Real Band, No Record Company

Internet Challenges Musician's Traditional Longing To Be Signed By A Label

(CBS)  When the band Clap Your Hands Say Yeah packaged and shipped its new CD, called "Some Loud Thunder," they released it without a record label. And this was after their first self-financed album had sold more than 200,000 copies, prompting plenty of offers from the big labels, which they turned down.

When asked why, Sean Greenhalgh, the band's drummer, told CBS News correspondent Anthony Mason, "The question that we asked record companies was essentially, 'What can you do for us that we can't do for ourselves?'"

Billboard magazine made the band the poster boys of a "do-it-yourself revolution." Even million-selling artists like Jewel are considering going it alone. Garth Brooks did; so will The Eagles with their next album.

One big reason: The Internet is now doing much of the promotion & distribution work, as fans themselves spread the word and the music.

"Now you have blogs, other places where people go — that's how the publicity happens now," said Greenhalgh.

So band members hired their own manufacturer, distributor and marketing company, and instead of the $1 an album they'd typically make from a record company, they'll get about $6 for every copy they sell.

Jeff Tweedy is lead singer of the Grammy-winning band Wilco, whose new album, "Sky Blue Sky," comes next week on the Nonesuch label. But he wonders how long labels will be important.

"Technology has evened the playing field. If the artist can gain more power over the situation — over the economics of the situation — why wouldn't they take it?"

Like many artists, Tweedy admits asking himself the question: Do record labels deserve that big a cut?

And his answer? "It's getting to be a really tough call" — because the record companies aren't moving albums the way they used to. CD sales plummeted 20 percent the first three months of this year.

Empty shelves are all you'll find now at Tower Records, which until December was one of the most famous music store chains in the country. But it's now out of business, bankrupt — the abandoned display cases another unsettling sign of an industry in turmoil.

As the industry tries to figure out where the business is going, bands like Clap Your Hands believe they're better off going it alone.

"It was definitely a calculated risk," said Greenlagh, "but we felt like we had everything in place to do it ourselves."

It's not necessarily their music that's revolutionary — it's their business model.

[brianbwb-2009]

As a veteran music producer and "Black" American, I am beginning to have hope. For decades, "Black" artists were ignored by the industry, who only chose to use, and I do mean "use",those who through their own hard work and perseverance, managed to gain a following. New talented artists were brushed aside for manufactured acts, who were little more than pliable pretty people with marginal ability. Rock became the bastion of "Whites", even though its creators and pioneers were not. Non "Whites" usually did their own distribution from the trunks of cars, or at best were offered contracts that were little more than loan shark deals, in which royalties became the property of the company. We had to "take it, or leave it". Recording studios, at $250.00 per hour put the ability to record music into the hands of the wealthy, and the quality degenerated into such as it is today.

Tomorrow looks a lot better for all recording artists, 5 days of old fashioned studio time can now buy a studio we can use for at least a couple of years.

Radio airplay is still a problem, the stations are still by and large feeding from the big boys' marketing departments (they used to call it payola, and it used to be illegal), but even this is changing, radio's role in music promotion is becoming less and less relevant.

[berrypicker1]

The first thing the industry needs to look at, that is if they want to correct the business is:
1. They need to strive for the music quality of the artist and song and forget about if he or she has grey hair etc.
2. The radio folks need to start caring about what the people want to hear instead of force feeding what they want them to hear.
3. Stop trying to make it as vulgar as they can and strive for genuine talent and quality.
4. Stop trying to tell the artist what songs to sing, let him sing songs from the heart and not just words, when an artist has experience he or she will know a great song that he or she can relate to.

[missingamerica]

I bet the ASCAP lawyers start lobbying Congress to pass a law requiring all performers to sign with a record label.

[pcecbs06]

The alarming drop in sales for the record companies is not surprising, and I can't really be sad for them.

For years after the CD came into vogue, the record companies enjoyed huge profits. They created a perception of a CD being a premium item and double list prices to nearly $20, even though CD's were cheap to produce. The record companies and the tightening of the radio markets (hello, Clear Channel) led to less quality product - and more product overkill with what was left.

The industry has been suffering because of a glut of music aimed at juveniles, a lack of developing artists across the board, and a complete lack of developing accessible multi-media platforms in the early stages of the Internet to distribute music. People craving new quality music went and found it on their own, often for free. The companies are STILL wary of working with digital services, and definitely don't understand the benefits of the Long Tail Theory (ie, selling two or three of everything will actually net more total sales than foisting 5 million copies of a Britney Spears album will).

[obiwan234]

As a Gospel Music Artist our market is fairly small and profits are minimal, but we go on, and on as we feel we are called to do. We self market and we bank almost $10.00 per CD sold. Our business model is really simple; where we sing in person we sell our CD's.

This approach has worked well for us as we just finished vocals for our second CD project and now into post production and this project is fully paid for in advance. Now before anyone thinks we are "cutting a fat hog", I must remind you that if we sell 2,000 CD's a year we are doing well by our measure and needs.

We may well move into internet distribution, but I don't expect too much from that because there is just so little air play and we are known in California and the West only.

Just another piece of the pie.

[obiwan234]

As a Gospel Music Artist our market is fairly small and profits are minimal, but we go on, and on as we feel we are called to do. We self market and we bank almost $10.00 per CD sold. Our business model is really simple; where we sing in person we sell our CD's.

This approach has worked well for us as we just finished vocals for our second CD project and now into post production and this project is fully paid for in advance. Now before anyone thinks we are "cutting a fat hog", I must remind you that if we sell 2,000 CD's a year we are doing well by our measure and needs.

We may well move into internet distribution, but I don't expect too much from that because there is just so little air play and we are known in California and the West only.

Just another piece of the pie.

[dcm5150]

In the 1980's the the VCR was going to ruin the movie theater business becuase nobody would want to go to the theater if they could watch a movie at home an. Cassette tapes were going to destroy the music industry because of the ease of copying an album on cassette.

Movie theater ticket and music salessales continued to climb.

In the 1990s the DVD was going to ruin the movie industry because of the high clarity and (in the late 1990s) the ability to make exact copies. They sued and sued (and are still suing) yet sales of DVD quickly became a substanial portion of the money movies were making.

In the 1990s the CD was going to destroy the music industry because people could make exact high fidelity copies of a CD. Music sales soared as people loved the new sound and went and bought all of their old collection on CD.

Today, the internet is going to destroy
the music and movie industry. Of course Spiderman 3 is on pace to make $1 billion, iTunes conintues to increase sales, I guess only time will tell, but if history has anything to say about it....

[ralan40]

Right you all are, those who posted, remember we are not talking 'Art" as much as "a product" in the music industry's eyes.
The real money is in Concert Tours, t-shirts and the like. It is interesting to see the industry force itself to find new revenue streams.

[micma-2009]

It's good to see that artists are taking more control over their careers and destiny. I think that this trend will be good for the industry.

[whocares161]

i think record labels are a big waste of time for bands. Bands get about $1 off every cd sold which is just horrible i've talked to bands about labels they can't say much they just told me they hate it and wish they were never signed i think it is amazing for what the internet, home studios, and such has done for bands now you have to ask yourself is that little label on the back of your cd worth going hungry for a few years? not to mention you're screwed if you sign a bad deal with a label. The lists go on and on about how labels screw you behind closed doors but i think it is time for bands to "rebel" against labels do it without them. we need to start using our resources around us and less of what labels put on us.

[culligancan]

Each CD cost around 25 cents to produce. They sell them for $12 - $15. I live in Europe and have no idea what Americans are paying. The record company will pay a producer and an engineer to record the artist plus mixing and mastering the CD. They will pay an artist for all the designs. They will pay for marketing and distribution of the CD. The artist gets on average $1 for each CD sold. Out of that dollar, they have to repay the record company for videos and such. Most of the time, the artist will end up in debt to the label. The label made a fortune and the artist ends up in debt. For example, this happened to TLC. They had a #1 CD and a world tour. After all debts were paid, the girls recived 50K each. The record company made millions. More power to the idie artist. I support the indie labels.

[farmerbb]

What was not clear here was the $6 per CD returned to the band. Did that include the money they paid out for manufacturing, distribution, etc. ? If so, then it surely seems the record companies have been making obscene profits on CD's. Sounds a lot like the prices farmers are paid for their crops, versus what we pay for the same item in the grocery stores.

[stezzer]

The record companies were too greedy for too long.

CD's could have been sold at a fraction of the cost, but the record companies just couldn't resist fleecing our pockets.

It's a brave new world. More artists, more choice and better value. The guys in pinstripes had better get used to it.