Do you know anybody who’s a graphic designer? Maybe a photographer? Their businesses have been DECIMATED by technology.

Used to be you provided all these services…that corporations now pawn off on twentysomethings in-house. Yup, take your point and shoot to the event and fix the images in Photoshop. There is Adobe software to do seemingly everything. Sure, some high-end jobs remain. But if you want to remain in business, you’ve got to do it on the cheap, you’ve got to control COSTS!

Or go back to the story of Compaq. Making high-priced machines with new technology that IBM couldn’t yet deliver. Parts tested multiple times. BMWs to IBM’s Mercedes-Benzes. And then along came Dell and ruined Compaq’s business model. Dell acquired industry standard parts, just in time, and sold computers directly to the consumer, built only upon order, so as to control inventory costs. Dell’s parts weren’t tested, but how often did RAM fail? Better to ship it and deal with it coming back. Cutting all these costs, Dell decimated Compaq, to the point where it was merged into HP.

Now we can talk about Dell’s war with HP today. But that’s about the commoditization of computers. Important, but too deep for our discussion right now. Then again, music has become a commodity, shouldn’t it be sold that way?

Point is, the old model was a good one. Spend a fortune to make a fortune. Some records didn’t hit? Who gives a shit, we can sell ten million Jewels! And Kid Rocks! But no one goes diamond anymore. The music might be just as good, but it’s hard to reach people. So, you’ve got to retool, you’ve got to align with modern realities, you’ve got to cut costs.

Major labels provided the capital for production. And controlled distribution. For this, they extracted a pretty penny. Which they made back because they controlled exposure too, and only what they signed sold.

But now anybody can make a record and sell it on the Internet. The key isn’t finding out how to put the genie back in the bottle, how to make the major labels dominant today, but to figure out what your niche is and how to compete!

If no record can sell double digit millions, you’ve got to cut expenses. The album has to be recorded more cheaply. Which technology allows. Oh, don’t tell me studio time is expensive. And musicians too. Studios will just have to charge less, which they’re doing. And musicians will just have to be paid less. I KNOW YOU HATE THIS! But you can only fight reality for so long. There will be fewer superstars in the future and more journeymen. Look at yourself in the mirror right now and decide who you are. Can you get on Top Forty radio? If so, you’re a POTENTIAL superstar. If not, you’re a JOURNEYMAN!

Hair and makeup? Private jet travel? They’re like the old billboards on the Sunset Strip. It’s questionable whether they EVER sold any records. They just played to the star’s vanity. Great when there’s extra money floating around, but when there isn’t…

Radio promotion/marketing? Is it cost effective? If not, slice it off the budget. Oh, it’s great to have your record on the radio, but is it going to move product, is it going to score you gigs, IS ANYBODY LISTENING?

Make the music cheaply and focus on what’s inexpensive or free. Like distribution. The major model of paying an act less than ten cents per dollar download won’t be changed because of the Allman Brothers and Cheap Trick’s lawsuit, but because new acts won’t stand for it, they won’t sign up for this heinous deal. This might leave the majors marginalized, only swinging for the fences, and the rest of the field might be chaos, made up of mini-corporations. Or maybe some young ‘un will consolidate the new acts. That’s an opportunity, making nickels and dimes instead of dollars. But the major labels don’t want to do this.

It costs nothing to build a mailing list. It has to be managed appropriately, you can’t dun your fans ad infinitum, you’ve got to give something back. And the music must be good.

Your revenues come from recorded music sales, live gigs, merch and any sponsorships/endorsements/advertising you choose to do. LOOK AT IT THIS WAY! You have YOUR OWN 360 deal. Recorded music revenue is just part of the pie. And chances are recorded music is not driving touring sales, but vice versa.

Any label in business now must look at every line item. It’s not about cutting overhead willy-nilly, but evaluating what’s necessary. As for the well-paid top execs, they’re dinosaurs, about to go extinct. The system just can’t support them. Maybe some of the younger ones will become managers, but the days of making ten million bucks running the publicly-traded label? THROUGH!

As for the musician… More musicians can make money than ever before, because it’s easier to bring your wares to the market, and you can expose them with little capital. But those at the top, who are used to scoring beaucoup bucks…they’re going to have to adjust their lifestyles. Because there just isn’t enough money to support the way they used to live.

A musician may still get laid at will, but all the accessories demonstrated on "Cribs"? They’re gonna be on your wish list, but you’ll probably never acquire them. Consider the "Robb Report" a fantasy book.

What has this got to do with music?

Great music can still be made. And good stuff is sold by word of mouth. Which has the advantage of being instant and vast on the Internet. You can’t control the public the way you used to be able to, you can’t manipulate the consumer. Quality is the start, a relationship is second and managing this connection is third. Most of this requires sweat equity more than cash. Start perspiring.