(Trent Renzor)

4/15/08
Link


When the Smashing Pumpkins recently announced that they were leaving the major-label system, they joined a growing group of musicians who have discovered they can put out music, connect with fans and earn more money while not working with a major record company. "We're free," says Pumpkins frontman Billy Corgan, who plans to distribute songs directly to fans online. "We're out of purgatory. And we're excited to take on everybody in the open trench warfare of the new-media world."

In the past year, artists including Radiohead, Madonna, Nine Inch Nails, the Eagles and the Black Crowes have all released — or announced plans to release — music without a major label. The trend signals a shift in thinking among artists and managers: Thanks to digital distribution, sites like MySpace and YouTube, and an ever-expanding array of companies looking to partner with musicians, the labels are less necessary than ever.

The Eagles — who founded their own label, Eagles Recording Company 2, in 2003 — released Long Road Out of Eden exclusively through Wal-Mart in October. The retail chain offered "a royalty that no record company could come close to matching," Glenn Frey said at the time. The two-disc set sold for a discounted $11.88 at all stores and was given prominent shelf space and a $40 million advertising campaign. It became the third-best-selling album of 2007.

Wal-Mart has since inked similar deals with Journey and Bryan Adams. "When you have established groups, you don't need all the things that a record company would offer: marketing, press, art departments," says Journey manager John Baruck, who works for Eagles manager Irving Azoff. "You just need to get a record out there." Baruck says the band's royalty from Wal-Mart is about four times more than it would get with a typical record deal.

Trent Reznor wanted to release Nine Inch Nails' last major-label record, Year Zero, on his Website without copy protection for five dollars, make all the songs available for fans to remix, and sell a deluxe package including an elaborate book and other merchandise. His label, Interscope, wouldn't allow it. After releasing the disc, Reznor opted not to renew his contract. "It gives me great pleasure to be able to finally have a direct relationship with the audience as I see fit," he wrote on nin.com at the time.

In March, Reznor released a new thirty-six-track Nine Inch Nails album, Ghosts I-IV, on the band's Website. Some 780,000 fans got the instrumental album from the site in a week, earning Reznor more than $1.6 million. "It really takes three things to get this done right," says Reznor's manager, Jim Guerinot. "You have to control your publishing, you have to be able to control your masters, and you have to be able to control the brand. Trent has all three of them." For Guerinot, the freedom that comes with independence has a price. "It was an enormous amount of work," says the manager. "Trying to figure out licensing arrangements in Scandinavia, Germany, France, Italy — it requires a tremendous amount of human resource."

Part 2:



(The Eagles)


Last year, Dolly Parton and her manager, Danny Nozell, met with several major labels in hopes of scoring a deal for a new record. Unhappy with the offers she was getting, Parton founded Dolly Records in 2007. "I decided, 'I'm going to really make an all-out effort to get back on country radio and in the charts,' " says Parton. Nozell and Parton launched a digital-music company, Echo Music, and hired an independent publicist and a team of independent radio promoters. "We're just kind of covering the whole market, like gravy on a biscuit," says Parton.

Parton's first single, "Better Get to Livin'," landed at Number Forty-eight on the Hot Country chart — her highest position in fifteen years. And Parton gets to keep a much bigger percentage of profits than she would with a label contract. "I'll own it all," she says. ?It's not going to take but a few weeks for us to recoup what we've put in it.?

The Black Crowes, who earn a large portion of their income from touring, were willing to trade off the marketing and promotional drive that their former label, Columbia, could provide in order to have more control of their music. "We were stuck in a system, and it was depressing," says frontman Chris Robinson, who founded Silver Arrow Records to release the band's new album, Warpaint, after years of frustration with the majors. "Now we don't have to have 5,000 conversations about why this isn't right for us. We know what's right."

Other artists, such as Prince and Pearl Jam, sign one-album deals with majors while releasing bootlegs and other bonus material directly to fans on the Web. "I think the notion of doing things on a one-off basis makes a lot of sense," says Guerinot, who also manages Gwen Stefani and the Offspring. "People who have been doing this for a long time, career artists, like flexibility."

The idea of releasing music independently — and keeping more of the profits — isn't new: Jimmy Buffett launched his own label, Mailboat Records, in 1999 after becoming frustrated with label politics. He earns about five dollars per album sold, and he made about $44 million in total revenue in 2005, including touring.

Smaller bands, which would typically sign to an indie label, are also finding ways to get their music directly to fans. Electro-dance duo Ghostland Observatory have released three albums, attracting a national audience and scoring an appearance on Conan O'Brien while consistently rejecting opportunities to sign with any label, major or indie. "The deals weren't sweet enough to change what we were doing," says the band's drummer and producer, Thomas Turner, who estimates the group has sold about 50,000 albums so far.

Conventional wisdom holds that established artists can succeed outside the major labels, but new acts — especially mainstream artists who depend on radio play — need the promotional, marketing and publicity push that a major label can offer. But that is less true than ever. Singer-songwriter Ingrid Michaelson released her debut album, Girls and Boys, on her own label, Cabin 24. When her songs got played on Grey's Anatomy, labels came calling, but she decided to stay on her own. "It?s going really well, and I don't owe anybody anything," she says. "So why would we give the reins to somebody else?"

You know, it's sad that Prince isn't listed on there anywhere. He really was a pioneer in this movement (if not THE pioneer).

His last 3 albums have been on major labels . . . I wonder if that took him off the list.

Overall though, this is great for the music biz. There's no reason the labels should make that much money and have that much control over music.

I see three trends developing here as far as the new music distribution model:

First, you have direct marketing. NIN, Radiohead, and other bands are going directly to their fans. They have released "free" downloads and are relying on an honor system from their fans to finance the cost of putting out their new material. And so far it is working brilliantly. The major labels and business mavens thought that giving away the album was a horrible move, but they based their reasoning on the fact that their major label albums were being easily pirated on the net. But the true fans know that the artist has to be able to eat and put a roof over his/her head and are willing to go out and support them for the privilege of hearing their music.

Second, you have licensing. Prince was probably the first artist who did this effectively, but Moby, The Eagles, and other artists have picked up on this too. Some are doing licensing deals with the major labels to do distribution only while others are going the unconventional route and licensing their work for movies, television, and commercials. This was a huge deal for artists like Feist and Yael Naim, who probably would be completely unknown to most people were it not for their songs being featured in Apple's commericals for the iPod Nano and Mac Air Book.

Third, you have joint ventures. Seeing how CD sales are declining precipitously and how major label superstars are bolting from their major label homes, other companies are going up to these artists and asking to do joint venture deals to get a piece of their touring and merchandising revenue. Madonna, Paul McCartney and Jay-Z are the most visible examples of this joint venture move, but 50 Cent's Vitamin Water venture was a joint venture as well. The parent company didn't have the cash to give Fiddy, so they gave him shares of the company. This ultimately paid off when they were sold to Coca-Cola for $4 billion.

728huey, all I see is established major label artists jumping ship. I don't think this new model is good for unheard artists who haven't already established some sort of hardcore fan base.

Cinnie said:

Se7en said:

I gotta agree with that. I mean, when you really look at the big picture, even though he never had an indie hit, really, he was still innovaote in staying off the major labels for a number of years and still making music and being a relavant touring act.

So far, only the Eagles have really proved to be able to sell albums as a once commercial act that went indie (and that was due to a tie in with the most evil corporation....EVER). Or are their others...and how do you define Indie? To me , Live Nation has so much money that and are giving out such big contracts, it's hard to really consider them indie. We know this much...the established major labels have put themselves into their own situation! The future could be interesting.

SoulAlive said:

The labels still have a very strong grip on radio, magazines and music video channels.

Cinnie said:

That may be true, but the internet is making a lot of magazines obsolete, radio has become so consolidated and generic that people are actively seeking new stuff outside the medium, and MTV, VH1, et al have drastically cut back on the time they commit to playing new music that people are going to YouTube to check out new music videos. Having said that, not every artist who goes it alone with Myspace and YouTube are going to become huge stars. The mainstream artists are leading the way because they already have the history and fanbase, but for some up-and-coming band like Kosher Pigs or Vomitburger (I just made up those names), they will have to build a fanbase online and tour the club circuit relentlessly to get exposure. What Web 2.0 is good for is all of the niche artists (dance, techno, reggae, bluegrass) who have a small but strong following to continue their music careers. They may release an album that sells only 50,000 copies, which on a major label is a colossal flop but released independently with a $5.00 per disc profit may give them a comfortable living.

Cinnie said:

Very True, but with myspace and other places it is quite possible to create a stir without a label's help.

Musicians do it by touring incessantly, pop stars do it by being photographed in the right outfits.. wink wink.

Some artists have made a very nice living without ever having any label backing... Ani Difranco comes to mind. She has made more money per album sold for years based upon owning her own label and distribution. She toured non stop for many of the early years.

I think for a pop song to get play it stills needs Ryan Seacrest to yuck it up on his syndicated top 40 show or something.

Hip Hop guys ... does it still happen via mix tape momentum???

Cinnie said:

true

728huey said:

Touring and using the internet are indeed great ways of getting exposure but there's one BIG question...:


WHO'S GONNA PAY FOR THE STUDIO TIME?

WHO'S GONNA STUMP UP THE MONEY FOR A TOUR?

These are the things the record company usually pays for - and for a new band with no money a record label is like a bank offering them a large loan. Think of it as a business loan - without that start-up money there's no album TO distribute.

rocknrolldave said:

That's true, but with the actual studio technology being cheap enough to download and put on your home computer (at least the average studio technology), a band could record a whole demo in their garage or basement. Now the stuff you can get on the net isn't good enough to record a Sgt. Pepper, Dark Side of the Moon, or Purple Rain, but then again most new up-and-coming bands aren't looking to record that type of album in the first place when they are starting out. And there are a lot of local independent studios where they can get reasonable rates to record a decent demo.

Now as for touring, that's where a lack of money could be a hindrance. But then again most artists who are serious about their music careers stuff all of their sound gear in the back of the van and hit every club that will take them in. This is how most bands develop a following, but this obviously wouldn't work for some manufactured pop act like Britney Spears or Rihanna, who need the huge studio backing to get promoted.

728huey said:

"Where there's a will, there's a way?" kind of thing.....?

Yeah, I guess that's very true.

And yeah, home recording equipment has come way down in price and risen way up in quality since the digital age well and truly kicked in. I think for the average young band (I'm think of a band like the Arctic Monkeys when they began), you are quite right in saying that the quality is sufficiently high for their early efforts. (And that's not a slight against Artcic Monkeys-type bands, before anyone misinterprets me!)