For almost 30 years I have been a participant in, and an observer of, the music business. At one time or another I have touched every aspect of it: songwriting, record production, publishing, contracts, performing rights, publicity, radio promotion, booking, touring, marketing, sales and distribution. I don’t hold myself out as any kind of authority or expert; I have simply, by the nature of my relationship with the industry, seen and observed a lot.
Today, dedicated artists and small business people struggle against tremendous odds, trying to preserve music that is diverse, that has feeling, that respects tradition, that is not formulaic — music that is from the heart. The face-off against this struggle is the growing dominance and control of corporate America, where profits trump art.
We live in a capitalist economy. It has survived as the only viable economic system in the world because it is the only system that is predicated on human nature — people’s innate greed, ambition, and self-interest. People simply were never good enough to be socialists or communists, and those systems failed.
Corporate capitalism relies on creating predictable, programmable consumers. Corporate America wants everything reduced to a manufacturing formula: Keep it simple, make it uniform, don’t ask people to think too much, don’t give them too much information. Risk is associated with individualism, uniqueness, and knowledge; they are unpredictable. Yet to create something unique — anything — you must take risks. It is this quality in great art that moves us, for the human soul yearns for freedom.
In the not too distant past there was no music industry. Musicians and storytellers performed as part of religious rituals, or as a release from day-to-day exigencies. Only in the late 1920s, with the dawn of radio and affordable phonographs, did popular music became a viable business.
Less than a century later we stand at a new technological crossroads. With the advent of digital media and the internet has arrived a whole new class of young people who seem to feel that music should be free. They have little understanding or care as to what went into its creation or how those who devoted their time and talent to producing and distributing it might make a living.
Even the major music imprints are now struggling, albeit for various reasons — bloated overhead, overpaid top executives, old business models, lack of leadership, digital piracy, and simply producing bad music. Regardless, it is a tough time. Distributors and retailers are going broke and dodging bankruptcy.
People cannot devote their time and talent to something at which they cannot make a living. Music companies, large or small, cannot invest their capital to manufacture and distribute music where there is no return and no profit.
Without the ability to make a profit, new music could cease to exist, except in the most local and entrepreneurial forms. Perhaps music will once again become simply a hobby, and we will be left only with a trove of old music on internet swap sites.
At the same time, the major music labels have been in demographic denial. Today one person turns 50 in the United States every eight seconds. This goes on, without stop, for the next twenty years! This is the first generation of 50-year-olds raised on high-fidelity sound. Music was and remains an important part of their lives. Yet the major imprints still cling to the youth market, where monolithic peer pressure can manufacture million-sellers; but this is also the demographic where piracy and friend-to-friend “file-sharing” — another word for theft — is most rampant.
On the supply side, advances in recording technologies are shrinking recording costs. You no longer need an expensive studio filled with a million dollars worth of equipment to make a quality album today. All one needs is a computer, some software, and a room full of good microphones. Anyone can now afford to have a website, and anyone can now afford to make a CD — and a plethora of bad music is being released because of this. The supply is increasing, while the demand is shrinking. In economic terms, that means the price of the oversupplied product must decrease.
The key is still marketing and promotion, and that takes lots of capital, and/or years of touring and starving as an artist. The major labels are still, at least for a while, the investment bankers of this industry. They own vast catalogs of proven sellers, and they are the only ones with the deep (though dwindling) pockets necessary to develop and exploit talent on a grand scale.
The major labels desperately need to marshal those resources to once again become engaged in artist development — supporting dedicated, talented acts over a number of releases, and not just counting on a lightning blockbuster.
Consider Bob Dylan’s career. The late John Hammond Sr., the legendary producer, told me once that those who ran Columbia wanted to drop Dylan from the label after his first couple of albums. How many recordings was Dylan selling then, and how many is he selling today? How long did it take him to get where he is today? An entire lifetime, a 40-year career! John Hammond’s vision, however, is still generating profits for Columbia (now Sony) decades after his death. Where are the label executives with that vision and patience today?
Developing artists takes time. First the majors must solve the piracy problem, which is going to require some form of encryption, plain and simple. Once they regain control of their product, they will have to begin working the niches, just as the small independents already do. They will have to trim their bloated overhead, and they’ll need to adjust recording budgets to reflect the economy and added productivity of the new technology. Instead of having a few expensive acts selling multimillions, perhaps they will need to sign a hundred acts who are selling 10,000 to 100,000 copies.
The problem with corporations, however, is that by their very nature, they cannot be run by patient men. Capitalism is not patient. But this will have to change from the top down in the music business, or the industry will cease to exist. Technology will not stop, and the demographic curve is cast.
The third certainty, which may well be our salvation, is that the need for music will never disappear from the human heart. It is part of the rhythm of the stars and the universe. People will seek it out, as they must. People need the stories, people need the beat, and people need the inspiration. The structure of the business may change; the delivery system may change; many people may go broke in the process. But when the dust settles, the drummers will drum and the singers will sing, whether they are paid or not. That’s the magic.
