It’s beginning to look a lot like Detroit.\u00c2\u00a0 Where claiming it was only giving the public what it wanted, GM drove itself to the brink of bankruptcy.\u00c2\u00a0 And Ford had to decide it was not going to be the Ford of yore, but a much smaller company.\u00c2\u00a0 Both entities failed by having no vision.\u00c2\u00a0 Believing that the way things are today, they will be forever more.<\/p>\n
It starts with the SUV.\u00c2\u00a0 Making more money per giant SUV than car, GM threw all its development money into remaking trucks like the Suburban.\u00c2\u00a0 Sound like selling CDs to you?\u00c2\u00a0 That ten dollar wholesale number looks pretty good to the major label.\u00c2\u00a0 So, it wants to forestall its evisceration.\u00c2\u00a0 As market conditions work against it.<\/p>\n
Toyota.\u00c2\u00a0 The Japanese company knows it’s about innovation.\u00c2\u00a0 So, it pours tons of money into hybrid engines.\u00c2\u00a0 Then, lo and behold, gas prices rise and a fickle public is INTERESTED in driving a car that gets twice as good mileage.\u00c2\u00a0 It’s kind of like the Administration.\u00c2\u00a0 Who could FORESEE that radical Muslims would fly airplanes into the World Trade Center?\u00c2\u00a0 Well, with the oil cartel dictating prices and said prices being higher in most of the developed world, it was OBVIOUS that prices would rise, but GM did nothing to prepare for this.\u00c2\u00a0 At least Ford eventually developed a Hybrid Escape.\u00c2\u00a0 Then again, would you buy a Ford?\u00c2\u00a0 Not most people.\u00c2\u00a0 Since they believe Toyota is the mark of quality.<\/p>\n
Speaking of quality.\u00c2\u00a0 Does ANYBODY other than the major labels themselves believe that they purvey the BEST acts?\u00c2\u00a0 Maybe the biggest selling, which they trump up with promotional dollars like Detroit sells cars to rental companies, but certainly not the best.\u00c2\u00a0 Would you rather own a BMW or a Chevy?\u00c2\u00a0 Turns out the BMWs of the music world, those based on what’s under the hood, those that perform and are not all gloss, are increasingly on INDIE labels, where they can do what they want.\u00c2\u00a0 GM couldn’t build a BMW because some bean counter somewhere would say based on PAST numbers there was a limited market share for a BMW.\u00c2\u00a0 People want chrome, not performance.\u00c2\u00a0 But, BMWs numbers BURY GM’s.\u00c2\u00a0 Sure, GM sells MORE cars, but it’s LESS PROFITABLE!\u00c2\u00a0 What is the major label game?\u00c2\u00a0 Shipping tonnage, or maintaining a lasting business?<\/p>\n
Then there’s the issue of costs.\u00c2\u00a0 In both cases, Detroit and the major labels, they’re OUT OF LINE!\u00c2\u00a0 Major labels keep cutting low-level employees, keep consolidating backroom functions, but NOBODY AT THE TOP TAKES A HIT TO HIS EXORBITANT SALARY!\u00c2\u00a0 At least Rick Wagoner took a serious hit to his paycheck.\u00c2\u00a0 These guys at the major labels are fiddling while Rome burns and somehow it’s not their fault.\u00c2\u00a0 Furthermore, they don’t rein in costs.\u00c2\u00a0 That’s why they say CDs cost so much.\u00c2\u00a0 MARKETING COSTS!\u00c2\u00a0 Well, today marketing can be free.\u00c2\u00a0 Not only on the "Today Show", but most importantly on the Web.\u00c2\u00a0 But somehow the majors are wedded to the old paradigm.\u00c2\u00a0 Price and positioning in an evaporating retail world.\u00c2\u00a0 Radio promotion, even though Spitzer cracked down.\u00c2\u00a0 ALL THE OLD WAVE TECHNIQUES IN A NEW WAVE WORLD!<\/p>\n
Then there are the tentative moves.\u00c2\u00a0 The indie distributors formed by the majors.\u00c2\u00a0 This is kind of like GM’s Saturn.\u00c2\u00a0 A good idea at the inception that is not handled correctly.\u00c2\u00a0 First and foremost, CDs are dying.\u00c2\u00a0 So, do the indies NEED a distributor?\u00c2\u00a0 Second, the deals are crap.\u00c2\u00a0 There’s no new paradigm thinking.\u00c2\u00a0 No one page contracts that give up a healthy percentage of the action.\u00c2\u00a0 The indie distributors are just a FARM TEAM for the majors.\u00c2\u00a0 And I ask you, who wants to play on the FARM TEAM?<\/p>\n
It’s a new world, and despite their carping, the majors are doing nothing about it.\u00c2\u00a0 They’re just trying to preserve their OLD WORLD!\u00c2\u00a0 And the old world they’re clinging to is dying.\u00c2\u00a0 And, they’re going to be crippled in the future.<\/p>\n
What do accountants say, the numbers don’t LIE?<\/p>\n
Last week the business was down 2.9% from 2005!\u00c2\u00a0 An anemic year.<\/p>\n
But it gets worse.\u00c2\u00a0 NEW album sales are down 3.4%!\u00c2\u00a0 While catalog sales are down .7%.\u00c2\u00a0 If this is not testimony to the fact that the industry’s hero, Clive Davis, has go it all wrong, I don’t know what is.<\/p>\n
It’s all about the catalog baby.\u00c2\u00a0 Creating lasting acts that will sell for DECADES!\u00c2\u00a0 Something Clive doesn’t do.\u00c2\u00a0 Something all his imitators have forgotten.\u00c2\u00a0 The INDIES don’t purvey evanescent shined-up crap.\u00c2\u00a0 Because they know you have to shove it down people’s throats, and they ultimately have a bad taste in their mouths from the hype and REJECT these acts.\u00c2\u00a0 You’ve got to have a slow build.\u00c2\u00a0 You’ve got to enter people’s hearts and minds.\u00c2\u00a0 You’ve got to sell acts by TRUST!\u00c2\u00a0 Something the majors just aren’t doing.\u00c2\u00a0 Which is going to MARGINALIZE them!<\/p>\n
At least the majors, unlike Detroit, HAVE these catalogs.\u00c2\u00a0 Of evergreens that will continue to sell.\u00c2\u00a0 Still, selling them on disc is going to become passe.<\/p>\n
In order to survive, the majors must change their paradigm.\u00c2\u00a0 They must see their advantages.\u00c2\u00a0 Which is primarily possessors of a sleek system.\u00c2\u00a0 They should sign EVERY act, to almost no advance, and pay a healthy royalty four times a year.\u00c2\u00a0 They should start this TODAY!\u00c2\u00a0 Before these acts can easily get paid online.\u00c2\u00a0 And don’t need them.\u00c2\u00a0 THEN, if an act gets traction, the major can offer a new deal, to put promotional money into them.\u00c2\u00a0 There must be HONESTY in the relationship, not the bullying fly-up to the major deals of today.<\/p>\n
The majors must embrace digital distribution INSTANTLY!<\/p>\n
What we have now isn’t true digital distribution.\u00c2\u00a0 It’s just a way to get a lower quality version at the same aliquot price per track.\u00c2\u00a0 What about all those costs savings?\u00c2\u00a0 With no manufacturing and shipping?\u00c2\u00a0 Why don’t they end up at the purchaser’s door?\u00c2\u00a0 Why can’t the public buy TONS of tracks at a CHEAP price?\u00c2\u00a0 Hell, they’ll buy them all over again when they get a new computer\/iPod.\u00c2\u00a0 How often does someone remove the stereo from one car and put it into another?\u00c2\u00a0 It’s cheaper and less of a hassle to get a NEW ONE!\u00c2\u00a0 THAT’S the new music business, it’s FLUID!\u00c2\u00a0 With product changing hands CONSTANTLY!<\/p>\n
And, it’s less about the Ford Taurus.\u00c2\u00a0 Or Chevy Cavalier.\u00c2\u00a0 It’s more about niches and customization.\u00c2\u00a0 Turns out not everybody wants the same car, and not everybody wants the same music.\u00c2\u00a0 But, the major labels continue to employ a BROADCASTING model in a wide-open cable world.\u00c2\u00a0 The key is to make everybody a music consumer, and sell them SOMETHING!\u00c2\u00a0 Not to try and sell everybody the SAME damn thing.\u00c2\u00a0 THEN you end up as GM.\u00c2\u00a0 Is there ANYBODY in the music business who wants to own a Chevy Malibu?<\/p>\n
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It’s beginning to look a lot like Detroit.\u00c2\u00a0 Where claiming it was only giving the public what it wanted, GM drove itself to the brink of bankruptcy.\u00c2\u00a0 And Ford had to decide it was not going to be the Ford of yore, but a much smaller company.\u00c2\u00a0 Both entities failed by having no vision.\u00c2\u00a0 Believing […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[2],"tags":[],"class_list":["post-331","post","type-post","status-publish","format-standard","hentry","category-music-business"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p96vPs-5l","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/331","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/comments?post=331"}],"version-history":[{"count":0,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/posts\/331\/revisions"}],"wp:attachment":[{"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/media?parent=331"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/categories?post=331"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/lefsetz.com\/wordpress\/wp-json\/wp\/v2\/tags?post=331"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}