creative deconstruction

Dropping Record Sales Free Bands to Go into Business for Themselves

Posted on 27. Mar, 2009 by refe in MUSIC INDUSTRY

Record labels have built their businesses on the profitability of recorded music, and until recently it was a pretty lucrative business to be in. Because artists couldn’t afford to produce their own recordings they were forced to be dependent on the major labels, and the Majors became the all-powerful gatekeepers of the Music Industry.

Now, with sales of recorded music falling sharply, the Majors are losing some of the clout they once had. Without all that money to throw around, the content creators – the bands and artists – are beginning to wonder why they had allowed themselves to be put in their pocket for so many years.

In case you aren’t familiar with how the process has worked for the past few decades, here is a typical example of the relationship between artist and label:

1. Band A has been playing out for a while and has developed a decent following.
2. Their fans want to take their music home with them so Band A puts up some cash to record a brief, usually crummy, demo to sell at their shows and shop around to record labels. This step can last years if the right person doesn’t hear the band at the right time and decide to give them a shot.
3. An A&R scout sees some potential in Band A and offers them a contract. The label will put up the money necessary for recording a full length album, and in exchange they will retain full ownership of tapes and masters. The band will be required to pay back whatever money the label loans them before they see a dime in royalties – pennies on the dollar.
4. When the album is finished, the label may decide to loan the band some money to go on tour (this will need to be paid back as well.)
5. Halfway through the tour, the label decides that Band A isn’t selling enough records to be worth supporting any longer, so they drop them.
6. Band A is left in the middle of a national tour with no money, no support, few contacts and no idea what to do next.

At least, that’s how it seems to go more often than not. It makes you wonder – what good did the label actually do for the band? Not much. They made it possible to record an album, but now they own the masters and aren’t willing to do anything to promote it. That doesn’t leave the band with too many options.

There is an option that artists have only begun to realize they have left: forget about record labels.

Truthfully, the whole system was never designed to work in the artists favor anyway. The major labels have held too much power for much too long and have used that power to exploit the content creators for their own gain. Now that their main product – recorded music – is not as profitable as it once was, artists are free to step out from under the labels’ shadow and do things their own way.

Tags: business, economics, MUSIC INDUSTRY, record labels