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New Music Boss, Worse Than Old Music Boss
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ex-CBOT quant) talks about the economics of the music business and how the 'old boss' — the record labels — have been replaced by the new boss — file downloading services, song streaming, and commercial online music stores.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."
So where's this new boss? I see new method of old boss at work here.
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
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.
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.
.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.
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
I'm so sorry you can't afford to drink top shelf champagne on your private jet anymore.
GCS/MU/P d- s:- a-- C++++$ UL++ P+ L++ E+ W++ N o K- w--- O M+ V- PS+++ PE Y+ PGP t+ 5- X R++ tv+ b++ DI++ D++ G+ e++ h-
you should me making music for the love of it, anything else and you're greedy
Here's the thing about it though:
Let's say I make good music. Right now I have a full time job to support my family, which means that any music I make is in the spare time between work and sleep and whatnot. If I can't make money off of the music I create, it will continue to be made only in the spare time I have. I will produce it slowly and sparingly. I won't be able to do that many live shows.
We don't need a system where I become a millionaire, but it does need to be enough that I can make music (or books, or any other form of art) my occupation rather than my hobby, if I'm good enough.
William of Ockham had no beard. The most likely explanation is that it was chewed off by squirrels every morning.
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.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
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.
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.
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.
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.
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.
Socialism: a lie told by totalitarians and believed by fools.
Be careful what you wish for. You just might get it.
If that is the moral then the article author might be in trouble given his stance. His last sentence is:
I’ll make technologists a deal, I’ll give up my song copyrights if you give up your software patents.
So how do we accept? More telling is that I think it shows he really does not understand the digital side of things very well. Outside major corporations or patent trolls I imagine many people would happy see software patents disappear.
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".
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.
Spelling and Grammar errors have been added to this post for your enjoyment
Actually, there is a difference. A bank will give you a loan and expect you to pay it back with a certain interest rate. When you've paid that back, you just have to pay your other costs, rest of your income goes into your pocket. With a record label you're forever stuck with only getting a small cut, and sometimes they even withhold a part of this to cover costs they think belong to the artist.
This is different. I don't think anyone would ever take a loan from a bank that demands that 90% of all future income from the investment go straight to the bank.
Also, the bank hopes to see you succeed(for obvious reasons), but can't really impact your success, and would be indifferent of your success if you went to another bank. Record labels on the other hand will try to block independent artists from breaking into the mainstream radio playlists(RIAA labels probably tolerate eachother though), unless they can force/convince you to sign, because you're their competition.
She: Hey, are you a traitor? Me: No, I'm atheist.
So there's nothing new there. Live gigs were always the life blood of any musician in the "recording era".
Stefan Axelsson
So are you saying you don't want new music, art, books, etc, or you are just too fucking cheap to pay for it?
No, he's saying he wants new music, art, books, etc, but if there's too much of it, he can't afford to pay for ALL of it. Someone's not going to get money. Basic supply and demand.
Yes, new artists CAN do that. Financing your own music production is not a problem. Getting around recording industry is. Recording industry isn't profiting heavily from financing music production. They're profiting from their position as mass media gatekeepers. If you as a musician want to get on TV or big radio stations, you either sign up to them and become a star almost overnight, or you don't get there at all and stay practically unknown for a very long time. The Internet has undermined the gatekeeper position of recording industry but the change is coming very slowly.
No, he's saying that it's time to come back to reality and realize that we can't all be fucking professional football players, ballerinas, astronauts, rock stars, movie stars, stand-up comedians...
I'm a amateur musician myself but I've played in a few bands that did live shows and even done a little work as a session musician for others in the studio. I didn't pick up the guitar when I was 10 because I wanted to be a rock star, I picked up the guitar because I wanted to learn how to play; the instrument fascinated me. I know I will never in a million years make a living playing music, but that doesn't mean I'm going to throw the guitar in a closet like a fucking child. I still play often, still record my own little ideas, and I do it for myself. If I never earn a penny on music again, I'm totally okay with that. I have a real job that pays my bills. I play guitar because I love it.
The people that "make it" in the industry (and while I know this is true in music, it's probably true in film and other arts as well) aren't necessarily very good at their given craft anyway. Most of the time, it's just a matter of being in the right place at the right time. Conversely, I've met some of the most ridiculously talented musicians busking for spare change on street corners and, from the looks of them, probably spent their nights sleeping on a street corner as well. This is just as much fault as the industry as anything else. Ask yourself, how many ugly pop stars are there? A person could sing like an angel and never do more than sing jingles in commercials because they weren't lucky enough to be born with the right set of genes for physical attractiveness while some empty-headed chick with big tits and a great ass will become the next Britney Spears thanks to Auto-Tune and the support of a major label.
When the hell did people stop creating art for the sake of creating art? That's what I want to know. All this bullshit about how "downloading is killing music"...since when? I'm still doing my thing, and I know many other musicians that are still out there creating music, many of whom don't earn a dime doing it...are they supposed to just throw in the towel because they're not going to be the next Metallica? Better yet, if they DO throw in the towel because they're never going to be the next Metallica, why the hell were they playing music in the first place? Go get an MBA and earn 6 figures with the rest of the clowns on Wall Street.
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, that you're an idiot, in either your business skills, your public relation skills, or both.
Oh so sincerely,
The Internet
yeah, but funding was largely a sham. Dave is right that studio time and agents don't get paid a percentage of record sales, but there are numerous errors in that chart he shows as well as his rebuttal of it, and I can see where this bass player was coming from. Fees for agents, studio time, and expenses all come out of the musician's pocket, not the studio's pocket. The chart completely missed the 10-15% songwriter cut, which for my band was a slightly larger share than share the entire band got (admittedly it was a bad contract, but we couldn't afford lawyers), divvied between all of us, but we never saw a cent of it - all those earnings went to pay studio time (primarily). Our singer songwriter made money on the album, the rest of us didn't.
All in all it wasn't a failure, though - the band actually made a meager living on the road, and I made a decent living by also playing in both a variety band and as a cellist (solo and quartet) at weddings. In the early-to-mid 1990s both of these gigs paid MUCH better than my band, and both were organized by my variety band's business - I was more like an employee, not an owner, unlike with the band (technically I wasn't an owner, but we divvied the profits) - I'm sure the owner took a large %age, but still $2k-5k (I made 5k twice doing both cello solo and variety band) a gig was pretty awesome. Unfortunately, variety bands ceded to DJs in the mid-1990s and I went back to school and finished my degree so I didn't have to live by random and becoming much more sparse income anymore. The band had broken up by then anyway (mostly over the financial dispute with the record label, and then refusing to make another album without renegotiating our contract - if this sounds familiar, it is hardly rare - see the Stone Roses as an example, and they were much bigger than we were).
Good post. The elephant in the room for this bank metaphor is that banks are not stupid enough to lend thousands of dollars to young musicians because almost every band ever started fails. It doesn't take a bank analyst to realize that young, unproven bands are an extremely high-risk investment. Aside from the possibility of flat-out sucking, there are plenty of other pitfalls for them: drugs, stds, changing tastes of the public, and the fact that touring is a wretched endeavor until you reach a certain threshold of popularity. From what I've seen, recording advances (i.e, MONEY) are much harder to come by today than they were 10-15 years ago. I might be blind, but I don't see youtube or spotify or rhapsody handing out money to cultivate new bands and yet they profit enormously from new music and old music alike.
There's an excellent book describing the economics of the music industry called "All You Need to Know About the Music Business" by Donald S. Passman. Don't let the bland title fool you. It's a good book and describes how lucky artists might get 15% of revenues after a label "recoups" their investment. It also describes typical advance amounts -- $200,000 for a band in the late nineties. This may sound like a lot until you realize a band (and their staff) have to create their recordings, pay rent, buy/maintain a touring vehicle, eat, etc. Managers and Lawyers are also likely to skim up to 25% for their services. And even if you are successful, the record label will tell you that they have to 'recoup' the cost of electricity to air-condition Jimmy Iovine's bedroom on his 3rd yacht before you get your 15%. Try housing and feeding 4 band members, roadies, etc for a year or two with what's left after all the other expenses are paid. Admittedly, this book is out of date now but it does provide a good window on the music industry as it used to be and some information is still relevant. The abiding lesson in it is to get a good lawyer to defend against nearly a century's worth of accumulated douchebaggery you can expect from recording companies and distributors.
What has not changed is that you still need these:
* A great song that appeals to some demographic with disposable income
* A great producer/engineer to make your recording
* Publicity so that the world knows about your song
* Revenue to survive and sustain the creative process
I'd love to see a business school analysis of the industry's outlook. I don't have an MBA, but I'd be willing to bet that the assessment would be that the potential for profiting in the music industry has diminished greatly in the past decade for a variety of reasons:
* Lower barriers to entry (lower cost to record music due to cheap new gear, lower distribution cost due to internet, etc.) will introduce lots of competition. E.g., new 'competitors' like Rebecca Black or anything recorded in someone's garage.
* Other low-cost forms of entertainment (e.g., facebook, games, youtube, netflix, etc.) will introduce competition for listener's time and money
* Both the music industry and the entertainment industry in general will become increasingly splintered as more bands make music and more types of entertainment proliferate due to aforementioned competition. Margins will drop accordingly.
* Changing user expectations and 'unauthorized' distribution of recordings undermine (eliminate?) the ability of a band to extract revenue from the recordings they make. I.e., the kids think music is free and give it for free to all their friends. No one really has to pay the artist for their song any more. The fact is that spending on music recordings today is voluntary regardless of any other agreements or DRM or terms of use or whatever. Because of this fact, recordings probably shouldn't be viewed as a product but rather as marketing.
At the same time, there are some factors working in favor of musicians:
* New recording technology (not including instruments, amps, and mic