Artists And Labels Must Accept The New Music Industry

AcceptanceGuest post by Gregory Haberek, artist manager and co-founder of All For The Addicts Management.

Music has been a part of human culture since the beginning of history, and it continues to transcend language barriers, belief systems, and remains completely open to interpretation. Musicians create works of art through emotional expression and artists create because they have to, and in turn, an industry was created to exploit that need. In other words, the industry is aware that all an artist wants is for his or her voice to be heard and that they are willing to sacrifice everything to make that happen. This means that those who connected the artist to their fan base once held all of the power, but let us examine where artists and labels are at today.

Once upon a time before the Internet boom, record labels had entire divisions of people hired to find potential talent and get them out there to the world (and make money off them). A label might have signed an artist based on what they could become with the proper nurturing and development. Bands like Aerosmith, Rush, and even the Beatles were developed over time with a lot of hard work and a team of people that believed in the product. Artist development was the key to success and the networking of these companies made it such a tight circle that it was impossible to get in unless you were attached to these companies in some form.

It was a scheme that would work like magic for decades but as the 90’s and the Internet came, artist development took a back seat to the fans themselves who had effectively become the A&R. Bands were getting exposure to the masses through the Internet and constant touring, which forced the industry to change its focus. It was no longer a development-based models, but rather a jump-on-board model that only promoted the laziness and corruption of the current model.

It has been a gradual change over the last 20 years to where an artist has to do all the work themselves before a label will even consider you for a contract that may end up taking over 85% of their income. It has become a model where the band actually screws themselves by signing to a label.

The “old” model and mentality has had no choice to adapt. Labels used to offer distribution, which you can now get through companies like Tunecore for less than $50. They used to offer album printing and production, which doesn't really matter now in an age of digital downloads and torrents. So at this point, it is merely their network that is keeping these labels alive, and that will dissolve as the Internet discovers and produces more and more superstars.

As times have changed, a few things have to come to light:

1. Reliance on album sales for revenue has to stop. It is time we quit fighting the loss of sales on actual records and embrace it. Nowadays, you can get a great album produced for under $10k. Write it off as a business expense and find new ways to attack the target market through merchandising and branding.

2. The band does not get a huge signing bonus and rarely profits from a standard record deal. The days of signing a deal and getting millions just to sit back and be a rock star are over. You need to think of yourself as a small business getting absorbed by a conglomerate. They will take your style and dull it, they will water down the product for profits and will only give you enough money to survive and make them profitable. Once you stop producing profit, you are dropped to the side just as quick as you were acquired. 

3. Labels can’t tell the people what is cool anymore. Although it was true for so long, it is now the public themselves through their friends and the Internet find out about new music. A man in a suit can no longer dictate what is cool.

4. Booking agencies can’t keep raping on tour packages. Promoters and venues alike have become extremely lazy with the way they put on tours. Venues don’t want to promote their own venue and promoters are taxing on touring acts that will not draw what they claim to draw. This results in locals having to pay-to-play and venues having to ask for ridiculous demands to book on a night where people wouldn't come out unless there is a built in crowd.
5. Large studio and video budgets are not profitable. You can now create either of these at a fraction of the price that it would have cost 10 years ago. So budget smart and use that extra money on promotion.

6. Artists can't rely on a label to take care of everything. The bands are to blame as well for being lazy and expecting the companies to do all of their work. If you are lazy enough to shove off all of your work to others, then you deserve to be taken advantage of.

Bands need to quit being whiney prima donnas, and labels can’t be lazy monetary gluttons. Times have changed, so either adapt or be left behind. 

Gregory Haberek is an artist manager and co-founder of All For The Addicts Management.

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  1. As someone who’s been on the internet since it’s beganing and being involved in the music biz I used to scratch my head at all of the talk about how the internetwork was going to do away with distribution. It’s pretty clear some 18 years later that no such thing has happened and those in distribution have both physical and digital customers and the producers are still stuck with either doing it themselves or using an intermediary. For the sake of it…..Can we please come to some baseline understanding as to what distribution means.
    “Product distribution (or place) is one of the four elements of the marketing mix. Distribution is the process of making a product or service available for use or consumption by a consumer or business user, using direct means, or using indirect means with intermediaries.” http://en.wikipedia.org/wiki/Distribution_(business)
    As for the music biz let’s also get a few things straight, labels are not distributors, while some may claim they do distribution often as not their really going through a onestop or take the major labels which are called that because they have a distribution arm thought which they offer products to the markets.
    As for any digital distributor they only sell to digital stores so it’s an incomplete distribution strategy; Since it won’t get your release into Record Stores which still exist (Hence the whole RecordStoreDay that so many now celebrate) and IMHO it’s the main reason why ENgoove bought Fontana Distribution.
    So while this article makes some valid points about labels~ it’s underlying premise still misses the most important mark. Either you have distribution or you don’t and a digital only strategy is not the full measure of distribution and it leaves the independent’s fighting to get into and noticed by a mear handful of online stores, and mean while the Majors still makes sure that their artists are in every channel and facing little competition for the consumer attention.
    PS the Majors are laughing all the way to their off shore bank accounts and oversea’s corporate structures

  2. The headline is wrong — it should be “Artists & Labels Need to CREATE the New Music Industry”. After all, they are the engine that drives it. The majors created the “old system”, and now it is failing; the indies and artists must create a new model, not just “accept” the future that is happening around them.
    Also, the author is wrong when he blames the internet for the decline of artist development. Years before the web took hold, major labels became arms of mega-global corporations like Vivendi and TimeWarnerAOL, and the true A&Rs were replaced with profit-obsessed corporate types. They didn’t care about “development”, only fast profit. If your band didn’t have a hit single on your first album, you were canned or left to wither on the vine. “Artist development” at major labels was dead before the internet came along.
    Now, here’s my main point — the author needs to differentiate between MAJOR labels, who often fall victim to those six points outlined above, and many INDIE labels who are actually doing it right. A lot of indies offer fair deals like 50/50 splits and treat their bands with care and devotion. Secretly Canadian, Jagjaguwar, Anti, and ATO are independent labels that practice true artist development, and they’re showing signs of success & stability. Instead of whining about how labels are “lazy gluttons”, let’s shine a light on the labels who get it right and use them as role models for how to succeed.

  3. Please tell me what a disabled song writer, who can create great songs, but is too disabled to tour, to do?
    I guess they should just give up because there is no way (except licencing maybe) for them to monetize their songs and make a living.
    Will untold gazillions of amazing, life enhancing/changing songs and compositions, be destined to stay in a box, like home movies that are only played to friends and family on weekends?
    Will this inability to pay an artist their messily .13 cents to .99 cents per song, destroy quality recordings?
    People spend a dollar in dollar store for crap that they don’t even care about, without a thought. Yet here we are. A war! A war about obtaining a song. One that perhaps gives you great joy. So are you entitled to just take it and show your appreciation that way? or Do you show your appreciation by paying the artist less than what one would pay for a single dollar store item?

  4. Question for you genius: How much does it cost to hire an orchestra for a recording? Still less than $10K? Thought so.

  5. I wonder how many times they are going to print this same article? Different day, new author.
    Here’s the deal Gregory. Yes, the business has changed, yes the labels are struggling to catch-up. Although they do have the cash and can pull that trigger when they choose to.
    BUT, here’s the problem. “borrowing things” and not paying is an unsustainable business model for anyone. Psst, I didn’t want to offend anyone by using that “stealing” word.
    B. Artists and labels have got to get this cloud deal together. Spotify is not a workable compensation model for artists. While it might work great for going after VC money, it doesn’t bode well for the future of music. Damn people even pay more at the dollar store for stuff……..

  6. Great reply. CREATE is the key word here. This post’s theme is hammered away at because people are concerned. But the fact is that throughout the history of music, the artists making real money were always a tiny minority. Very little has changed in that regard. I say it every time I post: it is up to artists to shape the future. Don’t expect to get rich and if you don’t really, really love it, think about diversifying your interests.

  7. I’m with Justin. Keep posting these same old articles and we are going to start believing this blog is anti-artist. Nothing new here, keep moving….

  8. I actually don’t care at all what Hypebots stance on artists is, I’m just tired of repetitive content. Hypebot has, overall, been an outstanding resource for years now.

  9. Exactly. This article is a load of BS. There has not been one single bonafide international star created due to the internet alone. A label still had to take them and run them through their channels and make them famous and get them to be a household name. There is no DIY that has worked… you will always need a label because they are the ones who can make you a star, get you on radio, get you on TV, product placements that count. Can you have a mediocre career as an Indie, yes… sure, but don’t leave that day job. Jeez, what a load of shit Indies have been fed since 1999… and we bought it hook line and sinker unfortunately. What a waste of time it’s been. Now all we have is a bunch of people with EPs, Albums and all this product out there diluting the market. Music business has become a joke. I liked it better when there were gatekeepers and you couldn’t record a CD of your dog barking and get it instantly put into iTunes, Amazon etc via Tunecore. Now EVERYONE is a recording artist, musician. It’s taken the craft out of it and made a mockery of music IMHO.

  10. The reason its the same article is because something needs to change, yess change and a lot of companies don’t like that word and neither do bands. I see a few labels just going under and just dissappearing because with acts their siging nowa days and how their trying to promote them. The only reason they have these less talented acts is because they ran off the bigger names because all they have done is raped the bands name and have stolen their hard earnd money. And bands shame on you for getting lazy and letting someone do this too you. Its time to change the game gentle man.

  11. Hi Justin,
    Thanks for your response.  Coincidentally, I'm writing an article on how artists are perceived by their fans and based on your quote, "I actually don't care at all what Hypebots stance on artists is",  sounds like you have strong ideas in this area.
    Would be so kind and share your insights about the artists role in today's music.
    Happy 4th,
    Will Buckley
    founder, FarePlay
    Begin forwarded message:

  12. Seriously?
    The smith III is a budding pop trio. http://www.youtube.com/aljdaas
    600k views over seven videos? Famous? Hardly.
    And what single? “Put A Stamp On It’? According to Soundscan it’s sold a total of 8 song Downloads… WOW.
    So eight song downloads = getting famous?

  13. funny thing is… these so called solutions have been promoted for over a decade and guess what… none of them work…

  14. This article makes all the sense in the world. …if you are a musician no older than 24, with no wife or kids, with a sizable trust fund.

  15. And, what every you do pay no attention to the 150.46 million albums sold so far this year. SOURCE: NIELSEN SOUNDSCAN, BTW none of them where indie and the US consumers gladly entertain their economy to death.

  16. Must accept. must accept. must accept. must accept?????
    Must accept new music industry? I must have missed it. What “New Music Industry”?
    Please, would someone clearly define (With tables n graphs n flow charts n shit…) what the “new music industry” is, and how it works?
    Maybe like a Don Pasman Text Book kinda thing. ya know a “So ya Wanna know all about the New Music Business” kind of affair.

  17. I think it is important to realize here that fame doesn’t always mean money and unsigned artists don’t need to have millions of fans to become wealthy off of music.. If you can sell 10,000 copies of a record at ten bucks a piece either hand to hand at shows or online, the band can pocket $100k. Now for a 4 piece band, that’s 25k a year which means… they CAN quit their day job! (and that is not even including show guarantees and other merch sales.)

  18. If this article was actually written by someone who’s company had a website past Facebook or even one artist has had mediocre mainstream success, then it would be interesting. But from what I can tell, this guy’s model just leaves him looking like another amateur with a chip on his shoulder.

  19. “There is no DIY that has worked…” I’d beg to differ. Honestly, it all depends upon what genre of music you’re referring to. If you’re aiming entirely off of pop music in general, then yes, I fully agree. However, if you aim your focus to metal, hardcore, or punk, that statement is entirely false. I’m sure I’m in the minority here when it comes to those genres of music, but there’s endless amounts of musicians of those musical styles existing entirely on a DIY basis that are putting out records and touring nationally.
    Coverge, a hardcore band from Boston, MA with a career of 20 years broke into the global market when they formed their own record label, started self producing their own records by themselves, self managing, self booking, etc.
    The Dillinger Escape Plan, a progressive metal band from New Jersey are self managed and produces their own records and has a distribution deal set up through a distribution agency based out of France.
    Both of these bands self fund everything themselves through their own businesses, i.e their band.
    There are seemingly endless amounts of bands out there right now touring across the country playing without the aid of a record label or management agency pushing them further into dept and utilize the Internet and merch in order to provide the means to do this.
    Granted, most of these bands don’t see the level of success as being a “household name” but that all varies upon what your definition of “success” is. If you measure success based entirely off of making music and being able to tour, (which honestly, isn’t that the entire point of making music?) then I believe it’s safe to say there’s plenty of bands finding success using a DIY method. It all boils down to the business ethic and knowledge used by the musicians, and obviously g
    reat music.

  20. Every post here seems entirely way to focused on “mainstream” success and “household” names to define whether or not someone’s opinion or art is worth any merit.
    Haven’t we all realized by now that the majority of “mainstream” success is created off of sex appeal and skills using pro-tools and auto tune?

  21. With the decline of CD sales and overall availability of physical CD’s in general, I fail to see how distribution into record stores should be looked at still as the “be all end all.”
    Record Store Day is widely popular due to the product that’s put out that day, many of which are offered only that day, creating a very limited product which will force people to act quickly if they wish to buy it. Also, it helps that vinyl sales have increased significantly over the past few years. And with all the innovative things that are being done to vinyl itself (see Third Man Records), they’re becoming more and more of a collectors item. Where as CD’s are still remaining the same as its always been, untouched for decades.

  22. Thesmithiii is a budding pop trio. Look at SmithIIIvevo for example. Actual album sales because itis not on Soundscan doesn’t mean it didn’t happen. The Album is doing well and is gaining international recognition. This company and group is young and they are doing the work and they are getting famous. The funny thing is that it always takes a while for some people to see greatness.

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