by David Byrne
Though I have painted it as rather homemade and self-limiting in scale, this approach doesn’t exclude cobbling together the DIY approach with other deals—doing a P&D or something similar to get the physical CDs out, for example, but handling digital yourself. You can mix and match. That combo platter concept is one of the best things about the current environment.
Radiohead adopted a DIY model to sell their record In Rainbows online, and then they went a step further by letting fans name their own price for the download. They weren’t the first to do this. Issa (now known once again as Jane Siberry) pioneered the pay-what-you-will model in 2005, but Radiohead’s move was much higher profile. It may have been less risky for them than it was for her, because they have a huge pre-existing fan base that knows their music and is excited about their output. One of their managers pointed out to me that it wasn’t entirely the altruistic gesture it might have seemed: so many of their fans were sharing files of their records immediately upon release (or sometimes even before) that they couldn’t do worse than the pay-what-you wish plan. If there were going to be so many illegal downloads, this option might generate at least some income from people who had previously paid nothing. As one of Radiohead’s managers, Bryce Edge, told me, “The industry reacted like the end was nigh. ‘They’ve devalued music, giving it away for nothing.’ Which wasn’t true. We asked people to value it, which is very different semantics to me.”
Obviously, not every artist can risk this approach. Even Radiohead’s subsequent record went back to having fixed pricing, but they’re still partly going it alone (they do a P&D deal for distribution of physical CDs). For artists who aren’t so well known, however, there’s a chance that without marketing and promotion no one will ever know they exist. Others will not find the DIY route attractive because they don’t have the time or inclination to get involved in all aspects of the business. It isn’t for everyone.
However, within this model are sub-models. DIY can be done on a relatively small scale. A local band can have their own CDs pressed, sell their downloads, and market themselves via their live shows. A larger percentage of fewer sales is a likely, but not inevitable, result. Artists doing it for themselves can actually make more money than the massive pop stars with a standard royalty deal, even though the sales numbers may seem minuscule by comparison. The debts accumulated paying off label advances and promotional expenses aren’t there in the DIY model, for starters. Of course, not everyone is as smart as those Radiohead boys.
Many new companies have emerged to play various roles in this new DIY universe—Bandcamp, Topspin, and CDBaby all allow unsigned artists to sell their songs as downloads in ways that are less financially onerous than using iTunes or Amazon, both of which charge hefty percentages and have lots of rules. Topspin, which I have worked with, can also sell physical CDs and other things online. They’re not the megastore that iTunes is, so fewer customers are randomly wandering around the shop, but with the help of links from music blogs, reviews, and elsewhere, fans do find their way to buy through these sites. I know I do.
Amanda Palmer of the band Dresden Dolls made a record on which she covered Radiohead songs on her ukulele. She released it on Bandcamp and made $15,000 in a few minutes. Sufjan Stevens’s Bandcamp release got him onto the Billboard chart of top-selling albums. So DIY can be profitable and can move numbers of recordings as well.5
When Brian Eno and I were nearing completion of our collaboration Everything That Happens Will Happen Today in 2009, we decided to give this DIY model a try, though we didn’t go as far as the pay-what-you-wish plan. We’d both been mouthing off about all the new opportunities for artists, and here, we thought, was a chance to find out the truth for ourselves. We had some things working in our favor:
• The recording and mixing of our record didn’t cost all that much for a typical pop record (if one could call it that); besides, we had already covered those costs ourselves, so we didn’t owe anyone anything.
• We have established names and reputations, and we assumed that some folks who like what we’ve done previously might like this record as well. Our sales probably wouldn’t be zero. Beyond that, the curious might even seek out news of the project without us having to pay for a huge marketing and promotional budget. (I was curious about what would happen if there were almost no ads or marketing at all—I hoped the magic of the Web would take care of spreading the news all by itself.)
• Lastly, I have been frustrated by the increasingly long time that record companies say they need to “set up” a record release—the time between delivery of the finished mixes and the time the album lands in stores. This time lag is at least three months, often four. I understand that you’ve got to prime the pump for ages for a blockbuster movie, because if it doesn’t do amazing business in the first weekend it will get pulled from the theaters. But records don’t work like that anymore. With digital distribution one can, if one desires, have the record “out” almost as soon as it is done. The artist doesn’t have to worry quite as much whether or not the distributor actually has the records in the stores. You don’t have to wait for the trucks and the advance copies to arrive—there’s always stock available in the digital store, and shipping is instant.
Our DIY experiment sort of worked. When we had nearly finished the record, I decided that I wanted to do a tour during which I’d perform some of the material. This might draw some attention to the record, as Mac pointed out, but I didn’t think of the tour as a sales tool; I did it because I wanted to have the experience of singing the songs again. Singing them was, to some extent, its own reward. As it turned out, the tour made money.
We had to hire other companies to handle some of the ancillary work: Sacks & Co. in North America and Gareth Davies at Chapple Davies in the UK did publicity; Topspin built the web pages to sell the tracks online in various configurations; Tunecore handled administration when the digital files went to iTunes; Red Eye handled Amazon and other digital download vendors in North America, as well as physical CDs; Essential pressed and sold physical CDs to shops, chains, and online merchants in Europe. That’s a lot of vendors to keep track of! You can see how it might be daunting to an emerging artist.
David Whitehead explained his philosophy toward some of these vendors: “I prefer to get accounted to monthly by Tunecore (as opposed to quarterly by Red Eye), and for a onetime flat fee of twenty-five dollars rather than paying 10 percent monthly fees. The big advantage for anyone supplying the digital service providers [download stores like Amazon and iTunes] direct or via Tunecore, is you get paid monthly. Over the last twelve months we’ve averaged over $3,000 per month in income from iTunes sales on that record.”
Within three weeks of the digital files being available online on our own websites, we sold enough to cover our recording costs, which added up to $49,000, and included travel, the mixing engineer, graphic design, flights, and extra musicians. Based on my own experience, that seemed amazing to me. With a standard record deal, it would normally have taken six months to a year to recoup those costs. And then there would have been other miscellaneous costs to recoup—the music video (there wasn’t one), that open bar after the concert, the car service to the airport.
EXPENSE BREAKDOWN FOR SELF-RELEASED EVERYTHING THAT HAPPENS ($315,000)
RZO Music Ltd.
* Business Management traditionally retains a 5% commission on income generated. In this case, the 5% accrued by business management resulted in 10% of the total expenses related to self-releasing the album.
The charts on the next page give more detail on U.S. and foreign sales. The one on top shows the percentage of total units each vendor sold. Below that is the income accounting for each of those vendors.
SALES BY DISTRIBUTOR FOR EVERYTHING THAT HAPPENS (160,000 UNITS SOLD)
RZO Music Ltd.
REVENUE BREAKDOWN FOR SALES OF EVERYTHING THAT HAPPENS ($1.15 MILLION)
RZO Music Ltd.
Note that although Redeye sold 41 percent of the total u
nits, the income generated from those sales was only 19 percent of the total pie, which illustrates how expensive it is to sell records in stores. Conversely, Topspin only sold 14 percent of the total units, but they generated 29 percent of the total income, largely due to the fact that we were selling deluxe edition packages direct to consumer swithout having to give percentage to retailers.
The $59,850 cost of making this record was only part of what it cost to prepare it for market. All told, the total costs to self-release the album were $315,000—building the website, paying for servers, design fees, promotion, manufacturing, etc. That’s a lot more than any indie band could ever afford. We wound up generating $964,000 in total income. So minus the $315,000 in expenses, that left us with $649,000, 50 percent of which went to Eno, leaving me with $324,500. Since we were the record company, we paid our own mechanicals out of our profit.
I was elated. Here, finally, was the future. I made $324,500 on this “self-distributed” record, compared to the $58,000 I made on the standard royalty-deal record Grown Backwards—and the two sold nearly the same number of copies: 140,000 for Grown Backwards, and 160,000 for Everything That Happens. Wow, the writing is on the wall here! Well, that enthusiasm might be justified if you can afford the $315,000 that we paid to assemble the apparatus needed to make, sell, and market a record. (It should be pointed out that some of those costs were startup, learning-as-you go costs. Presumably they wouldn’t be as high down the road, as the infrastructure has been built.)
Whenever I get too excited about these figures, I need to remind myself that I splurged on the Grown Backwards recording costs, which came in at $218,000. I didn’t have to front that money; it came out of the advance from Nonesuch. The recording costs for Everything That Happens were $49,000, so if I had kept the costs similarly low for Grown Backwards, then, redoing the math, I could have made $167,000 more than I ended up making on that album. My net for Grown Backwards would then have been about $225,000. So in this hypothetical scenario in which the recording costs were equal, I actually would have made only about $89,000 more on the somewhat self-distributed Everything That Happens. That’s still quite nice, and if you amortize that $323,000 over the two years of writing and recording, it’s a “salary” of about $160k a year. Way better than an elementary school teacher in New Jersey. (For the record, I think most teachers are woefully underpaid.)
But if Everything That Happens had been a real solo record, if it had been just me like it was on Grown Backwards, then I would have walked home with the full $626,000 as my net income. Now we’re talking! That’s nearly three times what I made with Grown Backwards, even assuming that that record could have been made equally cheaply. Of course, Grown Backwards would have been a completely different record had I chosen to record with fewer musicians, and Everything that Happens wouldn’t have been the same without the Eno collaboration. It’s really hard to compare records, given all the variables, but you get my point. With this particular situation one could indeed imagine living off sales of one’s recordings via self-distribution. It’s even enough income to allow time for writing—or the occasional flop.
Can this distribution model eventually net enough so that even an emerging artist could live on their own music sales (excluding live performing income)? Could more musicians and composers have a life in music this way? There are no guarantees, but if you don’t need a huge recording budget, tour support, and a big marketing effort, then this approach is worth exploring.
Self-distributing didn’t work as well for me in Europe and in the UK as it did domestically. We didn’t do extensive marketing. I did press, and we gave a free advance copy of one song as an exclusive to some music blogs, but there weren’t the traditional ads and paid radio promotions. In North America, music blogs are replacing print music-journalism. They respond faster to breaking news and to feedback from their readers, and they can link to video clips, streaming music, and websites provided by the artist. Music fans get more and more of their information from the internet in North America, so there was a little bit of a viral effect that happened here without us having the usual expense of ads and conventional marketing. The Europeans in general aren’t buying or reading as much stuff online as North Americans do. Digital sales are generally lower there, and they seem still to look to print as their main source of news. There are lots of countries with varying musical tastes and different languages, so one campaign can’t blanket the whole region as it can in North America.
I toured for about a year after Everything That Happens came out, on and off through 2008 and 2009. The shows were super well received; we all had a wonderful time performing. I made some money from the tour as well, but it was expensive to mount. I examined the receipts when it was done, and if most shows hadn’t sold out, I would have lost money. That’s not a good omen for anyone who isn’t sure they can fill seats. I am still not convinced the tour really helped sell records. Maybe it helped a little, but not, for example, like getting wide radio-play would have. Some songs were played on NPR, and on indie and college stations, but the larger, more commercial stations never jumped on board. That’s not a surprise; the record is what it is. However, well after the record came out, another way of getting the songs in front of people presented itself. And this opportunity highlights a few of the advantages of retaining some ownership and publishing rights.
LICENSING
Another source of income for recording artists is licensing. That means letting a movie, TV show, or commercial use your song in exchange for cash. I don’t license songs to commercials, but I still see more money from licensing songs to films and TV than I do in actual record sales. Those who allow their songs to be used in ads can become instantly familiar to a wide audience overnight—or at least that one song does. This too is a form of marketing, one that is usually completely separate from and unreliant on the record company.
A few years after Everything That Happens came out, Oliver Stone included a substantial number of songs from it in his movie Wall Street: Money Never Sleeps. A fair number of people commented on the fine songs we’d written for that film, not realizing that the record they appeared on had been out for quite some time. That confirmed for me that while distribution is moving online relatively quickly, getting the word out still requires some traditional marketing effort and muscle—and money. For artists without recognizable names, that would have been even more true.
Eno and I might be exceptions, but films will often license a song from a record or band that isn’t that well known. I suspect that there’s a cool-factor at work—many film directors are covert music geeks. The late singer-songwriter Nick Drake didn’t sell a lot of records and wasn’t that well known, but whoever handles his publishing is doing okay. His songs have been used more than once in big ad campaigns, movies, and TV shows.
If you hold on to the rights, and your song is sampled, that, too, becomes a source of income. If a song is sampled by another artist, it’s usually because of a musical or sonic quality, not because it was already a hit. In fact, sampling a hit is anathema, so the obscure artist has a better shot. Even a relative unknown can sometimes find himself with a surprise source of income if his song is sampled, but that income is always more significant for the writer if he has held on to a good percentage of those publishing rights.
The more a writer or band holds on to their publishing or even, when possible, their master recording rights, the more they will benefit from income sources like these—though it might take a while. One licensing deal can provide more income than a whole tour, and certainly more than royalties from CD sales through a label. Often a band or songwriter will feel it is necessary to give away some of their publishing for the cash in hand that will get them through their struggling years, but if you can hold on to that stuff, it turns out much better for you pretty quickly. Musicians often don’t have pension plans, sad to say, so planning ahead can be critical.
Some decades ago, when MTV was doing well, pulling in viewers and makin
g money, the big record labels decided that the commonly held idea that MTV was providing free exposure for the labels’ acts wasn’t acceptable anymore. They began to see MTV reaping profits while the record labels were providing all the network’s content for free. So the labels made deals with MTV to continue providing music videos, but now for a flat fee. The labels said that they would then funnel some of that considerable income back to their artists, but I don’t think they ever did. Eventually MTV played fewer and fewer music videos, turning instead to cheap reality shows, which they could own and syndicate. Part of that change had to be motivated by not wanting to pay the record labels for content.
A similar situation has now developed on the Internet. Lots of websites and apps such as Pandora and Spotify have emerged that stream music to their customers. This isn’t about giving you access to songs you have previously purchased, but rather about hearing music you don’t physically or digitally own. Spotify has reached agreements with the major labels, just as MTV did before them. And just as before, the artist, who should be entitled to a share of that equity, is missing from the equation. Maybe this time around that will get fixed, and if it does then streaming will be an additional source of income for artists—especially if the artists hold on to the rights to their songwriting and recordings. But that remains to be seen.
FREEDOM VERSUS PRAGMATISM
The models I’ve outlined are not absolute. They can morph and evolve. Aimee Mann and her manager initially went the 100 percent DIY route, but they eventually made deals with various distributors to get their records into retail outlets.
