The TuneCore Huffington Post Article

This posting went live at the Huffington Post some time ago - I thought it made sense to make it available here as well.

The Democratization of the Music Industry

(The original posting can be found here.)

Due to the advent and adoption of the Internet, digital media and hardware by the masses, control of the global music industry has being broken. For the first time, all music creators can choose to be their own record label – there are no longer subjective gatekeepers controlling who gets let “in”, promoted, exposed and made available to the masses, the choice now becomes ours.

For the past century, artists could record, manufacture, market, and, to some degree, promote their own music, but no matter if they were The Beatles, Elvis or Led Zepplin, they could not distribute it and get in placed on the shelves of the stores across the country, the required costs and infrastructure of the physical world were just too massive – a 500,00 square foot warehouse staffed with 30 people,  trucks and inventory systems, insurance, a field staff of 30 people walking to music stores leveraging, begging, pleading and paying to get the CD, album, 8-track, wax spool etc on the precious shelves of the retail stores.

Without the music available to buy, there was no way for it to sell – and this is the Music BUSINESS after all.  Record Labels made artists famous and made money off that fame by selling the music the bands created. The record labels exclusively had the relationships with the distributors (and in the case of the “4 major record labels” the same company owns both). Therefore, with only one means to the desired end, the goal for many artists was to get “signed” to a label.

Record labels were in a very unique position of power due to their exclusive access to distribution, they were not only the singular gatekeepers to a career for an artist by “signing” them to an exclusive contract, but they were also the subjective “deciders” (to use a Bush-insm) as to what music was pushed out and promoted to the masses. With a “signing”, the labels acquired exclusive rights to and from the artist.  In return, the label advanced money while providing the relationships, expertise and infrastructure to record, manufacture, market, promote, distribute and sell the music. Which brings us to an important point, of all the artists and music creators in the world, less than 1% of 1% of 1% have ever been chosen by the labels due to the risks and economics of the “brick and mortar” world.  Of all the music created in the world, even less has had the opportunity to be discovered and heard by the masses.

And then the world changed thanks to the Internet and digital media.……

As I write this, iTunes ranks as the 2nd largest seller of music in the US – only Walmart’s physical stores sell more.  Digital revenue is real, and there is a lot of it being earned. Sales in iTunes alone can create enough revenue to allow true financial success. Don’t take my word for it, just look at some of the sales by the following unsigned artists utilizing the Net for both digital distribution and marketing; Kelly sold over 500,000 songs in 5 months, Eric Hutchinson sold 120,000 songs in three weeks, The Medic Droid sold over 25,000 copies of a single in 45 days, Crank Squad sold over 20,000 songs in 30 days, Secondhand Serenade sold over 225,500 songs in 3 months, Jason Reeves sold over 20,000 songs in December, 2007 and list goes on and on. Unlike a physical store, digital stores like iTunes have unlimited shelf space allowing everything to be in stock.  If the virtual shelves fill up, another hard drive is popped in to make more shelf space.  In addition, inventory never runs out, the music simply replicates itself on demand each time it is bought.

For administrative reasons, most of the digital stores, like an iTunes, do not do deals directly with the artists allowing them to stock their music on their digital shelves – frankly, customer support for millions of bands or Uncle Larry, who insists he can do the best version of “How Much Is That Doggy In The Window” are not what the digital stores are about.   The stores prefer to get the music from music industry middlemen that aggregate music and deal with the administrative headaches (i.e. a record label as one example).

Therefore, the means to meaningful distribution has been reduced from “access AND infrastructure” to simply “access”.

Through websites like TuneCore (full disclosure here, I am the CEO and founder), for the cost of a six pack and a pizza (around $30), ANYONE can now literally be their own record label and have the same distribution as any “signed” artist. However, unlike a “signed” artist, this new model allows artists to keep all their rights and receive all the money from the sale of their music via a non-exclusive agreement that can be cancelled at any time, all while having infinite inventory with no up front cost or risk.

This is analogous to telling someone 15 years ago that if they paid $30, every Tower Record store (god bless its now departed soul) around the world would have their album on its shelf and never run out of stock.

In regards to music marketing and promotion, music marketing and promotion is simply giving music to media outlets in hopes that they play it, talk about it or write about it.   In the old days, there were three main media outlets that provided the general population a way to mass discover music: commercial radio, TV (i.e. MTV, VH1, BET) and print magazines like Rolling Stone.

These three media outlets created a second subjective filter as they chose from a pool of artists promoted to them via the labels which bands to show videos from, write about or play on the radio. If an artist was not on a label, the possibility of getting exposure from any of these three outlets was virtually impossible – MTV in particular.

Just getting pitched to any three of these media outlets also required a label due to the costs (i.e. make a video, greasing the palms of the programming directors at commercial radio stations, hiring a publicist etc) and connections.

Once again, enter the digital age.  The Internet created new media outlets and access for anyone to have global reach to others. Commercial radio is being replaced by Internet based recommendation streaming radio stations  (i.e. LastFM etc) that let all music in for programming, not just music pushed from the labels.  MTV (when they actually played music videos and nothing was being pimped out, dated or real world-ed) has been replaced by sites like YouTube - all anyone needs now is a cell phone to make their own video to broadcast to a potential Internet viewing audience of hundreds of millions of people (and before you doubt the power, just think about how Virginian Senator George Allen’s “Macaca” YouTube video clip saturated into the mainstream). Print magazines have been replaced by MP3 Blogs like Stereogum, Gorrila Vs. Bear, PitchforkMedia, My Old Kentucky Blog and more. These combined with social networking sites like iLike , MySpace and more have limitless circulation and the ability to allow readers and users to form a community that listens to, shares, rates and comment on the music.

Each person in and of themselves can become their own commercial radio station, magazine and/or TV network reaching tens of millions of people.

With the restrictions of the physical world removed even places like iTunes have new vehicles allowing people to discover and share free music (make sure to snag a copy of 34 Stars, a 34 artist compilation album available for free download  on iTunes.

Subjectivity and filters have been removed.  All music can be available to be bought, discovered, downloaded, shared and heard via the masses.  It is truly the democratization of an industry.

As far as the other label functions, these are now affordable and accessible for the everyman. For the cost of one day at a studio, you can go to a place like Guitar Center (disclosure again – Guitar Center have an equity position in TuneCore) and get high end, inexpensive high quality gear to record at home along with lots of knowledgeable experts working the floors to educate and advise.  With the removal of a physical medium to deliver the music (i.e. a CD), the barriers and expenses created by physical manufacturing have been removed.

Despite allowing everyone in being both exciting and frightening, there are a few undisputable facts – the control that previously existed in the hands of the four “major labels” has been significantly reduced. What we as the “masses” now have access to discover, share and listen to is much larger and wider.  Hopefully access to all of this new music will inspire us, piss us off and open the doors to experience whatever we want, not what a corporation or media outlet decides we should want.  It is then the public, not a corporation that gets to decide what is bad, good etc. The revolution (pun intended) has truly begun.

Comments

[Paul Cascio]

I feel this is an amazing opportunity for all artists. it reminds me of the Beatles, the Stones and other great bands making incredible music on a 4 track recording machine. It's the same thing, raw, inspired and beautiful. Please check out my album "Conventry" on Tunecore. If you like cool, if you don't cool! Peace, Paul

[Nathanael Matthias Weiss]

Jeff, what is your opinion on 3 out of 4 of the majors having an equity share in the new MySpace music?

[MELO MALO PAULINO]

I am emphatic about the fact that more power is coming into the hands of us artists and out of the fascist hands of destructive corporations that care nothing about music and world self expression.

[Markus Nylund]

Well I think the record labels are just simply in a different position to those of many artists. In the end they are just making money and doing their jobs. But the problem is, this is not selling soap. This is selling music and there is a danger always that if an artist or art gets exposed with too much money (as with anything else in life) it can potentially ruin it.

I actually wrote more about this in my recent blog so check it out:

I am so excited about this and the fact that i am not the only one with these thoughts.

[Paul Nash]

This article is correct and I have read several similar assessments by music industry executives.
I feel that promotion will continue to play the important role it always has, and perhaps live performance will become more and more important for the stage artist.
The most significant factor is the huge numbers of artists now involved in self publishing and the huge quantities of tracks available in all genres and at all quality levels. This may reduce the industrial, profit-making potential of music for all but a few first-to-market online retailers and enhance it as a cultural activity, but we need filter systems to allow public taste to develop. There is still a place for discerning DJs and music magazines. The danger is that the audience will be swamped by the sheer quantity of music, to the detriment of the best talents. Shows like American Idol are a positive sign, showing the public's love of good tunes and appreciation for good performances, As with sport, there is also an unhealthy over-obsession with winning...

[doubleagame]

This does a great job of summing up the current state of the music business, however, labels big and small remain relevant on the marketing and promotional side of things with a deep well of contacts within the industry intact that comes only from years of experience and hard work. Everyone is so quick to point to the now practically effortless distribution of music, but there is still much more than a good recording, MySpace page and getting on iTunes. People still have to know why they should care, which is arguably the toughest part of all.

[BIONEMIS]

On the one hand you´re completely right. The opportunities are so large in these days and it could bring the most lovely sounding arts to the last corners of this world. Yes in theory this is as you describe it. And you can mention one or two winning examples of 3 millions of artists who fight! seriously with all means (awesome sometimes) for example on networking myspace to grab attention. Are they the forgotten loosers in this game?? I ask you because maybe the old structures change slowly. The artist will sometimes be beated today as in the past from several institutions. Radio isn´t often much interested when you´re a smaller act. The fans try out to make their funny laughs on you and don´t hear exactly to your music, until you´re the "big spender". It is critical therefore and the musicians sit on their idealism alone staring to the stars. O.k. but that´s the game i´m full of hope that not only the surface decides this battle. But it is life that you make it (citation from famous talk talk in the 80´s)

[Mark]

I still think TuneCore took a tank and drove it through the phony wall of "Record Labels" signage. It was sorely needed a long time ago like at the end of the 1980s.

[Mark]

Being your own record label is very difficult work to say the least. You have to have a hawk eye on your merchandise every single day or you can be misinterpreted and look very foolish when they make a mistake etc. 10 to 20 stores worth!
If you make decent money best to hire a few people but then you're a record label yourself.
Resrtictions from the real world are not totally removed yet I can say, Yes, the door has been torn down in trade once again as it was too snobbish and restricted. You used to be able to make allot more money locally because resources were limited but that has changed so we need the Internet.

TuneCore is great but they need to still comptete with other distributers.

[Lord Hong]

This is a breakthrough for great independence and culture. There
aren't 4 or 5 opinions who control what music gets out there. But
what the next step is to eliminate this payola or bribery scam for
who gets on the local and national radio stations. That's where new
artists will make it or break it - level the playing fieldcompletely in
this great time so we can expand our choice of what we desire to
listen to.
Also we need to be protected from illegal sharing and downloading
- that's what brought down the record industry and will destroy this
new system too. Remember our songs are our livelihood and if a
person steals a car they are put in jail - I didn't spend years on
recording just to keep working a dead end job.

[caparina]

i loovvve tunecore !!

[rmhr]

this is all great...i agree with much of what your saying, but whether or not artists are smart enough to take control of their careers is a totally different story. we find ourselves at a point in time where the artist, if he chooses to and works hard, can release their own records, do their own promoting, play shows, and make a living. but artists don't always want to work hard. so record labels will capitalize on this fact, and find new ways to exploit artists...this is already happening, as many labels (including some indie ones) are asking their artists to pay percentages of their live earnings and money made off of merchandise. WOW! it's clear that many labels are just bloated machines with too many overpayed cushy job folks, and a whole army of young interns that work for little if any money so that they can feel the glam.