Your Band Can Live Off Of $1/CD, Right?

Mathew Ingram consistently blogs in a matter-of-fact, sensible-is-as-sensible-does style. Today, he’s discussing musicians and business men in response to a poorly reasoned CNET post. To quote Mathew:

As for the line about only 5 per cent of EMI’s acts being profitable, that’s hardly surprising. For one thing, many of the label’s acts are unadulterated crap, which even millions spent on marketing and hype cannot spin into gold; and for another thing, the overhead of a traditional label like EMI is astronomical — for all the mid-level managers and their salaries and bonuses (never contingent on actual sales, of course). That’s presumably why the new owner is slashing and burning.

Some thoughts.

The record labels need only 5 percent of the artists to be profitable. There are two types of acts that interest record labels: 1) established, or 2) new. Bands that don’t transition from new to established in relatively quick order usually end up 3) dead, broke or both. Labels don’t want to financing struggling bands or pay them better. Labels want to go through many new bands in order to find the most established bands. Plenty of bands do manage the long road of touring and fan base building, but that’s a much different skill than either 1) creating music or 2) being a record label.

The $1 per CD problem. There would be fewer broke or dead bands if they were better paid by the labels. Since there are so many bands that are looking for the possibility of label-promoted success, the labels don’t need to negotiate much. They just talk to the next, newly-formed, newly-struggling act. Unestablished bands cannot wish away the other unestablished bands.

Record labels cannot tell a good band from bad band. That’s a good thing. They are well aware of this fact, too. The labels naturally focus on the quantity of unestablished $1/CD bands rather than the quality. They don’t know quality. The wasted expense of unsuccessful bands is a cost to all bands.

A band who’s primary approach to their potential audience is to get the record labels to give the a $1/CD record have to live with the fact that the odds are stacked against them. If you talk with business men who say, “the first thing we do, take 90% of the money,” why would you expect them to change?

You need to have a better alternative. That requires a different type of creativity. Complaining isn’t creative.