I am heading east next week to take part in the madness that is the CMJ Music Marathon. New York’s music scene is always great, but during this five day stretch there is no better place in the world to see and hear some of today’s best independent music. For us on the business side of the music scene it also a great opportunity to network, schmooze and drop names without trying to hurt one’s toes.
Last year at this time the word was that the major labels were in serious trouble. That obviously played out to be accurate. While the labels are definitely hurting, I have noticed that they are no longer the slow moving mass that they once were. Sure there is still the old guard pulling the stings of the A&R and creative departments at the majors, but I think it has finally registered that making money off of physical record sales is just not going to buy the CEO his 2nd jet anytime soon.
360 deals are being pushed hard by some labels and industry giants (eg. Madonna and Jay-z with Live Nation). Companies are taking a piece of everything an artist touches from album sales to touring to merchandise. In return the artist is promised national and international marketing and promotion by a label who still has the connections and manpower to launch such a campaign. I am still not sure if this model can be mutually beneficial. Judging by the insistence of some labels to only use 360 deals, I have a feeling they tend to skew in favor of the labels a bit more than the artist. Just a hunch though.
If a band is looking for a more traditional deal, they are still available. A one and five deal (one album with the option for five more) is still commonplace with many of the lables who are still around. These are typically too long of a time period and too onerous on the artist (transfer of ownership your music is the norm), but have been around for so long that they have become the “industry standard”. In the past a label would convince an artist that a long term recording agreement was the way to go and would sweeten the deal with a phat or fat advance. Not so much these days.
Bottom line, an indpendent band that kills it at CMJ next week will probably get an offer from one of the many lurking label execs present at its showcase. Whichever type of deal is offered, rest assured there will be a teeny tiny advance attached. Labels do not have any money. Its gone. The days of six figure advances and seven figure recording budgets are history. The labels’ belt has gotten tighter just like every industry in America. On top of that, we are in the final quarter of the year so any coin that the labels had has most likely been committed to an earlier project.
So what’s my point? Don’t wait for a killer deal. It just isn’t going to happen. Musicians should definitely listen to any offer and be courteous while doing so. Then they should think about this: can they do the same thing the label is offering on their own? If the answer is yes, and a band can forge strong relationships with strategic management companies, booking agents, merchandise companies and lawyers, they may not need a label. If a band can do all of that, they definitely do not want to give up ownership of their music or have someones hands in their pocket during a performance, at the merchandise tent and at the record store.
Lots to think about. Perhaps we should wait to think about it all until after next week when we have completed the music marathon.
SHAMELESS PLUG(S) OF THE WEEK:
Toki is getting well deserved press. Click her wicked cool necklace above for more info.
You may have already seen this, but I think its awesome: