damage while failing in their intended goal.

  • by ODBOL (197239) on Thursday May 24, 2012 @03:32PM (#40102629) Homepage
    This is where I buy music today: http://magnatune.com/ [magnatune.com] I bought their entire list, past present and future, in a lifetime subscription. I listen to everything, whether it's something I think I like or not. I like lots of it, and the rest expands my listening capacity.
  • The Labels now have limited ability to control reality. They can no longer pay off radio and television interests to produce a hit. They can no longer put one popular song on an album, and control costs by adding 10 low quality tracks. I have seen artists without a label do this, and the results is that those people are doing much anymore. So supply is no longer limited, it is a buyers market, so it more likely artists that do novel or interesting things are going to succeed. Radio and TV still have a role to play in promoting it, but they are less likely to promote crap as consumers have other channels in which to compare. It is like movie studios putting out crap movies that are a failure by sunday morning because everyone who paid to see the movie have tweeting how much it sucked. The fans control reality

    This loss of control has nothing to do with the internet, it has to do with Labels losing control of prices, i.e. the loss of the price fixing case 10 years ago, and reduction in cost of entry into the market. Fifteen years ago, bands I saw had to work hard to get the money together to press a CD. Now most of the costs is studio time and marketing, which has also fallen Labels can't keep prices high, lower cost of entry means more competition, profit per item falls.

    Then, of course, if the ludicrous idea that the new system is worse than the old system because less profit is generated in the new system. No one who creates a product automatically deserves to profit. At least in the US, we are guaranteed the right to pursue profit, but no one is guaranteed profit. With both conservatives and liberal trying to prop up failed models that is hard to remember, but it is the truth. If I put out an album, there is no law that says someone has to buy it, and no law that says some one has to buy it at a price where I can make a profit. That is why Walmart exists, and why so many products are no longer made in the USA.

    So the question is can creators keep up with new market realities, not does the market have an obligation to prop up legacy suppliers. If an content creator is still making a profit, then all that matters is if the content creator leaves or stays. If the content creator leaves, is there someone who will be willing to work for prevailing rewards, and if not does it matter? For instance, if the rewards for pop music were so low that no one would want to do, would society fall. Note that for jobs that are critical to society, we often prevent these workers for asking for high wages.

    So while i think the paper has some interesting content, the idea that we should pass laws or change society to guarantee a profit is simply silly. We have already critically wounded our democracy by passing laws that allow copyright holders to overwhelm the rights of arbitrary citizens. Let them make a product people value instead of insisting that god have given them the right to be rich.

  • by daniel.benoy (1810984) on Thursday May 24, 2012 @04:04PM (#40103081)

    If you talked to someone in 1912 and you told them in 100 years that high quality, diverse music would be as common as grains of sand on the beach, and nearly the same price, they would probably say the future sounds awesome.

    The last thing you'd hear from them is 'That sucks. I hope it remains super expensive so top artists can get super rich in perpetuity.'

    I think the discussion has gotten so wrapped up in the issue of intellectual property. People have become so invested in coming to some societal consensus on how artists get compensated, that they didn't notice when music became phenomenally easy produce and distribute.

    People need to realize that paying someone money to create music has gone the way of paying someone to repair your shoes, or paying someone to deliver fresh milk to your door. The concept is obsolete.

  • I haven't seen a single comment here that wasn't rebutted in the original article. Of course, it's always better to mouth platitudes from talking points and say tl;dr than to actually read the thing and... you know... be challenged. It's the geek-arrogant way (also covered nicely in the article, BTW).

  • by trout007 (975317) on Thursday May 24, 2012 @04:18PM (#40103287)

    My first problem is that you don't have a constitutional right to IP. It isn't in the Bill of Rights. It's in the power of Congress section. That means it is up to congress how to deal with IP. We could get rid of it tomorrow with just a plain old law no amendment needed.

    Most importantly is the ignorance of economics. The author doesn't go far enough back in music history. Go back before there were recordings of any kind. How many people made a living being an artist? How many we're wealthy? It was the recording technology that let artists reach a large audience. Coping records was capital intensive so the recording and publishing industry was able to make lots of money.

    But now technology advanced to the point where coping is nearly free. The recording cartel can no longer exist. Sure they will try to use laws to keep it alive but it's a losing battle. There will be no money to be made in recording.

    The answer? You will have to work. That means playing for audiences, selling merchandise, and figuring out how to get people to pay you for real goods and services.

    How many geeks here would live to return to the 90's where all you had to do is make a website and go IPO? Well too bad those days are over.

  • by gtirloni (1531285) on Thursday May 24, 2012 @04:33PM (#40103447)
    AFAIK, there was a time when musicians would earn their living by performing their music.
  • My Experience (Score:5, Insightful)

    by rabtech (223758) on Thursday May 24, 2012 @05:23PM (#40104037) Homepage

    I tried to start an indie label, partnering with a band that was well-liked locally and had some regional fame. We recorded at home with a TT-24 for digital I/O and monitoring and Logic 7 & Profire Lightbridge for getting it onto disk. Were able to do 24-bit 96khz and plenty of plugins. I had more multi-track channels and more processing power/virtual gear than any studio in the early 1990s. Grabbed a set of self-powered studio monitors for under $1000 (which blow away anything that was available for purchase in 1990).

    We did the Tunecore digital distribution method, got into the local record shops, and generally tried to take advantage of any avenue we could.

    Ultimately we lost money, here are the mistakes we made:

    1. We pressed Vinyl. Granted, we got a good deal and it was a quality product (including MP3 download card using software I wrote myself) but the economics make it such that you need to sell at least a couple hundred to break even and there wasn't enough of a market for it. We sold over 100 in the first year, just from a few local shows and two local record stores. Come to find out this was more than almost everyone else - the local record store sold out (and paid us out) several times - the store manager was shocked to actually be paying money out as most of the indie albums don't sell enough to reach the threshold. Lesson: Don't press vinyl. Unless you can sell out a 5,000 seat venue in at least 10 cities you will lose money.

    2. We thought CDs were on their way out so we didn't make that many of them. It turns out we should have - we sold through the CD run quickly and it was our biggest money maker, even at $5 each. This was in 2009 but still - people are more likely to buy CDs when out and about because they are small and easy to carry. Vinyl means a trip back to the car or having to lug it around town for the rest of the night.

    3. Digital only works if you have access to some channel to get noticed - a friend with a very popular blog, a host of a very popular podcast who likes you, etc. There is too much music in the online catalogs - often good music. It is extremely difficult to stand out in the crowd, no matter how good you are. You should plan on about 1% conversion rate of people at the show to merch sales, so if 1000 people show up 10-20 will buy something.

    4. Publicists and marketing don't work unless you can put a huge budget behind them. Thankfully we didn't spend a ton on this but others we know spent their life savings or thousands. Yes, they got local college radio interviews and blog mentions but none of it translated into increased sales of albums. It did bring a few people to shows but not enough to make up for the outlay in merch sales. This seemed to apply regardless of the genera.

    5. We spent money on the launch show - it was a huge loser. If I had to do it over again, I wouldn't have bothered. It just takes too much money to put on a good light show so unless you have access to moving lights or projectors that you can borrow for free, or can play to a venue that already has the gear, don't bother. This leads into the next item...

    6. Unless you are a well-known act, you will get screwed by the venues (who are often trying to squeak by themselves). Always charge a cover and make sure your deal is for the cover if you can (and have *your* helper work the door!). Local promotion is difficult - people are bombarded with Facebook notices, emails, etc about a ton of shows all the time so most people tune out. If possible, find out where the crowds already show up locally and make a deal to play there. It is much easier to make a new fan by going to where the people already are than trying to convince a bunch of strangers to come see an unknown band.

    7. You must take credit cards. Period. Get an iPhone and Square and make sure you have signal. Make each band member get on a different network (VZW, ATT, Sprint) so you can be certain you will have coverage at the venue. Taking cards will often more than double your take vs not taking c

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