Monday, 9 January 2012

Music Download and Stream, neither black or white... the gray spot is taking over.

As a music manager I frequently get confronted with the question if I am against illegal and/or free music download and streaming...
I used to be pretty much against it like U2's manager, Paul Mcguiness.

In fact I have not changed my mind in regard of the rights an artist has, to get paid for what he does and creates, but I see now, that the source of the problem, and the solution lies far away from the music end-consumer.

Music download can be something positive, and it is! I do believe that viral marketing can have a huge impact on  someone's popularity and therefore further his career. The main question is; how to make a profit and run a business, where there is no real income from it's main product, in this case the music.
I hear a lot of people talking about Merchandise and live shows being the real solution for the future, I just like to remind everyone, that merchandise and live shows, where already part of an artists income before the advent of Internet. Therefore this is not only a weak, but also an absolutely stupid answer for the problem in my opinion.

You must now be thinking, that I am still against free download and streaming, No, I am not. I just believe that those who offer it for free, should pay for using music as part of their advertising arsenal.

Spotify, Itunes, You Tube, Telecom and even Mobile phone companies  being some of many corporations, that take advantage of a product, that lacks or has outdated, general and global regulations, simply lobby their way through and around royalties and copyrights, under the “we promote flag”.

Nokia comes with Music and that's cool. But who does Nokia pay for this great feature? And how much?

Companies, which use 3rd party products, brands or services, pay insignificant amounts of money to Artists and labels, forcing them, to either join this “criminal” scheme or to be doomed to oblivion.

A year ago I was talking with a Business manager from a known German indie label, we were analyzing  Spotify's popularity and he told me, that is was a necessary evil, that the label had to join since everyone was doing it. The label had over a 2 Million plays from 40 different artists.
The Label got £440 for the lot, and after taking their commission (25%) of £110 plus £250 for advertising made for the campaign. The rest £ 80, was proportionally divided the 40 artists and there you can see how much 1 year on Spotify will give you....

If you take the recent article from the Independent about superstar Lady Gaga, who probably has even better royalty rates, than the above mentioned label, she got around £108 for 1million plays.
I am not sure, but I would bet my life, that the label invested a slightly bigger amount in order to promote the “Lady” in question.
Link hereLink to the article here!

I believe that digital sales could easily be obsolete in a couple of years, and all music available could be for free to listen to, if artists and labels would get their share from this Multi-billion Dollar companies.

If music is not to be sold over the counter, that is fine, neither will newspapers, movies or books in the future, but those who provide means of mass distribution and also earn billions through advertising and attracting investors, should pay their suppliers accordingly, in this case the music industry and the artists.

This is the “Grey Spot” in music business, an obscure area where no one dares to enter, it is much easier to blame the end user or to point at the already stigmatized record industry (not that they are free of guilt) But the most dangerous part of this intricate puzzle is very hard to spot without  magnifying glasses. 
We should  change the focus of our holy inquisition away from the end consumer and turn to the right direction. At present,  music distribution is an almost  free product with great market power  for Internet giants to deal and lure costumers worldwide. They've managed for years, to stay away from the spotlight and avoid any blame in the course of facts.

If you have the illusion that indie labels make a lot of money you are wrong, I've seen many A/R directors, PR managers working out of passion, driving to meetings in 1997 Toyota Corollas, and   sleeping at dodgy hotels.
Indie labels sometimes fight to present new products, and even help bands to tour knowing, that this might be a risk investment with no compensation at the end of the day.

The idea of free music is now moving to another level. Some of the big festivals (especially in Europe) offer artists a spot on the festival, telling them that this is a great opportunity, for them to promote themselves. Artists go there, play for free and on top they spend a couple of thousands in transport and lodging, in order that sold out festivals can put their names on the bill,  and make even more money.

If this idea of promotion sticks, then we will see the demise of professional agents, managers, crews and artists, who will simply stop to work, as there is no more money whatsoever to be made, never mind a living.

How shall we, professionals of the music business invest on new acts and career development with no foreseeable return of any investment in the future? 

We don't need more amateurs in the business, and there is a lot of them already, dumping the value of music accepting every offer to play live regardless if this will create a domino effect affecting all those artists that depend on their fees to make a living.

I always say, if you agree  to play for free, you are telling everyone that your music is worth absolutely nothing!
If a Festival offers you a spot and they won't even pay your transport and lodging (which is already an outrage to play without a fee) this means only one thing: you are worth nothing for them.

Stage production in the last 15 years, has never been so bad. If we were to compare it to the 80's (OK they were a bit over the top), but even smaller acts would back then, offer something for your eyes beside of the music attracting good crowds.

If no actions are taken and artists keep on following the herd like obedient  lambs going to the slaughter, soon we shall see music that once was a profession employing thousands of people, to become a house hobby like gardening, or knitting in few years .

Tommy Morriello

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