D.I.Y.

Occupy The Music Industry

image from www.google.comThe falling security of the US economy bears an uncanny resemblance to the relative microcosm that is the music Industry. The occupy movements 99% are angry at the 1% with all the wealth. Those at the top are overtly occupied with increasing their own worth, with little respect for the prosperity of people who make up the majority of the population.

The success rate of musicians is staggeringly similar to the 99 to 1 statistics. Those with power enjoy the trappings that their position brings, and they seem just as preoccupied with growing their own success as the Wall Street 1%.

The instability of each economy and downfall draws surprising parallels as well. The way the US banking system works is that the Federal Reserve requires banks to hold 10% of their money in the reserve. However if you put $100 in your bank they do not put $10 into the reserve, the say that the $100 is the 10% and this creates $900 for the bank. This allows the bank to offer lots of credit, they then charge interest and make even more money. Confusing I know, but the upshot is that 90% of the wealth floating around is not real. This is why the economy crumbles. People cannot make their car payments, credit card payments, or house payments. Money in does not equal money out.  The banks suddenly are not getting their payments and the whole infrastructure of the economy is threatened.

In essence, is this not what destroyed the music industry?

Labels would offer a ridiculous line of credit to artists. They would ship CDs to stores and get paid on the pre-sales; this was the labels line of credit.  Of course some product would be returned, but it would just be replaced with the latest releases. The big sellers would bring in profit allowing this cycle to continue. However, when the CD crashed the line of credit provided by the record stores disappeared.  Money in did not meet money out, and the labels suffered.

However, it seemed the labels did not learn from this. They are corporations and corporations are not efficient. They are fine charging ahead like a transatlantic cruise liner – the small waves are not big enough to upset its course – but throw an iceberg in the way and they don’t have time to maneuver around it until it’s too late.

The ship may be sinking, but do you know who got a place in the few lifeboats that were available? Those artists at the top. The 1%. They hold the power. They hold the wealth.

The independent artist is quick to hold the labels up as the bad guy, making them the 1%, but aren’t the real 1% the popular artists themselves?

We hear the independent labels causing a ruckus and pulling content from Spotify, but when do the artist at the top stick up for the rest of us? When do those artist boycott the MTV awards for not playing music anymore?  When do artists pour money back into programs to discover new talent? When do artists use their fan base to bring awareness to other bands new releases? When do the artists use their weight when Spotify payments seem unfair?

There are a few exceptions, but in reality it is not the major labels that need to be occupied – it is the artists making millions. They are the ones with the money, the power, and the ability to instigate change. The labels are destroying themselves, but the artists at the top seem to be doing just fine.

Then again, if you were in their position, what would you do?

This post is by regular Hypbeot contributor Robin Davey, Head of Music and Film Development at GROWVision.

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21 Comments

  1. Eh, yes some artists did get great deals while others on major labels did not, but that’s not their fault or should not have to be penalized for that. It’s the labels that should be held responsible because they were the ones making the deals, playing the odds, deciding where the money went (or goes), and made the rules. Even the top 1% of musicians with great deals got screwed too at times, they just got screwed less because the money was still rolling in, but they still got screwed all the same.
    Let’s go after the ones who monopolized all of the major ticket industry and who have a grip on major radio stations. You know, all the labels with all the money because that’s what it comes down to. For all the advice I’ve read about how social networking works for DIY artists I find it doesn’t compare to the success that musicians receive while with a major label with lots of revenue invested in them. It’s like the old line… money talks, bullshit walks.
    Free album download at http://www.facebook.com/chancius

  2. And again, just as with the OWS movement a lot of this stems from unrealistic goals. Not everyone can be a superstar, nor should they try!

  3. I’m not sure I follow. Didn’t Lady Gaga, Justin Bieber, Kanye, Adele, etc. get to the 1% exactly because of incredible talent supported by the label system? Isn’t that evidence that as far as serving as venture capital for artists, the label system is still working?

  4. Hmm…it’s a ‘chicken & egg’ situation to me, and a blame-game to some extent. To be honest, when CEO’s and label heads started becoming richer than the artists and gaining as much celebrity, it stopped being about the music.
    I agree with Chancius’ “Money talks” line and think thank indie artists “breaking” through the streams of the internet do exist. However, if it were strictly true that labels were crumbling at as fast a rate as the media keeps reporting, surely that makes every artist or band vying for nothing less than the backing and investment of a major, ignorant?
    Some of today’s most talented (& smart enough to know what they were doing) people in music got there by doing exactly that, chasing the majors rather than wanting to do it from a grass-roots level, meaning they knew the risks and took them anyway…
    That said, whilst it seems extremely rare, I have seen artists help launch other artists after a simple co-sign, such as: “I like insert starving artists name here ____’s music”.
    Sure, major artists could do more for the indies, but I’m, starting to get the feeling that even they fear the strength (or lack-thereof) of the future of major labels & so are busy just trying to keep themselves secure…
    ______________________

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  9. This is the worst post.
    If anything, artists should occupy tech companies.
    Occupy Lady Gaga.
    What a fucking moronic post.

  10. Don’t the Wall Street bankers get to where they are because they have talent in banking?
    My point is, where is the support from the top for the fair rights of all musicians as we move into this new era.
    Do those in the position to make a change want to create a fair system for all, or do they want to just benefit themselves and their situation?

  11. robin, only musicians who don’t make it, complain.
    music world is full of complainers who have little talent, both on the biz side and the music side.
    look at all the biz people who failed in the music world, like lefsetz, and many others. they are now complaining via a blog.

  12. Roland I am a successful musician, however I am certainly not in the 1%. I am not complaining, I am raising questions that I havent yet seen addressed.
    You are complaining about this blog…see the hypocrisy in that?
    I don’t have to write this blog, but I do like to share my experience and opinion for free for the benefit of others, and I do like to read the opinons of others wether they agree with me or not.
    Collective knowledge makes us all smarter.

  13. The poster is right about needed to stop the haliburtionization of the entertaiment biz
    However he is incorrect about the size and scope of both the indies and overall music biz. According according to all the last data the role of indies has increased an now where about 12 percent of total music sales. Infact dig into the recent numbers from Neilson/Soundscan and what we see is that the top artists aren’t the ones driving the sales it the middle of the pack releases and it’s especially true in Country music.
    As well the artists on the majors have no control of anything. If they pop off they’ll be cut from the roster faster then a whistle blowing employee from a these multi-national corporation. Which the now 2 major really are and there is one way to fix what’s wrong with the music biz.
    BuyIndieSupportLocals.org

  14. This is entirely what we’re all about at Nimbit (http://www.nimbit.com), and the whole reason why the Direct-to-Fan model came about.
    Power to the people: build sustainable artist-to-fan relationships without the need for a label to force you into indentured servitude to do it.
    Don’t occupy the music industry, #OccupyYourFans and you’ll win. Everything you need is now at your fingertips, you just need to do it.

  15. Reality is that major labels invest in PRODUCT, not music. Long gone are the days where merit had anything to do with success. Major labels sell music in much the same fashion as they sell candy bars. Wrap it up, advertise the hell out of it, get it on TV, movies, radio and in magazines. Wait for the paycheques.
    Independents have as little chance of competing with major labels as the corner store has in competing with Wal-Mart because indies can’t get the press or exposure that the money and professional connections of major labels affords their ‘artists’.
    And to suggest that Gaga, Bieber, Kanye and so on are the result of label ‘talent’ is absurd. They are all the same over-produced, homogenous, mind-numbingly stupid crap, packaged appropriately for their respective demographics.

  16. I really liked the comparison of a local corner store to Walmart. That’s exactly the case. The majors can afford to place their roster on the radio, billboards, tv, movies, magazines, etc. Labeless artists can’t even come close to that kind of exposure. I’m not saying that DIY indie artists can’t be successful, but their potential for success is much smaller than the potential of success for major label artists.
    More to the point, it’s the major labels who took advantage and created the system in which all musicians have to adhere to now just like it was the corporate firms and banks that took advantage of the stocks and loans system. How and why did it happen? Because those were the companies and people making the most money and they wanted to keep on doing the same.

  17. Roland Fein
    What rot. Great artists writing awesome songs often have to be in more than one outfit to bring the money in to pay rent, buy food, and have a life.
    So what you say, so does everyone … true. But most other people have jobs with some security, holiday pay, etc.
    Also, many successful musicians still have to work in other jobs to keep a constant flow of money in. The number of artists who make a great living writing, performing, recording and selling their own material is underwhelming. And a lot AREN’T complaining because they are pursuing something they love.
    But it is difficult.
    In Australia, where I am from, there is a very successful who sold 150 thousand albums [that’s great for an Aussie band], but didn’t make a cent from record sales thanks to Sony. Not a cent. Sony wouldn’t release the album in Europe, and released the album in the US but wouldn’t promote it, or their tour. They got dropped by the label after five commercially and critically successful albums, including achieving awards like ARIA’s and AIR … and they each now survive by still working bars [despite their numberous fans constantly noticing them, wondering what the hell?] and lending their musical services to other groups.
    However, this band were happy to be dropped by Sony. As a band they haven’t failed. They still sell out shows, headline festivals, and continue to be critically praised.
    This band situation IS NOT unique. They have talent. Their manager was a former A&R rep with great ability and passion for the band. They didn’t fail in the music world … but they were let down by their label.
    Just ask Radiohead about their opinion on record labels… hardly a band that fits your descriptions yet still have the courage to speak out and act.
    Out of interest Roland, what do you do?

  18. After reading the comments, it seems that ROLAND FEIN is the one ignorant dude in this conversation.

  19. After reading all this, it still remains that people are clueless. Roland is right.
    “Collective knowledge” means nothing. It doesn’t make anything better.
    It’s funny to see people still trying to get Facebook “likes” and Twitter followers. Doesn’t anyone remember Myspace?
    Make amazing music and people will come. It’s that simple.
    Ask Adele.

  20. Tony this blog had nothing to do with anything you are talking about. It wasn’t about how to get success, or how to up your social networking status. I suggest you re-read and keep your comments on point.

  21. Robin, I see what you’re saying, but with all due respect, the logic of blaming successful artists is completely flawed. That’s like saying homeowners who actually benefitted from risky loans are the 1%, and not the corporate bureaucrats who pushed those loans and collapsed the entire system.
    Lada Gaga is only making a fraction off of herself that her label is making off of her. You’re not even starting at the top — 1% implies that there’s nothing higher!
    Bands have tried to combat the establishment, i.e. Pearl Jam vs. Ticketmaster, and failed miserably.

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