My Dad used to love to complain about how stupid people can be. He once pointed out an example when we were driving through Ohio to go visit his brother, my Uncle John Circle, in Columbus. Pops preferred country roads to interstates, and as we approached a small town along this one U.S. highway, arrows, reflectors and flashers directed us to the right as the lanes split around a median that was indicated by a massive black and yellow, reflector-be-speckled railing. I commented on how strange that was. My Dad went on to explain how there was an ancient oak tree on that spot for many years, and when the road was put in, the town didn't want to remove the beautiful old thing, so they paved lanes around it. It wasn't long before several people were managing to drive right into it though, so the town put up warning signs--don't drive into the tree. This didn't do the trick, so they added reflectors... then flashing lights... then arrows. After years of moronic drivers slamming their cars into the poor misplaced tree, the town finally resigned itself to cutting the old oak down. Now everyone just slams into the median and no flora or fauna are harmed save the human idiots behind the wheel.
My Dad promptly jumped on this great new opportunity to point out stupidity and then in his endearing old farmer-come-raconteur way, turned it into an anecdote on how change or the unexpected effects people, i.e. poorly. He was so effective in his constant demonstrations of how no one understood economics (he was a student of Friedman at University of Chicago) that years later I actually started (didn't finish) a masters in history and econ just to shut him up. Now, he had always wanted to write a book. So, as we drove winding country roads in Ohio, I told him he should write it on economics and call it "Why You Shouldn't Drive Into Trees." He never got around to it, as it wasn't long before the unexpected took him. But, in deference to Pops, I'm using his book title for this little blog on the music industry and the not-so-unexpected lack of initiative and creative response to its changing nature. People really can be stupid. Or at the very least, short-sighted.
In 1998, I was researching the effects of all the major record company buy outs going on in the industry and came across a speech that Courtney Love gave at the International Songwriters Salon about the standard record contract and how the bands got screwed. She demonstrated that an artist could easily end up owing the label money after a successful release. I was a little appalled, to say the least, and thus began my advocacy of the independent musician and tons more research.
Here's a typical example, from recent research, of a major record contract and what it'll get you. Scenario: You meet in a fancy office with a suit who tells you something along the line of "have a cigar, you're gonna go far, you're gonna fly high" as they slide a check for $100,000, a contract with little pink highlights on it, and a Mont Blanc under your nose. You see dollar signs and a dream coming true and without doing much more than scanning the contract and nodding knowingly as if you do, you stick out your lower lip, raise your eyebrows and sign. Some niceties are exchanged as you hold the check and try not to bounce excitedly like a four year-old on bathroom break. Plans are made for recording sessions and for you to meet with your A & R person (that means artist & repertoire, if you were wondering), and you head straight to your bank to bring your account balance up to $100,050.39. Now you can pay your electric bill.
As things progress, you find out that the label controls the creative process, choosing who plays in your band, what songs you play, where you record, who the producer and engineer are. Pissed at the prospect of adding Kanye to your country tune, you go to your A & R rep throwing a fit. He calms you down with a load of propaganda about how these things work and you're in the big game now buddy, so you'll have to play by the rules... but don't forget how lucky you are! But, I'll talk to the boss (he doesn't) and I'm on your side (he's not). Now go enjoy some of that money we "gave" you.
Here's the thing about the $100,000 they "gave" you. It's recoupable, an advance on potential future profits. With the standard 2.3% you receive from net income on your CD, you won't see another check until you've sold, get ready for it, a million copies! Once you've accomplished this, your second check will be about $38,000. For the million albums of your music sold by the label, you get only $138,000. And don't forget, this puts you in a 36% tax bracket, so if you don't have some pretty clever accounting techniques, you need to hand over nearly $50,000. You end up with $88,000 when the label walked away with somewhere around $6.5 million. Oh, did I mention they also took 50% or more from your sales of t-shirts and other similar merchandise? Oh, did I mention that they gobble up a high percentage of your royalties from radio play? Oh, did I mention we're talking about your music? Oh, did I mention that without the artist, the record industry would be non-existent.
Time for a commercial break where I quote Hunter S. Thompson: The music industry is a long plastic hallway lined with vampires and sycophants... and there's a bad side, too.
So, why this business practice that makes you feel you're caught in Buffy, the Musical
? I've looked over the question of piracy as an excuse for the major record labels to take so much and give so little. But, as it turns out, there's a great deal more evidence that allowing fans some free downloads is a very effective way to boost
sales. As an artist, I'm typically delighted to find that my music is being heard. Sure, I'd prefer everyone bought my music, but how's downloading any different from when I was a kid and my friends and I would exchange albums and then record them to cassette? It really isn't. And we still bought the albums eventually... you can't de-seed pot on a cassette case. In fact, many bands have followed the example of The Grateful Dead and actually encouraged piracy (at live shows, at least). As for how it leads to sales? Here's a personal example: While on stage at a show, a reviewer (who could've gotten all my music for free as a member of the media), walked over to my merch table and said to Megan,
"I feel bad, I've downloaded most of Phil's music for free from the web, let me buy some."
When we examine the question of overall sales in the record industry in this country, we finally come to real indicators of what's going on. In the last ten years, total U.S record sales across all genres, as reported by the Recording Industry Association of America (RIAA), have dropped from $14.5 billion down to $8.5 billion, or 41%! The previous ten years, they went up about 4%. Just between 2008 and 2009, total digital and physical music sales registered with RIAA dropped 12.3%. This includes all forms of media through which music is bought... which by the way, as of 2009, included a relatively small percentage where downloads are concerned (18% of the total).
I suppose one question is whether a drop in sales justifies the kind of prices labels charge for music and that their artists receive as little as 2.3%, or if there's another factor. The only immediate and legitimate issue that comes to mind though, is the aesthetic aspect of the music being released by the mainstream record industry and the fact that people have more choices now than ever, thanks partly to the internet. Put another way--now this is only conjecture--most mainstream music releases contain increasing waves of blandness. But anyone who hits a local music venue or the web can find any number of independent musicians (like myself) who sell or give away downloads and offer quality CDs of great music for a low price. I, for one, keep my retail prices down because the actual cost of each piece is ridiculously low (even when you include studio expenses) and when you consider the economy on top of that, there's no good reason to be pricing an item at ten times what it costs.
Watch for my Indie Musician's Outback Survival Guide or visit one of my workshops to get the total run down on self promotion and the resources available to you. In the meantime, visit Bob Baker's website.
What really seems to be happening is that American consumers are spending less time responding to what mainstream media tells them to buy and deciding for themselves. And once they find something they like, they spread the word with friends.
But even independent artists like myself are struggling to turn online or other media attention into sales. For one thing, plenty of aspiring songwriters and bands will actually give their music away at shows. I very much discourage this. I've hosted many open mic nights and when the bar is closing they have a whole new collection of coasters, i.e., all the free CDs that patrons were accosted with. It's one thing to offer a free download once in awhile to get your tunes out, it's another to completely devalue your music by handing it out to everyone, especially to those who could care less.
I've been seeing this unfortunate trend effecting whether crowds at shows buy CDs from the acts they like. If we bring the economy into the equation once more, we see the problem getting worse. And lastly, we bring sales for independents to a slow dribble when we find an overwhelming amount of music websites and very little that helps the listener decide what's good, save their own ear. So, what do we do?
As a listener, just be picky. Don't jump on an act because they're cute, well-dressed, or someone else told you to... don't grab the first candy off the rack. Look for music that truly intrigues you. Ignore the status quo. Be a unique listener, not a eunuch listener. You're just gonna have to dig through the garbage a bit sometimes.
As for we songwriting types? While many people in the media are still getting all hot and bothered about all the "new" opportunities available for musicians via the internet (for the last 15 years), we're standing around wondering how to keep our livings alive when every band has a CD and website and the internet is inundated with just as much crap as the mainstream. I've inquired with many gurus about this.
Here's a portion of a response from Derek Sivers,
founder of CD Baby, after I emailed him asking for a short state-of-the-industry statement. Ya ready?
"Yep, CD sales were never very clearly directly linked to online activity. One of our biggest sellers never had any online promo, but sold a ton, just from people browsing CD Baby, finding it, loving it, buying it. Sometimes our biggest sellers were touring artists, sometimes online-only artists. All depends.
I agree it's hard to make a living as a musician. The music business might end up kinda like the poetry business is today. That is: there are a few who are able to be full time poets, but nobody would get into poetry for the money.
It is still possible to make a living in this environment, but it's going to come from assuming that the old school music industry can't help you in any way, and you're going to have to find your own entrepreneurial way to reach dozens then hundreds then thousands of people, one at a time. Do something so jaw-droppingly amazing that people who see or hear it tell all their friends and grow your audience organically. It'll take creativity, communication, and learning, but it can still happen."
What it comes down to is this: there has been, is now, and always will be poorly put together music available. And to bring you down even more, nobody really has a solid handle on what works... we just do everything we can and something always bares fruit. This is true of the mainstream as well as the independent world. And things keep changing at a remarkable rate. CD Baby, for instance, has done some $80 million in sales over the years. When I first joined their site, my sales were consistent. But as their site has grown, I've become lost in the high numbers of their members. Random surfing is less likely to lead listeners to me.
What worked even a few years ago may still be one approach, but you have to continue to seek out new ideas for promoting your music. Even should someone discover the biggest new thing in getting music to the world, it'll change. Only a hundred years ago, recorded music was unavailable. Since then, we've gone from wax cylinders through five kinds of analog media into the digital age. Next, we'll be beaming tunes into our heads. Thing is, it's still going to change. Did I mention it's always going to change?
Should we handle change with surprise and fear?
No. We should take it in stride, but an educated stride.
(Educate... Derived from the Greek "to open"). With a knowledge of the past and courageous application of this knowledge to the future, people may finally stop driving into trees.