Irving told me he had something really big coming.  But I didn’t expect it to be THIS big.

In a world where David Geffen was left out of the negotiations of MCA’s sale to Matsushita, because he notoriously couldn’t keep his mouth shut and meddles, one has to say no single individual as ever had this much power in the music industry.  Clive Davis may publicize the fiction that he’s the man with the golden ears, but he got fired by his bosses at Arista, and even though he crawled back, he was neutralized/marginalized in Sony’s recent acquisition of BMG.  And Doug Morris…  That’s one powerful dude.  But he’s not positioned well for the future.  Sales dropped 17.6% year to year last week, and Kenny Chesney’s album debuted with 176,000 sold, a fraction of last year’s total of 387,000, for "Just Who I Am: Poets & Pirates".  Doug’s presiding over a declining business.  Whereas Irving truly controls the talent.  The creme de la creme, over 100 acts.  And with the talent comes the true power.

And TicketMaster has been spun off from IAC…  So, unlike Doug, Irving’s not really reporting to anybody.  It’s his fief.  To do what he wants.

And despite allegations of untrustworthiness, Irving’s got Warner on his side, and  Dolan…  They may have cashed out, but this is a business of loyalty, the money comes second at this high level.  Because what goes around comes around, the same players always meet in the corral.  You thought Edgar Bronfman, Jr. was done?  Now he runs Warner…

And Michael Rapino…  Smart dude.  But from a new era.  He grew up working for a beer company, Irving Azoff managed Dan Fogelberg and the Eagles.  Talk about experience…  He wasn’t there at the birth of Christ, but he knows everybody who was.  Intimately.

But what is the plan?

I’m not exactly sure.  Irving specializes in playing people off against each other, neutralizing them.  When he’s the man…  It doesn’t work so well.  Irving rebuilt MCA, but it never became number one.  And when he left in ’89 to make some real money, with Giant…  He did well in merchandising, but his record company operated in fits and starts.  A movie soundtrack, Big Head Todd, eventually Disturbed…  One doesn’t see the company as a paragon of excellence.

In other words, I’d rather have Irving cocking up the works rather than running the works.

But it is a changed marketplace.  The money is in live.  And monetizing all other aspects of an act’s career.  New products.  New kinds of promotions.  Rapino realizes this, but he’s saddled with the low margin concert promotion business.  And he controls very few acts.  With very rich contracts.  Whereas Irving/Front Line is the MANAGER!  They split the revenue that comes in.  If nothing comes in, there’s no obligation to the act.  If the act’s new album stiffs, it doesn’t get paid.  Whereas Jay-Z gets his money, no matter what happens in the marketplace.  That’s a big bet, the river of nickels flowing from the concert promotion business covering that overhead.  Such a big bet that Rapino battled with Michael Cohl over doubling down, and won, and slowed the process.

But how is Rapino going to get acts to exploit his new products on favorable terms if Irving controls all the acts? Sure, Irving will do a deal.  But the terms won’t be good!

It’s uphill for Rapino and Live Nation.

Suddenly, TicketMaster is no longer dependent on ticket fees to make its numbers.

And we’re sitting here wondering what this does with regard to developing acts and ticket prices.

Well historically, and history is very brief in this case, the modern Front Line is not interested in developing acts. Maybe that will continue to be the case.  Maybe this is about maximizing revenue as opposed to new business concepts.

But this is all very new.  Irving wanted to cash out.  One didn’t foresee him both cashing out and ending up with MORE power.  Does he have a plan?  You betcha!  What it is?  I’m still thinking about that…

Conventional wisdom is the entertainment business is recession-proof.  If you believe that, you probably believe Sarah Palin is our country’s foremost energy expert.

The movie business was hurt by the last recession.  But at least their prices are cheap.  Ours are stratospheric.

We’ve got high prices, a dearth of superstar talent and a financial meltdown.  Do you really think the concert business is going to emerge unscathed?

Yes, superstars will sell every ticket.  Then again, Madonna is not selling out, even though her handlers won’t say so.  You can get tickets for gigs.  People e-mail me the promotions.  And if Madonna can’t sell out, what are the odds for Joe Wannabe Band?

Historically the concert industry has been one of rugged individualism.  Run by independent acts and their agents.  To a great degree, this is still true.  But along the way, there was a great consolidation in concert promoters.  Instead of regional fiefdoms, we have the international giants and JAM and…some more indies.  It is time for all concert promoters to unite and tell the acts TICKET PRICES MUST COME DOWN!

The concert industry can’t fuck this up like the RIAA did with music sales.  The fan is the key to the business. The message has to be sent that the industry cares about the fan, that the fan is part of the process, and is welcomed into the tent.  True, this will be difficult with ticket holdbacks and the inability to get a good seat, but maybe now it’s time to be truthful about those scenarios too.  Posting online manifests of exactly what seats are available before the on sale date.  We need transparency and an olive branch, telling the consumer we’re rolling back prices as a payback, as a reward, as recognition of their loyalty.

Who’s going to pay those inflated prices for sports tickets?  Don’t use that analogy any longer.  The company with naming rights goes under and what happens when the corporation buying those insanely priced tickets and luxury boxes get trampled by Andrew Cuomo?  If AIG can’t rationalize a sales conference, what are the odds it will be able to rationalize entertaining its clients in luxury boxes?  What are the odds corporations now owned by the government will devour front row seats like Chiclets?  What are the odds that conspicuous consumption will be lauded as opposed to pelted with aural tomatoes?

Everybody knows ticket prices are too high and you can’t get one.  But, that’s only for a very few acts.  Can those acts sacrifice for the good of the public?  Can we all unite and lower prices?  Can acts and promoters reveal their TicketMaster kickbacks?  Is this an opportunity to air and clean the concert industry’s dirty laundry?

Absolutely.  Acts now have to be built on the road.  Concertgoing must be a regular activity.  I call on Michael Rapino to lead the charge, to bully the agents and managers.  And for a campaign that can run with every concert ad.  A logo that charms the ticket buyer as opposed to the FBI sticker on a CD.

The record industry fucked this up.  They thought happy times were going to last forever.  Instead, they’re never coming back.

Now it’s the concert industry’s turn.  True, you can’t steal a live show.  But you don’t have to go.  Certainly not if the act’s only had one hit and it’s going to cost you hundreds of dollars to go out for the night.  We’ve got to bring people in.

Apple’s success today is due to innovation during the last downturn.  The concert business shouldn’t be pulling back, but using this crisis as an opportunity to get people out of their houses and into theatres to get their minds off their problems.  For a fair price.  To see quality talent.

Your move.

Albums are for fans.  Singles are for newbies.

So, if you’re nobody, and you’re not live-based, focus on the single, that’s all people want.  Hook ’em with a few singles and you’ve suddenly got fans.  Who want more.  Does this mean a full-length, with fifteen tracks and seventy eight minutes of music?  Probably not.  After all, they’ve just come to know you.  You don’t want to get married after the first date.  So, feed ’em three or four tracks.  At an incredibly discounted price on iTunes if you must, a package price.  Build slowly.  And whenever you get a good-sized fan base, don’t overload them all at once!  Today’s albums are incomprehensible.  Too long, never mind too expensive.  Better to put out three tracks five times a year than fifteen all at once.  Not only do you maintain your buzz, your audience stays bonded, doesn’t go on a hejira somewhere else, waiting years for your next opus, possibly forgetting you in the interim..

If you’ve already got a fan base, release that album if you must.  But know that non-fans don’t care.  And, if they come to care via airplay, old wave media, they only want THE TRACK!  If you learn of an act from a friend, you might want an album.  But if you’re dipping your toes, you don’t want to get soaking wet!

As for keeping your tracks off iTunes…  What are you about, money or a career?  AC/DC is gonna sell a whopping number of albums at Wal-Mart, but they’ve got no buzz online at the iTunes Store, their album and its single tracks don’t appear on the chart, never mind front page advertising.  If you want to play an untelevised World Series, be my guest.  But why play outside the stadium, by yourself.  Some people would rather play basketball in Europe for more money, but most want the glory, and will stay here in the U.S.A.  (Furthermore, the salary might be less, but the endorsements, the peripheral income, adds up.)  You can reach those who truly care outside of iTunes, but the casual user, newbies, they’re not gonna be affected, they’re gonna be completely out of the loop, which is going to hurt you in the long run.  iTunes is the Big Kahuna, why would you want to play outside its parameters?

So if you’re making an album, don’t think of world domination.  Think of satiating your fans.  If you must, include a catchy single for radio airplay.  But it probably won’t get airplay and will quite possibly alienate your core audience.  If you’re only about the core, don’t sell out, feed your homies.  But, if you want someone new, sell individual tracks online, allow people a taste.  Better yet, give them a taste for free, just like dope dealers.  If you’re purveying really good shit, people will want more and will get hooked.

That’s the title of an article in today’s "Wall Street Journal".

Network television viewership is down 6.6% from last year. And that INCLUDES DVR viewership. Even more fascinating is that DVR penetration has grown from 18.6% of TV households to 24.4% in the last twelve months. Although some network TV shows are traded via BitTorrent, piracy is not the issue. People just don’t want the big time, mainstream, made for everybody fare.

We’ve been hit over the head by the major labels that if we could just eradicate piracy, their woes would be over. This is hogwash. And they’re driving their businesses straight towards the cliff. Because their present business model is to sign fewer acts, work them with fewer people and have great success with each. But how large can that success be?

The WSJ refers to a fractionalized environment. It’s not that people are sitting at home staring in silence at blank walls in the dark. Rather, they’re choosing alternative kinds of entertainment. Many are migrating to the myriad of entertainment choices on cable.

But the networks own so many of these cable outlets. This has allowed them to still capture a large portion of the overall viewer pool. But the major labels don’t own the indies.

Unless the majors start releasing a plethora of product, going for market share, seeing themselves as service companies facilitating the distribution of all the product, they’re doomed to marginalization. Please don’t try to deny this. Please know that the protestations of the majors are irrelevant. We’ve moved on to a new marketplace, where iPod penetration is gargantuan and the CD is antiquated, a worse fit for the times than network television shows. The goal is to get on someone’s iPod, how do you do that?

Their A&R man said ‘I don’t hear a single’
The future was wide open

"Into The Great Wide Open"
Tom Petty & the Heartbreakers

You’ve got to start making these records for yourself. Forget satisfying the system. The system is decrepit and falling apart. IF you homogenized your sound to fit radio…you’d find out that the radio in your mind has already evaporated and what is left is highly formulaic, doesn’t include many genres and is listened to fewer people than before. The story of the summer isn’t that Kid Rock had a hit without iTunes, but that after a year in the marketplace, "Rock N Roll Jesus" has sold a mere two million copies. That’s with the biggest hit of the summer! A multi-format smash!

You’re better off buying Seth Godin’s "Tribes" than reading "Billboard". The question is, not how can you get on the radio, but how can you build your own coterie, your dedicated tribe, that will keep you alive. And how they remunerate you might not resemble any of the twentieth century business models.

Make music that satisfies you. Forget the media outlets, go directly to the consumer. Can you get people excited? If you can, they will tell other people. It is very important that you abandon old wave marketing techniques. Street teams, carpet bombing, unsolicited e-mail and MP3s… You can try these, but they don’t work, they just serve to alienate people.

Your community must drive your career. Not your label, not radio and not "Rolling Stone". Sure, the old outlets still have some power, but it is rapidly fading. And unless you want to have a one year career, NEXT YEAR, you’re better off abandoning the old game and going your own way.

You don’t want to hear this. You want it to be easier. You want to be rescued. But there’s no government bailout for artists. You’re lucky if people steal your music. Then maybe they’ll become fans, and buy tickets to see you live.

A fan will send you e-mail, which you must answer. A fan will sign up for your tweets. A fan will befriend you on Facebook. A fan will buy your merch. T-shirts as a badge of honor. Special edition packages, books. Instead of lamenting your inability to sell CDs, construct other products that fans can buy. Even at the micro level, 100 copies of a $100 package is TEN THOUSAND DOLLARS!! In the old days, you sold a person a CD and then they were done. Your fan will buy the special package AND additional merchandise.

A fan will pick you up at the airport. A fan will let you stay at his house. A fan will bring all his friends to the show. A fan wants access. If you provide this, you’ll be stunned at what you get in return.

But you’ve got to give something in return. You can’t be aloof. You’ve got to get down into the pit with your fans. And not worry whatsoever what the mainstream media has to say about your success. Not worry if the A&R man comes to your show. Not worry about hiring a promo man to get your song on the radio.

Your goal is no longer to get paid by the label, but to get paid by your audience. Figure it out.