Industry Evolution

That’s $45,000 to live on for a year until the record gets released.

spend half a million to record

leaves the band with $500,000

They pay $100,000 to their manager for 20 percent commission. They pay $25,000 each to their lawyer and business manager. That leaves $350,000 for the four band members to split. After $170,000 in taxes, there’s $180,000 left. That comes out to $45,000 per person.

record is a big hit and sells a million copies

record company spends $300,000 on independent radio promotion

You have to pay independent promotion to get your song on the radio

All of those independent promotion costs are charged to the band.

Since the original million-dollar advance is also recoupable, the band owes $2 million to the record company.

If all of the million records are sold at full price with no discounts or record clubs, the band earns $2 million in royalties, since their 20 percent royalty works out to $2 a record. Two million dollars in royalties minus $2 million in recoupable expenses equals … zero!

record company make?

grossed $11 million.

costs $500,000 to manufacture the CDs and they advanced the band $1 million. Plus there were $1 million in video costs, $300,000 in radio promotion and $200,000 in tour support.

The company also paid $750,000 in music publishing royalties.

They spent $2.2 million on marketing.

record company has spent about $4.4 million.

Worst of all, after all this, the band owns none of its work

Stealing our copyright reversions in the dead of night while no one was looking, and with no hearings held, is piracy.

TLC declared bankruptcy after they received less than 2 percent of the $175 million earned by their CD sales.

Toni Braxton also declared bankruptcy in 1998. She sold $188 million worth of CDs, but she was broke because of a terrible recording contract that paid her less than 35 cents per album. Bankruptcy can be an artist’s only defense against a truly horrible deal and the RIAA wants to take it away.

Of the 32,000 new releases each year, only 250 sell more than 10,000 copies. And less than 30 go platinum.

The 273,000 working musicians in America make about $30,000 a year.

But the music industry is a $40 billion-a-year business.

Recording artists have essentially been giving their music away for free under the old system, so new technology that exposes our music to a larger audience can only be a good thing. Why aren’t these companies working with us to create some peace?

Downloads are creating more demand.

record companies figured out that it’s a lot more profitable to control the distribution system than it is to nurture artists

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster.

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster.

Add Sticky NotePrivateIndustry EvolutionMusic Marketing and self promotion tipsThe new music IndustryPersonal floating sticky note by Jeffrey Ellison

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster.

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster.

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster.

The present system keeps artists from finding an audience because it has too many artificial scarcities: limited radio promotion, limited bin space in stores and a limited number of spots on the record company roster.

Artists pay 95 percent of whatever we make to gatekeepers because we used to need gatekeepers to get our music heard. Because they have a system, and when they decide to spend enough money — all of it recoupable, all of it owed by me — they can occasionally shove things through this system, depending on a lot of arbitrary factors.

allow millions of people to get my music for nothing if they want and hopefully they’ll be kind enough to leave a tip if they like it.

We don’t understand or want to understand corporate culture.

I know my place. I’m a waiter. I’m in the service industry.

I live on tips. Occasionally, I’m going to get stiffed, but that’s OK. If I work hard and I’m doing good work, I believe that the people who enjoy it are going to want to come directly to me and get my music because it sounds better, since it’s mastered and packaged by me personally. I’m providing an honest, real experience. Period.

The answer is purity. We can afford it. Let’s go find it again while we can.

I’m looking for people to help connect me to more fans, because I believe fans will leave a tip based on the enjoyment and service I provide. I’m not scared of them getting a preview. It really is going to be a global village where a billion people have access to one artist and a billion people can leave a tip if they want to.