How Music Works (39 page)

a few. Some of these artists simply didn’t manage their finances well and spent their money on drugs or limos, but some did nothing “wrong.” They were just

part of a business that wasn’t designed to sustain them over the long term.

In 2011, the
New York Times
ran a story about the economic realities facing the musician Teddy Thompson:

Mr. Thompson, who has been struggling to succeed for more than a decade (he turns 35 on Feb. 19), has enjoyed only marginal success in the United States—his average record sales are 21,000—and is acutely aware of his dwindling shelf life in a business with a rapid turnover of talent. If his fifth album,
Bella
, to be released Tuesday on Verve/Forecast, doesn’t break through, how many more chances will he get?

“My goal when I started out was to get to the point where I could tour a lot and make a living, which means getting paid enough to hire my own band, travel and end up with a bit of money, but I’m still nowhere near that point,” he said. “Because I didn’t have a band and fan base when I started, I did everything backward. I’ve ended up making five reasonably expensive records and not having a commensu-rate fan base.” 1

In another
Times
article, about singer-songwriter Nicole Atkins, Ben Sisario writes,

She was signed by Columbia Records and got the full star-in-the-making treatment, with a spread in
Rolling Stone
and even an American Express commercial in anticipation of her debut album,
Neptune City
. Critics began to fall for her darkly laced, almost surrealistic songs and her soaring, dramatically powerful voice.

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Shortly before its release, however, the album was delayed—to be remixed by the label’s new co-chairman, Rick Rubin—and when it came out, months later, its

promotional momentum had evaporated.
Neptune City
sold a disappointing 32,000

copies, according to Nielsen SoundScan, and by 2009 Ms. Atkins and her label had

“divorced,” as she once put it.*2

It is important to keep in mind that the sales numbers described here as

disappointing might have actually been okay if these artists could have held on to a larger percentage of that income. I know both these artists. Their

records are good and they are plugging away, gigging around town and else-

where, and I feel optimistic that the changes in the music-distribution landscape will help them find a way to make a life in music.

In the last decade things have changed. The big record companies have cut

back, and they rarely offer generous advances to artists anymore. I have been paid sizable advances by Nonesuch, and though I could have tried to make

a cheaper recording on my last record with them, and thereby pocketed the

change, almost all of the money I received went into production costs. That

was my choice. I did okay, but I don’t recommend that to everyone.

As the advances and marketing expenditures that record companies commit

to projects continue to shrink, artists have naturally begun to seek other ways of funding their recordings, paying the rent, and marketing their music.

CHANGE 4: PERFORMING

IS NOW VIEWED AS A SOURCE OF INCOME

Live performances by artists were traditionally seen by record companies

as a way to publicize their new releases—as a means to an end and not

an end in itself. Bands would therefore ask for and often receive advances

from record companies (called tour support) specifically to cover their touring losses: the cost of hiring musicians, hotel rooms, van rental, gas, and meals in strange cities. Bands would anticipate that they’d recover that advance from the record company, which they’d have to pay back later, through a subsequent increase in record sales. Sometimes the record sales would indeed increase as

* Sales quoted reflect United States numbers only. Overseas sales can, in fact, “save” deals for bands.

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the result of a tour, and after a long time those loans could be paid off, but often they would not.

This, to be blunt, is all wrong. It’s backward. First off, performing is a distinct skill, different from writing songs, singing, or making recordings. And for those who can do it, performing can be a good way to make a living. There are acts out there who don’t sell all that many records, but whose excellent live performances can fill sizable halls. They don’t need a record label’s help to do that either.

Not everyone agrees with me. I spoke with Mac McCaughan, who co-runs

the independent label Merge. He sees a continued value in bands touring to “support” their records. As he put it:

The most old-fashioned way of doing things is still the best, which is touring.

That really sells records more than anything else. It really does work. Most of what Merge puts out only gets played on college radio, non-commercial radio, KCRW, places like that. And that’s great, but by the time you get to a record store two days later, you’ve kind of maybe forgotten what you heard. But if you see a band live, that stays with you. It’s so memorable and it’s so immediate. That, more than anything else, is gonna stay in your mind. And you can actually make money touring if you keep your budgets down.

So given all these changes, what is the purpose of record labels? Do they

still have a place in this new world? Can we redefine what it is? Some will

survive. Nonesuch, which has distributed several of my albums, has thrived

under Warner Music Group ownership by operating with a relatively lean

staff of twelve and staying focused on talent. “Artists like Wilco, Philip Glass, k.d. lang, and others have sold more here than when they were at so-called

major labels, even during a time of decline,” Bob Hurwitz, president of Nonesuch, told me. The label has had some unexpected successes recently, like

Buena Vista Social Club and the Black Keys. Such successes, Hurwitz says,

happen about 5 percent of the time. He says that things do a little better than hoped for about 10 percent of the time, exactly as expected about 60 percent of the time, and not as well as was hoped about 25 percent of the time. Without knowing how much each record costs to make and market, it becomes a

little hard to know just how devastating the “not as well as hoped” records

would be financially for that company. Similarly, a successful record is only a 218 | HOW MUSIC WORKS

financial success if it didn’t cost an arm and leg in recording and marketing to make it happen. Hurwitz claims that Nonesuch, though prestigious, is not a

vanity label for Warner Brothers.

DISTRIBUTION MODELS

Do people need labels? Some bands don’t, but some bands do just because they don’t want to worry about what we do. They don’t want to do what we do. They just want to make music and play shows and make records and write songs. They don’t want to have to worry about finding a distributor and calling record stores and making sure they’re stocking the record when they’re coming through town.

—Mac McCaughan

Some big labels have disappeared, as these roles that Mac mentions get

chopped up and delivered by more thrifty independent vendors. Brian

Eno (who now produces Coldplay and is co-writing songs with U2) recently

told me he was enthusiastic about ithinkmusic—an online network of indie

bands, fans, and stores—and pessimistic about the future of traditional labels.

“Structurally, they’re much too large,” he said. “And they’re entirely on the defensive now. The only idea they have is that they can give you a big advance, which is still attractive to a lot of young bands just starting out. But that’s all they represent now: capital.”

So where do artists fit into this changing landscape?

Where there used to be one model, now I see six, ranging from the artists

who puts themselves entirely in the hands of the label, to the artists who do nearly everything themselves. There could be more delineation along this spectrum, but the following will suffice for now. Not surprisingly, the more involved the artist is, the more likely it is that he or she will retain a bigger slice of the pie per unit sold. The totally DIY model is certainly not for everyone, but the point is that there are options.

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