We had so much obscure music in the back catalogue that people would browse our archives, find a band that they'd never heard before, listen to a few songs, and then buy one of their CD's. More often than not, people would buy multiple CD's.

For that matter, when Sarah McLachlan's first big album, Surfacing, came out, the day that it hit the shelves we also put the entire thing in (for the time) high quality MP3's up on our web site for people to grab copies of.

And even if they didn't buy the CD, we hoped that they'd enjoy the music enough that they'd come out to see her in concert, or at Lilith Fair.

That kind of worked out not too badly, it turns out.

When you think that your sources of revenue are dying, it makes sense to try and extract as much as you can from them on the short term, despite the damage it does to them long term.

Of course, this makes the prediction self-reinforcing.

The people who are rightly worrying that their jobs are in peril are the suits (though often dressed in Tshirts and ballcaps) who bring less and less value in an age where experiments like Louis C.K.'s are a widely publicized and self-produced success. Disruption at it's finest and most liberating.

You're basically right, I just want to reinforce that there are lots of us modern music industry types who couldn't be happier about "the situation".

As a side note, I wonder how someone could plot the frequency of usage of auto-tune in the studio with record sales.

Here in Canada, EMI produces and delivers, via physical distribution, a huge number of CD's and DVD's.

As soon as things "go digital", that goes away.

I think that physical channel, more than anything, is what they've been trying to salvage, by staying away from digital.

Universal Music (the largest music company) sold its CD manufacturing plants a few years ago and all their focus is on digital exploitations. They are looking to the future and that rarely includes people buying CDs in retail stores.

I can't stress how desperate they are to take advantage of the huge number of digital assets that they own. So, start-ups, don't be too afraid of them. If you have a way for them to make money they will be interested in you, just don't assume they are idiots.

You may also want to start thinking about writing software to help them manage the millions of digital assets that they have - its not a simple problem - imagine the digital rights that needing tracking (for every type of exploitation in every territory), the royalties to be paid, the SOX auditing, the contracts, digital workflows, let alone the challenges with taking digital content and pushing it to a huge variety of downstream partners.

That's a really polite way of saying "They will squeeze the last drop of blood out of you and then some".

You may also want to start thinking about writing software to help them manage [...]

We already have the software. It's called spotify, soundcloud, grooveshark, iTunes etc. The technology to pay the artists a slice of the revenue is in place. Except currently it's mostly used to pay the labels instead.

Very true! However, they do have a lot of cash and very few ideas of how to exploit all their digital assets.

We already have the software. It's called spotify, soundcloud, grooveshark, iTunes etc. The technology to pay the artists a slice of the revenue is in place. Except currently it's mostly used to pay the labels instead.

I didn't mean software for end users, but software for the music companies to use internally to manage their assets. You'll be surprised (or not) to know quite how disjointed and hacked together their internal systems are. Every music company merger results in years of hacks in getting data from one set of archaic systems into another. Of course, the same software could also be used for managing other media, such as film, tv etc - there are small companies that have done very well supplying custom software to entertainment companies e.g http://www.ecteon.com/products-overview

Not surprised, I've witnessed it first hand (I've been with a music startup).

My argument is that they don't have a software-problem. Managing an inventory of a couple million items is by no means rocket science, they could fix that in a couple months. What the best software can't fix is their mindset, which is firmly stuck in long expired business-models.

Dealing with one of the so-called "majors" is like dealing with a really stubborn 3yr old. You can forever explain the simplest realities to them in the simplest terms - they will still insist on their objectively absurd position and use all the remaining power that they have to make your life miserable in every possible way.

The best strategy is to stay far away from them until they run of money and their inventory moves into more clueful hands. Unless you want to be the one to take-over their inventory of course. In that case I wish you the best of luck - and nerves of steel.

Nothing came of it. Maybe it was too soon? Maybe the first founder didn't know the right people?

Music companies are entertainment companies so are still extremely relationship-oriented businesses - far beyond the way conventional businesses are (such as software companies, manufacturers, retailers, etc). To be a top exec at a music company does not necessarily depend on skill or acumen.

Music execs can fail horribly at one company and then effortlessly transition into another great exec job at a competing music company. It's a small world. The music industry has this idea that its very complex and difficult and needs years of experience - but its really not.

If your founder happened to know the right exec in an e-commerce department and was able to show a demo/trial you could have been in with a chance. Anything related to billing software always has a good chance because its easy to make a case how it is generating revenue from day one. That's a difficult thing to do.

For a start downloading a full CD would be quite a faf back when most people had dial-up or something else slow as their main connection method. Costly too if you were in a country/area where there were no plans that didn't result in you paying per minute for time on dial-up.

To keep the download size manageable you'd have to use a relatively low bitrate, which would probably mean most people could tell the difference between them and the CD, especially with the older compressors with psycoacoustic models inferior to those used today (giving the choice on dial-up: high quality some time later today, or low quality sooner).

Being able to download a track, at a high enough quality that you can't tell the difference without breaking out a spectrum analyser, in a matter of seconds means the number of people paying for the CD because that is easier is going to fall drastically. The number of people buying other merchandise of tickets for live gigs might remain more constant though: physical delivery and "being there" can't be refactored by a fast connection in the same way.

But a major challenge remains, and it's this: Trent Reznor, Radiohead, and even Louis C.K. were all hugely popular and successful before they employed this model. Can the model work for lesser-known artists attempting to capture an audience?

In theory, sure. If anything, I could see this model's working out quite well for the proverbial little guy. But first, that little guy faces a big challenge: how to get himself noticed. How to turn himself into a Radiohead without the tens (hundreds?) of millions of dollars that EMI spent marketing and promoting and touring Radiohead, over 20-odd years, prior to the band's online release of "In Rainbows." How to turn himself into a Louis C.K. without two major HBO series deals, a bevy of TV roles, sponsored tours, and a movie role or two.

In looking at the majorly successful artists in pop culture today, we see that 99.99% of them were "made" by a big company or series of big companies. They were self-made in the sense that they quietly worked in the trenches, perfecting their craft, sometimes for decades, before they hit their big breaks. But big breaks were necessary conditions of becoming superstars. And becoming a superstar seems to be a necessary condition for big success in this model.

[I don't want to get onto too wild of a tangent, and start discussing the philosophical meaning of "success." For some, success might mean simply making a living as an artist. I get that, and I respect that. I'm putting that aside for the moment, however, and focusing on the top of the game.]

In our haste to cast out the old guard, we tend to lose sight of the fact that the old guard still fills what appears to be a necessary purpose: the breaking-out of artists. I'm confident and hopeful that their crucial role in that purpose will, eventually, weaken or fade. But for now, it's still a strong reality.

Ultimately, we have yet to see indications that this new model is any kinder to small-time or nascent artists than the old model is. That's the big problem. The winners of the new model (Radiohead, Trent Reznor, Louis C.K., et al.) have first been winners of the old model. So it's very premature to say that the new model is better for the little guy.

To put it in financial terms: the new model holds bigger theoretical upside (share of profits) for artists and consumers (reduced costs). But it does nothing about the downside (risk of never breaking out, financial burden of building a fanbase, etc.), and may even make the downside worse for most artists. At least the little guy in today's model has a chance, albeit extremely slim, of getting discovered and catching a big break. But will the same thing be true in a pure long-tail environment? The jury is still out.

To be totally but somewhat apologetically blunt - that is a steaming pile of BS. That is the exact party line repeated by every single rank and file music industry do-nothing to justify their phony-baloney jobs.

In my own personal experience, affiliation with a record label as a young and growing artist is almost certainly more likely to handicap your chances at success than it is to actually help it. The reason is that when the young artist buys into the party line that "you need the major label machinery to grow your career", the artist then hands over a large amount of control and trust to a supposed "experienced, connected industry professional" to do a job that 99 times out of 100 would be better off done by the artist themselves.

Not only that, but the young artist has no idea that the supposed "experienced, connected industry professional" has zero interest in or understanding of what it is that the artist actually has going for them, either artistically via their music or commercially via their fanbase. At that point all they know is that for some reason, things aren't working out as everybody had hoped it would with the new label. They find out later that they are essentially paying a 100% interest rate on their advance for the privilege of believing this in the first place.

I and all of my buddies in other bands live our lives in the long-tail environment and we play for larger crowds and make more money than probably 98% of the suckers that take the advice to place their bets on "the traditional industry model". And we own our souls outright. You've probably never heard of any of us, but we're okay with that.

THE ONLY WAY FORWARD is to once and for all crush the notion that the "traditional industry model" is anything other than a parasite that eats hopeful and talented artists and excretes auto-tuned plastic dolls.

Rant over for this round.

This is still marketing. By removing the publisher, which specializes in marketing, we put the burden of publishing duties on the artist.

Note how financially successful, award-winning, prime-time comedian Louis CK is playing the little guy against the publishers, mentioning that he financed it all (much like a publisher would do).

Who knows who he's paying or how much. The role he's playing implies that all the cash goes straight to him, the artist, but did he pay anyone for the production? Does he have a future royalty agreement with an agent or, perhaps, a channel like Comedy Central? Is he paying for advertising, or has he hired a marketing manager/publisher to rustle up publicity? Is he calling in favors to get mentions on news sites (much like a publisher would do)?

I'm not being cynical, just that he's playing the game very well, he's using his fame/brand to leverage sales, and that this distribution method doesn't really change anything except move the same roles elsewhere.

This is sort of how I feel about the traditional publishing industry. The way it's worked traditionally is that can't quite tell which authors are going to be big sellers, so you take a chance on a bunch, and the more successful ones subsidize the less successful. Now the successful ones for obvious reasons resent this and can shift to a self-publishing model. The problem is they never would have gotten successful had some publisher taken that initial chance on them. Where's the next generation coming from?

Your band could have been poised to be a very successful mid-level act and have been mispositioned, because mid-level acts aren't hugely profitable, and thus seemed to be a failure in a market you weren't wanting to compete in.

The small bands don't need a ton of financial support, especially these days. Recording a song can be done, professionally, for just a few thousand dollars and traveling to nearby concerts is pretty cheap. If you drop the idea of trying to sell an album in stores (payola!), and doing continent-wide tours, it's not all that expensive to spread your music to fans and enjoy a moderate return on investment.

But I'm sure it helps a lot if you happen to write songs that appeal to nerds and then get featured on slashdot as a sort of novelty act. I don't see that working as well if you write earnest alt-folk love songs instead of songs about Mountain Dew.

Incidentally, there was a story about Coulton on NPR not long ago [1].

[1] http://www.npr.org/blogs/money/2011/05/14/136279162/an-inter...

Isn't that kind of the whole point though? You can't just be a no-name, release some music that is very similar to a large number of artists in a popular genre of music, and then expect to hit it big.

Novelty acts? Sure. But they're proof that it's possible to become reasonably successful without the help of traditional media outlets if there's an audience for your work out there (I think most artists are–understandably–delusional about this one).

Anyway, I think curation is becoming more important and influental nowadays. And curators used to be much more (totally?) dependent on what the industry decided to provide them with.

It is no more so. I see no reason to worry about that (being a recording and performing artist myself).

Right and I would add that the model also worked because the supply was constrained on talent by the those offering the break. It's possible that we will hit (and are already hitting) a talent saturation point there is only so much entertainment pie that an individual will pay for or needs to consume. I mean my time reading HN takes away from the time that I used to spend reading other sites.

It's currently the 25th highest grossing app, 12th if you exclude all the free games that rely on in game purchases.

The fact that my wife knows what Minecraft is speaks worlds, when I barely get her to pick up an xbox remote, let alone think she'd find an obscure indie developer.

> and they would have owned your private information for their own use.

> You never have to join anything, and you never have to hear from us again.

And I think Louis CK is going to be Louis CK's EP from now on.

EDIT: Forgot about the "don't contact me" default on the purchase screen.

Not exactly the same thing: Ghosts I-IV was fixed price(s), provided lossless downloads, under a very permissive CC license and the first quarter was put on torrent sites directly.

Similar yes, same no.

My comment was mostly just to correct the "Trent Raznor's(sic) Radiohead" part of the op.

http://www.youtube.com/watch?v=PBxhxVIiwaA

Absolutely. There's a very recent (<60 years) misconception (among artists and fans alike) that creating (as opposed to performing) music is a standard career choice and if you're at all good at it, you should be able to make a living off of it, and if you're not it's because the labels screwed you over. This causes musicians to vie for the favors of the industry they profess to despise.

These guys going out and actually making it happen on their own (even if the initial entrants have a historical advantage) will erode that sense of entitlement, and thus erode the willingness to submit to the industry that artists have.

Eventually, hopefully, musicians will be busting ass, giving away their music to fans early in their career, and getting increased funding/patronage as they go along, just like every other artist has since ancient times, not positioning themselves for a deal and being depressed if there's no A&R people at their big show. The most talented will likely still get rich, the one-hit wonders will go back to their day jobs, and if we're lucky, music will again be created by those who love doing so.

Again: Well deserved and I for one feel like I got $100 worth of awesome, for a bargain price!