A New Music Business Model

There has been a lot written and debated about the future of the music business and how the old model is broken, but there is little consensus about what the new model will be. I have my own theories and opinions of where things are going, and it might be to a better business model for almost all concerned.

The old model is a top-heavy hierarchical system where the labels made all the money, controlled output, and screwed the artists making the music. With the ubiquitous availability of music online, their way of doing business is quickly becoming irrelevant to the most voracious music consumers—young kids, college students, and the occasional hip music fan in his forties with a high speed connection and wide taste in tunes (that would be me, in case it wasn’t obvious enough).

If a music fan wants to hear music these days, they don’t turn on the radio, or even their CD player—they go online. Streaming audio from Myspace and other sites is a great way to discover new music without spending that twenty dollar bill on a full CD with one good song, but the file-sharing avenue is how most are filling up their iPods and hard drives with music.

Here’s where it starts to get interesting. Artists no longer need to work toward the one thing that used to legitimize them—a record deal. If you only get jerked around, for pennies per CD or song, what’s the point in giving up control of your career? The bands making money now are doing it in smaller, more focused regional touring circuits, and the free availability of their music is what’s driving a new generation of fans out to the clubs to see them play live—the one experience that can’t be downloaded.

So if you’re in a band, forget about working toward that record deal—instead, invest in some good recording equipment and do your own albums, or hire a local producer with a project studio who can probably make you sound just as good as the L.A. or NYC guys. Put the songs out on your website for free download, post them all over the place—Myspace, Facebook, Purevolume, wherever, just get them out there. If you’re good, people will find you even in the torrent of traffic on the web. It may take a while, so be patient and keep working on your live show.

If you can work your way into a regional touring circuit where you’re not playing the same town every Friday night, it’s entirely possible to sustain your band, if not full-time then at least to the point where you’re not losing money on your hobby.

Repeat this scenario nationwide and you’ll have more bands touring in smaller areas, creating vibrant regional scenes, which in turn will initiate some buzz online from regional bloggers and local publications. If the buzz gets loud enough, the opportunities to expand will come to the bands, resulting in an ever-widening touring circuit. All those people who listened to your music for free online will then get the chance to hear you in person, too. I’ve heard many stories from bands who play a town for the first time and there are twenty people up front they’ve never seen before, singing along to their original songs.

In this scenario a major label becomes virtually unnecessary—even if a band bottles some lightning and experiences a Shawn Mullins moment (a sudden, surprising spike in popularity due to a hit song or other one-time exposure like a commercial placement), if they’re putting the music out there officially for free, there isn’t a need for the old-school hard copy distribution channel, even.

Monetary streams for bands in this model will come from live shows, of course, but also from non-downloadable merch. T-shirts, posters, the usual souvenirs that fans like to have, plus some hard copies of the music for those who want the physical document. Depending on your band’s genre, vinyl albums are now hip again and being stocked in larger numbers by indie record stores. Give your fans the option to buy hard copies directly from you or through a seller like CD Baby, and there will still be a number of them who will do it even if you have the downloads available free. Creating communities online around your band will also serve you well not just in gaining fans, but keeping your current ones interested. Are you posting tour blogs, video journals, new demo recordings, live clips, or any other innovative content on your band’s website? why not?

This is a different level business model than the multi-million selling major label archetype, but given the odds and the competition, it’s very unlikely your band will ever even come close to that type of opportunity. Acknowledging that is the first step to a realistic approach to your music career, taking any of the suggested routes above is the rest of the staircase.

There are more nuances to this whole subject, and others have explored them more in-depth than I just did, so I’d appreciate your thoughts on this too–Comment away.

I’ll put my money where my keyboard is as far as expanding your exposure. If you think your music is good enough that I need to know about it, write about it, or otherwise let people know about it, drop me a line at kageyo@yahoo.com with your best two songs, links to your videos on Youtube, and your website address or Myspace page link. If I like what I hear, I’ll be in touch for more.

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2 thoughts on “A New Music Business Model

  1. Got the following via email from James Mayfield of Asheville, NC; he gave me permission to post it here as I think it validates and supports many of the points I made above–KO

    I could not agree more with everything you point out. From bands no longer needing a record deal to succeed, to online places like myspace and facebook being the most popular ways for fans to learn about music. The one thing you pointed out that is so very true for bands is the aspect of the live show. It is so important for every band to work on what they do live for music lovers. What will a band do differently and uniquely, to pull in the ears to their show and then, what will the show sound like to those ears? That is such a driving factor for independent musicians these days. Thanks to businesses like Lee Crumpton’s Home Grown Muisc Network, independent artists have many oppotunities to put their music out there for millions of fans to listen to and download. If they have what it takes. Having what it takes means a lot though. You have to have the music and live show, but you also have to use marketing skills to turn heads. These online stops are exactly the model for all bands trying to make a living with independent music. Bands also have to become a close knit family to survive on any regional tour, as I unfrotunately found out with MXB in the later tour days. They were awesome and turned heads, but did not make it as a family on tour. Too many differences split them apart. The last thing I wanted to comment about was your statement about free music. Free music is the best way to get people to listen to you. Why wouldn’t any band do it? Etree.org is THE BEST online stop for any jamband, deadhead, electronic, etc. fan to download entire shows for free. Thousands of independent artists at your fingertips. An archive of amazing genres of music, live and free! WHAT? Napster/Metallica…..a funny story no doubt! Blogs, You Tube Videos, bulletins for myspace and facebook, live tune players, and all kinds of other great outlets, should be every independent artists plan for being a successful touring unit. I use Reverbnation, which allows the artist to create Live Tune Widgets, banners, fan collector/street team widgets, and a whole lot more to reach fans, increase email lists, and drive the music to the people who want to hear it the most. Currently, the band I mange is ranked 60 out of over 11,000 other electronica artists on Reverbnation. It works! Check it out, http://www.reverbnation.com/themalah.

    Check out The Malah, a new band on the live electronica scene, much in the footsteps of STS9, Lotus, Future Rock, and Telepath, but with much more of a live show then any of them. We just played a late night slot at Trinumeral Fest (2AM-3AM), in front of about 1000 people. Sick lights and a brand new album in support, Sound Spectrum. It is a follow up to the first CD Voyage of Radiowaves, which is available at the Home Grown Music Network, and about every download site in history. We were excited to share stages with Galactic, EOTO with Michael Kang of String Cheese Incident, and many others. I am happy to report that the good peops at Bear Creek Music Festival have asked the band back for a second session at Suwannee Music Park in Live Oak, FL this Fall. This year we will share stages with Burning Spear, Perpetual Groove, Umphrey’s McGee and many others. Humbling. We have an intense archive of live shows at archive.org. All multi-tracked, digital, and maybe the best recordings in their! We are about to release 3 new live best of albums, Live From Earth 05, Live From Earth 06, and Live From Earth 07, all will only be available at download sites like iTunes, eMusic, Rhapsody, Napster, and many others. We did this to promote the Digital Distribution plan that the Home Grown Music Network made avialable to us. They will link the sites to our band page on their website to help draw fans there to download the albums. They are all live, but mastered in depth to the most incredible sounds a recording could possibly make thanks to our Sound Engineer, Chris Mohsenni! I look forward to hearing what you think about The Malah. Here are all the places you will find music, youtube video, digital photos from our personal photographer Josh Nash, and all the paintings that our live painter, B Paul, has painted over the past year and a half. He is amazing! Paints to the music at every live show!

    http://www.themalah.com
    http://www.myspace.com/themalah
    http://www.myspace.com/jamwizard
    http://www.reverbnation.com/themalah
    http://www.homegrownmusic.net
    http://www.sonicbids.com/themalah (under construction)

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