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Wait, What?

Several companies are already doubling as a label.
Look here: https://play.google.com/artist...
And here: https://www.apple.com/itunes/w...
http://www.tunecore.com/index/...

And the Music industry isn't in a position to take on Google and Itunes and Amazon. Those three companies decide not to sell your crap-music, at your crap-prices, and you are pretty much dead in the water as a label.

Artists are getting smarter. They are starting to care about the license terms, and while they may release their first hits to a label more and more of them are declining to take long term contracts and trying the indi market.

As a hobby I write some music which I publish independently on Spotify and some other platforms such as iTunes.

I use a service called http://www.tunecore.com/ and apart from their charges I have no middle hands whatsoever.

My songs seem to average nearly 4 times as much revenue as Anssi Kela's. I get around $0.008 per Spotify stream (slightly different payments apply depending on in which country a Spotify user plays a song). Here are some stats for one of my songs:

Month Streams Total
Aug 2013 670 $5.41
Jul 2013 616 $4.92
Jun 2013 561 $4.51
May 2013 608 $4.38
Apr 2013 825 $6.16
Mar 2013 1,333 $9.46
Feb 2013 990 $7.46
Jan 2013 1,123 $8.51

My take on the process is that I see Spotify as a way for me to make music publicly available on the same terms as the major publishers. As an independent musician this is a god send.

As for compensation, in the digital era where no one (this includes publishers and independent musicians) can expect big money per song sale or stream, I think what I earn from streams is very reasonable. It should be noted of course that the revenue for the example listed above are peanuts, but should I now publish as song which will become a hit, I have a viable method of reaching my audience and still earn some money from what is essentially just marketing of my music.

Many "legit" stores do not benefit the artists!

Some sell the artists music without permission and do not reimburse the artists
http://torrentfreak.com/apples-itunes-sued-by-artist-for-pirating-music-110812/
http://forum.tunecore.com/post/Album-on-iTunes-without-permission-5680939

Sometimes the artists get no money because of extraordinary business practices by their music publishers or associations
http://www.salon.com/2000/06/14/love_7/
http://www.techdirt.com/articles/20100712/23482610186.shtml
http://www.techdirt.com/articles/20091203/1853507190.shtml
and for interest
http://www.techdirt.com/articles/20120323/18055718229/how-ascap-takes-money-successful-indie-artists-gives-it-to-giant-rock-stars.shtml

Sometimes the artists get no money because their music publishers instruct them not to register with the copyright agency of that country SO THAT the publisher can claim that the seller is not legitimate because the artists get no money.
http://www.transmissionentertainment.com/entry/russian_based_all_of_mp3coms_former_owner_may_see_jail_time_fines_and_a_mor/
http://allofmp3.ru/press/centre.shtml?s=994&d=66219728 : "Even without an agreement between ROMS and the rightsholders, it is our understanding that ROMS, in particular, has sent several letters to the major record labels inviting them to collect their royalties. Those notices have been ignored."
http://techcrunch.com/2007/07/25/former-allofmp3com-owner-faces-jail-time/

Sometimes it's a choice between
1. not paying
2. paying and the artist gets no money
3. paying and the artist gets no money and you support an abusive music industry
4. paying and the artist gets money and you support an abusive music industry

For mass music I opt for 2 where I can because I think it does least harm.
For less popular music I use CD-Baby and other self publishing sites or buy direct from the artist.

Then let me rephrase: How should an indie recording artist advertise more efficiently than the establishment, which has both economies of scale and radio program director goodwill to its advantage?

An indie really can't compete marketing/advertising-wise against the majors. You have to find a way to get your music to go viral through alternative channels.

Don't undervalue live performances. Live performances can also get you some local (to the venue you're playing) radio plays, and since many radio stations also stream, they reach further than they once did.

These may also help:

http://www.sonicbids.com/

http://www.bandmix.com/

http://www.tunecore.com/

http://www.reverbnation.com/

There is no single best method/path/plan for indie artists. Do your research, try some things, see what works best for you and your music.

Strat

I believe there may be a couple of methods, but I chose to go with TuneCore. I read this article with Trent Reznor, someone I have a lot of respect for, and arguably one of the musicians who really, really gets how to harness the power of the internet. I think he has some very insightful views on how new and established artists can prosper, and he has definitely paid his dues with bad recording contracts.

From the TuneCore-FAQ:
"What format must my artwork be in, in order to upload to TuneCore?
[...] You may not include: email addresses, URLs, any other contact information or any pricing information."

Is this a common (or acceptable) limitation?

From the FAQ

"What format must my music be in, in order to upload to TuneCore?

We have found .wav files to be the most reliable and therefore recommend them first and foremost. Remember that they must be set at a 44.1 khz sample rate, 16 bit sample size and the channel set to stereo. Not sure how to convert your music? - Check out our tutorial.

What format must my artwork be in, in order to upload to TuneCore?

Artwork can be in one of the following file formats: JPG, GIF or PNG. The image must be a perfect square and at least 1600x1600. All artwork must be in best-quality RGB Color mode (including black and white images) and must have a resolution of at least 72 dpi. You may not include: email addresses, URLs, any other contact information or any pricing information. You must include both the artist name and album title on the artwork and remove any stickers or other items from your artwork in case you are scanning it in from a physical CD."

I'm certain that, because people aren't so bright, there'll be a lot of "CD containing audio derived from mp3s that came from ripping a burned CD that was produced from .aacs, that were compressed from the output of a ten dollar ADC connected to a microphone taken from a 'Barbie's Kiddie Karaoke' machine" stuff floating around; but it looks like the service itself supports perfectly sensible upload options.

Apple doesn't want to do this because of all the contracts and accounting involved. They'd prefer TuneCore take care of that side of things. TuneCore also has an API which is cool (I wrote it).

I have an idea! If you're a band, sell your songs yourself on iTunes! Collect the 70 cents/song yourself, and then arrange your own tours for the ticket sales.

/rocket science, this is not

You forgot to tell them how to sell on iTunes. There, for about $30, you can get an album listed on iTunes for a year.

FWIW, you can buy 256kbps AAC non-DRM'd versions of just about everything on iTunes for a bit more.

If you're really concerned about better quality music and artists, iTunes isn't the best place to discover them, but if they are indies and self-release their albums, the cut that the actual artist receives is HUGE for that $.99 sale ($.70 per download and more for the non-DRM version, "iTunes Plus" I think its called). iTunes isn't the problem here, since they're passing most of the sale onto the rights holder. The labels are the "problem", but only in the sense that they recoup their costs out of that $.70 (or around $7 for an album download), and their notoriously corrupt practices cut deeply into the artists' cut.

TuneCore (and another services) allow indies to publish to a variety of sources that includes iTunes.

Incidentally, it can be argued that eMusic is actually not as good to the artists in terms of paying them as iTunes is, due to the way they determine how much you get paid for downloads. Obviously, there's a lot of variables there, but I'm much more in favor of flat rates vs variable rates.

Make no mistake, getting paid for making music is a complex, tough process.

In addition, the iPod will never support it. There goes 70% of the potential users.

And the largest music store in the US. But that's exactly what this is about, isn't it? Reinventing Fairplay so they can re-establish their cartel... Too bad for them, since to do it, they need a vertically integrated solution like iTunes/iTMS/iPod. Apple makes everything from the hardware all the way down to the QuickTime file format. That's why everyone who attempts to compete with Apple fails. Tougher still: They not only have to make all the pieces to succeed, they have to do a better job of it than Apple. They will fail, miserably. The RIAA/MPAA might as well burn the money they're spending on this scheme. Who really needs the RIAA anymore anyway? With sites like TuneCore, why would you sign away most of your gross income to the record company? You can get listed on iTunes for a year for about $30. Make it $40 and you can get listed on all the stores.

Or you could take advantage of an online service to place your music in major online distribution channels like iTunes, AmazonMP3, Rhapsody, eMusic, etc. and who also manage the accounting, micropayments from streaming, and other details and pay you from one source while you concentrate on making music.

http://www.tunecore.com/

From the FAQ:

What does it cost me?

If you are delivering just one track (a single) the only fee is an annual payment of $9.99. If you are delivering more than one song (an album) the annual fee is $19.98. The only additional charges (for an album) are one time fees of .99 cents per store you choose and per track that you upload to TuneCore. For example if you deliver a two track album to only iTunes US this would total to, $21.96 with an annual renewal fee of 19.98 after the initial payment.

Cheers!

Strat

Apple does not deal directly with producers or artists, but companies like TuneCore provide producers and artists with an inexpensive service to get the music they make listed in the iTunes music store, Rhapsody and others.

If an artist uses Tunecore to deliver their music to iTunes they keep 100% of their profits, after iTunes takes their cut.

You cite iTunes taking 35 cents on each $0.99 sale. That information seems outdated.

Here's one website that has more information. I think there is at least one other site to check, cdbaby.com, but I'm not going to do that right here. This is the payment plan for independent artists, so I imagine the "labels" could try and negotiate a better deal, but this deal is pretty sweet:

iTunes: $0.70 per song, for 10+ songs (AKA an "album") payment is only 10 x $0.70 = $7.00
Rhapsody: $0.65 per song (subscriber download), $0.70 per song (non subscriber download), for 10+ songs album payment is 10x
Napster: $0.65 per song, for 10+ songs album payment is 10x
MusicNet: there is some undisclosed "independent record label" pay rate. See the FAQ
eMusic: the "subscription pay rate" model. They pay a percentage of their profits.
Sony Connect: the "subscription pay rate" model. They pay a percentage of their profits.

So, the best deals offered by tunecore.com, at 70.707070% of the purchase price, are very, very good for the artist. Any artist only making around 30% is simply losing money on their next album.

You cite iTunes taking 35 cents on each $0.99 sale. That information seems outdated.

Here's one website that has more information. I think there is at least one other site to check, cdbaby.com, but I'm not going to do that right here. This is the payment plan for independent artists, so I imagine the "labels" could try and negotiate a better deal, but this deal is pretty sweet:

iTunes: $0.70 per song, for 10+ songs (AKA an "album") payment is only 10 x $0.70 = $7.00
Rhapsody: $0.65 per song (subscriber download), $0.70 per song (non subscriber download), for 10+ songs album payment is 10x
Napster: $0.65 per song, for 10+ songs album payment is 10x
MusicNet: there is some undisclosed "independent record label" pay rate. See the FAQ
eMusic: the "subscription pay rate" model. They pay a percentage of their profits.
Sony Connect: the "subscription pay rate" model. They pay a percentage of their profits.

So, the best deals offered by tunecore.com, at 70.707070% of the purchase price, are very, very good for the artist. Any artist only making around 30% is simply losing money on their next album.

Well, I suppose. But there's a great service out there called Tune Core and they "sign" pretty much anyone. I'm as lowly a musician as they get (to see my electric stuff just go Here), but I got in, submitted my mini-cd, and was in busness pretty darn quick. The pay is good (70 cents or so each song for iTunes), and the rent is cheap (a few bucks a year to be a Tune Core member), I got nothing to complain about.

Not anymore :-)

You also have to consider the iPod as a platform. With so many people owning so many tunes encrypted with Fairplay, you're absolutely sunk in trying to get those folks to convert. Unless your player is twice as nice at half the price, your player must be compatible with Fairplay or else all those tunes must be purchased again, adding to the expense of the switch. Apple has faced this for all its history with the Mac OS, because even if their offering was better, switchers would be required to buy all new software to make the change. Hence no flood of switchers.

Since there's no way to offer twice as nice at half the price without eating a huge portion of the cost yourself, you must have Fairplay. That's why the RIAA wants Apple to license it, and that's why Apple will not. Finally, and most ironically, the very law that the RIAA and friends put into place in 1998 (DMCA) to maintain their iron grip on their music distribution monopoly is the key reason why the RIAA cannot simply reverse engineer Fairplay and retain their control of music distribution now. They've even started to consider unencrypted file schemes like watermarking so they can break Apple's lock on online music distribution. Of course, these schemes will ultimately fail, and the law they bought and paid for will be their own undoing.

Oh, and the final nail in the RIAA's coffin? Any band can get an album up on iTMS for about 20 bucks. Bands no longer have to give up their copyrights. They no longer have to sign terrible contracts or pay off million dollar loans. They no longer have to give up creative control and push to put out mediocre music to make quarterly numbers for some corporation. They just have to do what they like to do: Make music. Does Samsunk have all that in place? Nope.

It's beautiful. The RIAA labels are toast :-) Thank you Apple! Those guys deserve to wither and fade away after suing children and generally making an ass out of themselves at every opportunity. You've done us all a great favor. And to think... who would have ever believed, when the Beetles first sued Apple, that Apple really would become a record label :-D It's priceless.

Check out Tunecore. You pay $8 + $0.99/song listed on iTunes. You keep your copyright, and you keep the lion's share of the $0.99 that Apple charges its customers. If you fail, you're out 20 bucks.

Record companies on the other hand require contracts that strip you of your copyright, all sorts of overhead, and the company store buys your soul with a loan that you'll be paying for the rest of your life if you don't produce a gold record. If you fail, you're screwed for life or until 7 years after your personal bankruptcy. Whichever comes first. Oh, and you still have to pay 'the man' to sing your own songs.

Given the choice... I know what I'd choose.

Donno what Apples net profit is, but I'm getting 70 cents a pop for a 99 cent song. And I'm signed up through Tune Core, so it's not like I'm some RIAA shill. 99 - 70 = 29 cents to cover the rest of the bills.

Not to worry :-) The usefulness of record labels is now at an end. Creation, publishing, distribution, and marketing can now be had practically for free. Check out Tunecore to see what I mean. Why would any band give up their copyright and settle for second class shelf space and loan payments when they can post their works in their pajamas? Create music with software and instruments, distribute online, done. There is no step three ;-) As more new bands go direct, more revenue streams disappear for the big labels. The big labels will eventually be unable to afford lobbyists.

This is allready happening. Various 'aggregators' allow musicians and/or indie labels to publish music on iTunes and Rhapsody, against a hefty sum that is. Tunecore (http://www.tunecore.com/) offers the same, against much smaller costs.

Record companies had 3 monopolies which allowed them to firmly control the recording industry:
* To record an album you need a studio, which is expensive. Record companies paid band to use studios, tying the bands to the record company.
* To publish an album, you need to put it on CD (or LP), and get it out to record stores (distribution). Both of these activities come with huge expenses upfront.
* Finally, you need to promote and plug a band, which requires a network of people you know.

Nowadays, as a musician, I can record decent quality productions at home with the aid of a computer, at a fraction of the costs it would take if I were to do it in a studio. Distribution can take place via the Internet, (e.g. Tunecore), and for promotion/plugging, web2.0 like community networks and a well designed website can get you somewhere.

Basically, there is no more need for a record company. Their days are over, and the general public should realise that there are plenty possibilities to make do without them.

sorry: http://www.tunecore.com/