Saturday, February 27, 2010

The State of the Music

For nearly half a century, there was only one way for a new artist to break into the music industry. This process revolved around impressing the right record label employee and signing a contract with that label. From there, the label would take on the responsibilities of getting a band’s album recorded and promoting that album, as well as helping the band with booking and other technicalities of touring. While this may sound like a great deal, greed has always tainted this relationship. Labels have always been able to take advantage of young artists who have no idea how to evaluate the contract they’re signing, taking a huge percent of not only gross but net profits. While there were always some rare exceptions, this was the only way most artists could break into the industry. Though this is a path many artists still follow today, the digital age has put other options on the table.

[logo of now infamous file-sharing service, Napster]

Anyone who’s been paying attention to the record industry in the last 15 years is aware of the controversy surrounding internet file sharing. We watched as bands and record labels fought tooth and nail against programs like Napster, and we saw those same labels concede to the internet’s power and begin to adapt, selling their music online through iTunes, Amazon MP3 and dozens of other digital vendors. Considering the lack of production cost to sell digital music, one would think that record labels would be paying artists a large percentage of these sales—after all, with a nearly 100% profit margin, there’s enough to go around... right?

This is just not the case. Major record labels are sticking to their arcane practices, making money off their artists’ music and refusing to cut them in on the profit. While this happens all the time, perhaps the most relevant example in recent years is that of alternative rock band 30 Seconds to Mars. Since their debut album in 2002, this band has achieved massive amounts of success on an international scale, selling millions of records, invading the airwaves of both radio and music television and playing some of the largest concert halls in the world. With all this success, you’d think these guys would be millionaires. In reality, their label, EMI/Virgin, didn’t pay them for the sales of their recordings.

[30 Seconds to Mars' platinum album, A Beautiful Lie]

In a blog posted on MySpace on April 28, 2009, 30 Seconds to Mars explained their situation. “We had finally, and thankfully, achieved some success around the world, only to learn that although we had sold millions of records we would never see a single solitary penny. On top of that, we were then told that we were also millions of dollars in debt. As you can imagine, that was more than confusing so we began to educate ourselves and started to discover what a strange situation we were in.”

The long and short of it is that EMI/Virgin was claiming the band was actually in debt for the cost of their recording, promotion, etc. When the band found out about this, they tried to break their contract (a contract which was, in the eyes of law, out of date) and the label responded by suing the band for $30,000,000. While 30 Seconds to Mars’ case was eventually settled, this situation should serve as a warning to any young artists with preconceived notions of the glory that comes with signing to a major record label.

Due in part to these romantic notions of the path of the “rockstar” and in part to ignorance to other options, many young artists are at risk for being taken advantage of. It’s time for that to change. With a wealth of technology at their disposal, artists no longer need to be dependent on backing from a record label. Using the internet as a tool, they now have the power not only to promote, but to sell their music completely independently. While this process takes a lot of devotion, it allows the artist to keep all profits and maintain complete creative control. Remember, this isn’t just about money—when you sign to a recording contract, you are essentially giving up the rights to the music you record under that contract. With the internet as an ally, many young artists have managed to keep the rights to their songs and sell them through Amazon, iTunes, MySpace and many other digital vendors who allow artists to retain the rights to their music and take only a small percentage of the sales (if any).

While these independent artists selling their music online may not sound like a force strong enough to shake an industry half a century in the making, the fact is there are many highly celebrated musicians embracing—and fighting for—this new medium. On October 10, 2007, multi-platinum selling alt-rock band Radiohead released their seventh studio album, In Rainbows, as an online exclusive, allowing fans to pay any price they wanted for the album. Some paid nothing, others paid thousands, supporting the idea behind this method of releasing music. With Radiohead as inspiration, another prominent alt-rocker followed suit.

[Producer/Musician/Businessman Trent Reznor]

Nine Inch Nails frontman Trent Reznor is no stranger to the music industry. He’s been putting out records since 1989, and for the better part of a decade he was part-owner of Nothing Records, a subsidiary of the major label Interscope. Pushing boundaries is nothing new for Reznor (after all, he’s responsible for the success of shock-rocker Marilyn Manson,) but over the last decade he’s shifted his focus from rattling the limits of pop culture to exploring the potential of the internet as a tool for musicians.

In May of 2007, Reznor released the DVD version of his band’s 1997 tour documentary online. After years of pushing Interscope to release the DVD to no avail, he finally got fed up and put it online through an alias, a gift Nine Inch Nails fans were thrilled to receive. This was just the beginning. After Radiohead released In Rainbows, Reznor followed suit, releasing one of his own albums with the “pay-what-you-want” method. He did the same for an album by lesser-known artist Saul Williams. All of these ventures met reasonable success.

On July 9, 2009, Reznor decided to tackle the issue of how the internet can be used to benefit young artists. After all, the success of his ventures wouldn’t have been possible without his already established fanbase. On his band’s forum, the industry veteran posted a set of guidelines for young artists. “Forget thinking you are going to make any real money from record sales. Make your record cheaply (but great) and GIVE IT AWAY. As an artist you want as many people as possible to hear your work. Word of mouth is the only true marketing that matters.”

After suggesting a list of digital music vendors, Reznor reminded musicians of the realities of the industry as it is today. “Have a realistic idea of what you can expect to make from these and budget your recording appropriately. The point is this: music IS free whether you want to believe that or not. Every piece of music you can think of is available free right now a click away. This is a fact - it sucks as the musician BUT THAT'S THE WAY IT IS (for now).”

It’s a scary time to be a musician, especially one without an established fanbase. For struggling artists, it’s difficult not to associate a record contract with fulfilling dreams of success. It’s important to remember, however, that such a dream can end with a thirty million dollar lawsuit. The internet is a relatively new medium for musicians, one that is complicated; one that still needs to be explored and refined. All complications aside, one thing’s for certain: The internet has put power into the hands of musicians, and soon major record labels will have to acknowledge that shift in power or become obsolete.

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