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Comment by jakejake | Hacker News Reader

This is exactly how record deals work as well, I can tell you first hand. The added kick in the nuts which isn't even mentioned is that if the project starts to come close to the level of profit where the artists would get payment - all the studio/label has to do is spend more money on additional, marked-up promotion and the project goes deeper into "debt."

Why would they bother paying the artists, when instead they can invest that same money on a 2nd round of advertising? From their perspective it doesn't make sense to ever pay the artist. The only time they do is if the artist gets really pissed off, has some clout and the studio/label wants to keep them happy. If all three of those things happen then maybe they'll get some crumbs.

The moral of the story is, unless you have the kind of clout to make your own deal, make sure you get a satisfactory amount of money from your advance (up-front payment).

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I truly look forward to the day when supporting (by paying real money) individual creators and independent teams for music, movies, animation, games, and books will be commonplace in the general public. In tandem, I hope that this will spur great creations to come forth that are not bound by the traditional red tape and truly messed up business models of today's media businesses.

Such a world will require a lot more independence and proactivity from us the consumers (which we are frankly not accustomed to at all right now), from the extra effort needed to engage in "discovery" and in realizing how much of an impact each consumption & purchasing decision can have on the lives of each creative person we choose to support; but such a world will have far more diversity and niche options than we currently see today, which would be a truly amazing future.

I can see things starting to go in that direction - the tech industry is always on the bleeding edge, and things like kickstarter is only going to become more and more mainstream.

For example, a band could kickstart their own record/tour by asking for crowd funding. These sorts of funding means that they aren't somehow tied up by commercial record companie's business tactics which would obviously benefit the record company, and not the actual person/group making the creative work. This way is the way forward, as surely as water falls off a waterfall.

You mean going BACK in that direction. All (or most?) art used to be directly commissioned.

All or most commercial art, certainly. I wouldn't be surprised if most art has always been done by amateurs.

Oh well yeah, that was implied.

Yeah, I just thought it worth calling out explicitly.

Quite a few artists/bands have crowdfunded albums on pledgemusic (http://www.pledgemusic.com/). This seems to work reasonably well for established artists that already have a decent fanbase but I'm not so sure about how well it would work for a band that doesn't have a group of loyal fans to turn to.

I agree completely. I've reached a point where the only music I buy is from Bandcamp, where I can choose how much to pay and the money I do pay goes directly to the artist.

Maybe someday this will become a more mainstream phenomenon and it will spread to other media. I can only hope.

What do record labels bring to the table now? They provide the capital to record an album (or at least the studio that can record it), and a complex distribution channel to get albums on shelves and tracks on the airwaves.

The distribution channel is slowly being eroded by the Internet, where a band with the right mix of music and self-promotion can get their music in front of half the planet for the cost of a Wordpress template and some solid hosting.

Getting music on radio and raising the initial capital to get a studio album made are the two missing pieces of the puzzle, but I strongly suspect the Internet will fill those gaps competently in the next few years, as crowd funding reaches maturity and old media like radio realises they don't have to deal with the major labels directly any more and can find new, popular music with a few google searches.

There is such scope for a startup working in this field. You could host and sell albums on behalf of bands, offer a crowd funding model for those who need to raise the funds to record, and build relationships with radio networks to funnel new music their way once a band has reached a certain threshold of community appreciation or some other relevant metric.

The record industry is almost universally loathed, it just seems so ripe for disruption.

Production costs are rapidly approaching zero. Both the equipment to record, and the skills to manage the recording and mixing process, are much cheaper/easier than they were. The current #2 album on the Billboard 200, Macklemore and Ryan Lewis' "The Heist," is completely independently produced.

What do they offer? An ungodly and unparalleled level of marketing. Any artist can put their music on iTunes but nothing organic can ever compare to a $200 million media blitz.

"Popular" music will always be predominantly influenced by deep pockets. Not exclusively, but damn near close.

Yep, and the record company pockets pretty much every dime of the profit. As a musician you're counting on concert tours to pay the bills. Even wildly successful musicians who are still on that first contract.

But if they are pocketing all that money... what do they offer besides more exposure? You make it seem like artists get nothing out of the deal. If the labels are just providing exposure, what does the artist get?

The exposure is all they need to offer. More exposure will lead to more concert ticket sales and merch sales. With the modern '360 deals' in which the label now takes a cut of those things (because of declining record sales) exposure might not be enough anymore.

>Why would they bother paying the artists, when instead they can invest that same money on a 2nd round of advertising? From their perspective it doesn't make sense to ever pay the artist.

Because eventually word gets around. Especially these days with social media, minor celebrity bands who end up with nothing have a forum for their complaints.

Unfortunately many young artists are literally begging labels to make them famous. They assume that money comes along with that, but its not necessarily the case.

I was one of those people once and got a fairly standard (crappy) deal. We're still 6 figures in debt to the label even though the records made a profit.

>> "Unfortunately many young artists are literally begging labels to make them famous. They assume that money comes along with that..."

Half of your statement is true, most if not all young musicians want to be famous (and by that I mean have lots of people listen to their music and see them play). I don't think the second part is completely true though. Most musicians do what they do because they love it and as long as they can make enough money to buy them food, a bed, and get them to the next show, they will be satisfied. People are familiar with the bad reputation labels have and are aware it is not always a road to riches. I think there are very few people who get into music for the money, frankly because the chances of you making a lot of money in it are unlikely. If you want to be rich there are much easier paths.

Don't forget that many bands consist of kids in their late teens and early twenties who might be more naive than you are and who may not have a full understanding their chances of making it big vs getting screwed over.

Well you are correct that some bands are only "in it for the music" but in fact that attitude can get you screwed even harder when you're negotiating with a label.

A lot of musicians are comfortable with a meager living - but not too many of appreciate being poor while the label is raking in cash. But, that's the reality of it. A big label has the power to get you in front of a lot of people and make you famous. It's better to build up the fanbase on your own in the long run, but that's a tough road and many, many artists are eager to accept the shortcut in exchange for a crappy deal. That's just the way it is.

Word is already around. Steve Albini laid out how record company accounting works in the early 90s in his essay "The Trouble With Music". The most cursory research would show you that as an artist signed to a major label, you're unlikely to ever make minimum wage.

That doesn't matter to the labels, because there's a sufficiently large stream of starry-eyed wannabes to keep the wheels in motion. The labels simply don't want to sign the sort of band that's happy to have a small but loyal fanbase, because they can't make any money out of it - like tech VCs, their business model is based on signing a lot of long-shots aiming for global domination.

Honestly the modern moral of the story is bandcamp or indiegogo or kickstarter or some other service. I'll be the first to say it is going to be much MUCH harder than taking a record deal but we do live in a time where its possible to stay away from the big industry folks and strike gold (or out) on your own.

I wonder what it would take to set up a "recording studio as a service" type place that would handle all the tech stuff for a band and let them do promotion themselves, free from label control?

They already exist all over the country. I know a couple of people who own full recording sets and rent it out. Many musicians and techs make a decent supplemental income, and a few make a living, off of working with bands to record.

The record companies real problem with filesharing is that they feel that not paying musicians is their own special prerogative and it annoys them for everybody else to be getting in on the act, especially in a manner so unprofessional that it doesn't even bother including absurdly written contracts.

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