Category Archives: Business

10 Tips For Succeeding In Today’s Volatile Music Biz by Clyde Smith

American-songwriter-logoThe March/April issue of American Songwriter includes a feature titled Dream Big: How To Succeed In Today’s Volatile Music Business. Their website has transcripts of each individual interview covering a lot of ground about what to do after one has written some great music but has yet to build a sizable following or become visible to possible industry allies. Interviewees include a full range from Jacob Jones, a performer and marketing director for Artist Growth, to Mike King, an author and instructor for Berkleemusic.com.

These tips are taken from the article on the American Songwriter website, Dream Big: How To Succeed In Today’s Volatile Music Biz. Each individual interview is linked at the end of this post.

10 Tips For Succeeding In Today’s Volatile Music Biz

1. Kendel Ratley – Director of Marketing, Kickstarter:

“If you’re still establishing your fanbase, check out where your peers, favorite artists, or bands you want to emulate share their music and follow suit. There are countless platforms and venues to debut your work. Identify your audience, think about where you discover music, and post accordingly.”

2. Jacob Jones Of Artist Growth:

“Post it [for free] on Facebook, post it on Twitter, post it everywhere. It is good to put it online at a central location and then you can easily see how many are getting downloaded…Just make sure when you post it, you actually engage with your subscribers and not just beat them over the head with ‘I have a song! Hey everyone, I have a song!’ The competition is stiff and cleverness can get you in their ears faster than aggression. No one likes to be annoyed.”

3. Mike King of Berkleemusic.com:

“Artists have to think about sales differently. They have to romance new fans a bit…Providing free music is key to building up your larger community, and I think that in terms of sales, you are going to want to sell a variety of items to your fans from your own site, with the idea that you can sell items that are more personal, and not available in traditional retail.”

4. Tim Putnam of Moontoast:

“Build your audience/e-mail list, then follow up with bundles, and creative offers. Look how Third Man Records builds their bundles – they have a very niche and dedicated audience and they constantly give them cool products. Even if you can’t afford to produce merchandise, you can give people shout-outs on Twitter and Facebook, host live chats and video events. Debut music videos to a core group of people … then the next time you have something to sell, take it to those core people first.”

5. Kendel Ratley – Director of Marketing, Kickstarter:

“Ten people isn’t nothing! Whether they’re fans of yours or simply into music discovery, they made an effort to find you and saw value in what you created. Focus your efforts on seeking out those ten people and developing a relationship with them.”

6. Tim Putnam of Moontoast:

“If you’re getting a great response and can sell directly to your fan base, do you need to be signed? Keep going through the cycle, building your fan base and offering high quality and creative products…Keep an eye out for opportunities [but] realize that you don’t need a windfall moment to be able to offer fans something amazing. You can do it now and with every release you offer.”

7. Jacob Jones Of Artist Growth:

“First, ask yourself if a record deal is the best thing for you at this point…The smartest thing you can do is manage yourself well, keep track of all your numbers, keep records of your tours and merch sales, and know the big picture of how many fans you have and where they live. A label will want to know as much information about you and your career that you can provide, so being business-minded from the beginning gives you a huge leg up.”

8. Mike King of Berkleemusic.com:

“For the most part, a label is not going to care about you unless you have leverage – unless they see that you have a base of fans that you can leverage to sell your music. Things are much harder for labels now, and while I think some labels can be great for artists, I think that artists should really consider building up their own base, hopefully with a smart in-house team.”

9. Kendel Ratley – Director of Marketing, Kickstarter:

“The importance of live performances and establishing a following in a town outside your own – whether it’s three people or 300 – cannot be overstated. If you can’t afford to tour or your day job doesn’t offer vacation, create live experiences online: invite your local fans to a backyard show or your friend’s garage, set up a camera and stream it live.”

10. Traci Thomas of Thirty Tigers:

“Touring is the key to breaking any new artist. If you’re out there and touring and getting attention, the industry will pay attention.”

SOURCE:
10 Tips For Succeeding In Today’s Volatile Music Biz


Making New Music Distribution Models Work

In this clip Interscope Records head Jimmy Iovine talks about what a new business model for the music industry would look like from a business and consumer perspective, and what changes need to happen if record companies are to successfully make the switch.

http://youtu.be/HrOorem5q6k


How To Start Your Own Record Company by Lori Kozlowski

There are music lovers, and then there are music lovers. The thing that separates the casual vinyl buyer from the collector with 50,000 records. It’s that deep love that pushed Cheryl Pawelski to leave her first job in advertising to work in a record store.

She had such a curiosity about how records are made — both physically and figuratively — that she left Milwaukee and headed to Los Angeles to find out. Pawelski started as a temp at Capitol Records. She went on to spend 12 years at Capitol, became Vice President of Catalog Development at Concord Music Group, and then became Vice President of A&R at Rhino Entertainment.

The three-time Grammy nominee learned a great deal as a producer, saw the music industry change, took the lessons, and then built her own monolith.

“Labels are caught in a technological interruption. The scale is such that the labels can’t sustain as big as they are. I wanted to reduce the scale and be a conduit to the fans,” she said.

Starting a record label seems like an overwhelming task — the talent, the manufacturing, the contracts — even for a seasoned pro. But Omnivore Recordings is about examining what the market needs, meeting all the needs, paying attention to where industry pitfalls have happened, and remembering why you got into the business in the first place. It’s about keeping something alive.

Together with three partners — Dutch Cramblitt in sales and marketing, Brad Rosenberger in publishing and product, and Greg Allen in photography and design — the label was formed in 2010.

Without question, the music industry has changed — we are reminded of this all the time, as other industries look to the giant to figure out what went wrong and how they can avoid it.

“The music business was kind of co-opted by other businesses for their own profit. There’s a misnomer that ‘iTunes saved the music business’ or ‘Spotify is saving the music business.’ To me, they are just using the end product of the music business to sell hardware or subscriptions. That’s no longer the music business to me. The music business was about selling records and music, not about selling iPods,” Pawelski explained

“Our goal really is to sell music.”

Omnivore is not your father’s record company. It’s a multiple revenue stream enterprise with a publishing arm, an effort in music documentaries and films, and a consulting service that helps estates preserve and catalog their assets. Omnivore recordings are available on CD, vinyl, and digital. You can get their music directly from the label, at a record store, in iTunes, or on Amazon.

“We’re everywhere that you need to be, which is what you need to be,” she said.

Omnivore seeks ways to be unique. For instance, in honor of Record Store Day (an industry effort to drive traffic back into indie record stores) — her label is putting out two limited edition products: a vinyl 10-inch by the band The Knack, and a vintage Buck Owens coloring book that comes with a four-song flexi disc and a download card.

Artists on the label tend to be musicians she has worked with for a sustained period of time, or reactions to fluctuations in the marketplace. Musicians currently on the label include: Big Star, Alex Chilton, Jellyfish, The Knack, The Motels, and Buck Owens, among others.

“My job for a long time at big labels was to look for the holes in the bins. I ask myself: What’s the next chapter of the story I can tell for this artist?”

With less bottom line pressure and less overhead, her own venture has afforded Pawelski all the benefits entrepreneurs want — she’s able to be a lot more creative, take more chances, surprise fans, and produce high quality work every time.

SOURCE:
How To Start Your Own Record Company


How Do Musicians Really Earn Their Living? by Hisham Dahud

Screen shot 2012-03-26 at 12.06.16 AM

The Future of Music Coalition has released data from its Artist Revenue Streamsresearch project, where financial case studies drawing from 4-12 years of accounting data provide information about how musicians are making a living today. These five case studies provide a financial profile of different types of full-time musicians. Each case study graphs and explains the musician-based sources of income over time, and the results tell a lot about the state of today’s music industry.

(click on chart above to enlarge)

The case studies reflect the working lives and income streams of five different types of full-time musicians:

  1. Jazz Bandleader-Composer
  2. Indie Rock Composer-Performer
  3. Jazz Sideman-Bandleader
  4. Professional Orchestra Player
  5. Contemporary Chamber Ensemble

The reports include annual revenue pies, a look at income versus expenses, and net profit over time. Some case studies also include more detailed breakdowns, such as PRO royalties by territory, or session work by bandleader. Using data compiled from individual artists’ tax returns, Quicken files and PRO royalty statements, the case studies offer a deep look into how real musicians and composers earn their living.

Key Findings

For musicians that perform (which the majority of those studied consisted of), live performance is the essential revenue stream. In nearly every instance, a performing musician’s annual income is highly dependent on the number of shows they played. Live performance is not only important because it is a creative choice (all of the subjects indicated that they enjoy playing music for live audiences), but because it is also a controllable source of income.

That income, however, comes with significant expenses attached, as touring expenses can often exceed touring income. Moreover, these expenses are not scalable, and as the more active a band becomes, the more money must be spent on travel, promotion, sidemen, etc… Other revenue streams that the case studies incorporate, such as teaching and session work, appear much more stable in the sense that they have fewer expenses attached.

Another finding was that label advances and grants do not indicate direct revenue. Two of the case study artists have received significant grants or advances related to recording projects. In both of those cases, all of the money was spent to make their records. Some of the records even cost more than the advances or grants provided, meaning that the artist needed to invest income earned through other means to complete the recording project.

More findings showed that performers leverage their performances to earn money in other ways. With live performances being the main platform for artists, all of the case study artists who make recordings sell their CDs to audiences after their shows. For the indie rock composer-sideman for instance, selling CDs on the road was nine percent of his income in 2010, and 22 percent in 2011.

One more significant finding was that some revenue streams are time delayed, but pay off year after year. Unlike live performance fees that are incurred typically right away, income earned by compositions pay off over time. For instance, the indie rock composer-sideman earned public performance royalties for songs he composed with MainBand #1 steadily, even four or five years after the recordings were released. The jazz sideman has continued to receive PRO royalties for a song he composed for a film in 2001. Compositions have a life of their own and once it’s published, it can be licensed or performed repeatedly all over the world, resulting in income over time.

Why Study Musician Revenue?

These studies are significant because they help paint a “real world” picture of what it is like to earn a living as a musician in an industry dramatically transformed from what it once was only a decade ago. While technological breakthroughs such as the emergence of the digital music store, the rise of social media, and music streaming services have certainly made it easier for musicians to distribute their music and connect with their fans, sources of revenue have seemed to funnel to only a select few key areas.

For aspiring musicians, it’s important that they get a firm financial understanding of what it really means to make a living in today’s music business, and to plan accordingly. The information can help tomorrow’s artists get a clearer idea of what they will have to do, the lifestyles they need to plan ahead for, and the sacrifices they need to endure in order to make ends meet through their music. For more seasoned musicians, these case studies can only affirm how the industry has changed in regards to primary revenue sources, and how they must continue to adapt in order to not be left behind.

SOURCE:
How Do Musicians Really Earn Their Living?


MUSIC SAMPLING AND COPYRIGHT LAW by John Lindenbaum

“Digital sampling technology allows an artist to copy a portion of a recorded sound or series of sounds and incorporate the fragme nt into a new work.2 While only 8 of the top 100 albums contained sampling 10 years ago, almost a third of the current Billboard 100 albums use sampling as an artistic tool. 3 Whereas many rock and pop artists have used the technology to save the time and cost needed to hire a live band, hip- hop, dance and experimental artists have chosen the sampler as their primary instrument. For example, Tone Loc’s rap hit “Wild Thing” is based on the guitar riff from Van Halen’s “Jamie’s Crying,” and the Beastie Boys’ 1989 Paul’s Boutique is a rap album with beats composed of hundreds of samples including an Isley Brothers guitar solo, the reggae standard “Stop That Train,” The Beatles’ guitar solo from “The End”, Johnny Cash’s “Folsom Prison Blues,” and radio advertisements.4 As rap producer Daddy-O says, sampling “is something you put together out of bits and pieces other people have done. Once you have the complete product, you have a completely different picture.”5”

Lindenbaum, John. MUSIC SAMPLING AND COPYRIGHT LAW . Princeton Township, NJ: Princeton University – CACPS UNDERGRADUATE THESIS, 1999. Print.

You can download a PDF of the paper here.

SOURCE:
MUSIC SAMPLING AND COPYRIGHT LAW


Getting the Attention of a Label

Randy Lennox, president and CEO of Universal Music Canada, talks about how to get the attention of a label as an independent artist.


Sampling Music & Law regarding sampling

You may have noticed that there are several song out in the world today that use parts or words from other songs, within their song.  This is particularly popular in rap songs and also as introductions into songs.  This is known as sampling.  It basically means that you are going to use a part of someone else’s song, within your song, and the original artist isn’t going to be singing it.  This can make for some very interesting music and normally sounds very original, but it can be dangerous.  Sampling without the proper permission is obviously illegal.  It is an instant copyright violation.  Also, since you didn’t write the lyrics, nor did you record it, you are violating two different copyrights.  This can get you in a mess of trouble, but there is a right way to do things.

Permission is going to be the biggest part of this process.  You will have to identify and contact the person or company who holds the copyrights for the piece of work that you are interested in sampling.  Normally this will be the publishing company and the recording company.  You must ensure that you have permission from both copyright holders, one is not good enough.  Once you’ve contacted the copyright holders, you will have to negotiate a fee for using the song.  The price for a sampling can be all over the board.  Ultimately it will depend on who you are sampling from (big name artists are more expensive than non-name bands), how long of a sample you will be using (a fraction of a second is minor, but anything more than five seconds will be major), and how it will be used in your song.  Structuring an entire song around someone else’s will be very costly, while only using brief sections will be cheaper.

Now you will have to decide how it is you are going to pay these people.  Your first option is a buy-out.  This is a simple, flat fee that you are going to pay upfront to use their music.  Again, these fees will vary depending on the artist.  Your other option is to offer a mechanical royalty fee.  This means that you will pay a portion of every sale of the song, back to the original artist.  These fees can range all over the place, and occasionally will have to in addition to some kind of a flat rate, ensuring the artist will get some money out of it.  Any variation of these two options is a possibility too.  Some artist may even off the sampling for free just to get their name and music out there a little bit.  This normally happens with a larger band wants to use a smaller bands music.

Firms are also available to assist you in the pursuit of obtaining these sample licenses.  Occasionally these firms will actually be cheaper than hiring an attorney and they will often times negotiate a fee for you.  This will help save you a little bit of time and give you the best chance of actually obtaining the license to use a sampling.  No matter how you get it, a sampling license in absolutely necessary when you are interested in using any portion of someone else’s copyrighted music.

If you choose to ignore the law and simply use a sample of someone else’s music you can find yourself in a pretty bad situation.  Some of the copyright laws are strict and the punishments for breaking them can be severe.  In most cases the judge will slap you with a massive fine.  These fees can reach into the hundreds of thousands of dollars and higher.  That alone could not only bury your band, but also you, depending on the business license you are operating under.  The artist could also demand payment for each album sold or, even worse force a recall.  This would mean that every album ever sold would have to be recalled (all that promotional money down the drain) and destroyed (all that publication work and money gone).  No matter which way you spin it, unauthorized use of someone else’s songs could be the end of your band.

Some people may have heard of a “fair use” rule that is in the music industry.  This rule says that as long as it is four notes or less, there is no penalty for copyright infringement.  That is not true at all.  No matter how many notes it is, if a jury decides that they are easily recognizable as part of the other song, you can be fined.  Even if it is something that was done unintentionally, you can still find yourself in a world of trouble.  The only songs that aren’t a part of this copyright law are the songs that have no one holding a copyright for.  This eliminates almost every song, but there are a few that are public domain.  But other than this small group of songs, you must always have a sampling license.

These problems can become even worse if you are under a record company.  The reason for this is, most record companies will have sections in their contract with you covering these types of situations.  It will basically say that you are making your own, unique music and that if the company is sued because of copyright infringement, then you are personally liable for any lose the company takes on.  This can be a huge fine, since the record company will have similar contracts with other music suppliers, radio stations, studios and producers.  That means they will have to reimburse all of those people for your mistake, and then you will have to reimburse the record company for all of it.  All in all, it’s less risky and ultimately easier and cheaper just to get the license.

SOURCE:
Sampling Music & Law regarding sampling


Income Solutions for Independent and Major Label Artists

Owen Husney, a manager, talks about income streams for artists. He explains that while artists may not receive money from record labels, there are other methods to get paid. Touring and merchandising are major areas. Also, if the artist writes their own songs, they can make publishing monies. The performers can also make record royalties. Husney mentions licensing monies as well, which are from licensing songs for film and television. Also in this segment, Husney discusses the common monetary trap of artists. Many artists overlook the fact that they have to pay the record label back.


Music Industry Survival Manual: 13 Different Ways To Make Money From Your Songs

FREE .PDF Download of the TuneCore Music Industry Survival Manual. Everyone needs this vital information.

Click to download Volume 2.1 WAYS TO MAKE MONEY

SOURCE:
http://blog.tunecore.com/wp-content/uploads/2012/03/13ways-booklet.pdf


The Most Important Members of a Successful Artist Team by Paul Resnikoff

Everyone is always talking about the artists’ team, the critical support structure that helps spread the music and manage fanbases. But when it comes to successful artists, the most important and well-paid members are lawyers and accountants – then the webmaster, booking agent, manager, and everyone else.

The Future of Music Coalition recently interviewed thousands of artists about the composition of their team, and this is what a few hundred, high-earning artists said.  These are full-time artists making more than $100,000 a year with over 90% of that coming directly from their music.  And outside of the band members themselves, these were the roles designated most (in terms of the percentage of respondents indicating that these people were members of their team).

 

SOURCE:
Accountants & Attorneys: The Most Important Members of a Successful Artist Team…

 


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