The main issue wrt Itunes may not be the 30% cut. It may be that it facilites people buying a single and not whole the album. Thats a 90% drop in sales revenue right there. I would suggest if Itunes took 5% instead of 30% it would not change much.

I grew up buying 45s and LPs. I'm not a fan of the new frontier of digital music, but I have no problem with iTunes offering singles as well as albums. Seriously, there are a lot of singles that we like, but are tethered to an album's worth of dreck. That's why we have the term One Hit Wonder.

Knock... knock...
How many engineers, executives, recording artists, and marketers  does it take to screw in a lightbulb to make an album?

Lowery needs some cheese to go with that whine.

Let's see you go work your ass off for free.

I'm sorry that David Lowery signed with IRS and Virgin all those years ago.  He's probably still recouping advances according to their accounting.  Instead of blaming the man or the middle man or the record stores or the torrents, he's blaming Apple.

CVB hasn't sold anything in eons.  Cracker's last hit was 20 years ago.  Hard to make money when nobody wants your stuff.  Easy to whine.

And YOUR experience in the industry is WHAT?

Your "inside knowledge" of Lowerry's finances comes from WHERE?

You're blowing smoke, buddy!

Lowery is spot on. Especially the bit about touring, which is the dirty little secret of the "new model".

 

Itunes and Amazon are entiltled to about 10%, which is about what the adjusted margin of any other retail outlet is.

This may sound extremely romantic, but since when is monetary success the only sign of success for an artist?  I just went through the process of releasing an album through a relatively big indie label in France.  The album had been created without even the slightest hope of having been ever released.  The interested labels were a massive surprise, and in retrospect I really feel it was a big mistake signing.  The experience left me feeling like I'd been raped.  Obviously there are many kinds of artists, some are more commercial and commercially-orientated than others.  But I think the shittiness of BOTH the old model and the new are good reasons not to release music at all, except in the humble ways that artists can and still keep complete control and ownership of their work.  If it this doesn't lead to commercial success, who the hell cares, as long as the music is getting better and better.   I don't think there's anything wrong with having a second job.  And it seems that right now all the arts are in one big awkward phase.  The audience has been so inundated with streaming this and streaming that that they don't value any of it terribly much.  Of course that's a gross generalization but in my opinion, this is a time for musicians and artists to huddle together and just try and keep the flame strong until the storm dies down and there's some more clear road ahead to sales.

I see nothing romantic in being a starving artist or a part time dilettante.

There is a name for an artist who has a second job PART TIME MUSICIAN and a name for a full time musician PROFESSIONAL MUSICIAN.

Lowery isn't whining, you goof! He just outlined the very real situation artists are faced with today, and how that compares with the old world model. He's completely spot on too. What, you can't keep up with details or something? I really wish there was some kind of IQ test we could give to people before they leave comments. It would be nice to be able to read insightful comments once in a while from people with full use of their frontal lobes.

I agree with every word except for who he's referring to as the parasite.  iTunes & Amazon are just retailers.  There've always been retailers who took their 30% (approx) cut without taking risk.  The parasites are those who are pimping all the marvelous opportunities available to artists (while charging you up front for whatever it is that they're selling).

But who is to blame is not important. 

Much more important is having artists like David speak up and expose the myths being promoted by the hobbyists who comment about how great things are (but who likely can only post about how great things are when they get home from their day jobs) or by those self-serving digital P.T. Barnum types (but do so while being sure to reach into your pockets to grab that $50 for putting your record up on iTunes - because they know there is no money to be had on the backend). 

You'll no doubt read commenters who'll try to convince David that his big problem is that he just needs to "innovate" and he'll make plenty of money.  The fact is we're 15 years into the "digital revolution" and it's more miserable than ever for (good) artists to make a living from their music. 

Actually, iTunes/Amazon are MUCH different than traditional retailers or distributers. In the old model, the distributer BOUGHT the records from the label, who then SOLD the music to the retailer, all before the consumer had any access to the music. They all had invested interest in selling each record displayed. Which is why not just any schmuck with a guitar and a four track could get their records out. The label and eventually the artist, could possibly recoup before the album ever came out to the public (although, there were refunds usually built in in case it was a no seller)

iTunes,Amazon, Tunecore, etc. have changed the industry 180 degrees. Now, in many cases, the label/artist are PAYING to have their music put in stores. This is no different than the good ol' payola system of radio (that eventually was declared illegal). Even in the best case scenerio, these companies are making zero down "invesments", and keeping 30% of retail. And again, there's still the tunecores, cd baby's, and others, who one way or another, are taking a cut on top of that.

Just asking questions here, but don't record labels recoup all of their expenses? The money laid out by most labels, if I'm not mistaken, is a loan to the artist. It has to be paid back from royalties. So, even though labels may have put money up front to develop a band, they get it back when the record sells. So, for instance, as an artist, I may receive $.25 on the dollar from record sales, but if I got an advance of $100,000, that money had to paid back to the label out of that $.25 before I make anything. Not sure how that works with the overall math.

 

I do agree, however, that the online distributors are greedy. They should get something for hosting the song, but not 30%. If they want to help me market my music, that's another story.

Their reply would rightly be: go build your own distribution channel then. We built this, and put a LOT of money, energy, and reputation into doing it. If you think it's easy to sell over 15 billion songs straight to consumers, do it yourself.

If you think all they do is just host the song, then go ahead and stick your song on a file server somewhere. There, it's hosted! Watch as it sells exactly zero copies. Hosting is not worthy very much.

The fact is, it's a huge investment to build a popular online business, get people to trust you with their credit cards, build the infrastructure to handle that many transactions, etc etc. Apple not only hosts the song, but markets the iTunes store every time it sells an iPod, iPhone, or iPad. It owns the billing relationship with the consumer, and that is incredibly valuable.

Nothing stopping you as an artist from doing the same, except the same thing stopping Apple from producing music - it's not what they're good at.

I don't think your response really dealt with what I said in my post. My point was that record labels don't just give you money to promote your record, as seemed to be implied in the article. It is a loan. I was commenting on that one specific issue, not the entirety of the value of labels.

I'm also not denying that these companies make investments. The math is a lot more complicated than you presented, though. The cost  of infrastructure, both physical and programmed, is spread out among a lot of different entities, including the government in the form of direct investment and subsidies. Simply said, I think they overcharge. We all pay for access to services and goods every day. I have no problem with that. I just think that the value should be commensurate with the cost.

Lastly, I made a point to write my post as a question (I said it right in the opening sentence). I thought the tone of my post was also polite. Your response was unnecessarily confrontational. Responses like that are the reason I don't usually bother posting anything online. I can benefit from an exchange of ideas. I get absolutely nothing from someone trying to prove me wrong or critisize me directly for trying to contribute to a dialog.

 

Dave I think regardless of recoupability, it is cash on the table, and what an artist desperately needs.  A startup needs investors but ultimately investors get their return but the startup might have a difficult time getting traction without that cash (or loan, or however it's structured).

this guy blows and is a loser. if you arent a dumb ass it is a great time to be in the music business.

Your a moron. My guess is your not in the the business and are just another freetard who thinks all artists should give their music away. 

"Your a moron." = No, YOU'RE a moron!

A very helpful and civil analysis.

- Versus

Finally a known artist comes forward to speak the truth. Thank you, thank you, thank you. Much appreciated!

Lowry's arguements are fundatmentally flawed.  He's comparing apples and oranges (pun fully intended).  iTunes is a retailer and not a label (at least not yet).  He should compare iTunes to Tower Records if he wants to be accurate.

Further it's incredible myopic and wrong to say that "They [Apple and Amazon] put up ZERO CAPITAL and ZERO RISK and they get 30% of the gross in return."

Apple and Amazon invest a lot of money building their respective stores and technologies.  It's always been a bit of a mystery how much profit they make from their respective music stores.  Apple is often accused of even using their iTunes stores as a loss leader for their hardware sales.

Regardless, they both put up a LOT of capital and risk.

There are many other holes in Lowry's logic.  But an obvious one is that label tour support is really the artist's money since it is recoupable.  It's not a gift nor should it be considered profit.  

If an artist wants to make the lion's share, they need to take the risk. Otherwise, be content with a smaller share from labels.  As for me, i support the former strategy.  

I agree that Apple and Amazon put alot into their technologies and making their systems secure. It was a risk they both took and a 30%-35% margin for a retailer is probably below physical retail. They are making significant income (you can see what Apple makes in their SEC filings) but alot of that comes from scale.

But I don't agree with you completely about tour support. It is not always 100% recoupable and I worked for labels which gave vans to bands to help them get on the road...(for example) and other non-recouped support. And all the contracts I am aware of do not recoup tour support from mechanicals.....

Lowery paints a pretty much correct picture of the state of the industry now.  Sorry Steve, you and the others are missing the point about Steve Jobs' company and piracy.  BTW, the two are the real factors that have brought down the previous business model of the music industry.  Here's what I see.  The problem with iTunes is not that they take 30% but that they have forced (can you say "restraint of trade") to sell singles at $0.99.  Instead of letting master recording owners sell at wholesale the price they want to in order to stay in business in light of the new business model, iTunes FORCED us all to sell at $0.99.  I personally know this for a fact and so does everyone else.  Yes, years later they "allowed" an increase in the retail price (and thereby wholesale as well) but by then the consumer was used to the lower price and the increase was relatively miniscule for master owners.  Piracy is the overall industry problem that finally is no longer the elephant in the room.  Thanks to the SOPA national discussion, it has become clear that NOBODY denies there is music piracy, the questions are is it significant, does it have an effect on sales, should the law be enforced and who should do it, pay for it and how.  The arguments about 1st amendment rights, internet freedom, etc. really aren't the issue because those can be addressed by the tech industry, since they have all the other answers.  But they don't want to deal with it because THEY DON'T WANT TO PAY FOR IT!  They (Googe/YouTube as well) want all the investor money to pay for software, offices and their salaries not the actual product they sell not on how to do it legitimately.  Gee, I wish I could get my inventory for free too! 

As for Apple being a retailer, they are not. They are a walled garden and the opposite of the "open" internet.  I remember when real retailers like JC Penney, Woolworths, (I know that's old school) would sell records very, very cheap.  But guess what, they did it below the wholesale cost and they took the loss because they wanted the young traffic in their stores.  The dedicated record stores had a hard time matching it but they knew the competition couldn't keep it up.  Again, why, at the start of iTunes couldn't I sell a single to iTunes at $1.35 wholesale?  Why did they force that price which significantly single handedly to the devaluation of music?

Sorry for the shouting and rant. I would like your reply because I respect you and your work very much.

What happens if the artist doesn't ever recoup?  Do they have to declare bankruptcy and have their personal assets liquidated to pay back the advance?  Don't think so. 

Now compare that to a scenario where an artist takes out a personal loan or puts all the up front costs for producing a record and touring behind it on their credit card.  If they don't make it, they are personally busted.

The point is that the label takes all that risk away.  If the artist doesn't recoup, eventually they will get dropped, but they don't have to sell their house, car, etc. to pay the label back.  The label rights it off as a loss and cost of doing business.

 

 

Point one: Actually Itunes and Amazon are acting as labels (record companies in industry jargon) rather than simply retailers. They are manufacturing each download on demand and distributing it via direct sales to their customer. All online "music stores" are acting as labels in exactly the same way as any other master licencing deal between labels. The label owning the master issues another label a licence to manufacture and distribute said master, it is exactly the same in the case of ALL stores selling digital downloads.

Point two: Steve Jobs has stated that his only interest in selling music was to encourages sales of Ipods. Setting the price point at .99cents USD regardless of quality or popularity of any particular song was simply to encourage sales of Ipods. Without cheap product to fill them he reckoned Ipod sales would be severely limited. Setting a price point this way if in the music business seems a bit foolish but as a loss leader for hardware sales, brilliant. Convincing the record industry that to accept his terms was their only salvation from the scourge of music piracy was also brilliant, though not a sensible arrangement for artists or the industry in general.

A bit of history off subject: Apple was sued by the Beatles Apple Corp for trademark infringement when Apple was a startup. The beatles won that suit but graciously allowed Apple to use the name as long as Apple never entered into any business that had even the remotest relationship to music. When Jobs decided on his Itunes loss leader plan to encourages Ipod sales Paul McCartney reminded Jobs of his legally binding agreement with Apple Corp to which Jobs basically said Apple was small then but had become a giant. The balance of power had shifted and there was nothing McCartney could do to stop him. It was his billions against McCartneys millions. Lovely fella that Jobs. As far as I'm concerned if your word is no good then you're no good. Though I do admire his genius as a confidence man. His ability to manipulate the gullible was quite astounding. He very likely may have been the greatest con man since Mr. Ponzi.

Didn't understand much of this article. Last I checked iTunes or Wal-mart are retailers, not record labels.

Independent artists have never received tour support. I don't believe retailers before the advent of iTunes absorbed much if any risk either.

I don't understand his argument.

Disclaimer: I don't tour. I only sell music recordings.

interesting read...

"It's  long way to the top if you wanna rock n roll."  The old business model was better? As stated above, none of the support and production provided by labels is or was free.  That all comes out of the artists pocket at some point.  I think a better argument would be marketing and promotion is paid up front now by the artist not loaned from a label.

I admit I have not read his full rant yet, maybe the full version does not dwell on these misguided arguments.

The other aspect is that,under the old model, the artist paid for the recording and the video..and still didn't own either one.

 

The argument makes no sense.

First and foremost, digital distributors are stores not labels or record companies. So they're not your boss. They don't care one way or the other. Think wal-mart. So your new boss is the old boss.

Your problem is having a boss at all. The business model that's broken is the old record label model. Just like with the old book publisher model. Disrupt the old model. Have your own label, do your own marketing, go directly to the customer. Sell either directly through a website or at concerts, or go through online stores. Don't use a label/distributor middle man.

Of course that means not being a child and having daddy label/record comapny holding your hand. It likely means an order or two magnatude less quantity sold, but perhaps an order of magnatude more revenue to you. 70% of song sales is a lot better than 1%.

I'd much rather have 1% of 1 million than 70% of $1000

You hit the nail on the head, BB. To quote Billy Preston, "Nothin from nothin leaves nothin. You gotta have somethin..."

I enjoyed the article and understood his points.

The main reason is because I am a vet of the old system and still operating in the new system. So I see all sides of the argument.

I have a hate/love affair with the old labels (hate first), but mostly hate for iTunes and Amazon.

It would take too long to explain why, and I know many will only read it as a complaining artist (when I actually rake in the cash being a guy who creates web sites that sell things). 

If I had a vote I would vote things are worse in many ways, and better in very few.

I think your argument is artists are now responsible for creating, marketing, and distributing their products.  And have to risk their own capital (like every start up). 

I suppose its true that Apple put up zero dollars and zero risk in order to generate that 30% of a song sale.  But only if you ignore the hundreds of millions of dollars used to develop the systems and software for iTunes (a retailer, not a record label) and the iPod, at a time when their success was far from assured. 

Just to piggyback on that point... iTunes/Amazon also provide value in the platform itself. If people hear even the most obscure artist out at a bar one night and want to know how to get the album, they know iTunes is a pretty reliable source. I'd say that's added value.

 

Once we kick this piracy thing (what, when?) maybe artists will start to migrate off the iTunes platform and their catalog will start to look more spotty. If artists by and large were ever to remove themselves from all online retailers, they can still sell direct through their website. Is that likely? No. Retailers serve a purpose too.

I run a digital music store called HearJapan.  We are small, but I can empathize with Apple and the 30%.  To be honest, it simply isn't enough.  First off, "just hosting" a song means storing it in expensive servers on expensive hard drives and having multiple backup copies.  Not only does a single industrial hard drive cost a ton of money (much more than consumer grade).  The expense doesn't end there, you have to power the hard drives which require constant electricity, which ISN'T cheap.  I have tens of thousands of songs on my hard drives that will never sell a single copy but I am paying to upkeep the electricity costs of them.  I read somewhere that apple's datacenter uses more electricity than the entire county it is in.  That's a ton of electricity that is used.  If you are talking about a "struggling artist" chances are extremely high, that I-tunes is taking a big loss just to keep your music on I-tunes.  Then you have to pay customer support staff, staff to upload new releases, quality control staff, staff to maintain your servers, development staff (Itunes is always pushing new updates, it costs a lot of money to develop that).  I hear this, "30% fee is bullshit" a lot, but to be honest, artists have no idea how much it costs to maintain a digital music store.  In fact all digital music store owners I know, make no profit off of selling the music but rather make profit from spinoff businesses.  You either breakeven or lose a lot of money.  The big sellers are essentially supporting all of the independent/amateur artists on every digital music store.  If they did 5%, then the only way to run a business would be to only sell the top 100 artists.  

Great info.  Thanks.

@ Nate:

Yes, you either break even or lose a lot of money. That is what happens when the product you are selling is undervalued. Your fee doesn't need to be high. You actually need to sell at a higher, more reasonable price point. Itunes can afford to sell below value because for them music is a loss leader to encourage Ipod sales. You aren't selling Ipods so you really don't have the luxury of selling at the ninety-nine cent USD price point. You price really should be higher. Itunes has skewed the market and not for the better.

In 1965 a single record consisted of 2 "sides" (or songs) and cost $1.00 USD retail. That is a retail cost of fifty cents per song at the 1965 rate. In 2010 that same fifty cents, adjusted for inflation was equivalent to $3.42. The 2010 retail price of $1.00 USD is equivalent to purchasing a single for fourteen and a half cents in 1965 USD. The actual retail cost of music has steadily decreased through the years yet consumers in general feel the record industry is engaging in price gouging by setting the retail price at $1.00 USD (or less) per side in today’s market a clear disconnect between perception and reality. For online sales to be a viable business consumer prices must be raised to a reasonable level.

That price, however, included the manufacturing of a physical object, the shipping of that physical object over roads to retailers, and the storage, distribution, and retail housing of those records. Now, you could argue that CD prices rose with inflation, until the government discovered the various music publishers were acting together to drive up the price of CDs. Once a settlement was reached, CD price dropped again, to a level roughly matching $1-$1.50 a track for back catalog releases. Apple, and other digital retailers, obviously have massive infrastructure costs, though one could argue all their various digital goods share the cose, and while Apple initially took a loss to sell iPods, I suspect it was a loss in part because Apple needed to recoup the cost of building the infrastructure. Given how much music moves through Apple's hands these days, I suspect they are profitable, what with volume cost savings and the initial sunk costs defrayed. For a small digital retailer, just dealing with the initial costs could be daunting. Digital retailing really only works well for lower cost items for high volume sales.

I don't know what studio mastering techniques were used in 1965, but I imagine the mastering process was less malleable and used lots of tape. These days, as long as you have the skills (the hard part), digital mastering equipment is affordable and high-quality. And yet, even with this great digital equipment huge, popular bands like Rush and Metallica are struggling with crappy mastering (http://www.nme.com/news/metallica/39816). I wonder how the cost of recording a mastering a song these days compares to the cost in 1965. I'm sure the labels hire high-cost engineers who use expensive studios with expensive equipment, but I'd wager a talented upstart with a good ear, a few thousand in equipment, and a good space (amazing what you can do with low cost materials, too) could master a track or an album well enough that all but the most talented listeners would have trouble determining whether it was studio mastered or mastered on the cheap. Besides, as the above-linked story mentions, the pressure labels put on engineers means that even a high-cost engineer with fancy equipment may have to put out an album that just doesn't rise to the level it should.

And now that I've put myself almost completely off-topic... I'm not sure digital sales of MP3 files would have caught on without that low price. Yes, Apple set the low price to sell iPods, but without iPods and their ilk there is no market for digital tunes. CD sales were declining even before the iPod and portable MP3 players were ubiquitous, but it was because of copyright violations by way of downloaded songs. Without that digital transition to legitimate downloaded music, spear-headed by Apple, there would have been little to turn that trend around (even wrong-headed laws which put due process on the back-burner can't stop copyright infringement). And truth told, if it weren't Apple it would have been someone else, probably Microsoft. Apple is not saint, even next to Microsoft, but Microsoft would not have been an improvement, I can almost guarantee, and it would have been a garden just as walled, one of wma with DRM and authentication servers.

In truth, Apple's recent success has been due to their ability to get ahead of trends. The walled garden, controlled experience aspect has always been their MO. Apple got ahead of the on-line, digital music explosion, and as a result they largely control it.

As for track costs, well, music is only worth what people are willing to pay. I'm not especially willing to pay much more, if any more, than Apple charges for a lossy recording. I like CDs because they are uncompressed. I can make my own damn MP3s. Then again, much of the time I don't want to pay $10 for a CD for 3 tracks that I like and a bunch of filler, which is why I buy used CDs, for which artists get nothing. So, for my participation in the music market, as an artist, do you want some of my money or none? If the artists and industry try to over-value their music, they'll get nothing from me. At least as it is now I'm willing to buy new and/or digital and they'll get something. We must keep in mind that consumers are not compelled or obligated to buy a product which does not line up with their preferred valuation.

 Yeah but iTunes encoding quality sucks. Maybe when they start offering FLAC lossless (No DRM) then maybe I will be interested. See, even the bittorrent model is more efficient because the users themselves host the files on many hard drives including both home computers and servers (seedboxes). The download speeds are much much better than Itunes, Amazon, Beatport, Trackitdown, Juno, etc. The selection is simply much larger too. There is alot of stuff available through torrents that is not available at Amazon, Itunes, Beatport, Juno, etc. At least Beatport, Trackitdown, and Juno offer lossless wav files so I give them credit for that however they want up to 3.49 per track and usually have "territory restrictions". Torrents do not have these "territory restrictions". See the problem here? When a legal alternative offers the same quality, selection, and fast download speeds without DRM or territory restrictions like torrents then, and only then, will it become a viable alternative.

You know at first I was supportive and understanding, but this ongoing rant of DL has really grown tiresome. Please understand that I've gone to the shows, I've purchased most of their music both digitally and in hard copy. I've been a die hard supporter, but hurling insults and acting like a child because some of your fans disagree with you is enough. Enough already. Hell, I even BOUGHT "The Palace Guards". I'm really turnded off and "successful" or not you really come across like a jackass not worthy of my support. 

I think there are a few artists that, like him had more rewarding careers in the 90's that would agree with him. 

However, 

There are also a lot of people who didn't have that luxury and are out there making do with things as they are...and probably even more people completely outside of (and ignorant to) the old paradigm who it has never, and will never be relevant. 

David, you had a great run with multiple bands on major labels and had songs that charted. You can still play shows and make music, you have a job (a career even!), just not the same one you once had. 

That's more than 98% of the music making population have or will have. 

I'd say wake up every day and be grateful. 

(Besides, topspin and bandcamp only take 10-15%)

 

 

 

I think there are a few artists that, like him had more rewarding careers in the 90's that would agree with him. 

However, 

There are also a lot of people who didn't have that luxury and are out there making do with things as they are...and probably even more people completely outside of (and ignorant to) the old paradigm who it has never, and will never be relevant. 

David, you had a great run with multiple bands on major labels and had songs that charted. You can still play shows and make music, you have a job (a career even!), just not the same one you once had. 

That's more than 98% of the music making population have or will have. 

I'd say wake up every day and be grateful. 

(Besides, topspin and bandcamp only take 10-15%)

 

 

 

I see others have debunked most of the flawed logic in this article.

How about taking credit card charges into account as well?

Try selling something on itunes for .99 cents and see how much they send you after payment charges. The same issue exists to varying degrees for all creditcard companies. Apple has a lot of smart strategies to collect paymentsand save on CC fees, but they are always there. So Apple is not actually getting 30% for their retail service/Hosting /electricity bill/ invoicing/QC/customer support etc. they are getting 30% minus credit card fees.

 

Try selling something on PAYPAL I meant :)

 

Well, yes. iTunes get the 30% by doing nothing at all, just hosting the song. But we forget that physical format still exist. WE release Vinyl and we have to rely on small record shops in our area to sell the records to. And they keep that 30% too.

Then the margin of benefit is so small that we have to take the records in person (metro, friends visiting) 'cause small record labels get no deals with packing companies (like DHL).

Obviously do not even think about selling your records in major shops as the part of the cake they take is bigger.

I guess the new system is WORSE than ever, but it never was I think, not in this economic situation where no one buys music anymore. Would it be even better any day? Hope so, but I don't think so.

We failed on telling people how important is to buy music of any genre and the beauty of format. They are surrounded with music (and lots of bad music) so they no longer feel that owning music is important. Industry and artist and advertising killed music as well.

 

Yes, he's popping at the wrong target - the major distribution system of today isn't iTunes, it's the torrents. And whether you think that's a good or bad thing (the arguments have all been aired enough ...) the fact is that Google, ISPs, cyberlockers, advertisers - never mind the torrent/pirate sites themselves, are all making a mint out of either 'enabling p2p' or selling ads on sites that do - and none of that cash ever gets to the artists who create the content that drives the demand for those sites and what they distribute (technically - 'help to distribute')

The new model is exactly the same as the old model - very big corporations are using artists' creativity to make a lot of money, while not paying enough to the artists - except that in the new model, the 'product' isn't the recordings, it's the distribution system itself, and the advertising income that can be made from it.

And the beauty of it - for those who provide it and make money off it - is that the artists have no rights in it, only in the recordings (and films) that drive the demand to use it.

So they don't have to pay us zilch, and they use all that same 'rebellion/youth/artistic freedom' bullshit to persuade tech people, consumers ... and congressmen ... that things like SOPA (or even watered down versions of) will 'destroy the internet', and all that crap.

The thing is .... artists, politically speaking, have no power at all. Their desire to create - almost at any price- leaves them both weak, naive, and easy to rip off.

We always have been, and we always will be. It's just that these days the ones ripping us off don't ever have to pay us anything at all, and they're doing everything they can to make sure they never will have to, either.

 

Re:  Artists Having Power

Visit www.fareplay.org

I'm not affiliated with the organization in any way but I do believe that if artists who want to be compensated for their work have any shot at having a voice they need to create an organization like this one. 

I think The Recording Academy does a lot of great work (eg. MusicCares) and I appreciate Neal Portnow bringing up fair compensation for artists on The GRAMMY telecast but I think they've generally done a pretty poor job speaking out about this issue, choosing instead to hide behind labels when I know firsthand many, many artists who are struggling.  The inside belief about The Recording Academy is that despite the majority of their membership being working class musicians they are driven by the interests of their superstar artists who, for the most part, are less affected by the financial damage done by illegal downloading and file sharing.

The other quasi-artist org is The Future of Music Coalition.  I think Future of Music Coalition pays lip service to "artists being fairly compensated for their work" but I question how they form their positions.  If you pay attention, they seem to represent the hobbyist who just want their music heard by someone (anyone) more than they do artists who make a living at music (based upon the results of their own survey which revealed the artists they're speaking to report that the largest income stream for them is grants...GRANTS?!?!).  I know they'd disagree but it's either that or they're being unduly influenced by board members like Lawrence Lessig and financial supporters from the tech community who are, for the most part, aggressively anti-copyright which is the single most valuable tool that creators have.  As narrow minded as I know that sounds, it really must be an either or thing if you really know how artists are compensated.  

Everyone would be better off if we heard a lot more from artists who make a living from creating music.  Of course, as seen here, artists willing to do so have to consider negative fallout such as the commenter here named "Tim" who thinks that David sharing his experience makes him a "jackass not worthy" of support.  Sheesh!

This comes off as a case of "It was much better back when I was young." David saw success under the old model. Good for him. Most did not. As an independent singer-songwriter who's been at it for awhile, I find the playing field to be much more level these days. 

Here's a link to Steve Albini's famous article, "The Problem With Music", written in the early 90's, that breaks down what a record label will do for (or is that "to"?) you.  

http://www.negativland.com/albini.html

 

Steve Albini wouldn't have a recording career without record labels investing money in bands. He's a great engineer and he has the right understanding about how "evil" record labels can be. He particularly hates the A&R at Geffen who treated Kurt Cobain so badly just before he topped himself. But Steve Albini would not have the lucrative career he's had without many of those a-holes in the industry doing their a-hole work to finance expensive recording sessions he profits from.

Most of us back in the 90s could only dream of making an industry standard record with such a great engineer/producer and gear. You had to be a trust fund kid, some kind of doctor or lawyer with a "dream," or a signed artist benefiting from the investment Daddy Warbucks over at Warners was putting up to give you that chance. If you were a creative genius like Brian Wilson from the Beach Boys dying for studio time (with fully composed songs in his head tormenting him), you gave thanks every day just to be able to "get it out of you." For the seriously creative musicians out there, the "ride" of the process was enough reward in and of itself. Just being in that league with the best creative minds out there has been and still is the holy grail for serious artists. And this point is too often lost in the conversation about the new world order being better than the old world order. 

Traditionally speaking, artists were generally willing to take a lot of financial and other risks in order to be card holding members of that "big league," to eventually have a vinyl record or two they could plop down on the turntable to let their children hear one day. The LOVE of music so often gets lost in this conversation.

Today, musicians can do so much with digital technology, which is great for the DIY LOVE. But as expressed by DL and others on here, it's a HUGE undertaking to put together a whole industry for one's own self, with time and money being so limited as it is. Songwriters should spend their work time writing the best songs they can and not worry about doing someone else's job. PEOPLE MAKE THE WORLD GO ROUND! We all need each other, which this new digital age only further reminds us of. We can sit in isolation and do a lot on our own, but we still need each other. Why not try to revamp the old world record labels into something more like co-operatives?! Instead of throwing the baby out with the bathwater, why not try to take the best of all worlds and make it work better for everyeone involved?

Lowery is a smart guy and his figures are correct based on what I've seen (as a manager and indie label owner.) And a number of other artists I deal with have brought his words to my attention although they are wary of making public statements supporting him.

I couldn't disagree more with this whining. Saying Apple has no risk or reason to collect it's 30% of the sale is absolutely absurd. Apple is now the retailer in this changing landscape and retailers deserve the be paid for their work. Apple created the entire infrastructure to deliver any song to every continent for a reasonable price, handles all the billing disputes with customers, worries about refunds and fraud. Their system has tens of millions of customers in their virtual store every day. In addition to their on-line business, they market the Apple/iTunes gift cards at all major retailers on the globe (who earn about 10% of their 30% share every time one is sold). They make buying music profoundly easy in an environment when retailer after retailer is backing away from physical CD sales. Imagine the cost to the artist to try to place physical inventory in 1/10 of the spots that iTunes delivers it to. That alone would wipe the artist out. The service and exposure to tens of millions of customers is worth every cent that Apple charges.

This was an interesting read. I read some comments that bicker about iTunes afterwards stating that they started this whole buy one song, not the album crap.  

Two things here...1, singles have existed as long as I can remember (im 30) I could go to the store and buy all the latest singles for 2 bucks and get two tracks. So what's changed about that other than ease of getting it. 2, and the most important is that artist don't create albums worth buying anymore. It started in the 80s with bands like Mr. Bigg who took advantage of people buying whole albums. They would make the top selling ballad and trick girls into thinking it was soft rock, then the rest of the album is metal-ish. They would also have one possibly two killer tunes and the rest is tripe.

Today, people figure out a one song formula and them release what sounds like people farting for another 45 minutes. It's the artists who should take responsibility. They are the lazy ones.

Hear my art here:

www.facebook.com/lonoband

well ... most artists who get major deals aren't really in a position to control exactly what gets put out- it's the producers and the label who decide. Whether that's a fair trade for (usually) about $500,000 of promo being spent on them is up to them to judge. Could be 'laziness' but given the difficulty in getting any kind of 'traction' out there, trying to do it in DIY land, it's probably more ...well, if you're going to sup with the devil, may as well just go along with it, if it's going to help your career. 

... and if you're willing to sacrifice integrity to help it along, of course. That's a choice some may wish to take, and others won't. There's plenty who don't, and put out good albums that are good all the way thru- making fat generalizations about artists doesn't help much.

Talking of DIY land, you may like to request either FB or Reverbnation to remove the requirement to 'like' your page before the player will even play any tunes. Not sure whose responsible for that, but it isn't good. How do I know I like it before I've even heard it ?

It's a 'lazy' tactic.... 

it is a lazy tactic and i'm a lazy man who put it there.  

But you've also ignoring the point of regurgitating the same garbage over and over just to fill space.  That being the artist or the albums fault aside.  It's still happening.  There was a time when people wanted to make albums, not songs.  If more people had that mentality again, people would once again want to hear a whole album, and not just one song, and a remix of that one song.

Much as I agree with the sentiment of much of this, much of the analysis is just plain wrong.

Very interesting view of the development in the music industry...

A lire!

The new bosses are Apple and Amazon and they are greedy b*st*rds.

Okay. You come up with a way to deliver millions of songs to millions of homes for free oh wise one.

Kinda depressing...

A compelling argument...

All one has to do is go back to 1999-2004 to understand the relationship between artist,record companys,retailers  and the public to understand the break on all fronts.The public was sick of high priced CD's up to $ 18.95 at retail with very few good songs and alot of filler. Record companys were tring to make up the difference from illegal down loading and the lack of ROI.

Apple comes along and offers $99 cent songs and everyones getting paid.

It's up to the artist and all involved to create material that the public will pay,example Adele and others in todays world.

When you sign to a record label they expect a return on the money they have invested in the artist so be expected to repay all cost first before if  you happen to sell any music at all. Remember they have 25 artist and 7 make money this business is a gamble,as Ahmet used to say for every hit there are 50 clunkers ,nothing has changed.

In most cases they will own your masters which would cost most artist an arm and a leg if you want to buy them back.. If you are signed to a major label today and want to sell your own records at concerts the label will charge  you $ 9.99 ,makes I-Tunes sound great.

There's pro's and con's to both I have found most artist haven't a clue about,marketing and retail so that's why major label exist.

Remember as of now artist signed to label's are still a work for hire,somethings never change.

Stating that it costs Apple and Amazon zero to sell music is factually inaccurate and just plain dumb. Besides the obvious costs of servers, electricity, office space, and labor to keep it humming, there are the costs of credit card transaction fees. The majority of purchases are for songs and often one or two at a time. Credit card fees eat up a sizeable percentage of the 30% of the gross on such a small dollar amount.

The argument tries to cover a very broad area.  A couple of points:  1) Not all genre operate the same, R&B vs Pop vs Country vs Rock, 2) there are general deal terms but many deals are very specific and unique and therefore create value for different activites, i.e. touring vs record sales, 3) Apple/Amazon is many things a retailer and a distributor all at once.

The old model was broken the day the CD was invented. The new model was when we achieved critical mass with respect to bandwidth for transmitting in the MP3 format.

Apple and Amazon are big players but they are not the only problem as has been pointed out previously.  Additionally, they will only be part of the solution.

The issue is you can not protect a copy right, i.e. charge for its use in the current technological environment.  The rather simplist solution is - move to another technological environment, i.e. a format change. The 45 and 33's format went the way of the dinosaur as will the MP3 format.  Next time someone needs to be at the Fraunhofer Institut or equivalent thinking about the commerical consequences for the industry we love when the format changes.

most sensible thing i've read in a long time

You missed the biggest argument, actually, but can reuse the rhetoric: We are several times more likely to stream the clip via YouTube vs. even buy a track at iTunes (verifiable fact - been proven...and ask anyone under 30 where they go to access music really...it's YouTube). So the real new boss is GOOGLE, and THEIR revenue/take/shares model vs. service offered for the customer & artist is what's really going to kill the artist's share/take/wallet in the long run. Especially when you see they are purchasing Motorola and got themselves mobile O.S. with Android...They're moving toward slicing at Apple's heels with the hardware/software biz that Apple's had (a retailer, with a device)... i.e. you are making the right argument, but when pointing to business models becoming entrenched in a bad way for artists, you're not yet pointing to the worst economic/artistic parasite.

As a professional musician, (Gang of Four,) I've talked and written about the artist's dilemma on many occasions. I won't go into the lack of income due to disruption here as it would take too long. Instead I've been putting my money where my mouth is, as it were, by becoming a board member of Cash Music, a non-profit platform that is built for musicians to sell their music and other products directly to their fans, with no middlemen. We have a Kickstarter going right now http://kickstarter.com/projects/cashmusic/cash-music-platform and although we have funded our project please feel free to donate as this is something that is useful for musicians..

Thanks for reading this.

Wow, this may have been the worst bit of economic information I have read in any article from DMN ... PLEASE make sure you 'vet' or fact check. Here are the problems (a) tour support, recording costs, and even some marketing costs were not 'covered' but labels - the were 'an advance against royalty' which means you had to pay it back from your 15% royalty (b) the 'risk' that the label put in with capital was offset by the fact that they got their 85% of sales revenue oof the top along with your 15% until you reached break even ... meansing they almost always broke even even if you did not 'recoupe (c) with the advent of the 360 deal they are now taking a piece of your touring, publishing, sponsorships, merch etc. plus their 85% of any recording sales!!

Yes it is true that YOU the artist in a DIY situation have to frontload your project with dollars -- get smart -- try kickstarter... and yes, marketing in this time of 78,000 releases is a total bad dream come true ... but the article's old boss/new boss was a really bad case of voodoo economics ... ??

Chris, your record label example is consistent with venture funding.  A typical deal is that an investor who puts up capital gets 100% of the available cash flow until that money is repaid along with a predetermined Internal Rate of Return.  This IRR is determined by risk.  After this return the investor and entrepreneurs share each additional dollar in some form.  The entrepreneurs are often paid salaries to live and operate the business, but their payoff comes after making money for the investor.

If artists are now responsible for self funding they will most likely have to search for investors.  Or kickstarter.

Oh god. I'm so sick of listening to folks cry about this.  There is exponentially more content available to consumers now.  If you want to get paid you need to compete to get heard.  Stop blaming everyone else and get creative.  If a 14 year old like Rebecca Black can make it big surely you can figure something out.  

And btw, if you can't figure out how to make it just enjoy what you do and stop complaining.  The internet is all about creating and sharing.  Bloggers, developers, artists are all creating content because they enjoy it.  A small portion will get paid at all or figure out how to make a living.  

This outlines one of the reasons I will never buy music through iTunes.

This is garbage! The REASON making money out of selling your music is harder than it once was IS BECAUSE ASSHOLES STEAL IT! dear God why is there even a debate about this? The reason there is a debate about this is because, just as in the global warming so called "debate", there are powerful entities (google, ISP's etc) that want to keep the current system of theft going forever. This nonsense blaming Apple and Amazon is just so damned stupid. They provide a system of distribution the likes of which the world has never seen. This is extended to artists that would NEVER have had ANY distribution before as well as amazing access to millions of recordings that would be out of print and impossible to get. The problem that any actuary can identify in a nanosecond is PIRACY! Honestly, if someone steals your stuff instead of paying for it, YOU HAVE MADE A LOSS! It really is THAT simple. IT IS SO SIMPLE but for quite sinister reasons it has become politically incorrect to criticise this act of outright THEFT!

Put it the other way around... if people bought legitimate downloads from Apple or Amazon and there was a low level of theft, profit would be completely restored to the music recording industry and the artists that create the music.

Most reports say that 90% of all artists signed to a major label NEVER recouped (it was probably a lot higher). That means that artists did not make money the old way. Yes, there are costs associated with being your own label, but the incentive to recoup is certainly a lot greater, and the odds are also a lot better when you can easily have international distribution through the likes of itunes and amazon. It has already been stated that these outlets are retail stores and take about the same percentage as they always have. The biggest difference if that the access is much greater for the little guy. 20 years ago you couldn't have gotten your record in all of the tower records stores without some sort of distribution, and even then you had to make sure they were actually shipping the products. I produced a record that was in heavy rotation in several major markets and when I called the local record stores nobody stocked it. The old ways sucked.  

CB, a large part of your premise is dependant upon an assertion that you don't support with a cited reference and doesn't take into account that a big reason why so many artists didn't recoup on record sales was because they took the biggest advance check being offered by any old label despite available evidence that the offering label might not be a good fit for them.  Anyone who ever bid on an artist knows full well what I'm talking about.  Anyway, those advances WERE income - the artists certainly didn't spend much of those advances to record the records - and it's no one's fault but the artists if those advance dollars went into their arms, up their noses, or to their livers rather than in their bank accounts. 

That said, the "old" model was no doubt clogged by tired gatekeepers and excluded artists that didn't get the attention of labels. 

Conversely, despite it being wide open to any artist interested there is ample evidence that the 5-10 year old "new" model just isn't paying the bills (and comes at the expense of those old, fat advance checks and big marketing spends).

However, I believe the BEST model is within reach. 

This model provides choice and allows artists to be DIY'ers or signed to labels with reasonable spends and advances.  The only thing standing in the way of this "best model" nirvana occurring is the perpetuation of the myth that artists (and labels) should forget about trying to get fans to pay for music. 

It is music that your fans want from you and it shouldn't be a crime for you to ask your fans to pay you for your music.  Once artists speak up about the importance of their fans paying for their music and bloggers blinded by their love of technology stop trying to prop up the myths in an effort to convince artists it's in their best interests to give up that fight (to the enrichment of investment banker backed tech platforms) we might actually turn this tide and realize the best times for all artists.

After reading this, I felt the need to add my voice to a debate that, in my opinion, has to be reframed entirely in order to be understood. The numbers and receipts...that's all just noise.

In short: There is no “new model.” There is Chaos, and Chaos is not a model. We artists cannot treat it as such. Pointing out looters in the middle of a riot is an exercise in unenforceability. Do the looters know this? Oh, yes.

My full response, and hope for future artists including myself:

http://bit.ly/zsNJd5

I thought this was a great read. I've been making music for nearly twenty years now, and I can honestly tell you that I have not been very successful at it. I don't tour. I don't sell my music. I give it all away for free. I do not like middle men, and that's the real problem. Why should anyone profit off of a venture that I'm not profiting from myself? See the problem? Now, I understand that the music business is a business, but Dave was very restrained in discussing what this model is doing to musical expression itself. It seems many people are more interested in humping over a conception of fame or notoriety, rather than making good music, and having fun doing it. That's far more grave than any predatory business tactic used by a middle man.

MUST READ.

This point of view is moronically frustrating. 

1.) Physical record stores took the same cut in the past, if not more than what iTunes takes now

2.) iTunes is not a monopoly. If someone wants to come up with a better product, GO FOR IT!!! nothing is stopping them. Steve won because he made the best product. Lots of others tried and failed. Go ahead David and rally together the best minds in the business and create a new product that gives you a better take on the money. 

Apple so far has been the ONLY solution that's created a destination where people are actually buying music in mass. With iTunes it would be even worse than what it is now. 

Hey, don't blame Apple and the record labels. Sure profits in recorded music are down but you can't expect the executive suite to sacrifice any of their compensation package. What are you, some sort of class warfare-mongering socialist?

Labels have never "paid" artists to tour.

Labels advance (i.e., loan) artists money against their future royalties for what's known as tour support.

In the case of some artists subject to bidding wars, some tour support will be non-recoupable, but this is a very rare case.

If you happen to be an unmistakably excellent artist that probably is never going to break through to massive appeal (Cracker is a great example), then Lowery is correct -- in the 80s and 90s a band like this could get signed to a major label deal that would allow them to invest only their sweat equity over a period of 1-5 years while the label advanced money for recording, touring costs, promotion, marketing and minimal living expenes. 

The upside for the artist in that model was big -- you were getting a huge investment/loan in your business that you had zero obligation to pay back.

He totally discounts the fact of supply and demand. The fact that Steve Jobs was smart enough to see the trend of how consumers were consuming music conveniently (despite the fact that the sound quality is much less than with CDs), and then developed a convenient delivery system to provide consumers music the way they wanted to have it is just smart. Record labels were so busy trying to sue college students instead of figuring out how to sell them the music in the most convenient format that they missed the boat on how to corner the market. If each label would have built their own digital agregator where they could sell mp3s and other digital music formats, they would have been in a much better position than to only make 61% of $.99, or whatever price point they wanted to set per download!

iTunes does a lot. They provide you with world-wide distribution without any inventory cost and no possibility of returns. ("Returns," for you young'uns, is the records that stores send back because they didn't sell. That's over, in the digital realm.)  If 30% is greedy then Mr. Lowery you should make your music available directly and keep 100% of the money. Just make a website, hook up your paypal or other paythingy, and let it rip. You'll need a bit of webdesign, a server, bandwidth costs, server maintenance, all these things take time and money, but you have time and money, yes? You'd rather do those things, Mr. Lowery, than be on stage and in the studio and writing songs? Got it. Ok, so begin - make your own store, and keep 100% of what you earn there. Excepting that the time and money it takes you to create and maintain that store, will amount to, gee, I dunno, maybe 30% of the gross? Or more? How tech savvy are you? If you're starting from scratch, then that's going to be a learning curve and/or hired tech guys so you're spending closer to 50 or 90 or 100% of the sales you make, or more out of pocket, to have your store. Or have your indie label do it. Who's paying for the guy doing the work? Or are you doing it yourself?

David, you really have a good point about the change that we've seen, and I'm sure it has in some significant ways gotten worse. But being mad at iTunes for taking 30% is silly. Be glad they don't take more. Or try negotiating with them, see how that goes. Or take your stuff off their store, and sell it yourself. Or, as I am sure you will do and not do otherwise: leave your stuff on the iTunes store, and gladly cash the checks when they show up. Bitching optional.

I like your records, and I like that you aren't afraid to speak your mind about this stuff publicly. But keep in mind that no one wants to work for free. What, iTunes should take 20%? 10% Nothing? Reality is: they could take more and people would still do it. I think they priced it fairly for what they provide. They make their $ on hardware anyway, they would long ago have failed outright if selling mp3s was their actual profit model. 

If people buy your records, be very happy about that.

I'm not gonna get into arguing with people here, cause i didn't submit this to digital music news.  They just excerpted part of it from my facebook page.  My presentation at SF Music Tech is actually pretty nuanced. My argument is very long, well researched and backed by data.  I teach at university of georgia and i'll eventually publish it in a proper way.  but this isn't the place to argue about it when it really doesn't explain what i said.

 The main point is that overall and on average a lower share of recorded revenue is going to the artists now.  Not in every case but overall.  There are winners under the new system who do much better.  But if you look at all the revenue it appears that less is flowing to the artists now.  The point of comparing the current system to the old system was hyperbole.  Show that the bad old system was actually better than the new system to shock everyone.  It works as I spoke to a crowded room.

Many of you make good points but you've got a lot of this wrong simply because this article doesn't explain what i'm talking about. My data is not drawn from my own personal experience but drawn from records of recording studios.  over a period of nearly two decades.  

What disturbs me is that you can't say anything about Apple in a public forum without what appears to be proffessional reputation monitors countering your claims.  ick.  creepy.

 

David why duck out of this debate, please jump IN?  You can't just have the keynote that you call "Meet the New Boss, Worse than the Old Boss" then say that's not what you said?

"The point of comparing the current system to the old system was hyperbole.  Show that the bad old system was actually better than the new system to shock everyone.  It works as I spoke to a crowded room."

Okay fine you got everyone's attention, so please don't crawl into some corner by saying everything is more nuanced and harder for us to understand?

Please ignore the Apple fanboy mafia. It's just intimidation so let them strengthen your resolve. Dave you are the few with the cajones to say this, and I love you for that.

David - please listen to the facts:-

1. In the traditional physical record market the retailer takes at least a 30% mark-up. In addition, in most territories, there is sales tax (VAT).

2. Apple iTunes store is a retailer, that operates on an international scale. For them to take a 30% markup (incl sales tax) for making a huge collection of music easily available around the world is not unreasonable.

Your claim that stating these basic facts is a display of Apple fanboi "professional reputation monitoring" is totally ridiculous.

Exactly right about iTunes.

I don't think David referred to "Apple fanboys," though. That was someone else, unless I mis-read.

Anyway this will go how it goes. The "old model" is dead, that is clear. The new one hasn't fully revealed itself yet. At least now an indie label / artist / producer who creates a recording can distibute it to the world, without pressing a single piece of plastic. Whether anyone ever hears about it is another thing.

Hey David,

I didn't consider, before I commented, that your comments might have been highlighted outside of their full context. This happens often. I might have spoken differently had I been privvy to your complete statement. I say again, I respect that you speak openly about these subjects. I re-read my comment and it seems judgemental, I didn't mean it to be so. You're navigating some tough waters, and I only wish you continued success. I think everyone here would like artists to receive fair compensation for their work, when it generates profit for distributors or other parties. I just thought the iTunes bit was, taken alone without further context, well, not complete. 

"Let's get off this, get on with it, if you want to change the world, shut your mouth, and start to spin it."
- David Lowery, Cracker.

I love that song.

I bought that album, btw, on CD, back when. I still listen to it. Regardless of that, I'd be sad if this forum did not welcome your thoughts - after all, you were invited to share your perspective and you did so, honestly and fearlessly. These issues wont be solved without sincere discussion. Obviously you provoked some response, so, ok!

"I had a dream, I wanted to sleep next to plastic" 

Rock on.

David, 

I should respond here, because if there's a lot more to the argument I'd like to make sure that it's represented.  There's actually going to be a Soundcloud upload this week of all the SF MusicTech sessions, so maybe that's the start. 

Perhaps what was so interesting about this opinion is that it so unflinchingly challenged the notion that artists are enjoying a better existence under the 'new model'.  It's almost a religion at this point that unfettered direct-to-fan has improved the life of the artist.  But as you can see, some will shout down any protest of this notion, while others will support it, which means there's clearly another side and debate here.

/paul

what do you mean Apple hasn't done anything other than hosting files? Is this guy insane???

They create the interface, they do the marketing to get people there to buy. Apple SAVED the music industry and is now the best way for an indie to get heard and purchased.

Cmon..

To assume that retialers are going to sell product at cost is just plain dumb.  There will always be a gap between PPD and SRLP

Definitely something to think about.

You can always just not use itunes and amazon, and figure out a better way yourself.  There is that option for all. 

It's just like the people that worry about Google and Facebook, when no one is forcing anyone to use these outlets. 

While one can argue whether 30% is a fair percentage; iTunes and Amazon aren't doing "nothing" as you maintain. They are providing a huge, centralized distribution channel for your work. In addition; they are making it incredibly easy for anyone, anywhere, and any time to buy it. 

That said, I can see your points about having to absorb all of your own marketing and touring expenses. The "do it yourself" model often works best for artists who are already established, and who have legions of fans who will snap up their digital downloads.

If you're not an established artist, doing all the work yourself is very hard, and pays very little.

I think it's still just a very hard road for all artists these days--established or not...to quote an old Talking Heads tune "same as it ever was, same as it ever was".

 

 

 

One point that keeps being repeated is that iTunes and Amazon are retailers. Perhaps, but it's a lopsided model when you consider that they don't have to purchase inventory - they aren't assuming the common risk of buying a bunch of crap that doesn't sell. That's the catch, so it's not quite fair to give them the benefit of the argument in that sense - especially when you consider that the original idea of offering content (for iTunes) was to sell more devices (iPods). Apple is not a retailer of music - it is a consignment house.

The music industry is like Wall Street. You have a buch of fat cats calling the shots, creating complex hedges and debt obligations using creative content as music backed securities to sell to advertisers reaping billions in ad revenue while the content creators get shafted in the process.

And just like Wall Street, these fat cats need to be regulated and held accountable.

The entertainment industry needs something on par like the SEC, to police the abuse taking place. Never in my years in business have i seen such abuse taking place on an industry like this thing we call "the music business".

I made my living off this industry, not as an artist but as a business selling pro audio products to this creative market. I'm lost for words to discribe how disgusting at the evil that is killing so many great and talented artist, composers and publishers.

The Google, Apple, Yahoo, Amazon and all the other unregulated, unaccountable wheelers and dealers are giving vast resources of creative content to exploit and mine at the expense of a creative industry on the threshold of death. If they have they no dignity, respect or love for this industry, maybe it's time to declare "war" on them. 

Remove all your content for 30 days and see what happens.

Long live music and long live fair trade.

Dalton priddy

I'm sure Lowery is a great guy and i'm sure he has some smarts but i learned from the best i got my masters in music business at NYU (was taught by industry professionals, entertainment attorneys, and everyone in between) i also have my own music industry experiences (entrepreneurially and professionally) and schooled myself on the old models of the industry prior to getting my masters degree........just saying

__________________________________________________

Money Lost in Pensions:

Anyone with a 401k that reduces their risk as they come closer to retirement will not and their financial advisors will not allow them to invest in such a notoriously volatile industry – the second thing I have to say about this is that overall no one (unless you have a ton of money) directly invests (via the stock market) in any of the entertainment industries because the market is so risky and this has always been true (there are case studies that cite this but that’s besides the point – my books proving this are at my parent’s house)

Napster:

If it wasn’t them it would’ve been someone else. AND Napster tried to legitimize the download service with the labels after they got into trouble with them and the labels refused to accept legitimizing music downloads and stopped negotiations with Napster thereby allowing iTunes to control and dictate the terms of recorded music distribution and sales on the internet (rather than the labels being able to)

More Napster:

The most consumers of music are also the largest music customers (even if you’re illegally downloading a ton of music you’re also going out and purchasing the most music). Many studies have proven this – there is one large study from Stanford and the purpose of their study was to actually PROVE that illegal downloading WAS hurting sales of recorded music – much to their chagrin they were shocked when their hypothesis was actually proven to be reversely false. There are many other studies that prove that illegal downloading DOES hurt sales of recorded music but they’ve been paid for by the RIAA and the like so obviously the outcome will be what the RIAA wants it to be. Check out the book “How to lie with statistics” there’s a lot of ways to make a study have “real facts” even though the data/data interpretation was actually fudged (be it by sample size selection or whatever). It’s only the independently done studies (generated by general curiosity) that proved illegal downloading doesn’t hurt the industry (because no one was paying them for the answer they wanted).

Record Labels & Model Changes:

Record labels did not change their models – they made 360 deals standard These used to be called “all in” or “all inclusive” deals and entertainment attorneys since the 70s knew the negative impact that that type of deal would have on the artist and refused to let them sign those deals – now if you want a deal you have to sign a 360 deal or the label will tell you to take a walk… Labels were also forced to change their distribution models due to music consumption habits –they did not change their overall business model– they just decided to give in to a new distribution method to at least monetize music on the web rather than losing out on the opportunity to do so

How to get on Itunes:

Artists just need approval and meet select requirements to get distributed on iTunes his facts are wrong – oh and one of the aggregators he refers to is actually CD Baby (which most artists use anyways).

Payment & iTunes

iTunes takes 30% for distribution due to costs and they actually don’t make that much money off of the sales of recorded music (their money comes from the app store primarily) and the artist gets the remaining 70%. That might not seem like that much BUT since the artist put the album/tracks out themselves they pocket the money directly versus the labels taking it until the album recoups the advance money (which most albums don’t recoup and then with cross-collateralization the artist is even more screwed because they’ll never see any money from the sale of their music). Since the artist is paying for the album they are also becoming more responsible with their money so they’re not pissing away money like they used to just because it seemed like someone else was paying for the album (even though they really were paying for it in a backend way) – oh and when the RIAA realized iTunes had complete control of them (and pinned their backs against the wall in terms of dictating distribution terms) they started pursuing deals with Amazon (and that’s how Amazon’s music store was created – oh and that launched with DRM Free tracks – just so the RIAA could slap iTunes in the face)

Risk & The Artist:

Real artists accept risks because they’re pursuing their dream. If they want a sure thing they should get a steady day job and forget about being a professional musician because their mindset isn’t there and they wouldn’t have made it in the industry anyways (as they were never fully focused on pursuing their dream). If you dream big you must be willing to accept the risks of pursuing those dreams (however big or small those risks may be).

Oh and if the risk is about the personnel the artist might get involved with that’s why I am here. That is why The Music Business Network was created. The foundation of what we do is to help build artists’ networks up with solid industry professionals who will help them obtain their career goals (which usually is becoming a professional musician). We help them build their team – on top of all the other things we offer to help them achieve their goals.

Managers & Agents:

They’re still getting paid the same percentages as they used to but they just make less money due to 360 deals from the record labels dipping into their gross money pool.

Other:

He did mention something about artists not making a living on touring. ALL artists primarily made their money off of touring and merch NOT their albums (as they normally don’t recoup – as stated above). The difference now is for the signed musician the labels are taking a percentage of the monies derived from touring and putting it into their pockets now and for independent musicians they just need to be careful about where they focus their touring efforts and make sure they have enough fans to draw a crowd. This is not rocket science it’s marketing and market research (reference my article that was published in ASCAP’s Playback magazine or my 250+ page thesis on analytics).

Also, where this he get this 61% number from? He keeps stating that he wants those who are going to argue with him to provide empirical evidence to back up their arguments yet he doesn’t source any of his information (outside of the fact that he’s an artist signed to a label). I’d also love to know what his calculations were regarding how he came to all artists getting paid 61%.

this is the most intelligent response i've seen here. in a recent blog from Psychostick frontman Rawb , he mentioned that they don't make any money from sales of their music, they make money from playing shows and selling merch. I am a musician/songwriter/bandmember in the process of recording a "cd" which i will be uploading for free to torrent sites in the hopes that people will download it , like it , and come to see us play live if we make it to their area. And then they'll buy one of our cool pieces of merch and buy me a drink.

I agree with some of what he's saying, but some of it is so mind-numbingly stupid I hope he understands some day.

David, it's YOUR music so YOU should take ALL the risk.  I know you got used to someone else taking part of the risk, but now they don't have to.  Sounds like you feel entitled to socialize the risk - just like a Too Big Too Fail bank.  It's wrong for banks to socialze the risks and it's wrong for artists to do it, too. 

Basically, if you don't want all the risk, you have to give a percentage to the a partner.  Sounds like David's just having a hard time finding partner.  But you can't blame the retail end for taking the same cut they always have.  Funny how artists want to blame everybody else but won't lower their own damn prices.  Sorry, but mispricing your product and labor has ALWAYS been the artist's risk, artists hitting their 50's and seeing sales drop ain't new and ain't due to any new business model.  

I'm in my 50's and I could lose my job tomorrow.  At my age, if that happens I may have to lower my price if I want a new job fast. And I may have to because a long stretch of unemployment would only make me even less likely to be hired.  It happens in EVERY business, not just the music biz.

Well I'm just a comedy writer... but from 1978-80 I was signed to IRS Records and toured my arse off. These days I still don't get paid but at least I have full conrol over my poverty!

"The main job of a record company executive is to sell millions of copies of your recording and make sure you only get paid one pound sixty two pence. Your job as a musician is to try and get an appointment so you can demand to know where your royalties are before being thrown out and later served with a restraining order."

Luke Skyscraper

 You know what people? here's the bottom line.

I don’t profess to have all the answers or understand what’s happened to the music business. My first major public foray was on A&M records, when the average releases in the States were about 300 albums per year. Today, there are over 73 million songs online. And there are only (4) major labels left hanging by a financial thread. Needless to say the entire music business has been turned upside down and a few would say for the better, but most would opt for the worse.

Many you have heard me perform a song called “Radio”. It is about the end of non-commercial mainstream radio. I know there are more important issues in the world than to focus on one complex segment of the music business, but this is really about artistic and cultural freedom. Trust me,  Arlo, (my advisor), reminds me of that every time I play it! I have written many songs about greed – for example, "Share The Wealth", (Which MTV flatly refused to play), and "Mr. Blunt, & Mr. Frank", which are not only relevant to the current situation on Occupy Wall Street, but were written years before this awareness arose in the public eye. Finally……… we wake up !!! I am reminded of a quote by Bodie Thoene, "Apathy is the glove into which evil slips it's hand". I've always said, the problem is not the greed, it's the acceptance of it. I also wrote other songs that dealt with this extraordinarily unbalanced, unfair, self serving economic system we call Capitalism, like "Money Dance", and "Most Of Us Don't Understand At All", in which I wrote about the 1980 Earthquake victims in Italy and dedicated it recently to Haiti. I recently read a quote from a Norwegian author named Jo Nesbo that for me really put things into perspective. He said, "Man's ability to rationalize when self interest is at stake is inversely proportional to intelligence". Nuff said.

 I simply want to address the question that people ask me so often – "Why don’t I hear you on the radio? Your music is so much more beautiful, and different from what I constantly hear every day".  I’ve written a song for just about everything so I thought why not write one about the radio? So I did. What I'm talking about is commercial mainstream/drivin' on the freeway radio, not Internet Radio, not Satellite, and I beg to argue how community – some community radio is. I understand all radio one way or another is subject to paying it's bills whether it’s done by donation or advertising. There was once a time when most commercial radio stations were independent and the DJs controlled what went out on the air based on the artistic integrity, and substance of the music. Unfortunately, as we all know, too many gave in to payola, so to get around that accusation, the record companies cooked up a legal way to get their songs played called underwriting. I’m fortunate that before giant corporations like Clear Channel bought up most of the stations in this country, my work was heard and appreciated by the people in radio who had the freedom to play what they personally liked, and as a result you know about me.

In case you're not aware, Clear Channel is the largest owner of full-power AM, FM, and shortwave radio stations with twelve radio channels on XM Satellite Radio, and is also the largest pure-play radio station owner and operator. With some 850 stations, Clear Channel is the largest radio station group owner in the United States, both by number of stations and by revenue. According to BIA Financial Network, Clear Channel Radio recorded more than $3.5 billion in revenues as of 2005, $1 billion more than the number-two group owner, CBS Radio. They employ over 18,000 people. In addition to their Broadcast properties, was ownership of LIVE NATION, the largest owner of live venues in America. However, a legal ruling from Washington deemed this dangerously close to a monopoly so it became a spin off with independent ownership. Nevertheless, in this "Virtual non-monopoly", LIVE NATION also owns TicketMaster, manages 250 of the top commercial selling major label acts and produces 20,000 shows annually. So, between the two media monsters, let’s face it – the popular music industry has never before been so manipulated, contrived, and controlled that you’re not going to get heard or seen by the masses unless you agree to pay a great deal of your income to these people. All major labels now insist on what are known as 360 deals. If you want to be on their label, and work within this contrived framework, you must give up a percentage of your income independent of what you might receive in record/CD royalties, (of which, recording artists have ever only received piddling amounts anyway), your publishing, touring income, (up to 50 % of both), and merchandising. Now, on top of all that, can you believe that you are only considered an "Employee" of that record label. They will insist on ALL RIGHTS to your work in perpetuity. You spent years creating all that music, record it with them, and it isn't yours anymore.  That's a whole other kettle of fish that's about to go down. At least they don’t control You Tube or Face Book (yet).

"With every new technology comes new challenges and the Internet has certainly opened up a new world for the independent artist. The downside is that the musical consciousness of people around the entire planet has been self servingly manipulated by people whose bank accounts have been, and are currently fueled almost exclusively by the hormones of adolescents, and immature adults, yet they continue to shirk any responsibility of presenting a higher level of the art of music to the people who are the source of that income for those children."

The upshot is I think it’s safe to say is that this is due to greed and a lack of new CD sales, so the major labels are taking less risks on developing the new serious artists of tomorrow. That's cutting off your nose to spite your face. In my day they called that “artist development,” which meant an artist like me or a band like Pink Floyd who had low record sales were kept on the label and given a chance to grow. Today, if you can’t sell a 100,000 CDs on your initial effort you’ll be dropped by the label. The main issue is that the major labels control commercial radio/media – which is still the main way an artist can get known. Being an indie can work up to a point e.g. discovered on You Tube and other social media sites and there are success stories but not very many.

Now add the limits imposed by genre: Americana, Folk, Blues, Pop, Rock, Alternative, Adult Contemporary, Jazz, Rap, Hip Hop, Classical, Electronic, Country, Rap, Heavy Metal, Punk, Nu Jazz, Ambient, Reggae, and the sub genre of the sub genres. Not to mention the musical fields of other countries, and cultures. Can someone please explain what the hell “Adult Alternative” and “Americana” is supposed to mean? Who invented these channels? If I play a solo jazzy piano like Nora Jones I’m Adult Alternative, and if I pluck a banjo with a Blue Grass band I’m Americana. My publicist in Nashville said that I am a “Heritage Artist”. What does that mean? She said it was an honor. I searched GOOGLE for the answer: Quotation: The revival of ABBAmania again points to the power of visual media rather than radio to fuel a new generation’s discovery of what the industry politely calls "Heritage Artists", which translates as singer-songwriters of a certain age with a decent catalogue of hits.

 If you can’t be categorized your music isn't going to get played. Several years ago, while living in Los Angeles, I was writing, and collaborating with a very dear friend, who is highly regarded in the music business. His name is Bob Ezrin. I cannot even begin to tell you the enormity of his contributions to the music business, and the art of music itself. Well, one little thing. He produced the "The Wall", and "Dark Side Of The Moon", by Pink Floyd. The material we were writing was extraordinary and he decided we should make an album/CD of this work. We went to (at the time) RCA records, and because of his stature spoke directly with the president of the label, and played him some of what we were doing. You know what he said? "I don't know what to call this. We can't sell it". WHAT ?!! All you had to do was play it for people.They would have bought it.

 In 2002 I met a gentleman who is now a dear friend. His name is Bill Pursley. He gave me over $100,000 dollars simply because he wanted me to make a new CD. There were no attorneys involved, no paperwork, no nothing. I made him "No Category". I used the most sought after session musicians available, and made this wonderful musical experience that I was sure would sell enough CD's to recoup his gift. It was already too late. Not even one record company would even listen to it. How stupid is that?

 For years now, no one has been able to categorize my work. One time my manager called a radio station to see if they’d play me and the DJ looked me up in Billboard magazine – it didn’t matter what the music was. I had that problem in Minneapolis on this last tour – no radio station support: no one would interview me or play my music because I didn’t fit their demographic. The closest station willing to do a ticket giveaway promotion was the NPR brand - Station KNOW who play Americana music. (remember them next time they need a donation). Those of you who have been around long enough know it wasn’t always that way.

The actions of the past/present music/media have left the world with acute musical indigestion. There are no priorities. Today, if a person (age 5 – 90) can learn to play a few chords and perform in front of a video camera, (or get a song played on the radio/YouTube), they are regarded as a "professional musician". Hold on here a minute. Let's think about the years required to achieve even a modicum of musicianship. Let's get this straight. In my personal opinion, DJ's, and Rappers, are not musicians. DJ's just play records previously recorded by other artists, and rappers are storytellers. Brings to mind what my dear departed friend and fan the comedian Sam Kinison said. "Why are rappers always grabbing their crotches? Because they don't play any f…..ing instruments"!!! Certainly some Rap is pure poetry. The rest is a soulful cry of pain, from years of oppression, poverty and an explicit expression of powerlessness, which is righteous, but has done nothing but keep three generations of children stupid, angry, and resentful. Stupidity is a choice, and the music/media industry has been telling them it's the right choice for years.

I have watched artists I greatly respected fall prey to that mindless, needless affectation that commercial/designer music requires, and have lost the chance/ability to evolve musically into innovative fields. The creativity of future Singer/Songwriters who want to be heard by the public has been put on the chopping block with the genre limitations imposed by the present music/media industry. If you want to be a truly creative musician, you must be a sponge, and absorb ideas from every musical idiom. Can you imagine what film scores would be like if those composers had to kowtow to what the producers of popular music have to do to get on the radio, and get CD sales? Martin Scorsese, Steven Spielberg, and Francis Ford Coppola would be appalled. These composers are the Bach, Mozart, and Wagner's of today. Then we have incredibly evolved artists like Bobby McFerrin, but do we hear him on every day radio? Don't think so. He lowered his capabilities and wrote a commercial and catchy pop ditty, to get heard with "Don't Worry, Be Happy". In fact, he didn't even sing it. He spoke it. His incredible vocal prowess with symphony orchestras, and extraordinary interaction with concert audiences will never be played on mainstream media. Too bad. Anyone with ears, and half a brain could really get into that, because it's so beautiful and moving, but the powers that be in the music/media business don't think their advertisers would support it, and that their audiences are not smart enough to appreciate it. This…….. is a big problem. Besides, it puts too much pressure on "Up and Coming Young Artists", to aspire to that level of creativity. True artists scare the crap out of labels, because they know that artist is going to be very difficult to manipulate into "Taking direction". The artists that can do without that are rare, and they should be making the money that many of the morons whose music consists solely of samples, and loops are touted by the industry/media as creative, but the people who choose what goes into the public ear will not undertake the risk of allowing artists with serious aspiration that avenue of exposure. Actually, I just thought of something. Just as there should be a separation of Church and State, there should be a separation of Artist and Business. I don't think the music would suffer. I know that many years ago I realized that you could be an artist……. or you could be a businessman, but you cannot be both.   I would be very curious to know how many people agree with me.

There can be a change, but it will require a waking up of the consumer.  Consumer awareness and the rising trend of "anti profiteering" may be able to reconstruct a new model.  I can see it starting, but many people are still undeducated on what it takes to become a professional musician, and many of the people who are waking up believe that they should have free music... so it's going to require public education.  Articles like this are good examples.  All we can do is hope and spread the word.

It's been some time but it's finally time for another Modern Home Design special edition where I share some of my favorite recent discoveries

Logo Design Contest Online

I agree with you - there should be a separation of music and business. Everyone always dutifully recites and bows down to the mantra: "Music is a business". Yes, it is a business, but artistic creation is not. It's very difficult to travel to the creative netherworlds with one foot tethered to the temporal concerns of business. For the record, I've heard your music and I think it's great. You're a true artist. It's a shame the biz is so unenlightened and makes it so hard for the world to experience your work and the work of so many other great artists. Thanks for sharing your view of things.

In the early 1970's the music industry began a change from an industry balanced between artistry and business into a strictly business model with artistry considered simply a product like any other. This was a slow evolution with the current endpoint being an entirely new organism. This was driven by forces both within and without the industry. One of the early drivers of this change was large retailers advertising becoming the mainstay for commercial radio. The advertisers used their clout to demand that stations limit their playlists to hits only or to songs that sounded like past hits to ensure listeners would tune in to that station. The fear of losing such a large segment of their income caused the programmers to capitulate and fewer DJ's were allowed to amend playlists. This was followed in the 1980's by the advent of aggregators like Clear Channel standardising playlists through all their stations regardless of regional tastes as well as limiting the number of songs in daily rotation. This resulted in labels taking fewer chances on music outside the mainstream. Without exposure it is harder to sell an act and radio was at that point willing to include in rotation only acts that were already established or that fit a prescribed norm. As a result music has become more standardised. Adventurous or unique artistes were increasingly forced out of the marketplace.

It's refreshing to hear someone speak the truth. As a person who works on the business side of this industry and on the performing side, I can say that he's touching on a lot of truths here.

Many people who just illegally pirate music and think everything should be free online don't understand this when people try to explain it to them. Hopefully, this article will shed some light on their thought process so they realize exactly how much work goes into the music they take for granted. Whether it be from touring or hosting online, both process are a financial toll on the artists.

What he doesn't get into is how the record companies found themselves so screwed over by Apple and Amazon. The record industry basically dismissed the online potential for music, so they found themselves on their heels, and had to sign these god-awful contracts with iTunes and other digital distributors. That's why they take so much from the artist compared to other channels, because they were already established and had the record industry by the balls. It's unfortunate that many people blame the record companies for screwing over artists when, truthfully, it's just a side effect of the digital and physical retailers.

So, yes, it is a hard life being a musician. It's not all candy and sunshine. It's financially brutal, mentally draining, requires just as much work or more than a 40hr per week desk job. Think about that next time you decide to illegally download a song. Ask yourself why music might be declining? Is it truly fair to blame the record labels, or is that the easy way out and trendy answer?

Good luck to the musicians. We do this for love, thankfully.

The touring argument doesn't persuade me.  Duke Ellington's band, for example, barely broke even on its touring at the height of its popularity in the 40s.  (Not a new phenomenon.) But he paid all his musicians and staff.

Neither does the greed argument.  iTunes is not intended to provide added value to their vendors (us) but to their customers.

The musician has leverage (in business) when he can show results: profit, patronage, eyeballs, etc.  And not much when he can't.

If the label can deliver customers (paying listeners), that's a good label.  If the band isn't delivering music and perforance that sells, why should a label put up any money for it? 

All retailers are parasitic -- they are the channel to the customer.  Try getting your food product on the shelf of your big box store without going through a food broker and proving you can move sales.  Why should a band be treated any differently?

 

 

Dear David Lowery, what do you think of the Pirate Bay?

Zoe Keating dissapeared when she heard the same question, I hope you have more guts.

Some thoughts for all..

1) 99% of the population get to work ~40 hrs per week doing something they don't like just to stay alive. Having day job that leaves enough time. energy and resources to do music as a hobby is already  a privileged position. Actually earning enough to get by by doing something you love is dreamland for most people - so yes Lowery's article and the comments of those who sympathise with him do look like one huge whinge to the rest of the population.

2) It isn't a question of whether music "should be free" it is simply a fact that it IS free given modern technology and a state that stops short of fascism.

3) Without technology the music business model is basically busking or teaching.

4) There are other players in the online space that offer a better deal than Amazon/iTunes - both to the public and to the artist.

5) Comments about Steve Jobs are basically spot on...

1) 99% of the population get to work ~40 hrs per week doing something they don't like just to stay alive. Having day job that leaves enough time. energy and resources to do music as a hobby is already  a privileged position. Actually earning enough to get by by doing something you love is dreamland for most people - so yes Lowery's article and the comments of those who sympathise with him do look like one huge whinge to the rest of the population.

Does this not also apply to:- writers, authors, actors, sportsmen, fashion designers etc etc etc etc? Why should they get the full rewards of a "job that they love" but musician artists should not?

Does this not also apply to:- writers, authors, actors, sportsmen, fashion designers etc etc etc etc? Why should they get the full rewards of a "job that they love" but musician artists should not?

Yes, of course it does - and exactly the same pressures apply to authors as to musicians. Go to any authors' website and you will see all the same stuff.

As for actors - well the film industry is starting to whinge about these issues just as much as the music industry.

Sportsmen have a more limted career than most musicians and they only get paid to play on the day - when they retire they get no royalty payments from their back catalogue.

The new economics of copying may put musicians on a level with sportsmen but they don't put them lower.

The problem here is psychological and you give the game away when you talk about "the full rewards" of the job they love.

Thye reality is that you are in a competitive marketplace and you are not entitled to any reward at all - it is up to you to figure out how to make a living - and here is the rub.

There is an infinite supply of competant amateur musicians who would just love to make a living in music. New technology has made it much easier for them to enter the game and many have. The economics of music actually just got a lot better as a result of new technology - but the result has been a more competitive market - making life harder for some established people.

The old record industry operated a monopoly on the supply side. IF you had a record deal then you only had to compete against a few others. If you didn't then you weren't in the game at all.

The new technology has definitely made life harder for the more marginal of the "insiders" - but that is the result of the loss of a monopoly that was never really justifiable in the first place.

You sound like a "freetard" with a chip on your shoulder.

The next thing you're likely to start talking about is the alleged "iniquities" of the concept of copyright.

I don't really agree with much of what Lowery says but your use of the term "whinge" is kinda offensive.

Pot and kettle here - you object to "whinge" but happily throw in "freetard" which is offensive on all kinds of levels (and not just to your intended target)

I think my use of the word whinge is enttirely justified given that they are complaining unjustifiably.

But you are right - copyright is iniquitous - and if you study the history of it - rather than just swallow it uncritically you will understand why.

Technological progress has set copyright on a collision course with free speech and everyone is going to have to decide which side they are on. Are you with Stalin?

 

 

the people of this world are spending a higher percentage of their income on music and arts than ever before in the history of mankind.

today, there's more people making a living through music and arts than ever bevore in the history of mankind.

 

GOOGLE AddamBONGG .. THIS BAND INVENTED A NEW GENRE, DESKPOP .. AND POSTED 21 DOUBLE ALBUMS @ AMAZON .. OLD MODEL, NEW MODEL .. WE DON'T GIVE A FUCK

"But you didn't even need this whole complex argument to see this right? You've already spotted the main problem right?

"In the new model you have these parasitic entities (iTunes, etc.) that take 30% of gross and provide no added value. As screwed up as the old business was there wasn't this giant parasitic entity sucking out 30% of gross for nothing. This should suggest to any intelligent person that there is something seriously wrong with the NEW MODEL.

"Now I'm as surprised as you that we would evolve a worse system than the old record label system. But facts are facts. We have. And I'm not happy about it either."  

Actually David, I was signed to a quarter million dollar major label deal in 1993 - they took 100 percent of the gross until I recouped, at which point they kept 85 percent... sounds worse and more parasitical to me... especially when you work out the math - a band (5 guys) living off of 50k each for probably 2 years before they recoup (if they are in the top 1 percent, lucky you) means 25K A YEAR.

A well organized social networker or kickstarter entrepreneur could make that in a 6 week period (I have seen it).

The amount of wasteful spending and shitty quality control and dead weight present in the record business was disgraceful. Janet Jackson and The Rolling Stones (unknowingly I am sure) financed our record (that incidentally got shelved because the label decided it only wnted to "push" one record that quarter... I was told it was literally a flip of a coin.

Don't think I'll see an indy band flush that kind of money down the toilet on your super special brand of "expertise" anytime soon.

Cheers,

a

 

"But you didn't even need this whole complex argument to see this right? You've already spotted the main problem right?

"In the new model you have these parasitic entities (iTunes, etc.) that take 30% of gross and provide no added value. As screwed up as the old business was there wasn't this giant parasitic entity sucking out 30% of gross for nothing. This should suggest to any intelligent person that there is something seriously wrong with the NEW MODEL.

"Now I'm as surprised as you that we would evolve a worse system than the old record label system. But facts are facts. We have. And I'm not happy about it either."  

Actually David, I was signed to a quarter million dollar major label deal in 1993 - they took 100 percent of the gross until I recouped, at which point they kept 85 percent... sounds worse and more parasitical to me... especially when you work out the math - a band (5 guys) living off of 50k each for probably 2 years before they recoup (if they are in the top 1 percent, lucky you) means 25K A YEAR.

A well organized social networker or kickstarter entrepreneur could make that in a 6 week period (I have seen it).

The amount of wasteful spending and shitty quality control and dead weight present in the record business was disgraceful. Janet Jackson and The Rolling Stones (unknowingly I am sure) financed our record (that incidentally got shelved because the label decided it only wnted to "push" one record that quarter... I was told it was literally a flip of a coin.

Don't think I'll see an indy band flush that kind of money down the toilet on your super special brand of "expertise" anytime soon.

Cheers,

a

 

You talked about iTunes, Amazon and Google; but the biggest music label in the world today is Wall Street. Digital music is what is referred to as an exotic financial instrument that transform itself into stock,options,derivatives being further distibuted by the forces of mergers and acquisitions by the underwriting financial syndicate banking elites. By the way of the old contracts from legal entities like Masur and Associates, those particular instruments were binding on any and all that sold, reproduced and publicly performed by digital transmission or bundled or pre-installed or subscribed or packaged--tagged on cans or tops or software DVD's on the shelves of Office Depot-- right by the racks where you purchased your prepaid music card offered by iTunes or Napster or MusicMatch, just a few seconds before Exxon Mobile and Seven/Eleven chains decided to become bigger distributors than CDBaby. . . X         

 

I'll admit that I hadn't really thought of the new model in this way, but it just goes to show that there are flaws with the new business model, just as there are with the old. I personally don't think we need to go back to the old model, even though the new model with companies such as iTunes and Amazon has its problems and flaws. When it comes down to it, iTunes and Amazon are both large comglomorates in their own right, so they are truthfully not all that different from music labels that were gaining dollars in the old model in my view. I'll also admit that I'm not fully educated on the issue, so I'm glad to learn as much as I can, even if I don't agree with something.

This is a cat and mouse argument of a short sighted person.  If you are relying on music sales to launch your career than good luck.  If you have ever read a recording agreement the horrors are much scarier than thirty percent off the top. Let's talk about better ways to do things instead if which rotten apple tastes worse.

Lowery has angrily insisted several times (on Twitter and in comments at Techdirt) that the Facebook post was not at all similar to his talk at SF Music Tech. He says that his argument in the talk made all entirely different points. But this post here claims that they were more or less the same. Can someone who saw the talk please clarify?

My biggest problem with his statements is that I wouldn't want to go back to the days of an indie band spending 10-30k to record an album.   If a band or artist can't record with today's affordable technology, then that's their problem.    And if you need a big crew to tour the venues he does, that's your problem too.   

Look at the math (what you provide for a company with your time, skill, etc. and how much you make for them compared to what you are paid) for any day job and you'll feel ripped off worse than this.

I still like Lowery and think he's a cool guy, but he wants the best from both worlds.    And you can't have that if your music has a limited fanbase.

I do not agree with your polemic. ITunes and Amazon put up massive capital in the form of servers and networks. While they do not support an artist in touring, they provide the distribution for the artist's music.

If an artist loses money on a tour, he is either poorly managed (spending too much), or he is just not very popular.