TO RECORD EXECS: I told 3 people in the Nashville record industry my prediction that by the year 2000 there will be "significant" artists choosing NOT to sign a record deal. They could not comprehend such a dramatic change in the way the industry works.
Artist someday will opt to sell direct to their fans via the internet. Fans could log on to the artist's website and get their current tour schedule, photo gallery, buy tour shirts, buy most recent recordings, buy other collections, buy video, sign up for fan club. The extra money will help pay promotion, tour expense, etc. and bring PROFITS.
When a smart lawyer explains how much more money an artist could make over his record deal, the artist will have a choice.
NOTE: Before any record execs put me on their black list, this move is inevitable. I am merely the messenger. I am serving the industry notice that this WILL happen. Part of my concern is that the industry could be blind-sided and not prepared. That would be bad for us all.
The CD suit was a big enough blow to the industry. I suggest we prepare now for these and other changes on the horizon.
Artists traditionally receive small percentages of record sales, most of which is paid back to the record company for advancing them recording and video expenses. At 0.25 per CD sold, it takes an awful lot of sales to pay back a 250,000 advance. A million copies, to be exact. Whereas, at a modest 5.00 per CD sold would only take 50,000 copies to raise the same recording/video fees [250k].
At 13 bucks a sale, it is feasable to see a 10 dollar net, when selling directly at full retail. That is a significant difference. Warning: Do not underestimate the power of boutique sales and grassroots direct retailing via the internet.
How long do you think it will take for popular bands lawyers and managers to figure this out? Don't be caught unexpecting. That would hurt the industry at large. My suggestion, is for record companies to make plans now using the internet and band web-sites as a marketing medium. And I would further suggest increasing the points paid to artists for these sales that cost less per sale made. Keep your artists happy, they now have an alternative.
High-bandwidth internet is just around the corner. Nashville already has At Home Network running at 800kps. This is plenty fast enough to not only send out real-time audio, but the music video, too. As I said in the introduction of this thread, EVERYTHING WILL CHANGE.
Rande Is |
