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Wednesday, February 23, 2011

The Major Labels and the TOP 10% Money Makers vs. FREE MUSIC

I hear a lot of people talking about the Major Record Labels making HUGE PROFITS off the backs of the people who support the music they put out, but I can assure you that NOTHING CAN BE FURTHER FROM THE TRUTH! The major labels are going BROKE! In fact, many have CLOSED and two have filed for Bankruptcy leaving only about two left standing and their days are NUMBERED I can assure you.


Why? Because the labels stuck to the old business paradigm where they WERE making a TON of money but that model is BROKEN! The internet has changed EVERYTHING!

As for those ARTISTS that are getting RICH by charging high rates for LEGAL DOWNLOADS of songs – don’t even think that is the case! In fact, for 10 years in a row CD sales are dropping at an INSANE RATE! In fact, if you follow Sound Scan – you would know that CD SALES are dismal – and most retailers have dropped the number of SKU’s (CD TITLES and how they are tracked) that are available to a very small amount.

Wal-Mart – was the LARGEST distributor of MUSIC for quite some time – PERIOD. As you saw Tower Records file for bankruptcy – nobody stopped to think about all of the independent record labels or distribution companies that were caught up in that whole process and many of them lost HUNDREDS of THOUSANDS of dollars as their inventory that they had SHIPPED to TOWER was now owned by the bankruptch trustee – will they EVER see any money out of those bankruptcy proceedings? NO! Not a dime because you can’t sell CD’s anymore! That’s just how it is!

So what happened to these smaller companies? Many of them lost so much money that THEY TOO had to file for bankruptcy as a small company cannot afford to lose $25,000 much less $250,000 – so these purveyors of music that were NOT necessarily representing the “mainstream’ music that you heard on the radio but were trying to break NEW ACTS that had worked for years to get to the level of being able to put out a CD and I can assure you that the amount of time and money that is spent on a FULL CD is mind blowing! What happened to these ACTS? They’ve faded into obscurity – their music careers are OVER – they have to go back to the BAR CIRCUIT and try to make a living by giving away CD’s if you are willing to buy a T-Shirts just to TRY make some merchandise money to pay for the gas in the bus, equipment maintenance, CHEAP hotels (or sleeping in the van) and eating fast food! Keep in mind the COVER CHARGE has NOT CHANGED since the 80’s – that’s 30 years of inflation and yet people are not willing to pay more than $5.00 to go see a band and yet people wonder why there aren’t nearly as many GREAT new bands out there.

There is simply no way for a standard touring band in today’s market to even make more than minimum wage or LESS once you factor in the hours of rehearsal, drive time to the gig, set up, play for 4 hours, tear down and hit the road again. It used to be in the 70’s when I fried chicken to buy my first guitar – Minimum wage was like $2.35 an hour – I can’t really remember – but I did what I had to do to buy my first guitar – practiced and practiced and our band made $875 at our first GIG! That was 1977! You can’t even get that as a guarantee from a bar and it’s now 2011. Also, I could play solo gigs for $200 or so a night for years – not any more! So if you look at the early 80’s and compare that $200 a night to the minimum wage – I was making a KILLING! But you can’t do that anymore – unless cover charge goes up – the only way to make any decent money is to play private parties….

But enough of what it was like THEN – let’s talk about NOW. Did you know that ONLINE SALES took a HUGE hit last year? Yes that’s right – after Wal-mart was replaced by iTunes as the number one retailer in the world – LEGAL DIGITAL DOWNLOADS STIL TANKED! So who’s making all this money? Well it’s the Justin Bieber’s (sp? Who cares?) and Taylor Swift’s of the world – and I don’t even want to tell you how bad of a deal you get IF you make it on American Idol – you sign away your LIFE just to get on the show – sure you’re going to make money – as you have to TOUR, and TOUR, and TOUR and work 18 hour days hitting talk shows, meet and greets, in-stores, etc, etc – it’s SUPER HARD WORK and if you don’t keep it up they forget all about you and then your done- what happens to all of those bands or artist that have had JUST ONE HIT - who knows but they are not making a KILLING in the music business that’s for sure – as music has become TOO DEVALUED! Seen the viral video that got 64 million spins on youtube? Did they get rich? NO – they made less than $50,000. Heard a band on Pandora that you hear over and over think they are making a killing? No! They’ve got to get 50,000 spins to make $400.00. That’s insane! But what do you do if you want to get your music out there just to even SEE if people will like it?

Do it all yourself – but that takes YEARS of work! Which you may never see much return by way of money but if you love what you do – then just maybe everybody will catch on and follow you. With PRO TOOLS and home studios, anybody can make a good CD – but even if you can make your own music, get it on iTunes, and tour, tour, tour to try to build a fan base – without a LOT of money behind you (which used to come from the major labels) how are you going to PAY for all the promotion, production for larges shows, etc. It take money to make money – so sure that top 10% that you see on TV etc are making some good money – but for HOW LONG?

When was the last time you want to a TRUE ARENA show? They used to have them all the time but now all but the very BIGGEST stars can even get an arena to sell out. Most are lucky to get ½ full…and even bands like US – that have a HUGE following are NOT making a ton of money of music sales – they make it from TICKET SALES!

So the bottom line for those that want FREE MUSIC and think they are being ripped off – don’t buy those artists music, do NOT buy major label acts music either! Support the mid-level band that are jus trying to make a meager living – and don’t forget about those young and truly talented, hard working artist/bands that will spend years working on their craft only to fall by the wayside – and if they didn’t PLAN for a way to make a living in something other than music – what will you hear from then next? “Would you like fries with that?” So these days if you put all your eggs in one basked and don’t make it – which is the ONLY way TO MAKE IT – then you are going to have a really hard life.

And those are just the FACTS – THE TRUTH ABOUT THE MUSIC BUSINESS!

I'm all about supporting songwriters, artists and bands that are out the breaking their backs just TRYING to do what they love and HOPING that it's enough to just pay the bills - but i can assure you that only the VERY TOP ARTISTS (whose careers are eventually going to fail) are the ONLY ONES that are making much money - the stuggling bands that are REALLY GOOD can't seem to get a BREAK but again, if they are doing it for the LOVE of music - then I'm all for it - and will support them as much as I can - which is what I've been doing for the past 30 years - developing bands, helping band, working as their producer, their attorney, their mentor, and putting up MY OWN TIME and MONEY to help them!  But this is just how it is - only a very small percentage will hit the big time - the REST will fade into obscurity...
 
I just wish the more people actually understood the TRUE nature of the music business before they rant about how much the labels or the big acts are making - rememember you have a better change of getting hit by lightning that having a career in the music business and that is a cold hard FACT!  I just wish it was different and that more people understood that it's the mid-level bands and the up and coming bands that are facing the toughst times EVER!  They are going to work so hard - just to come up empty handed! It's SAD but it's TRUE!  So if we make music almost FREE - how will these poor musicians, writers and bands even make even enough money to live at the POVERTY LEVEL?  They won't and they aren't already!
 
Which is why I've taken a complete 180 and do NOT CARE about the music business or making money - I'll give you my music for free (not that I'm any good anyway, my good years are way behind me) but I still do it for one reason and one reaon only - BECAUSE I LOVE MUSIC!!  And more importanltly - "I love to PLAY music!"  And if EVEN just a few people enjoy what I do - then that's enough for me!  All it takes is for somebody to say they Liked JUST ONE of my songs or came to one of my shows and really enjoyed it and that will make my DAY!  But I can assure you I don't play live anymore as I can't afford it - it's just too much work for too little money - and I'm NOT going to go play unless I bring the WHOLE PA, Lights and everything else as I want to put on a GREAT SHOW - but you can only do that for so long - so I spend my time in the studio and writing and hope that when I finally release something - that just a few poeple will reach out and say - "hey that's pretty good!" And again, that's fine with me...
 
But I can't speak for the other Artists and Bands that are still trying to make it BIG! But I do wish them all the luck in the world!  Bless them all!
 
SM @ MSO