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Money in the Music Business
paulbd writes: "Electronic Musician has a good article on the economics of selling music on CDs. Its a sobering read that gives some of the hard numbers that do a little to counter
the sense of record companies being vultures. Recommended for anyone who seriously imagines making a living from selling music."
This reminds me of this wonderful article that's popped up on JWZ's site several times about the economics of the music industry.
It really sucks.
http://www.arancidamoeba.com/mrr/
as much as i dislike every aspect of the RIAA and its cohorts, i know from personal experience of starting a CD label that they are not "as [ir]relevant as buggy whip manufacturers". producing music has become vastly cheaper than it used to be, and the net offers some excellent possibilities for distributing compressed (lossy) audio. however, the net doesn't come within 10 miles of offering the marketing and publicity engines that the RIAA still know how to work (or maybe we should say control). its also a complete waste of time for people who want at least CD quality audio, though that will change as bandwidth increases over time. we spent about $5000 to do the production copy run on our first CD, and didn't have to pay for studio time since we own the studio. but this music isn't the kind of stuff that most people listen to, and the challenge of marketing it effectively is vastly more difficult and involved than running a website and having some MP3's available for preview. although their tactics and contracts suck, the truth is that its very, very hard to effectively market music without the involvement of major record labels. this is particularly true if the music you make isn't popular with the demographic that has made, say, ani defranco such a success.
Well, while a recording budget $500K - $1000K may be the "typical recording budget for an artist's first album" it seems rather high. While that may be true for the types of Britney Spears and your favorite boy band of the week (which really are just products rather than artists), you can record quality music for far less.
To give you an example: I listen to a lot of Heavy Metal. One of the more interesting bands I've come across over the past year or so has been "Children of Bodom" (for those who don't know them, they are a speed metal band from Finland and quite musically skilled; their live album puts most other bands to shame). Their first album, which admittedly was pretty rough, was recorded in 2 days. Their second album (Hatebreeder) is a wonderful symphony of high-speed power rock and melody which sounds good and was recorded in a week. While I don't know the recodring budget they had, I can assure that it wasn't anything in the $500K region.
Another example I can give is a local band here (2 of my friends play in it) which just recorded their first album. They had 4 days to do it and the studio cost them
My whole point is this: decent musicians can produce quality music on a much lower budget. You don't need 1/2 year of studio time to record your songs (provided you have written them prior to waking into the studio).
The story about music videos is similar. Artists are often required to do videos which basically puts them into more debt. So they are effectively owned by the record companies who are in effect pimping them; it's like indentured servitude.
Part of the problem is that the music industry requires expensive productions and videos as marketing tools. Where they should be more like reporters (ie: finding and covering the news rather than creating it) they have become the creators of bands which then require huge budgets to be pushed to popularity. It doesn't have to be like this.
I think I'll be putting on my asbestos suit
the problem with Albini's analysis is that it doesn't mention that the obscene $710,000 profit the record company made has to be used to amortize all the losses it made on the new mariah carey cd. see, there's this problem: you're a successful musician, and the record company appears to be ripping you off. they probably are. but a large part of the apparent rip off is because they are also making lossy investments in new artists which never work out. now, you could choose to excuse yourself from this charade, like ani defranco and others have done, by working on your own - you win, then you win big, but if you lose, you lose everything you put in. however, as long as you choose to allow somebody else to help you with the initial costs, you need to deal with the fact that their losses on other artists need to be covered by their profits on you. in such a system, the artists are simultaneously screwed and simultaneously supported. of course, the record companies are making obscene profits on the backs of underpaid musicians. but don't assume that when you get those numbers down somehow that the inherent inequality in the relationship will go away. if someone if going to make a risky investment in several artists, the ones that succeed will need to pay for the ones that fail. do you want your success subsidizing your fellow artists failures? do you want your failure subsidized by your fellow artists? or put another way, do you feel lucky, punk ? :))