FRUSTRATED BANDS WILL SIGN WITH MAJOR LABELS

Portugal. The Man just did.

The major doesn’t want you if you’re brand new, not unless you can be molded into a Top Forty superstar. But they do want to cherry-pick anybody with significant success.

Most bands make this deal. They’re sick of being broke.

If you want to undercut the major label, illustrate to these bands how you can get them paid, how you can grow their careers. Until we build an alternative structure the majors will always skim the cream off the top.

ESTABLISHED PLAYERS ARE INTERESTED IN THE MONEY

Everybody over fifty, and the mainstream music business is run by people over fifty, especially in the live arena, is about the money. Don’t come to them with a cool idea unless it can put A LOT of money in their pockets. Same thing with the over-fifty bands. They know they’re never going to have another hit, they’re just working to feed their lifestyles.

CONCERT TICKET PRICES ARE NOT GOING DOWN

It’s just too expensive to tour. And now that recording revenue has tanked, this is the best way to pay your bills.

Add up the cost of gas, rentals, hotel rooms…and you see that it’s almost impossible to support a cheap ticket. If you’re charging next to nothing you’re sleeping in your van or someone’s supporting you.

Sure, stars can lower prices 10%. But the concept of a show being an alternative to a movie are done. Except for developing acts in their own backyards.

CONCERT ATTENDANCE IS NOT GOING TO INCREASE SIGNIFICANTLY

It’s hard to build superstars and going to the show is a hassle.

This is the same problem facing the film business. There are fewer attendees, grosses just go up because of ever-increasing admission charges. The movie business painted itself into a corner with its tent pole extravaganzas. The business has become marginal. All the action is on screens at home.

The music business did the same thing. Building superstars in the last century that can no longer be built with modern apparatus. It’s impossible to reach everybody and the price of entry is almost nil and everybody is sick of the usual players.

People say they’d go to the show if they’d just known about it. This is a fiction, like dreaming of screwing an old acquaintance. The reality is you don’t want to pay, you don’t want the hassle, you don’t want to spend the time. Sure, attendance can be increased marginally, but it depends primarily on the development of new acts that last, and that’s troublesome.

LIVE NATION

There’s no magic bullet, no scale.

But this is not only the dilemma of the concert world, it’s the same problem plaguing the entire music business.

Used to be you could record relatively inexpensively and sell at an inflated price around the world.

Now recording is cheaper than ever but returns are less than ever for recordings.

If you want to get rich, go into a business that scales. Which is why the best and the brightest go into tech.

In other words, if you’re going into music so you can make double digit millions, you’re delusional.

ARTISTS ARE LUDDITES

The audience is so far ahead of the artists it’s not funny. It’s the artists complaining about getting paid and the death of radio and the crumbling of the old system.

Just like label executives used to spend a day in a retail outlet, where the rubber meets the road, artists should be made to surf the Net all day every day for a week. With a limited budget. Until artists see the world through their customers’ eyes, they’re screwed.

THERE’S ONLY ONE VICTOR ONLINE

To think MySpace can be resuscitated is to believe the Zune can make inroads on the iPod, which is dying by the way.

Don’t enter someone else’s online sphere unless you can kill your competitor. Look at Bing, a money drain on Microsoft, it pays for market share and does nothing better than Google. Whereas Xbox triumphed by being ahead of its competitors, having games its competitors did not, and focusing on multiplayer/online gaming. Xbox started out as me-too, but was executed well and then built upon to triumph. Kinect puts its competitors to shame. And Microsoft embraces hackers on Kinect. You should do the same (Sony?)

JUST BECAUSE YOU’RE POPULAR TODAY, THAT DOESN’T MEAN YOU WILL BE TOMORROW

Everybody’s a grazer, everybody’s looking for the next big thing, but most people don’t stay there. This is a problem in both music and online. In music, the majors believe a hit today means a career tomorrow. Online players believe eyeballs today mean money tomorrow. They’re both wrong.

Be in it for the long haul. Think about keeping your audience, how you can get it to evangelize your product.

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Now there are exceptions to all these rules above.

1. There are twenty and thirtysomethings revolutionizing the business. Too many of them are in tech, looking for the big payout. Those who will triumph will put money last. If you’re not willing to make $40,000 a year five years out, please give up. Everybody believes there are riches in music, from the artists to the developers, there are not. It’s a relatively small pie, not growing by much, divided by a plethora of players. Unlike online sites, different acts can coexist. But it’s incredibly hard to be dominant. Media gives the illusion that musical stars are rich. No, bankers are rich. And techies.

2. Learn how to play. Mark Zuckerberg was a wizard coder long before he built Facebook. What makes you believe you can triumph in the musical world after playing your guitar for a month?

3. Flash fades, substance lasts. If all you’ve got is the two-dimensional hit, you won’t last long. You’ve got to have a story. There’s got to be depth. It’s less about marketing than music. If people can’t keep discovering and being rewarded listening to your music your career is going to be short.

4. Most of the execs running the music business are old, many within ten years of retirement, if it takes that long. Who will run the business in the future? Yup, within ten years, Doug Morris will be gone. Clive Davis is essentially gone already. Ahmet died. Irving Azoff is in his sixties. Don’t think so much about beating these guys today as much as replacing them tomorrow.

5. It took eleven years to get a legal Spotify. Change comes very slowly in the music business. If you’re into changing the business, be in it for the long haul. Whereas musicians can change the landscape overnight. That’s the power of art.

6. Just because you’re a big music fan, that does not mean you’re entitled to a job in the music business. Just because you follow the NBA or NFL do you think you’re entitled to work for the Lakers or the Cowboys?

7. It’s almost impossible to stay in the music business. It’s a long term play for almost no one. To triumph you must have sharp elbows and brilliant insight. If you think the guys running it now are stupid, you’re wrong, you are. They might be acting out of self-interest, they might be all about the money, but what they know could put you back in kindergarten.