Columbia wants Rick Rubin to Save the Music Industry??!!

[BrazenMuse]

Interesting article. Would love to discuss...some of what it says about the industry is very much in line with some of our discussions of it...


What that means, most of all, is that the company wants him to listen. It is Columbia's belief that Rubin will hear the answers in the music — that he will find the solution to its ever-increasing woes. The mighty music business is in free fall — it has lost control of radio; retail outlets like Tower Records have shut down; MTV rarely broadcasts music videos; and the once lucrative album market has been overshadowed by downloaded singles, which mainly benefits Apple. "The music business, as a whole, has lost its faith in content," David Geffen, the legendary music mogul, told me recently. "Only 10 years ago, companies wanted to make records, presumably good records, and see if they sold. But panic has set in, and now it's no longer about making music, it's all about how to sell music. And there's no clear answer about how to fix that problem. But I still believe that the top priority at any record company has to be coming up with great music. And for that reason, Sony was very smart to hire Rick."
Though Rubin maintains that his intention is simply to hear music with the fresh ears of a true fan, he has built his reputation on the simultaneously mystical and entirely decisive way he listens to a song. As the Gossip, which is fronted by a large, raucous woman named Beth Ditto, shouts to a stop, Rubin opens his eyes and nods yes. This is the first new band signed to Columbia that he has been enthralled by, but he is not yet sure how to organize the Gossip's future. "Let's hear something else," Rubin says to Kevin Kusatsu, who would, at any other record company, be called an A & R executive. (Traditionally, A & R executives spot, woo, recruit and oversee the talent of a record company.) "We don't have any titles at the new Columbia," Rubin explains, as Kusatsu, the first person Rubin hired, slips a disc out of its sleeve. "I don't want to create a new hierarchy to replace the old hierarchy."
http://www.nytimes.com/2007/09/02/magazine/02rubin.t.html?hp=&adxnnl=1&adxnnlx=1188694908-6r4z/O969A5hvmQ8uz0JPQ


By the time Barnett first approached Rubin about coming to Columbia, Rubin had already decided that he would have nothing more to do with Columbia Records. This was because of the company's handling of the Rubin-produced Neil Diamond record "12 Songs" in 2005. Diamond was a hero of Rubin's, and he spent two years working on the album, persuading Diamond to record acoustically, something he hadn't done since the '60s.
"The CD debuted at No. 4," Rubin told me at Hugo's, still sounding upset. "It was the highest debut of Neil's career, off to a great start. But Columbia — it was some kind of corporate thing — had put spyware on the CD. That kept people from copying it, but it also somehow recorded information about whoever bought the record. The spyware became public knowledge, and people freaked out. There were some lawsuits filed, and the CD was recalled by Columbia. Literally pulled from stores. We came out on a Tuesday, by the following week the CD was not available. Columbia released it again in a month, but we never recovered. Neil was furious, and I vowed never to make another album with Columbia."
But when Barnett flew out to Los Angeles to discuss the job with Rubin, Rubin was intrigued. "I felt like I could be a force for good," he explained. "In the past, I've tried to protect artists from the label, and now my job would also be to protect the label from itself. So many of the decisions at these companies are not about the music. They are shortsighted and desperate. For so long, the record industry had control. But now that monopoly has ended, they don't know what to do. I thought it would be an interesting challenge."

[TAC]

Thanks for the heads up. I stopped working cause this article appears interesting enough to dig into. I'll read off line to give my eyes a break. Be back with some thoughts later....

Peace
TAC

[dj_ice_500]

Thanks for the heads up. I stopped working cause this article appears interesting enough to dig into. I'll read off line to give my eyes a break. Be back with some thoughts later....

Peace
TAC

respect for the flag TAC

[DJ Loka]

This is an incredible article. No denying Rick Rubin is a freaking genius, his ear is something you can't quantify...but Rick Rubin won't save the music business though.

Rick Rubin needs to have some meetings with Steve Jobs. That's the dude with the answer. Steve Jobs is the only dude convincing anyone to pay for music....so I'd kiss his ass up one side and down the other.

If it were me (lol, ahem!) I'd try to sell part of Columbia to apple, and focus on getting the quality of the art where it should be for new artists. Let apple sell the stuff.

Rick, if you need an innovative thinker...hit a grrrl up!!!! :mwink:

[Charliee]

I'd go so far as 2 say that a paradigm shift in the artist's creative aesthetic needs 2 occur 1st in order 2 change listener perception & music buying trends. Major's find themselves where they're @ as a direct result of prioritising revenue over artistic development & innovation. IMO, alot more kats like RRubin will get raked in an attempt @ development & innovation 4 the sole purpose of...

[Charliee]

... revenue yet again. The business model 4 selling music is directly dependant on artistic aesthetic & innovation & 4 every Rubin there's a thousand other kats waiting 2 take his position. As a result, the majors never really lost, as much as r formulating another reductionary contingency, IMO. Those in the know will continue 2 buy good music where they find it.

[Charliee]

I wouldn't sell any of Columbia 2 Apple. In fact, id do precisely what they're already doing. IMO, a merge would more likely occur down the line 2 increase profit share.

[The White Shadow]

"In the past, I've tried to protect artists from the label, and now my job would also be to protect the label from itself. So many of the decisions at these companies are not about the music. They are shortsighted and desperate. For so long, the record industry had control. But now that monopoly has ended, they don't know what to do. I thought it would be an interesting challenge."

Good post! I think labels are done. Who needs them when you can do just as well yourself on online sales? Since music is availible for free now who buys? Some dedicated fans do wich is why lately Common and Talib Kweli has been no.1 and 2 on the US Pop charts but still didn't sell more than 80 and 60 000 showing they got a strong fanbase who buys out of support for the artists but sales are low compared to before because that fanbase isn't that big, and a lot of people also downloads. If labels wanna survive they gotta come up with some smart ideas NOW, or at least get with the times. The old days when artists wanted to get signed are for the most part over.

[TAC]

Ain't gonna happen. So what they brought on some dude that started Def Jam with Russell? So what?

The problem is, "they" are trying to "think through" art. The artistic process is a bitch. What's more you never know what will stick from what won't stick. In the past, no one said, "Oh we are going to do XYZ song in order to make ABC profit". Rather, people just realized what was essence of who there were. Hence, the advent of product that had a demand.

Money is at the root of what's driving the major labels. Over the years, I've noticed that often times when money is at the root, then failure is not far behind.

The majors are in freefall and I don't feel sorry for them.

Peace
TAC

[BrazenMuse]

Ain't gonna happen. So what they brought on some dude that started Def Jam with Russell? So what?

The problem is, "they" are trying to "think through" art. The artistic process is a bitch. What's more you never know what will stick from what won't stick. In the past, no one said, "Oh we are going to do XYZ song in order to make ABC profit". Rather, people just realized what was essence of who there were. Hence, the advent of product that had a demand.

Money is at the root of what's driving the major labels. Over the years, I've noticed that often times when money is at the root, then failure is not far behind.

The majors are in freefall and I don't feel sorry for them.

Peace
TAC

:lol:

Exactly. The industry is going to have to think of itself as providing other services to artists in the way of marketing/promotion and give up its attempts at monopoly. Certainly in freefall. Notice the figuring of Rubin as a "spiritual" figure...crystal ball next. Watch.

[BrazenMuse]

Good post! I think labels are done. Who needs them when you can do just as well yourself on online sales? Since music is availible for free now who buys? Some dedicated fans do wich is why lately Common and Talib Kweli has been no.1 and 2 on the US Pop charts but still didn't sell more than 80 and 60 000 showing they got a strong fanbase who buys out of support for the artists but sales are low compared to before because that fanbase isn't that big, and a lot of people also downloads. If labels wanna survive they gotta come up with some smart ideas NOW, or at least get with the times. The old days when artists wanted to get signed are for the most part over.

There are still those out there not paying attention and really working to get signed without any real sense of what "getting signed" means or could mean...getting into bad contracts, accruing debt and the like. Labels are going for singles not albums and realizing that they are too complicated, clunky and inefficient to save their own hides. It's interesting to watch.

[dj aakmael]

Rick Rubin is the Man. For real.

[TAC]

:lol:

Exactly. The industry is going to have to think of itself as providing other services to artists in the way of marketing/promotion and give up its attempts at monopoly. Certainly in freefall. Notice the figuring of Rubin as a "spiritual" figure...crystal ball next. Watch.

I hate to say it, but it's bullshit.... So they bring in "Jesus" and what's he supposed to do?

I laughed at the image of this dude, walking around with no shoes, big dirty beard, and in his mid fourties. Meanwhile, the people anlaogous to him at his stage of life when he formed Def Jam with Russell are on some different sh*t.

There were some tones in there that even he realized "resistance is futile". I think that part where he mentioned something about dinosaurs? The majors have lost, and they are desparate to maintain market share, i.e., profits. F*ck em, I say.... The music will survive. The only thing that will change, and what is changing, is how it gets to us.

Peace
TAC

[BrazenMuse]

I hate to say it, but it's bullshit.... So they bring in "Jesus" and what's he supposed to do?

I laughed at the image of this dude, walking around with no shoes, big dirty beard, and in his mid fourties. Meanwhile, the people anlaogous to him at his stage of life when he formed Def Jam with Russell are on some different sh*t.

There were some tones in there that even he realized "resistance is futile". I think that part where he mentioned something about dinosaurs? The majors have lost, and they are desparate to maintain market share, i.e., profits. F*ck em, I say.... The music will survive. The only thing that will change, and what is changing, is how it gets to us.

Peace
TAC

cool. so it's not just me. This writer needs to spend some quality time reading at www.billboard.biz archives...the past entire year would help. Yep.

[FK]

IThe majors have lost, and they are desparate to maintain market share, i.e., profits. F*ck em, I say.... The music will survive. The only thing that will change, and what is changing, is how it gets to us.
Peace TAC
Rick Rubin: undoubtedly very talented and unique set of ears. Can he change what's taking place by coming up with better product? I highly doubt it. Only disruptive innovators could do something that radical.... He's a creator, but I can't think of anyone today who is that disruptive, except for Seve Jobs.

But there are many facets to this whole thing; a very complex ecology of people depend on these sales of CD's or whatever else. One result is that many people have to reconvert to doing other things (like live gigs) and do not have much time to spend creating in the studio anymore, and tour a lot instead; so that means less great music too, and more average stuff out there!

But overall, the focus groups were pretty much telling these dudes what they needed to know. (BTW, who doesn't know this stuff? -> formerly highly paid record executives)

The part about the labels demanding a share of the merchandise and touring income sounds pretty inevitable as the only solution, if you ask me.

Party..... Over. I won't shed any tears.

FK

[Charliee]

What Rubin is listening for is a new musical language as opposed to just another new trend.

Trends r played out.

When he find's it, u can be sure Columbia's gonna jump on it like a rabid dog.

[BrazenMuse]

Rick Rubin: undoubtedly very talented and unique set of ears. Can he change what's taking place by coming up with better product? I highly doubt it. Only disruptive innovators could do something that radical.... He's a creator, but I can't think of anyone today who is that disruptive, except for Seve Jobs.

But there are many facets to this whole thing; a very complex ecology of people depend on these sales of CD's or whatever else. One result is that many people have to reconvert to doing other things (like live gigs) and do not have much time to spend creating in the studio anymore, and tour a lot instead; so that means less great music too, and more average stuff out there!

But overall, the focus groups were pretty much telling these dudes what they needed to know. (BTW, who doesn't know this stuff? -> formerly highly paid record executives)

The part about the labels demanding a share of the merchandise and touring income sounds pretty inevitable as the only solution, if you ask me.

Party..... Over. I won't shed any tears.

FK

succinctly put, FK.
they'd be terrified of a Steve Jobs type of innovator. They still want to protect those salaries. What's needed is a MAJOR restructuring and I don't think they have the heart for it. And good riddance. I do believe that the labels will demand a share of the merch/touring income because they'll be bankrolling the promo for those who signed with them. Meanwhile innovative companies that do nothing but promote have already beaten them out of the gate with deals for artists that are less restrictive and less costly to the artist. Labels are also doing more and more work of with their own publishing with alacrity and diligence...because LongTail and licensing are the only way they can really get some return..but that is a long term return not an immediate one. One wonders what return one gets in 20 years on some of the CRAP they've been putting out in the past 10, but so be it.

Ok, one other benefit of working w a major is having their facilities for recording and mastering...esp. mastering, an art that not many seem to understand,...but you can have Sony master your stuff for $100 per song now without signing to Sony at all...

It is fun to watch ...:biggrin:


August 27 Billboard article on Rick Rubin's work at Columbia:

August 27, 2007

Rick Rubin's Columbia is beginning to take shape as Kyambo "Hip-Hop" Joshua has been named the president of Columbia's urban department, Billboard.biz has learned. Formerly the senior VP of A&R at Warner Music Group until 2006, Joshua began in the music industry working A&R at Roc-A-Fella Records, developing the sounds of Jay-Z, Beanie Sigel and Freeway.

Joshua, who spoke exclusively with Billboard.biz about his plans for Columbia's new urban department, began his Columbia post in early July after departing Atlantic last year. “Creatively, it wasn't working out so I told them that I didn't want to be there anymore and they agreed,” the exec says.

Joshua's entry to Columbia burgeoned when the exec began shopping an all hip-hop independent label to Rubin, among other people. “[Rubin] said he'd like to invest in [the label]. And then, a few months later, he got the position at Columbia and I called to congratulate him. He said, 'If I do it, I want you to do it with me.' I always meet with him when I go to L.A., so we've been talking since March," Joshua says.

Columbia's new urban president recruited Chicago producer and Kanye West mentor Dion "No I.D." Wilson to head Columbia's A&R department. Wilson says he agreed to join Columbia because he knows exactly what Joshua and Rubin want and is confident neither will become entangled in company politics. Though Wilson's contract isn't finalized yet, he's verbally agreed to the as-yet-untitled A&R position.

"Hip-Hop and I have been close friends for a long time, and now that he's the president of Columbia's urban department, it makes sense," Wilson says.

"We're trying to create an A&R position that's both an A&R and production situation. Everything needs to be correct. I'm not just looking for a title. I want to make a useful change in what's going on, it has to be more than babysitting," he continues. "Hip-Hop told me to get writers and musicians together as well as all of the resources so we can offer artists more than just direction. I hate to use the same example everyone uses but similar to how they put together Motown. We want to put together records the old way."

Joshua agrees. "When I say the old way," says Joshua, who also manages Kanye West and producer Just Blaze through his HipHopSince1978 entertainment company, with partner G Roberson.

"I mean, when the record labels were run by music people and not like corporate executives, lawyers and others that make the deals," he says. "With Kanye, I found him and built a relationship because I really believed in him. We want to create an environment that's more music friendly and not so systematic."

Joshua says Columbia probably won't re-negotiate distribution for West's G.O.O.D. Music label because, "that's not what Kanye is focusing on right now." But Columbia will continue to work with G.O.O.D. groups like the quirky producer-mcs, Sa-Ra.

"The key is making everything make sense financially and creatively," Wilson says. "There are a lot of mistakes we don't want to make like spending more money on an artist that has a lot of spins but doesn't end up selling any records. We'd rather put money into artists that grow organically. If you look at artists like Jay-Z, they didn't jump out of the box with millions in record sales, they built their careers. People are going to be happy with what we have in the works. I can't tell you who, but it's quality stuff people will be glad to hear."

Joshua is in talks with singer Maxwell to get him on track to finish his oft-delayed album, "Black Summer's Night." Joshua has offices in New York and Atlanta, and will make frequent trips to L.A., Rubin's home base.

At press time, several calls to Sony BMG/Columbia had not been returned.
http://www.billboard.biz/bbbiz/search/article_display.jsp?vnu_content_id=1003631629

[BrazenMuse]

What Rubin is listening for is a new musical language as opposed to just another new trend.

Trends r played out.

When he find's it, u can be sure Columbia's gonna jump on it like a rabid dog.
But even then, they'll have to have a new model for how to work it. Finding it won't help if they are going to continue to try to do things the old way. There are, IMO, no real conditions for the rise of the mega-star these days. You get superstars...but even touring has needed serious restructuring. Filling stadia? Nope. Radio City not Madison Sq Garden.

But the article is quite interesting...

[BrazenMuse]

What about artist growth/development?


SEEDS OF DOUBT: ARTIST GROWTH

September 01, 2007

In the fall of 1993, such superstars as Billy Joel, Mariah Carey and Jackson siblings Michael and Janet were welcoming new faces like SWV, Ace of Base and Tag Team into the top 10 of The Billboard Hot 100. Garth Brooks, Nirvana, Cypress Hill and a reinvigorated Meat Loaf were among the acts placing No. 1 albums on The Billboard 200. ¶ Far below the charts, and barely on anyone's radar, a rookie singer/songwriter's debut album crawled out of the gates. For two-and-a-half months, the album clocked fewer than 500 copies per week, according to Nielsen SoundScan; for the following month-and-a-half, less than 1,000 per week. ¶ Indeed, released in August 1993, Sheryl Crow's "Tuesday Night Music Club" was in stores a full six months before it even splashed ink on Top Heatseekers, a chart devoted to artists who have yet to appear in the top half of The Billboard 200. The album reached No. 98 on the big chart in April 1994, but would bounce up and down for the next three months, falling as low as No. 196 before third single "All I Wanna Do" took hold. The song became a multiformat smash, reaching No. 4 on Modern Rock and No. 2 on the Hot 100, with multiple-week streaks at No. 1 on Mainstream Top 40 and Adult Contemporary. ¶ In the Oct. 1, 1994, issue—more than a year after release—the album clocked the first of its dozen weeks in the top 10, nine of those happening in 1995, after "All I Wanna Do" won the Grammy Award for record of the year. ¶ But, suppose Crow had been born 14 years later. Would she still have found a multiplatinum career? ¶ Amid consternation from labels that artist development has become a more daunting task in this decade of dynamic change, and criticism from some observers that the task has become a lost priority, Billboard conducted an exhaustive study of Nielsen SoundScan data on more than 1,000 new and developing artists who reached the top half of The Billboard 200 for the first time from 1992 to 2006. ¶ Our findings raise questions about the fate that might befall a singer/songwriter who sets up shop in 2007. Compared with 10 or 15 years ago, it is dramatically less common to take an album that starts slowly and turn it into a hit. And that's unfortunate because our analysis shows clearly that today, artists whose first chart action bubbles on the Heatseekers chart generally outperform those that start higher on The Billboard 200. >>>

From 1992 through 1994, 60% or more of all artists breaking through to the top half of The Billboard 200 earned their first chart ink on Heatseekers. By the mid-'90s that balance shifted to more artists starting on The Billboard 200—and it kept on shifting. By last year, out of more than 100 artists who hit the top half of the big chart for the first time, less than 5% started on the Heatseekers tally.

Artists break higher on the charts than ever before, depending on how you slice the numbers, with more breakthrough acts debuting in the top 100 of The Billboard 200 in the past two years ('05 and '06) than in 1992, 1993, 1994, 1995 and 1996 combined.

All those artists debuting in the top 100 might be a good thing, were it not for a sobering trend: As more and more artists debut higher on the charts, their sales are falling. In 1993, for example, there were only 29 first-timers who began at No. 100 or higher, with their breakthrough albums averaging 1.2 million copies per title. Ten years later, in 2003, the 67 new artists who began in the top half of the big chart averaged only 659,000 per title. The 72 acts from the class of '04 made an average of 670,000, and the next year, that yield dipped significantly, as 89 bypass artists—those debuting in the top half of The Billboard 200—averaged a little more than 500,000.

And this isn't simply a factor of overall sales being down. While the decline in album volume certainly contributes to the trend, prior to 2006, this decade's threshold at No. 100 was on par with where it stood in the early to mid-'90s. The average weekly sales of the No. 100-selling album hovered between 12,000 and 14,000 units in each year from 2002 to 2005, about the same range as the years 1992-1997. (See chart, page 30, for new trends in more current data.)

Meanwhile, the average sale of the breakthrough albums by Heatseeker graduates remains vigorous. The five that grew from Heatseekers in 2006—the Fray, Flyleaf, Hinder, Gnarls Barkley and OK Go—averaged 1.2 million, the highest average in four years for a Heatseekers graduating class, and a higher average than graduates of 1992 or 1993 realized. (See chart, at the bottom of page 29.)

Would a latter-day Crow have been among the increasing number of rookie artists who start their careers in the top half of The Billboard 200? And if she were, would a multiplatinum career follow that splash? Or, given the paucity of albums to graduate from Top Heatseekers in recent years, would an album that develops as slowly as "Tuesday Night Music Club" get lost in the shuffle?

"I think the fundamental difference in the world as it existed at that time and the world as it exists today," says Al Cafaro, chairman of A&M Records when that label broke Crow, "is that record companies, like A&M—and there were many record companies that operated similarly—had the mind-set, the infrastructure and the resources to do things for new and developing artists for longer periods of time than they can today. The question is not as much, Could an artist like Sheryl Crow be successful today?, because I think she would be. The question is, Who is going to provide the early resources, the early direction and the infrastructure for that artist to be able to sustain itself/herself/themselves within the climate of the existing record business, which is extraordinarily about moving on to new opportunities?"

Cafaro left A&M in early '99, when PolyGram was folded into Universal, and is now co-CEO of Metropolitan Hybrid, one of many companies tweaking the music industry model. Cafaro's current company combines a record label with concert promotion and artist management.

"The difference is infrastructure," Cafaro says. "Record companies no longer have the time, the money and the staffing to provide that infrastructure around an artist early on that can help maximize the impact of the dollars that are being spent on that artist's behalf."

To investigate the numbers, Billboard interviewed more than two dozen current or recently employed executives with firsthand knowledge of artist development budgets and strategies. Some of the causes of these trends—retail consolidation, for example, or shrinking label budgets—may not surprise. But the reasons why these changes are affecting artist development—and some of the strategies that are working to overcome these trends—are striking.



Market Factors

RADIO AND RETAIL CONSOLIDATION

The radio consolidation floodgates swung wide open in 1996 with passage of the Telecom Act, which triggered unprecedented buying and selling prompted by the elimination of limits on the number of stations one company could own nationally, while allowing broadcasters to own up to eight stations in radio's largest markets.

Meanwhile, on the retail front, the game has changed drastically.

"Back in the day, you could find bands that broke regionally," says Jim Kaminski, who was the longtime head buyer for Tower Records' store in downtown Manhattan. "Radio was smaller back then. You had independent stores that would stock things on a regional basis.

"Now with centralized buying, cable TV and a unified radio, the media is more standardized and the U.S. is more like the U.K., where things happen really fast and explode out of the box, and then fizzle faster. We have turned the U.S. market into a monolith that is just one-dimensional."

Independent stores and regional chains, known for embracing developing artists, are critical in helping labels develop artists market by market, so that eventually baby bands would garner enough sales to convince the big boxes to take a chance.

That process was easier in 1991, the year that Billboard began using SoundScan data to determine chart placement. Billboard estimates that, at that time, there were 4,700 traditional chain record stores—at least 10 chains each had 100 stores or more—aggregating to a 47% market share. Some 6,000 independent stores yielded a 15% market share, 8,000 mass-merchant stores took a 23% market share, and the record clubs and mail-order companies had a 15% share.

Today, following mass consolidation, price wars and bankruptcies—most recently underscored by the 2006 closures of Musicland and Tower Records—Billboard very roughly estimates there are about 1,400 traditional chain music stores with about a 6% market share; roughly 1,600 independent stores with a 5% market share; digital stores' album sales including TEA (track-equivalency albums, or equating every 10 tracks sold by one artist with an album sale) are at a 24% market share; other nontraditional retailers like record clubs, Amazon, Starbucks and concert album sales account for about 8%; some 7,000 mass-merchant stores yielding approximately 31%; and about 2,000 consumer electronic and book stores with about a 26% market share.

Market-moving share has shifted to larger chains, and they generally prefer to join a success story, rather than create one. Such stores as Wal-Mart and Target like to see sales expectations above 50,000 units across other retailers before they even considering ordering a title.

"I remember records that direct accounts did not buy into until they reached a certain sales level," says Randy Goodman, president of Disney Music Group's country label Lyric Street. "Those were 'retail records,' and that's how people talked about them and perceived them. But there are so few retailers anymore, that where you sell your tonnage is also where you begin.

"With the advent of SoundScan, [album releases] are more like movie openings," Goodman adds. "If you don't start strong, accounts get freaked out and you don't have a compelling story to tell radio. No matter where you start out, you are probably going to have a precipitous drop of 50%-60% the second week. If you're not starting out with some significant number, that kind of decline will drop you completely off the chart, and then boom. It's over with in less than a month."

Carl Mello, head buyer for New England regional chain Newbury Comics, says, "All support for records that don't immediately take off dries up very quickly. Nowadays, the day after a record comes out, people will already be saying a record is already dead. You either get a record that works right away or you get nothing at all."

Pat Monaco, executive VP of sales and field marketing for Universal Motown Records Group (UMRG), says that same pressure is often imposed on new acts. "There has been this emphasis that you have to start out high and you need to do everything for that first week to get the high debut, because all you're going to do thereafter is drop," he says. "I will tell you what is lacking: the ability for records to maintain. Once a record debuts, there is a feeling, more times than not, that the path of that record is nothing but down."

LABEL budgets

It takes careful planning, diligence and belief in an artist to overcome such obstacles. Unfortunately, consolidation and shrinking label budgets can make that difficult.

"The labels have consolidated so much," one major-label A&R executive says. "You have situations like three [major labels] in one record company now. That means three marketing teams and three promo teams and three international teams are crammed down to one. It's a pipeline issue. You take the superstars and combine them into one roster, and you absolutely have to deliver those. There's just not room to focus on those developing artists in the ways you once did."

Continuing layoffs and consolidation at the major-label level have hurt in less obvious ways as well. "Distribution is a huge partner in breaking an artist, from finding space at retail, fighting for opportunities and using the college marketing team," the A&R executive says. "We talk about it a lot. We used to have alternative marketing people in the distribution company in every major market. Now that runs into one college marketing team."

Every executive Billboard spoke with placed artist development as a priority. "Look, we are very interested in artist development," RCA Music Group executive VP/GM Tom Corson says. "It's just that the stakes are high, the price of poker is way up, anteing in is intense."

"Everything is more difficult in today's market," Interscope Geffen A&M/Octone head of sales and marketing Steve Berman adds. "This becomes more about putting our resources in the proper place. It's about understanding each artist and the potential lanes for marketing that exist, and shifting the marketing spend accordingly."

Still other executives were upfront about the need for more vision. "The problem is, a lot of execs in the music biz are shortsighted to a certain extent," Virgin senior director of A&R for pop/crossover Chris Anokute says. "They think for tomorrow but not five years down the road. Whenever you build an artist, you have to think long term. Sometimes it takes the third single on the first album to break an artist. Now, they're just signing songs. Instead of signing songs, you have to sign artists."

"There is no artist development anymore," says Rick Valenzuela, partner in RikRaf Entertainment, a management company that represents Latin rhythm artists. "We're turning in the final product because the labels don't have A&R, especially on the Latin side. They want the final album done and turned in. If it sticks, it sticks. If it doesn't, they move on to another artist."

A DIFFERENT MEASURE OF SUCCESS

While digital and mobile sales have yet to make up for the decline of physical sales on an industrywide basis, it's clear that emerging artists can now break in ways that aren't Billboard 200-centric.

"I don't know if it's necessarily harder to break acts," Corson says. "I think it's harder to sell albums, and because there are many other different avenues to expose artists—with tracks and iTunes and online and digital and mobile and so forth, and then blogging and all sorts of sites and cultures and shared services and fan-[oriented], consumer-oriented, user-oriented content developing—I think maybe it's harder to galvanize these things because if you are just looking at music sourcing by the consumer, it is very segmented and fragmented."

"The research says that people are consuming music more than ever," Sony BMG Sales Enterprise president Jordan Katz says. The Billboard 200 "really does reflect just one facet, and the facet that it reflects is becoming less a reflection of consumer behavior. Perhaps if you looked at all of the revenue streams of how people purchase music, you would see a different pattern."

Berman says, "When you look at what digital tracks have become in the last few years and you look at mobile, you look at other ways of measuring success outside of the traditional CD sales."

Indeed, current examples of this are easy to find. T-Pain's two albums have sold a combined 1.1 million, but he has sold 3.5 million digital songs and 3.3 million ringtones. Sean Kingston's self-titled album has sold 112,000 in two weeks, but he has already sold 798,000 digital songs and 1.1 million ringtones. Huey's "Notebook Paper" album has sold only 69,000 since it was released in June, but he has sold 979,000 digital tracks and 1.4 million ringtones. Mims' "Music Is My Savior" album has sold 273,000 since it was released in March, yet he has sold 1.8 million digital songs and 2.2 million ringtones. And Unk's album "Beat'N Down Yo Block" has sold 180,000 since it was released in October 2006, but he has sold 1.9 million digital songs and 2.3 million ringtones.

Or, take the example Jive/Zomba set with Lil Mama, seeding the market with a fast-selling video and digital track of "Lip Gloss."

"We shot a not-a-high-budget-but-the-right-budget video, with the right concept that has made a direct hit to her audience," Zomba senior VP of sales and marketing/GM Tom Carrabba says. "It's become one of the top 10 most-viewed videos on Yahoo and AOL, we got a lot of play over at BET, and we got play at MTV and 'TRL.' But guess what? We sold a ton, too.

"We don't have an album out, but we sold 50,000-60,000 videos on iTunes with minimal airplay, 10 million audience when we peaked," he adds. The digital track has sold 488,000 units to date, according to Nielsen SoundScan, while the "Lip Gloss" ringtone has racked another 312,000 sales on Nielsen RingScan.

While Zomba records Lil Mama's album, due Oct. 22, Carrabba anticipates coming with another video to keep her awareness percolating. Not to dismiss the revenue opportunities of ringtones and digital tracks, but it seems most labels still hope to parlay such gains into the larger potential payday of album sales.

"When you're building the artist's story, you have to start feeding the content as early as possible so that people start understanding and learning about that artist," Interscope's Berman says. "In the traditional model, radio remains the most important tool that we deal with, but there are so many ways that people get exposed to music in the new world that we're living in. On certain acts, we'll want that music out there as early as possible . . . We will hold a record longer now to build up the marketing and the excitement around an artist, to hopefully have as high a debut as possible."


<table border="0" cellpadding="0" cellspacing="0" width="100%"><tbody><tr> <td class="font-cn"> </td> </tr> <tr> <td class="font-cn"> Article continued at:
http://www.billboard.biz/bbbiz/search/article_display.jsp?vnu_content_id=1003630749</td></tr></tbody></table>

[travy]

lots of people got really, really rich selling overpriced cd's for a long time. most, more than they deserved including artists who probably didn't need diamond encrusted watches and jets for their creative development. the big labels had it real good and they should've prepared for this moment better. i'd frankly be scared shitless if i were them, but they shouldn't be bitter by any stretch and playing the victim is really shameless...

[BrazenMuse]

lots of people got really, really rich selling overpriced cd's for a long time. most, more than they deserved including artists who probably didn't need diamond encrusted watches and jets for their creative development. the big labels had it real good and they should've prepared for this moment better. i'd frankly be scared shitless if i were them, but they shouldn't be bitter by any stretch and playing the victim is really shameless...

Death throes are ugly by definition, methinx.

[Chris Conrad]

time magazine named him one of the top 100 most influential people in the world...

[Chris Conrad]

I hate to say it, but it's bullshit.... So they bring in "Jesus" and what's he supposed to do?

I laughed at the image of this dude, walking around with no shoes, big dirty beard, and in his mid fourties. Meanwhile, the people anlaogous to him at his stage of life when he formed Def Jam with Russell are on some different sh*t.

There were some tones in there that even he realized "resistance is futile". I think that part where he mentioned something about dinosaurs? The majors have lost, and they are desparate to maintain market share, i.e., profits. F*ck em, I say.... The music will survive. The only thing that will change, and what is changing, is how it gets to us.

Peace
TAC

and what image does russell simmons portray...he puts out disposable hip hop, has a super gaudy house that is splattered all over mtv cribs and puts out preppy clothes of the type that white folks who hate black folks generally wear and has a soon to be ex wife that lives by all things materialistic...people like russell are not on some different shit by precisely the same shit that is the point of the article...

[Adam Cruz]

I think it was a mistake for record labels NOT to recognize the power of digital music early on. If they would have been smarter, THEY could of invented a digital music player like the iPod. Then, we'd all be humming another tune entirely. At that point, record labels would have been more equipped to recognize the pricing problem with iTunes downloads and its affect on major record companies long before Apple was able to rake in the profits. After all, isn't Apple a computer company at its core?

just thinking, A

[TAC]

and what image does russell simmons portray...he puts out disposable hip hop, has a super gaudy house that is splattered all over mtv cribs and puts out preppy clothes of the type that white folks who hate black folks generally wear and has a soon to be ex wife that lives by all things materialistic...people like russell are not on some different shit by precisely the same shit that is the point of the article...


Yea, but the difference between the two is that Russell used hip hop as a spring board to move to other arenas. He didn't stick to just that. Russell is a business man. In short, he stopped trying to ride the gravy train of music long ago. Russell moved on to another hustle....

This other cat is still stuck doing what he's been doing since he was in the NYU dorms. However, HE is the one who's stuck in the same paradigm from decades ago, while slowing realizing that all of that old sh*t is tired and doomed.

[TAC]

I think it was a mistake for record labels NOT to recognize the power of digital music early on. If they would have been smarter, THEY could of invented a digital music player like the iPod. Then, we'd all be humming another tune entirely. At that point, record labels would have been more equipped to recognize the pricing problem with iTunes downloads and its affect on major record companies long before Apple was able to rake in the profits. After all, isn't Apple a computer company at its core?

just thinking, A


I feel ya Adam. But, see, it doesn't stop at digital music. The frontier is digital content, what ever form this content may take.

[BrazenMuse]

I think it was a mistake for record labels NOT to recognize the power of digital music early on. If they would have been smarter, THEY could of invented a digital music player like the iPod. Then, we'd all be humming another tune entirely. At that point, record labels would have been more equipped to recognize the pricing problem with iTunes downloads and its affect on major record companies long before Apple was able to rake in the profits. After all, isn't Apple a computer company at its core?

just thinking, A

agreed. it was a huge mistake, and they have been really slow to respond to it. they are paying the price for that now...

[Charliee]

and what image does russell simmons portray...he puts out disposable hip hop, has a super gaudy house that is splattered all over mtv cribs and puts out preppy clothes of the type that white folks who hate black folks generally wear and has a soon to be ex wife that lives by all things materialistic...people like russell are not on some different shit by precisely the same shit that is the point of the article...

Werd.

[BrazenMuse]

and what image does russell simmons portray...he puts out disposable hip hop, has a super gaudy house that is splattered all over mtv cribs and puts out preppy clothes of the type that white folks who hate black folks generally wear and has a soon to be ex wife that lives by all things materialistic...people like russell are not on some different shit by precisely the same shit that is the point of the article...

any port in a storm. there are those who say "in russell we trust" too. But, u gotta give him credit...he has multiple revenue streams, which makes him resilient in the face of the changes in how the music moves. One wonders what he and puffy ... or piddly or squiggy or whatever Sean's nom du jour is...are planning for their 10 year forecast, much less their 5 yr one.

[BrazenMuse]

I feel ya Adam. But, see, it doesn't stop at digital music. The frontier is digital content, what ever form this content may take.
absolutely. and the convenience of the consumer is paramount. punitive DRM practices are on the way out of the door...gotta come up with something else.

[djmarbll]

Ain't gonna happen. So what they brought on some dude that started Def Jam with Russell? So what?

The problem is, "they" are trying to "think through" art. The artistic process is a bitch. What's more you never know what will stick from what won't stick. In the past, no one said, "Oh we are going to do XYZ song in order to make ABC profit". Rather, people just realized what was essence of who there were. Hence, the advent of product that had a demand.

Money is at the root of what's driving the major labels. Over the years, I've noticed that often times when money is at the root, then failure is not far behind.

The majors are in freefall and I don't feel sorry for them.

Peace
TAC


I feel the same way. Pure greed on the part of the labels has stamped out artisitic integrity. Not saying this hasn't happened before (ie. the disco era), but its the first time I can think of where people aren't selling records not because of the demand for a certain genre (disco), but because people just aren't buying albums the way they use to. I bought Common's "Finding Forever" this weekend and remember seeing an interview where his album was listed as number #1. I checked the Billboard today and its already down to #15. On top of that, people who usually are known to go at least double platinum (Bon Jovi, Prince, R.Kelly, Linkin Park, Toby Keith, etc.) are barely making it to platinum status, if they can even sell that much. The best sellers on Billboard right now are Carrie Underwood's "Some Hearts" at 6 million and High School Musical at 4 miilion. Justin Timberlake is next at three million. Most everybody else is scrambling just to sell a million copies. I was shocked that Ne-yo isn't even gold yet and he's been on the charts for 17 weeks and has been getting a ton of radio play.

[DJ Loka]

in 2-3 years or maybe sooner, you're gonna see a & r depts at itunes, yahoo & aol - i think they're going to end up replacing the labels eventually.

[TAC]

absolutely. and the convenience of the consumer is paramount. punitive DRM practices are on the way out of the door...gotta come up with something else.
Actually, I am not sure that punitive DRM is the way to go. I can't get too specific,, but without saying too much, I am seeing that more and more people (technologists) are trying to come up with ways to use DRM to control content and, hence, generate and ensure revenue.

[FK]

Actually, I am not sure that punitive DRM is the way to go. I can't get too specific,, but without saying too much, I am seeing that more and more people (technologists) are trying to come up with ways to use DRM to control content and, hence, generate and ensure revenue.

Think audio's got problems? Video is where the real fight is taking place today....


AACS DRM tentacles reach far into operating systems
By Ken Fisher | Published: August 12, 2007 - 11:03PM CT

"The biggest trick the devil ever pulled was in getting folks to blame someone other than Hollywood for video DRM." —not Keyser Söze

Peter Gutmann, author of a well-known and fascinating paper describing the tradeoffs of Microsoft's content protection system in Windows Vista, is on the hunt again. Last year, his paper "Cost Analysis of Windows Vista Content Protection" painted a grim picture of the lengths Microsoft went to in order to gain full compliance with AACS, the next-gen copy control system for Blu-ray and HD DVD (and they did go far). Now Gutmann is reiterating his claims but also reportedly digging deep in his attacks on Microsoft. While Microsoft deserves some of the blame, the bigger story here is the technical nightmare created by AACS and how its tentacles are reaching into the consumer technology we all use daily. It's a shame that this is getting lost in the mix, but after discussing the issue with a journalist this weekend, I decided to delve a little more into it here.

Gutmann's presentation at this year's USENIX Security Symposium in Boston has been profiled at Network World. Gutmann's thesis is fairly basic and unchanged from last year: Microsoft spent way too many resources appeasing Hollywood when it should have been making Windows Vista better. Gutmann is essentially correct; any time a consumer electronics manufacturer or other technology company has to waste time with DRM, that company is wasting resources that could be better spent elsewhere if DRM wasn't a sad fact of life. Let no one doubt that. All of this attention focused on Microsoft is missing the bigger story, however.

AACS: coming to an (incorporated) OS near you
This is important but rarely acknowledged in these discussions (and my journo discussion partner was rather surprised to learn this): Apple will also have to adopt a strict DRM regimen at the most fundamental levels of Mac OS X in order to be able to (legally) play back AACS-protected Blu-ray or HD DVD discs (e.g., most commercial discs in those formats). Apple thus far has avoided criticism, but only because the company has not unveiled its full plans for appeasing the various requirements imposed by the AACS Licensing Administrator for next-gen optical disc DRM. When Apple does, we'll all see that Blu-ray/HD DVD support comes with plenty of strings attached—strings that Apple will have to work into its OS, too. There is no way around it; something similar to Microsoft's Protected Media scheme will be required of Mac OS X if Apple is a licensee to AACS. (The same would be true for Linux, except that AACS won't be licensed for Linux desktop use. There's no way to securely implement it since desktop Linux is an open environment, and AACS requires keeping secrets.)

Here's the basic rundown: AACS has "robustness rules" that include strict mandates for the path that video data takes through a software-based system, like a modern PC. These rules require that decrypted video "not be present on any User-Accessible Bus in analog or unencrypted, compressed form," because users could possibly record or redirect that content. Companies like Apple and Microsoft are additionally required to use "encryption, execution of a portion of the implementation in ring zero or supervisor mode (i.e., in kernel mode), and/or embodiment in a secure physical implementation," or any other method that can "effectively" keep encryption keys secret. Furthermore, they are required to use "techniques of obfuscation clearly designed to effectively disguise and hamper attempts to discover the approaches used" to secure the systems. Thus, video content must travel through the system encrypted and must only interact with authorized components over authorized pathways.

Again, these are the requirements of AACS, and they're not simple to accomplish, especially in an operating system where there are multiple ways to attack the system. This is why AACS goes even further, requiring that operating systems constantly monitor the "integrity" of the content protection system and purposely stop playing content in the event that any "unauthorized modifications" are detected. In this way, the system not only watches the video path as video travels on it, but it monitors the state of the PC as a whole.

So, when thinking about this issue, we have to ask ourselves: is a company like Microsoft or Apple likely to tell Hollywood to jump off a cliff? No, because both companies know that users will want to play HD DVD or Blu-ray discs on their computers. Microsoft didn't tell AACS LA to stuff it, and Apple won't tell them to, either. Not only do both companies want to be a part of the HD "revolution," but both of them are also DRM developers, too. While Steve Jobs may be an opponent of DRM for music, he has said on record that his objections to DRM for music do not apply to video.

A tangled web AACS weaves
Video DRM is a drain on technology performance and engineering, wasting precious resources on something that only benefits a very small group of people with very narrow, self-serving demands. The shape and contours of the video DRM experience is established by Hollywood, not by Microsoft or Apple. How tech companies implement this stuff is, of course, important, and there are signs that Microsoft's implementation is made overly complex by architectural decisions the company has made. But the annoying stuff, like downgraded video quality and video pathways with significant CPU overhead, is all part of AACS, all by design.

Last year, Marcus Matthias, product manager of Windows Digital Media at Microsoft, put it this way to me in a discussion about this very issue: "Any device—whether it be a PC or consumer electronic device—will need to ensure compliance with the specified policies [read: AACS], otherwise they risk being unable to access the next-gen DVD content. Clearly we think that offering next-gen DVD content on the PC is much preferable to having the PC excluded from accessing this premium content."

Users should be outraged at these developments, but directing that outrage at Microsoft (or Apple) misses the point. The movie industry's fear of fair use and casual piracy is so great that it uses its considerable weight to influence innovation in personal computing. They can create a technology (AACS) and a license for that technology without ever having to prove its utility or safety for consumers. The situation is made more deplorable by the fact that AACS seems to be nothing more than a stab in the dark at the problem: it has already been cracked! AACS is unproven technology with amazingly complex demands. And it's being rolled into operating systems essentially unproven and with little care for how much havoc it wreaks.

[T. Tauri]

lots of people got really, really rich selling overpriced cd's for a long time.

On the flip, lots of underground folks got to pay their rent off the overpricing of cd's too.

Peece,
T. Tauri

[And]

Anyone know if all this apple itunes ownership/download/copying crap is the reason for 'medium write error' messages. I pretty much download and burn mixs onto cd for myself but for weeks haven't been able to burn anything.

[Mocambo]

I think it was a mistake for record labels NOT to recognize the power of digital music early on. If they would have been smarter, THEY could of invented a digital music player like the iPod. Then, we'd all be humming another tune entirely. At that point, record labels would have been more equipped to recognize the pricing problem with iTunes downloads and its affect on major record companies long before Apple was able to rake in the profits. After all, isn't Apple a computer company at its core?

just thinking, A

Your post reads like something Chuck D post on his numerous websites. Going back to the days of the Chuck D versus Lars Ulrich debates.

[BrazenMuse]

Actually, I am not sure that punitive DRM is the way to go. I can't get too specific,, but without saying too much, I am seeing that more and more people (technologists) are trying to come up with ways to use DRM to control content and, hence, generate and ensure revenue.

Let me clarify...I am only talking about music. I know nothing about video...

[FK]

Your post reads like something Chuck D post on his numerous websites. Going back to the days of the Chuck D versus Lars Ulrich debates.
Here are some informed and funny opinions (http://news.zdnet.com/2100-9588_22-6189011.html?tag=nl.e550) on the matter of DRM and why it will never work. It might slow the inevitable down by a bit, but not much....

FK

[TAC]

In truth, I've learned to disassociate myself from techology. I am not emotionally connected to it, either way.

Given what I do, I get the pleaure of seeing the direction that things are moving 5-10 yrs or so before things hit the street.

As it stands, these days, I'm seeing a movement that is swelling with respect to controlling content (music, video, whatever) and ensuring that revenue is directed to the right source. For now, inventors (technologist) are eyeballing DRM as a way to accomplish this. If it works, fine. If it doesn't, oh well. Regardless, there will be a solution to the problem because there is a long felt need (that's a term of art, btw)

In all of this, one fact that remains is that the playing field is changing. Whether one choose to participate is another thing. However, rest assured that eventually whatever platform one is performing the bulk of one's computing on, said platform will eventually become obselete. At that moment, the need to plug into the matrix will arise.

Peace
TAC

[FK]

I think it was a mistake for record labels NOT to recognize the power of digital music early on. If they would have been smarter, THEY could of invented a digital music player like the iPod. Then, we'd all be humming another tune entirely. At that point, record labels would have been more equipped to recognize the pricing problem with iTunes downloads and its affect on major record companies long before Apple was able to rake in the profits. After all, isn't Apple a computer company at its core?

just thinking, A

Adam, I am really unconvinced about the points you raise, which I've heard rehashed a hundred times by many
record execs who are clearly not aware of what has taken place, and struggling to find excuses for their
own inability to have kept up with the tectonic shifts in a changing business climate. (don't worry, I am one of them too)

Apple Computers is NOT keeping the lion's share of the proceeds from sales. The labels and rights owners are.

Let me ask you honestly: What it will cost for anyone to develop, maintain and administer a software system as
vast and complex as iTunes Music Store, including content entry, tagging and back-end administration, royalty
payments, legal affairs, etc.... and not to forget a killer cross-platform front-end application like iTunes which
we all download FOR FREE? How many people do they employ to do all this?

Apple is LOSING MONEY doing this, which they are only able to recoup by selling their iPods at high profit margins.

The iPods their customers purchase are only containing an average 5% ~ 10% of content purchased online. The
rest is all ripped from CD's or other sources.

The business model of people expecting to sell the music as expensive as they were before is what's wrong.
Nothing or nobody will ever bring that back.... including not Rick Rubin either, who might sign and produce
some mighty fine bands, and in the process also loosen up the corporate image at Sony/Columbia.

sowwy.... vewy sowwy.... there's nothing written anywhere that guarantees any of us an endless income stream.
(whether what they make is good or not is totally irrelevant to what I am saying)

FK

[TAC]

Apple Computers is NOT keeping the lion's share of the proceeds from sales. The labels and rights owners are.



Apple is LOSING MONEY doing this, which they are only able to recoup by selling their iPods at high profit margins.

The iPods their customers purchase are only containing an average 5% ~ 10% of content purchased online. The
rest is all ripped from CD's or other sources.

This is known.... I agree with you. People are generally not purchasing their music from iTune. Sh*t, me myself I'm still up loading my CD's and I'm not even halfway through.


The business model of people expecting to sell the music as expensive as they were before is what's wrong.
Nothing or nobody will ever bring that back.... including not Rick Rubin either, who might sign and produce
some mighty fine bands, and in the process also loosen up the corporate image at Sony/Columbia.


FK And now we are getting somewhere. The point that I am alluding to is that people as we seek are staking out their territory in the new business paradigm that is unfolding as we speak. Theh whole point is no longer about quality of product because it's not what's important. What is more important is ensure that product get moved to a particular end device. People are no longer willing to pay for a song (but you can make revenue if someone presses play and listens to the song, whether its good or not , i.e. content control. There's the potential to generate a fee for someone accessing the content. However, the problem is how to ensure the fee is directed to the right person. That is the kicker....

I'm speaking losely here, of course, because I'm pressed for time. However, I hope that the picture I am trying to paint is being grasped.

[Adam Cruz]

Hey FK: thanks for your comments. I just saw this. First, I definitely don't claim to know everything re: digital content, DRMs, and the like. Like you, I've made oversights being in the label business.

However, I think Apple DOES make the lion's share. When I say that, I mean the LION'S share - digital downloads are just a tiny piece of the bigger puzzle, as you've already suggested.

You say that Apple (with all its overhead and operating costs...I'm paraphrasing) is at a loss and only "recoups" thru the sales of the iPod. The digital content is sold at a cheaper rate to attract customers. if I'm not mistaken, in the business world, isn't that called a "loss leader"? Apple isn't losing a thing FK, think about it. In just 1 quarter in 2006, Apple announced that international sales accounted for 43% of the quarter's revenue. Apple shipped 1,112,000 Macintosh computers and 8,526,000 iPods during the quarter, representing 4% growth in Macs and 61% growth in iPods over the year-ago quarter.

8,526,000 iPods FK...in just 1 quarter in 2006...

http://digg.com/apple/Apple_reports_8,526,000_iPods_sold_in_one_quarter_

[FK]

Hey FK: thanks for your comments. I just saw this. First, I definitely don't claim to know everything re: digital content, DRMs, and the like. Like you, I've made oversights being in the label business.

However, I think Apple DOES make the lion's share. When I say that, I mean the LION'S share - digital downloads are just a tiny piece of the bigger puzzle, as you've already suggested.

You say that Apple (with all its overhead and operating costs...I'm paraphrasing) is at a loss and only "recoups" thru the sales of the iPod. The digital content is sold at a cheaper rate to attract customers. if I'm not mistaken, in the business world, isn't that called a "loss leader"? Apple isn't losing a thing FK, think about it. In just 1 quarter in 2006, Apple announced that international sales accounted for 43% of the quarter's revenue. Apple shipped 1,112,000 Macintosh computers and 8,526,000 iPods during the quarter, representing 4% growth in Macs and 61% growth in iPods over the year-ago quarter.

8,526,000 iPods FK...in just 1 quarter in 2006...

http://digg.com/apple/Apple_reports_8,526,000_iPods_sold_in_one_quarter_

Hello Adam, I am not sure that I understand the logic of what you are trying to express, besides admiration for the 61% growth in their hardware sales.

Are you saying that we should all turn to manufacturing consumer hardware devices instead of the music itself?

The point I was making is that OF THE DIGITAL CONTENT (the only part we can lay claims to) Apple keeps a small portion only, out of which it has to recoup the expenses of maintaining a complete virtual storefront system, and pays the remaining parts to the copyright owners. I realize that Universal Music has strong-armed Microsoft into paying them a percentage from their Zune player sales, which I think Redmond only did to gain leverage into that space at ANY COST. (very dangerous precedent it would seem to me)

Arguably, now that Apple has recently started selling DRM-free downloads, these song files from the iTunes Music Store could be purchased and downloaded into any portable hardware device that plays AAC-format files. But those sales account for only 5% of what people have on their iPods, the rest of which they burn from CDs or ...somehow obtain, somewhere....

In turn the point I was trying to make is that -IMHO- Rick Rubin, or anyone else will not change the fact that a whole generation of listeners is now expecting to get music for free. Part of the reason for this is that there is so much music out there, and it is so easy to make more, that nobody cares anymore the same way as when there were only 25 new releases a week. Now there are 500 releases a week.

The music is only there to function as a promotional vehicle for those artists whose careers it serves to promote. Forget about buying it, people will soon thank you for just taking your precious time to even just listen to it!

The same way Apple is arguably using music as a 'loss leader' for their hardware sales, perhaps it is that many modern DJs are using music not so much to get income, but as a 'loss leader' which they give away to help promote their gigs and merchandise sales (which could be argued is what is bringing them said income) as well as to try and get their songs licensed into commercials, video games, etc.... which is also why I personally happen to believe that DRM (digital rights management) is a losing battle, which consumers have clearly indicated is a big turn-off, and yet another way to discourage them from buying music legally, when it is encumbered by all these restrictive situations, or force them to install invasive software in order to play the music back. No matter what, it will all be defeated, so it doesn't so much act as a real protection, only as a major inconvenience and is just a way to slow down the inevitable.

I don't claim to have all of the answers, but in a nutshell we'll only be able to really figure this out by putting ourselves in the mind of 19-year old college kids. Music is not the center of their interest as it once was, when you have things as immersive and stimulating as full 3-D interactive gaming.

If you want to invest money in recording and making great music, do it because you WANT to make great music, not because it is going to sell. That music will prompt people to book you to perform live, either live show of all your songs, or a DJ set.

I am not sure what moaning about the old way and growling about how it used to be, and what it should be will accomplish for any of us. One thing I am sure of, however, is that those who keep doing the complaining are clearly adrift in a sea of change they refuse to accept and adapt to....

It's not time to complain anymore, it's time to adapt; quickly would be better.

FK

[Adam Cruz]

I don't claim to have all of the answers, but in a nutshell we'll only be able to really figure this out by putting ourselves in the mind of 19-year old college kids. Music is not the center of their interest as it once was, when you have things as immersive and stimulating as full 3-D interactive gaming.

hey FK: Your comment above solidifies my point imho. If you go back, all I'm really suggesting is that major labels have known about the mobility of their consumers. Since the walkman, labels knew to connect the music to a portable player. Why not take hold of the digital content (when it first started) and develop a player first? All labels did was fight against Napster, Kazaa, and the others, in the name of battling piracy. Why am I focused on the mobility of music consumers? Because, if they had come up with a digital mp3 player that the masses accepted (like the iPod), they would have been equipped to take full advantage of the digital content (the music) at that point - the captains of their own ships, in my opinion.

Let me ask you honestly: why should labels be giving away any percentage of their earnings to iTunes and the others?

I understand you're talking strictly about the music, but just like artists of today, labels could have diversified. Artists today aren't just releasing music, as you already know. They're moguls now - into everything and taking a piece of several different pies.

shoulda coulda woulda

[Bill Blake]

I think FK brings up an interesting point, music may have been over valued via price controls through ologopoly.

[Adam Cruz]

I think FK brings up an interesting point, music may have been over valued via price controls through ologopoly.

I agree with him on that. all the more reason to diversify.

[TAC]

Forget about buying it, people will soon thank you for just taking your precious time to even just listen to it!
FK

cosign.

[DJ Loka]

In turn the point I was trying to make is that -IMHO- Rick Rubin, or anyone else will not change the fact that a whole generation of listeners is now expecting to get music for free.

exactly. people dont care if it's good, or not. they don't have to pay if they REALLY dont want to, and now they don't expect to pay.


The music is only there to function as a promotional vehicle for those artists whose careers it serves to promote. - note the 'quadruple threat award' at the recent VMAs to the the artist with clothing lines, business interests, merchandise and widgets to tack on to their resume...soon you'll go to levis and buy some fierce low-rise jeans and beyonce will have licensed her cd to levis - you get her cd for free, and levis pays HER for the right to distribute...

- why does everyone thing every artist out there is selling games, clothing, vodka etc etc... they CANT depend on the music as a revenue stream.


we'll only be able to really figure this out by putting ourselves in the mind of 19-year old college kids. Music is not the center of their interest as it once was, exactly. to todays kids the music is a background for their you-tube fame.

[dj joey joe]

To tell you the truth I don't see why they need Rick Rubin to save the label, first of all they just bought out BMG/Jive/Zomba/Arista so they ain't out of old catalog material to reissue or artists that are still under contract that they could release material from.

I think the problem is they got tons of good artists that they're holding back cause their going the same route to promote them as back then before the internet was a major factor in breaking a new song.

Talent sells itself, exposure in different avenues does a lot more in a much quicker rate than before, they need to stop making those outlets expect payola & then they will see who really is making the hits & how much "the buying public" wants to hear more from that artist or group.

They also need to drop all the wack acts, believe me they cost more to keep them than letting them go to another label cause once their 15minutes of "a corny hit song" is up someone is there to replace them a few weeks later with a similar corny song and making them create an entire album of similar tracks is a waste of time. :wink:

So Rick has got a pair of fresh ears, hah, that's what they say.

[FK]

if they had come up with a digital mp3 player that the masses accepted (like the iPod), they would have been equipped to take full advantage of the digital content (the music) at that point - the captains of their own ships, in my opinion.

Let me ask you honestly: why should labels be giving away any percentage of their earnings to iTunes and the others?

Please connect the dots:

-Sony Corp: Inventor of mega-hit consumer products, including Sony Walkman™
- Sony Music (formerly Columbia Records)

Who else was better qualified to do this? And why didn't they?....

Anyway, they didn't.

Apple did.

End of story.

The points you raise seem to imply that you expect things might have stayed the same had the major labels done it instead of Apple. I disagree.

This cataclysm was bound to happen no matter what, and no one including Rick Rubin will be able to do much about it.

As for the matter of what to do next, surely we all have our theories on that as well....speaking of which, have to board a flight to go play a gig. LOL!

FK

[ebot9000]

As for the matter of what to do next, surely we all have our theories on that as well....speaking of which, have to board a flight to go play a gig. LOL!

Yup, that's the answer & the future. Anyone notice what Prince did with his last two albums?

[darshan]

I think TAC is right in saying that we're in the midst of a paradigm shift and there's no going back, meaning, no selling music per unit anymore unless it's some boutique format like vinyl will eventually be.. We are on our way to ubiquitous media - all kinds of digital shit on demand, whenever, from wherever. "Feels like free."

The thing is, there will still have to be some mechanism for compensation of content creators and promoters (but no longer for manufacturers or distributors because there won't be any), and that's the big issue. Musicians and producers still need (and deserve) money to make and record music, and this complete sea-change will ensure that the processes by which they're paid are much more egalitarian and merit-based than when the industry was controlling the distribution and sale of content. They shouldn't be expected to tour their asses off, or make clothes or gadgets.

Alternative royalty collection, accounting and distribution systems are already being conceived and, in fact, one such flat-fee scheme is being advocated by Rick Rubin himself. The subscriber would pay a flat surcharge attached to their bill for internet usage, and this gets aggregated into a royalty pool. Counters embedded in media players calculate play-counts for each media file which has some metadata in it -- these counts get sent to a centralized database and are tallied per song -- this is where hits are determined. Royalties are distributed to the rights-holders accordingly.. In that NYT article he concedes that many people will need to agree to play ball in order for this system to be implemented, but I think it sounds great.

Today's record labels would be transformed into marketing and promotion companies, paid to increase the listenership and profile of artists through media, advertising, merchandising, PR..

Check the below site for good information regarding this idea:

http://www.gerdleonhard.net/

[ebot9000]

Today's record labels would be transformed into marketing and promotion companies, paid to increase the listenership and profile of artists through media, advertising, merchandising, PR..

Record labels are also getting into the artist management bizness, so they can get at a share of their touring and merchandising profits. Artists, of course, are getting into the label game now, because so much powerful marketing has become easily tangible through the internet.

The pie has shrunk considerably so everyone's trying to get more pieces for themselves. Meanwhile people are trying to make the whole pie bigger with things like corporate licensing, Darshan's mention of internet pay schemes, shit like that. It hasn't worked yet, because, basically the supply is so huge right now, payouts for licenses keep shrinking.

It's a mess right now. I've heard of the music industry described as the Wild West before, but it's more like Custard's Last Stand at the moment.

The chips are still falling, it's difficult to tell how it will all settle just yet. Only one thing is clear, CDs, as sellable items, are on their way out. Noone's gonna stop that tide.

On a positive note, all this table leveling has allowed access for anyone with a laptop and will. And I think we're gonna see radio getting better down the road as FM accepts the need to compete with superior digital and cyber stations. Hell, maybe major labels will actually have to compete with smaller labels by putting out BETTER music instead of BLANDER music.

[Adam Cruz]

The points you raise seem to imply that you expect things might have stayed the same had the major labels done it instead of Apple. I disagree.

nope not at all. The game's changed. But for once, labels could have been forward thinking. It's the difference between good and great. have a safe flight and enjoy the gig.

thanks sincerely for the comments. I appreciate the learning/growing.

[ebot9000]

from http://lefsetz.com/wordpress/... my bad if this has already come up on dhp.

More Rick Rubin
In retrospect, hiring Rick Rubin to run Big Red was a massive mistake.

Yup, Rick’s running it. From a distance. He doesn’t go to the office, he doesn’t communicate, he dropped a ton of acts, there’s a wild cabal running the label and the worker bees have no clue what’s going on.

How did this happen?

A fuck-up this bad hasn’t been "masterminded" since David Puttnam was handed the reins at Columbia Pictures. You don’t take an offbeat producer and put him in charge of the whole enchilada. You don’t make Steve Saleen head of General Motors. You give the enfant terrible a production deal, his own playground. Or you hand him a moribund company and tell him to turn it around. You don’t put him in charge of your MAIN DIVISION!

Rick Rubin at Columbia just insures that BMG will own this partnership. What a screw-up.

I mean he’s gonna start from essentially zero and build a company that can compete with Clive’s? Shit, he won’t even be able to compete with JIVE!

They didn’t give Bob Krasnow Warner Brothers. They gave him Elektra Asylum, that had lost a ton of money, that was in jeopardy as a stand alone entity. The fact that he moved the label to the east coast and fired most of the acts didn’t matter. The company was a tear-down. The name and a couple of acts was all it had. Credit the powers-that-be for recognizing this, they assessed reality and gave a personality a chance, an opportunity to build a unique company, in his own vision.

If Rick Rubin is so pissed off about Sony’s building, acts and financial structure, why didn’t Rob Stringer give him HIS OWN company, in a building of his choice, with new deals? Would that be so hard to do? What advantage was gained by putting him in charge of Columbia? In what world is an absentee king a good ruler of a failing empire? Hiring Rick Rubin is like letting the KIng of Greece run the U.K. because he’s done a good job in his own country. But what about the peculiarities of the U.K? What about the fact that people speak a different language? The U.K. isn’t Cyprus, it’s a complicated behemoth. Rick Rubin is running Columbia like it’s Chrysalis. And last I checked, Chrysais NEVER ruled the music business. Sold a ton of Tull, then Blondie, Pat Benatar and Huey Lewis, but it wasn’t a FULL SERVICE COMPANY! Columbia is a FULL SERVICE COMPANY!

Columbia Records has pop acts. And Tony Bennett. It’s got to sell teen pop and hip shit and flavor of the moment ALL AT THE SAME TIME! You don’t want someone in the studio, you want someone on the phone, surfing the Web, watching television, in touch with the ZEITGEIST. So he can swoop down and execute miracles. Columbia is the Yankees. Playing 162 games a year, competing for the pennant. Not the Segway polo team that gets a lot of press.

Sure, the music business needs to be reinvented. But we don’t need revolution, but EVOLUTION! Columbia needs someone to shepherd it from the past to the present to the future. So far, Mr. Rubin doesn’t look like that guy. Sure, files are going to overtake CDs, but not TODAY! So, a company has to sell CDs while PREPARING for the day files take over. You can’t be too early, and you can’t be too late. Those in charge have been too early. Now Rick Rubin is frustrated that the business isn’t functioning as it should in 2013. Rick, you’ve got to BRING IT THERE!

Def Jam stood for something. Asylum did so before it. And I’m sure you can mention a bunch of albums you could buy by the label. But those companies were SMALL, with very little product. Columbia’s sole image was as a monolith. It stood for nothing sound-wise. Nothing wrong with that, it was in a different BUSINESS than Def Jam or Asylum.

Making Rick Rubin head of Columbia is like trying to solve Chrysler’s problems by turning it into BMW. Sure, BMW makes great cars, but it sells NICHE PRODUCTS! Chrysler is competing with Toyota, it’s got to offer a broad range of vehicles. BMW is a completely different business model. Sell high quality at premium prices to the elite. If you want to hire Rick Rubin to do this, fine. Have him sign the new R.E.M., the new U2, the new Johnny Cash and purvey them with an innovative business model. Maybe a subscription to THEIR club. You pay a lot and you get not only finished product and demos, but a t-shirt and a ticket to the monster gig in the Nevada desert. But you can’t sell Kelly Clarkson that way. And you can’t sell Kanye that way. And those are what’s selling today.

Columbia needs mainstream product, TODAY! Sure, it also needs hip, innovative product. It needs iT ALL!

Rick Rubin isn’t on the way to delivering it all, he’s on the road to destroying a major company, turning it into a shadow of itself, at most a marginallly successful miniature. And I say marginally successful because ever since Rick’s been divorced from Russell Simmons, he’s not made big money as Def American and then American Recordings. Great record producer, great finder and signer and developer of raw talent? NO!

So now the label’s been dismantled. They’re starting over close to ground zero. You’d be better off with Donnie Ienner. WHOOPS, they fired Donnie. He lost out in a power struggle.

If you think Rick Rubin can beat the Germans/Clive at their own game, you’re just not a student of history.

If Rob Stringer wasn’t Howard’s brother, he’d be looking for a new job soon. This idea was good dinner table fodder, but giving Rick Rubin Columbia was pure folly.

[BrazenMuse]

dang it...i hv to come back and read this last bit later...but it looks interesting. thanks.

[kayotv]

from http://lefsetz.com/wordpress/... my bad if this has already come up on dhp.

More Rick Rubin
In retrospect, hiring Rick Rubin to run Big Red was a massive mistake.

Yup, Rick’s running it. From a distance. He doesn’t go to the office, he doesn’t communicate, he dropped a ton of acts, there’s a wild cabal running the label and the worker bees have no clue what’s going on.

How did this happen?

A fuck-up this bad hasn’t been "masterminded" since David Puttnam was handed the reins at Columbia Pictures. You don’t take an offbeat producer and put him in charge of the whole enchilada. You don’t make Steve Saleen head of General Motors. You give the enfant terrible a production deal, his own playground. Or you hand him a moribund company and tell him to turn it around. You don’t put him in charge of your MAIN DIVISION!

Rick Rubin at Columbia just insures that BMG will own this partnership. What a screw-up.

I mean he’s gonna start from essentially zero and build a company that can compete with Clive’s? Shit, he won’t even be able to compete with JIVE!

They didn’t give Bob Krasnow Warner Brothers. They gave him Elektra Asylum, that had lost a ton of money, that was in jeopardy as a stand alone entity. The fact that he moved the label to the east coast and fired most of the acts didn’t matter. The company was a tear-down. The name and a couple of acts was all it had. Credit the powers-that-be for recognizing this, they assessed reality and gave a personality a chance, an opportunity to build a unique company, in his own vision.

If Rick Rubin is so pissed off about Sony’s building, acts and financial structure, why didn’t Rob Stringer give him HIS OWN company, in a building of his choice, with new deals? Would that be so hard to do? What advantage was gained by putting him in charge of Columbia? In what world is an absentee king a good ruler of a failing empire? Hiring Rick Rubin is like letting the KIng of Greece run the U.K. because he’s done a good job in his own country. But what about the peculiarities of the U.K? What about the fact that people speak a different language? The U.K. isn’t Cyprus, it’s a complicated behemoth. Rick Rubin is running Columbia like it’s Chrysalis. And last I checked, Chrysais NEVER ruled the music business. Sold a ton of Tull, then Blondie, Pat Benatar and Huey Lewis, but it wasn’t a FULL SERVICE COMPANY! Columbia is a FULL SERVICE COMPANY!

Columbia Records has pop acts. And Tony Bennett. It’s got to sell teen pop and hip shit and flavor of the moment ALL AT THE SAME TIME! You don’t want someone in the studio, you want someone on the phone, surfing the Web, watching television, in touch with the ZEITGEIST. So he can swoop down and execute miracles. Columbia is the Yankees. Playing 162 games a year, competing for the pennant. Not the Segway polo team that gets a lot of press.

Sure, the music business needs to be reinvented. But we don’t need revolution, but EVOLUTION! Columbia needs someone to shepherd it from the past to the present to the future. So far, Mr. Rubin doesn’t look like that guy. Sure, files are going to overtake CDs, but not TODAY! So, a company has to sell CDs while PREPARING for the day files take over. You can’t be too early, and you can’t be too late. Those in charge have been too early. Now Rick Rubin is frustrated that the business isn’t functioning as it should in 2013. Rick, you’ve got to BRING IT THERE!

Def Jam stood for something. Asylum did so before it. And I’m sure you can mention a bunch of albums you could buy by the label. But those companies were SMALL, with very little product. Columbia’s sole image was as a monolith. It stood for nothing sound-wise. Nothing wrong with that, it was in a different BUSINESS than Def Jam or Asylum.

Making Rick Rubin head of Columbia is like trying to solve Chrysler’s problems by turning it into BMW. Sure, BMW makes great cars, but it sells NICHE PRODUCTS! Chrysler is competing with Toyota, it’s got to offer a broad range of vehicles. BMW is a completely different business model. Sell high quality at premium prices to the elite. If you want to hire Rick Rubin to do this, fine. Have him sign the new R.E.M., the new U2, the new Johnny Cash and purvey them with an innovative business model. Maybe a subscription to THEIR club. You pay a lot and you get not only finished product and demos, but a t-shirt and a ticket to the monster gig in the Nevada desert. But you can’t sell Kelly Clarkson that way. And you can’t sell Kanye that way. And those are what’s selling today.

Columbia needs mainstream product, TODAY! Sure, it also needs hip, innovative product. It needs iT ALL!

Rick Rubin isn’t on the way to delivering it all, he’s on the road to destroying a major company, turning it into a shadow of itself, at most a marginallly successful miniature. And I say marginally successful because ever since Rick’s been divorced from Russell Simmons, he’s not made big money as Def American and then American Recordings. Great record producer, great finder and signer and developer of raw talent? NO!

So now the label’s been dismantled. They’re starting over close to ground zero. You’d be better off with Donnie Ienner. WHOOPS, they fired Donnie. He lost out in a power struggle.

If you think Rick Rubin can beat the Germans/Clive at their own game, you’re just not a student of history.

If Rob Stringer wasn’t Howard’s brother, he’d be looking for a new job soon. This idea was good dinner table fodder, but giving Rick Rubin Columbia was pure folly.


nice!
thanks for posting

[RX]

Columbia's new urban president recruited Chicago producer and Kanye West mentor Dion "No I.D." Wilson to head Columbia's A&R department. Wilson says he agreed to join Columbia because he knows exactly what Joshua and Rubin want and is confident neither will become entangled in company politics. Though Wilson's contract isn't finalized yet, he's verbally agreed to the as-yet-untitled A&R position.
who-the-what-the...:conf06::rofl:
this should be very interesting...