Music Business and Trend-Mongering

Following hot on the heels of No Depression’s announcement that they were closing up shop, Harp Magazine, another one of my favorites, announced this AM that they too were ceasing publication.

From my old contact there, Jake Flack:

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I am very sorry to tell you that, effective March 20, 2008, I will no longer be the Associate Publisher of Harp. Because of the declining revenues and increasing costs related to print publishing, Harp is discontinuing publishing as of that date. The March/April issue (with Dave Grohl on the cover) will be the last issue printed and distributed. The company is shutting down operations and will not be publishing the May issue.

It’s been my distinct pleasure to work with all of you. For the past five years I’ve been very fortunate to work with so many wonderful people who are dedicated to putting out and promoting great music. I’ve always felt that Harp provided a first class platform for giving independent music a voice that otherwise might not have been heard. We were able to do that because our advertisers shared that vision.

I apologize for the mass email but time dictates this rather impersonal notice. Best of luck to everyone and thank you so much for everything!

Jake

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It’s always a drag to see another positive entity in the music business go down, but I suppose I am not incredibly surprised. When I think of the parties and folks at SXSW that made an impression on me, much of it was online focused: Ioda’s party on 6th and Red River, Imeem’s event, the Ourstage folks, and so on. Similar to mid-level indie labels, I think mid-level music print mags are in for a tough haul, in particular those that are not making a serious push for online business. Online businesses with marketing dollars prefer to spend it on online advertising: certainly keyword buys, but also newsletter affiliation, banner ads, and contextual marketing. With online marketing, you can pinpoint exactly how successful a particular campaign is, and more importantly, online marketing folks know that it is easier to attract someone that is already online than it is to to attract someone that is offline. To survive these days, Harp and others need to monetize their online efforts by creating an online community, that A) folks want to be part of, and B) advertisers see value in.

Those that are not evolving are going to be left behind…

Ten months after Warner Music head Edgar Bronfman said that Apple’s Steve Jobs suggestion that dropping DRM copy protection from digital music was “completely without logic or merit,” Bronfman reversed direction last Thursday by licensing its catalog, DRM free, to the Amazon MP3 music store. Warner joins EMI and Universal in offering higher quality (256 kbps), DRM free mp3s through Amazon’s online store, leaving Sony as the odd man out in the major label circle.

On the surface it would appear that the majors are simply responding to consumer demand and giving music fans what they want. But the fact is, the majors hate the digital monopoly that Steve Jobs has with iPod/iTunes. They understand that the only way to increase their margins on digital music and regain some of the control that Apple has taken from them is to reach the billions of iPods floating around. Their endgame is almost certainly to get customers in the habit of purchasing mp3 files from a place other than iTunes (which currently accounts for 70% of all digital music sold).

DRM (digital rights management) is technology that copyright holders place on a digital file to restrict its usage. It’s a flawed, user-unfriendly tactic, and it will go away. But while it exists, I will continue to do my online music buying with DRM-free retailers emusic and Amazon.

Radiohead Rocking The Online Marketing Campaign (And You Could Too!)

Following up on the DJ set that Thom Yorke did on Thursday evening, radiohead.tv hosted a second straight night of live performances, videos and cover songs in what is appearing to be some sort of Webcast series. Excellent stuff – a homemade video for the new 15 Steps song using images from the Brad Pitt film Se7en (with Thom’s head playing the role of Gweneth Paltrow), a great Smiths cover, and a red hot live version of Bodysnatchers, the second song from the “In Rainbows” record.

Radiohead is, of course, in a unique position as one of the biggest bands in the world, and they are going to be getting a ton of publicity no matter what they do. But what’s interesting to me is how fun this all is, and the fact that any band can pull off essentially the same thing. The Se7en clip looks like it took someone about 25 minutes to make using iMovie!

Check out Thom’s DJ set from Nov 8th here:

Bodysnatchers clip from last night’s Webcast is here:

Se7en/15 Steps video:

Smiths Headmaster Ritual live cover:

Surely as a response to Amazon’s more competitive pricing structure for DRM-free music, iTunes has announced that they will drop the price of their iTunes Plus songs (256kbps, DRM-free) from $1.29 to $.99. iTunes Plus includes songs from EMI as well as a number of larger independent labels. Amazon’s mp3 store, which launched on September 25th, offers DRM-free songs for between $.89 and $.99. The battle is likely to continue as it’s clear that the majors, and in particular Universal, are not pleased with Apple’s dominance of the online music world (70% of all digital music sales are currently through iTunes).

I got this email first thing today:

THANK YOU FOR ORDERING ‘IN RAINBOWS’.

THE LINK BELOW IS YOUR UNIQUE DOWNLOAD ACTIVATION CODE.

PLEASE CLICK ON THE LINK OR CUT AND PASTE INTO YOUR BROWSER TO OBTAIN YOUR DOWNLOAD.
IF YOUR LINK APPEARS AS TWO SEPARATE LINES, PLEASE CUT AND PASTE THEM CAREFULLY INTO YOUR BROWSER.

THE ALBUM WILL COME AS A 48.4MB ZIP FILE CONTAINING 10 X 160KBPS DRM FREE MP3s.

IF YOU HAVE ANY QUESTIONS OR PROBLEMS DOWNLOADING YOUR FILE, PLEASE CONTACT OUR DOWNLOAD CUSTOMER SERVICE TEAM: downloadinrainbows@waste.uk.com

WE HOPE YOU ENJOY ‘IN RAINBOWS’.

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Well, I do enjoy ‘IN RAINBOWS.’ Very much. And from what I can tell, there’s a whole lot of other folks that are enjoying this record today too. Nicci and I went down to Cambridge 1 for dinner (a hip pizza place in Harvard Square), and they were playing the record to a room full of folks there too.

Over and above anything else, this coordinated experiment shows that it’s still possible to build a huge buzz around a new record (not easy). Radiohead has succeeded in having many people hear their record for the first time, at the same time. If the new music business model involves using a discounted (or free) digital product to corral these folks into creating a word of mouth groundswell that can support a tour, merch, licensing opportunities, ringtones, etc, then it looks like they may have nailed it. They also have 6 other records (now available digitally for the first time on Amazon). Long tail anyone?

First, what the heck is Richard Wagner doing as the #1 artist on Amazon’s new MP3 store?

All signs indicate that the Amazon store will give iTunes a run for it’s money as the most popular online music store. First, all the music is DRM free (thanks in part to a feud between Universal and iTunes), and high quality. The site is incredible easy to use, searching for new music is intuitive, and my Wagner download (”Apostles Mean for Small Choir & Orchestra”, I had to hear what the big deal was!) took no time to appear in my iTunes interface. Songs are also variably priced as opposed to the flat $.99 or album only method that iTunes offers.

Yow!

Radiohead (who fulfilled their Capital Records contract with their last release, and are presently “unsigned”) have apparently set up a Web page where one could purchase their new record in digital form at whatever price one wants to pay for it. A physical release is also available, for 40GBP

Check it out:

http://www.inrainbows.com/Store/index.html

A couple of interesting things to consider:

1) The proper physical release streets in December with tons of bonus material:

From www.inrainbows.com:

[start]

This consists of the new album, in rainbows, on cd
And on 2 x 12 inch heavyweight vinyl records.
A second, enhanced cd contains more new songs, along with digital photographs and artwork.
The discbox also includes artwork and lyric booklets.
All are encased in a hardback book and slipcase.

[end]

The package sounds amazing, but thanks to the weak USD, I’d be paying more than $80 for it.

2) The digital release (with less music) is available two months prior to the physical release.

I love the idea from a band in Radiohead’s position. They make the bulk of their income on stadium shows and merch, and they have the name recognition and reputation to pull off a 40GBP package (which has a much higher margin for them as they do not need to split any proceeds with a label). It takes the Stars experiment of breaking street date with their digital release a step further by dropping the financial component.

The Arts and Crafts label is a good example of label that understands the importance of a brand. Much the same as Stones Throw, I know that 9 times out of 10 times I’ll be into what the label puts out. Maybe it’s the fact that more than half the bands on the label have members who play with Broken Social Scene (who are great), but I like to think that they have a particular aesthetic and musical taste that mirrors mine. It makes me want to support them and buy their records/downloads.

Which leads me to the unorthodox release of the new Stars record. Days after the record was mastered, the label released it online, months prior to its retail street date. The following was posted on the bands Website:

Traditional music business practice says we are to begin sending out copies of this album now. We give advance copies to print publications in hopes of securing features that coincide with our September date. We meet with radio stations in hopes of securing airplay. etc, etc.

Inevitably someone will leak the album.

Throughout this process, the most important people in this value chain, the fans, are given only two options - wait until September 25th to legally purchase the new album or choose from a variety of sources and download the album for free, at any time.

We hope you’ll choose to support the band, and choose to pay for their album. However we don’t think it’s fair you should have to wait until September 25th to do so.

We believe that the line between the media and the public is now completely grey.

What is the difference between a writer for a big glossy music magazine and a student writing about their favourite bands on their blog? What differentiates a commercial radio station from someone adding a song to their lastfm channel? or their myspace page?

As such, we are making the new Stars album available for legal download today, four days after its completion. The CD and double vinyl versions of the album will still be released on our official release date, September 25th. We hope you will continue to support music retailers should a physical album in all its packaged glory be your choice of format.

It’s our hope that given a clear, legal alternative to downloading music for free, you will choose to support the creators.

We hope you enjoy it as much as we do.

Sincerely,

Stars and Arts&Crafts

Whether these motives are indeed true, or this was just a really shrewd marketing move by the label…I’m not sure. Arts and Crafts may have a point…I do know that the press are eating the record up, with positive reviews in Rolling Stone, Pitchfork, Stylus and about a hundred million music blogs. Press may be propelled to cover this release more thoroughly as it’s the first time this tactic has been taken. But if every artist did the same, would press be so kind? What if your fan base is less computer savvy than Stars? Will they still be able to find the record if there is no retail or radio coverage? Independent retail definitely holds a grudge when they think they have been wronged (read my Smashing Pumpkins commentary here). Does this even matter anymore?