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Originally Posted by kane
FACT: Record companies fuck over artists on royalty payments. They often have to audit the books and many artist never see a dime more than their advance no matter how many albums they sell. Why do you not see a ton of artists speaking out against piracy? Because they don't care. They know they aren't going to get paid much if anything for album royalties to begin with so people downloading the record doesn't effect a lot of them.
FACT: These same artist make most of their money off of publishing royalties, radio performance royalties, touring and merchandise sales. It is not uncommon for an act to do $15 per person in merch sales at a concert. So if they sell 1,000 tickets the merch sales just put another 15K in their pockets (less expenses of course)
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agreed but the problem is these establish artist have paid their dues, and can now leverage their fame to make way more money using the new technology.
think of like your sales funnel, you take the losses in the begining (loss leader) or give away most of your profits on the original sales, to build a customer base that you can sell higher profit items too. Or do repeat sales more cost effectively.
That business model would work .... if the RIAA didn't use the money they ass raped you out in the begining to sue the new technology into oblivion.
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FACT: I have said before and will say again bands like Radiohead and NIN are terrible examples of the free download working brilliantly. Why? Simple. Record companies have spent years, thousands of hours and millions of dollars marketing these bands. These bands have toured for years while enjoying the support of major labels that can get them on the radio, on MTV and in the best venues in the world. Job Bob's Garage band doesn't get that and even if Joe Bob's garage band is supremely talented it takes a lot of effort to get noticed so until they do they will continue to play for 20 people in a bar. Radiohead has millions of fans that they have built up over many years and while the bands talent and brilliant records are ultimately what keeps the fans coming back, many of those fans first discovered them through MTV or on the radio or in a magazine or some other media device that most likely was paid for by a major record label.
Think of it like this. If you were a bestselling author that had many major big selling books many of which were made into very successful movies then you decided to put up a book for free online the media would jump all over it and you would get a ton of downloads. Why? Because everyone knows you. How? Because when you started out the publishing house put a lot of time and money behind marketing you.
If JK Rowling puts a book online there might be so many downloads it could crash the server. If unknown writer #2 puts his new book online tomorrow, nobody would notice.
Radiohead is not the norm. NIN is not the norm.
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of course we are starting to see example where unknown artist are making money leveraging the technology.
http://en.wikipedia.org/wiki/Jonathan_Coulton
sites like eventful.com allow you to vote for an artist to show up in your town. Those sites collect your email (so you can be informed about his upcomming appearance) and keep stats (so sponsors know how many potential fans would be comming to see the show)
it starting to get there. You could make a better living, selling less stuff (because of the freebie leachers), for a bigger percentage.
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Yes, the record companies are unfair, but it is a trade off. The successful bands make a lot of money touring and the record industry keeps most of the money for album sales which allows them to sign and market new bands or continue to market existing bands.
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but that the point, if that was what they were doing the bands would have no problem with them. The problem is they are using those profits to KILL the distribution channel that will free the artist from the unfair deal. They are using that money to try and destroy the network which (once famous) can easily make them an order of magnitude more money. And which is evolving to be an alternative marketing vehicle to the unfair record contracts.