Bandcamp; how the online world has changed how music is released in the 21st century

Introduction

2008 was the year that saw the iTunes store become the largest music retailer in the USA, selling over four billion recordings, to fifty million customers, from a library of over six million songs (Apple, 2015). Although this success has helped claw back some of the revenue lost through illegal file-sharing, it has rendered many of the older business models favoured by major record labels redundant. In 2015, outside developers like iTunes and Amazon dictate the price points of recorded music sales in the on-line world, and the hangover of piracy now means there is a difficulty in getting people to pay for music at all (Harrison, 2014, p. 184).

One way that artists are taking matters back into their own hands is through “direct to fan” services that cut-out traditional record label deals, and allow artists to sell music direct to their fan base. The artist can dictate the price-points themselves and then make digital music and/or physical products/merchandise available online on specific websites. The most prominent of these platforms is Bandcamp according to Wiksteed Reports (2015); “Consider the service offered by Bandcamp as a benchmark for feature-rich DIY/self-serve platforms.”

This report will look into the various positive and negative aspects of the direct to fan business model, using Bandcamp as the main focus, and suggest what ways it could improve its services to both creators and consumers of music. It will also look to assess the viability of this business model in an attempt to decipher its place in the contemporary music market.

A Brief History & Bandcamp Today

Bandcamp was started in January of the same year that iTunes became the biggest music retailer in the USA, as part of a solution to the problem for new and unsigned artists creating their own website. Online music streaming players were hard to include on websites in 2008 and Bandcamp founder Joe Holt decided that this was a problem that needed solving. Holt’s (2008) goal was to “Try to let musicians explore new business models themselves” so that artists could have the ability to sell their music online independently, but hosted through Bandcamp’s servers.

Bandcamp (2015) has the tools for artists to sell recorded music, merchandise, physical releases on any format and just about anything else the artist can think of at the price they choose. Because of this level of freedom, the site has gone from strength to strength and has been highly praised by Emily White (2014) “what Bandcamp is doing makes the most sense for fans, artists and the industry at large with regard to modern music releases“.

The successes of the site can be seen clearly when Burton (2015) stated that in 7 years of business, Bandcamp has paid out over $100m to artists, averages 16,000 album sales every day and pays the vast majority of their $3.5m monthly revenue straight back to the musicians hosting content on their site.The site itself takes a 15% commission on each sale which drops down to a 10% commission once an account has hit $5,000 in overall sales. The site is mainly for niche and independent artists though small labels have set-up pages for their acts as well. This is because the site and orders are fulfilled by the artists/labels themselves, which gives the service a community feel, but this may not be viable for larger artists or labels according to Wiksteed Reports (2015).

Along with a recently introduced mobile phone application for fans, the next stage of development for Bandcamp is to offer artist specific streaming services. Consumers will be able to subscribe to an act and be given access to their back-catalogue of content, merchandise discounts and exclusive unreleased material. All of this will be at the artist’s discretion because, as Bandcamp CEO Ethan Diamond (2014) stated; “We want Bandcamp to be an important part of how any artist develops a sustainable career, and subscriptions can be a big part of that.”

The direct to fan market place

One of the other significant players in the direct to fan market place is Music Glue, another site set-up as a reaction to the post-Napster era music industry, though their philosophy on recorded music revenue did differ somewhat to Bandcamp’s when it started. Mark Meharry (2009), Music Glue’s founder, stated that “music is moving away from being a retail product – to what we refer to as ‘content’. And content is not necessarily something you sell”. This philosophy has since been adapted though as they now offer digital music to be sold on their site in the same way as Bandcamp does. Music Glue’s (2015) service is also slightly less expensive than Bandcamp’s, as they only ever take 10% of any sale. Bandcamp takes (2015) 15% of every sale until an artist hits $5,000 in overall revenues, then they then decrease their cut to 10% of further sales.

Music Glue has been endorsed by acts the size of Mumford & Sons, who have used the service to sell concert tickets. This was to bypass the secondary ticketing market that is damaging the live music industry and sell direct to fans, in order to avoid tickets being resold by third parties at overly inflated prices on a non-regulated free market (Reynolds, 2012, p.132)

Another alternative to Bandcamp is a service called Topspin (2015) that has worked with Pixies, Tyler the Creator and Interpol in their campaigns. The service provided by Topspin is subscription based with no free tier and a minimum commitment of $9.99 a month going up to $49.99 depending on requirements. Because of this, the platform is more suited to established artists where bespoke sales, marketing and ticketing can be collated together in an interface that is tailored to specific artists.

It is easy to see why more established acts are choosing to go down the route of direct to fan services to interact with their fan-bases when looking at the potential to be made from CD sales through this platform. A CD sold direct to a fan through a bands website, Bandcamp/Music Glue page, or Topspin bespoke sales solution could earn up to ten times more than one sold under a traditional label deal (Riches, 2012, p 193).

The premise of direct to fan services has come under criticism though, as some believe that it is only the artists that already have a significant following will be able to use the technology to its full potential. Berger (2013) believes that “without a very consistent fanbase, a serious work team and a strong marketing and media broadcasting basis, things won’t get very far.” Perhaps the main goal for direct to fan services is to bridge this gap and develop effective tools to further an artists reach, not just enable them to shout louder to those already listening.

Aggregators and Streaming services

One of the downsides to the direct to fan approach is that it ignores the need to have music available for purchase/streaming on the sites of major retailers like Amazon, iTunes and Spotify. For independent artists to place music on sites like these, they need to go through a third party service called an aggregator. CD Baby for example, communicates with the retailers on the artist’s behalf and accounts to them in exchange for a fee for their services. The service it provides has been touted as “the grandfather of all online toolsets for music artists” (Baskerville and Baskerville, 2013, p. 411).

CD Baby (2015) also offers the ability to press artist’s CDs for them and the options are there to add customisable store fronts on web pages and social media sites. CD Baby then accounts to the artist weekly as items are sold/streamed through every site they are available on. This could be seen as an advantage over Bandcamp’s services as all the revenue is kept in one place and physical items can be manufactured and distributed through this service.

The cut CD Baby takes is far less than a record label and the music is distributed to all of the same places. On the other hand, figures show that an unsigned artist has the potential to earn more through Bandcamp’s platform than CD Baby, as the 33% royalty cut CD Baby takes is double that of Bandcamp’s initial 15% cut of an acts sales up to $5,000. Bandcamp then reduces their cut to 10% after an act hits $5,000 in revenue, which means CD Baby’s services end up costing over three times the amount of Bandcamps. (Information is Beautiful, 2015).

All of these services offer alternatives to musicians that would rather not or have not been offered the chance to sign a record deal, but just because they are alternatives, does not necessarily mean that they are the way forward. Industry mogul Simon Napier Bell (2014) told Music Week “The thing is [independents] do need the marketing corporations… if you look at the Top 20 charts on both sides of the Atlantic, it’s all major record companies. They’re not dying.”

This is further backed up by the IFPI (2015) report on digital music which found that the 10 largest selling acts of 2014 were signed to labels owned by one of the three major record labels; Sony, Warner or Universal. The IFPI (2014) also found in their investing in music report that it costs between $500,000-$2,000,000 to break a new act in a major market and that more than $20billion was spent by record labels on A&R and marketing artists between 2009 and 2013. If this is the true cost of global success, it is no wonder that major labels have a firm grip on the upper echelons of the industry. An independent artist is unlikely to have huge funding to kick-start their early career and this is why the direct to fan model has not resulted in a paradigm shift, where every independent artist can become instantly successful (Spitz, 2013).

Crowdfunding

One of the ways a new or established artist can bridge this funding gap in the run up to a new release campaign is by approaching a crowdfunding site like Kickstarter or Pledge Music. Pledge Music identified a revenue gap that was also highlighted in a Nielsen Soundscan report. The report found that there were 6 different types of music consumer and that the industry was losing up to $2.6billion by not servicing the most passionate of those consumers (Peoples 2013). Pledge Music allows fans to be involved in the process of making an album, by funding it before it is released, and are then given access to exclusive content in return. Pledge Music’s CEO Benji Rogers (2013) believes it empowers fans to “have your super fan experience here [Pledge Music]” and that it goes someway to meet the demand not met by the industry. The service allows fans to pledge however much they want and provides the tools for artists to monetise anything from a private party with fans, limited edition merchandise or just simply a digital pre-order of the new release (Rogers, 2013).

Pledge Music’s services are specific to the music industry and are therefore tailored to suit musicians but Kickstarter’s services vary slightly and are open to film and tech companies as well. One of Kickstarter’s music success stories was Amanda Palmer, who used the service to fund the release of a solo album and reached $1.2million (Lindvall, 2012). On the other hand, there is also Bjork’s failure using Kickstarter to try and convert her innovative Biophillia application album for Android and Windows platforms. The project aimed for £375K in 30 days but was taken down from the site after just £15.4k was raised in 10 days, only 4.1% of the goal (Dredge, 2013).

The Bjork story is particularly interesting as one of the main criticisms that has been levelled by Berger (2013) at the direct to fan platform is that it will only work with established artists that already have a fan base, which Bjork certainly is. The money was for a conversion of an already existing product to another format for educational purposes and so is a process that may have less fan interaction than the making of an entirely new album. This example instead suggests that it is artists that use the platforms in a relevant way that engages fans or potential fans on a personal level that will get the most out of the direct to fan area. This idea echoes Wikstrom’s theory of creativity as consumption that suggests artists need to be more able to respond to their fans creative desires. By doing this, artists can turn “the fans creativity into their own consumer proposition… build a business with low churn and high average revenue per user” (Wikstrom, 2013, p.179). The tools that direct to fan services offer allow this creative consumption method to flourish, and is something that could be embraced by acts of all sizes in the future.

Where is there room to improve at Bandcamp?

Brian Solis puts forward the idea that it is no longer content that is king but it is instead the context that we consume it in. He states that “we must invest in the calibre of our relationships as well as the calibre of the content we consume, create and share. The answer to what consumers value lies in context” (Solis, 2011, p.35). Although this is true of the general public, the services that direct to fan sites provide mean that it is the artist that is defined as the consumer, as they are the ones giving a percentage away to the platform.

This is why the context part of Solis’s ideology is so important, because all the direct to fan providers are giving artists is the “context” in which the artist can sell and distribute their “content” to fans. If Bandcamp can ensure that the window they give into an artist’s world is more transparent than any other service then it will thrive. Ethan Diamond (2014) told the Guardian; “We’re trying to create a channel for artists and their biggest fans where they aren’t having to compete with the other things”. By becoming the best way for fans to interact with artists, by making sure the relationships between the two are strongest on Bandcamp’s platforms, it can ensure that the artist is getting the best available platform to display their content.

The issue that this does not address however, is the problem of direct to fan favouring larger artists with already existing fanbases gained through traditional marketing approaches. Rapper Ryan Leslie (2014) is in the process of creating what he calls “the first direct-to-consumer record label” which aims to solve this problem. Leslie was signed to Motown in 2008 but the royalties from 180,000 album sales didn’t cover his $100,000 advance, yet his self-released album sold 12,000 copies and brought in $160,000 in revenue. This is why he hopes to create a label that would provide small marketing advances for independent musicians with an app filled with massive amounts of data-collection and interpretation tools, in return for a 20% stake in their revenue (Holmes, 2014).

Leslie’s story proves the theory put forward by Passman (2012) idea that ”For a record deal to make sense, the record company has to generate more money for you (after they take their piece) than you would get by selling less product on your own” and although it is not a final solution, it is an interesting premise. This could be used as inspiration for Bandcamp to partner up directly with a music marketing specialist like Essential Music Marketing who work with labels such as Innovative Leisure, Cooking Vinyl and Fatcat Records (Essential-Music, 2015). This way Bandcamp could offer a premium service for acts (similar to Topspin’s services) and could seek to break acts into larger markets whilst letting artists retain all of their rights. As a way to help artists with upfront cost of this service, the marketing choices would be as tailored to the artist as the website platform they provide. Acts would be able to choose how they paid for the marketing costs; it could be as an advance against future earnings, as a higher royalty percentage taken on sales for a given period of time, or even as a reward for significant sales figures if a particular artist is utilising the tools given to them effectively.

Conclusion

Global recorded music industry revenues fell to under $15billion for the first time in history in 2014 as a result of a decline in both physical and digital sales (IFPI, 2015). This fact makes the findings of the Nielsen Soundscan report that there is up to $2.6billion being lost by not servicing music consumers in the most effective ways even more relevant (Peoples 2013). Direct-to-Fan services allow artists to adapt their pricing strategies in ways tailor-made for their fan base. Arguably, this is a service that labels cannot offer, as they are effectively a middle man between the artist and the consumer. The way that services like Bandcamp and Music Glue are breaking down the barriers put up by record companies is an area of much debate and one that still needs much exploration. This is because major record labels investing in marketing campaigns from deep pockets is still currently the way to grow acts on a large scale to a mainstream audience. However, if the services that direct-to-fan platforms provide can find a way to turn their artist’s revenue generation into marketing spend, or partner with people that can do it for them, then the shift in paradigm that was initially promised by the music press may yet happen (Berger, 2013).

Reference List

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Holmes, D. (2014) ‘With the help of Ben Horowitz rapper Ryan Leslie wants to reinvent the record label for the new music economy’ Available at: http://pando.com/2014/11/20/with-the-help-of-ben-horowitz-rapper-ryan-leslie-wants-to-reinvent-the-record-label-for-the-new-music-economy/ (Accessed: 15/04/15).

 

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Sptiz, J. (2013) ‘Direct to fan holds much promise, Many problems. Interview with Jason Spitz. Interview by Kyle Bylin for Hypebot.com, March. Available at: http://www.hypebot.com/hypebot/2013/04/the-promise-of-direct-to-fan.html (Accessed: 15/04/15).

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In 2015, is there a future for the entrepreneurial artist manager? – 23/03/2015

Introduction

The battle between creativity and commerce is one that every artist will encounter when they start to attract interest from the public. The resulting commodification of that artists work then has to be dealt with professionally and securely. This is the role of the Artist Manager, to plan strategically in order to best exploit and generate interest in their client/s whilst keeping every single aspect of their careers closely monitored (Harrison, 2014, pp.31-61).

The variety of different business deals and problems encountered by managers has changed vastly over time in an ever shifting industry driven by technological change. Artists are now able to create music themselves without the need for label backing, on modest costs, using readily available yet highly sophisticated equipment. Social Media then allows artists to build a fan base for little or no cost and earn a sustainable wage through online distribution (Evans, 2014).

This situation has led to questions being asked of the value of the artist manager in today’s market, and if business savvy artists need someone behind the scenes pulling the strings. This essay hopes to find the way forward for artist managers in the 21st century in an attempt to find their relevance in today’s industry.

A brief history of Artist Management

Throughout the 20th century, artist managers have been centre stage with people like Malcolm McClaren, and Peter Grant grabbing almost as many headlines as the artists they represented. One of the key figures in this period was manager of The Rolling Stones, Andrew Loog Oldham, who details a shift in management style from the mid-sixties; “In the ’70s, a different kind of manager was required — a hard-nosed money collector. Acts had their own vision. In the ’60s, we provided them with that vision.” (Loog Oldham, 2014)

This could certainly be said of the heavy handed approach by Led Zeppelin’s manager Peter Grant. He became famous for his intimidation tactics towards bootleggers, and his fierce negotiations with promoters leading to a 90/10 split in Led Zeppelin’s favour on tours (Allen, 2014 pp. 31-46).

However, the situationism applied by Malcolm McClaren in the making of The Sex Pistols, that impacted on the whole UK punk scene, was closer in approach to that of the vision led managers of the 60s (Simpson, 2010). The “Svengali” managers of the 1960s were exemplified by London star-maker, Larry Parnes. Parnes took working class youths, dressed them up in flamboyant clothing and had them sing interpretations of American rock’n’roll music under exciting pseudonyms such as “Billy Fury” and “Vince Eager”. The “Svengali” approach to management can still be seen today with the successes of Simon Fuller, which could point toward this management style being a way forward in the contemporary market (stratobuddy, 2010).

The Decline of traditional Record Labels in the 21st century

The decline in revenue from recorded music sales has led to a shift in management priorities as managers feel that their influence extends far beyond their now industry standard 20% commission on the contractually stated areas of Recording, Publishing and Live income (Riches, 2012 pp. 24-28). As the industry moves forward, managers are looking at different ways to earn a living from artist’s successes, especially as manager’s work for the artists and could potentially be fired at any time so need to protect their own interests. One of these ways is to enter joint ventures with prospective artists and start businesses together, instead of just signing a traditional management contract. This would involve co-ownership of any available rights with the artist in question. This may work in some circumstances, but artists should be wary of any such deal, especially when major labels also look to take a share of all available income with 360 degree recording deals (Riches, 2012 pp. 15-17).

In the 21st century, the lines between the services offered by labels and managers will potentially become more blurred. The merger between Cooking Vinyl and Music Manager John Black to create Black Gold management is just one example of how labels and managers are forming partnerships. This particular deal will allow the management company to benefit from the A&R (artist & repertoire) and marketing departments of the label at an early stage but leaves the company free to partner artists with other labels/publishers should they see fit (Music Business Worldwide, 2015).

Simon Napier-Bell sees the role of the manager now as a developer and part A&R man. In an interview with music week, Napier-Bell argues that major labels are still the power players in the music industry holding most of the places in the top 20 in both the USA and UK. He also goes on to say that the way the internet has allowed artists to grow and develop without major label backing is a positive thing for the industry as in his opinion “Artistic development was always better in independent hands, rather than corporate, so it’s actually a big step forwards” (Napier-Bell, 2015). If this is to be the way forward, perhaps the re-evaluation of the management role is fair, as they are becoming more crucial in marketing an artist’s output at the earliest stages of their career. If this relationship is to become the norm however, it is of vital importance that the legal principles are correctly observed. Potential production and/or recording contracts offered by management companies must protect artist’s creative work. They cannot allow managers to “double-dip” by taking a percentage of revenue from a single source twice, once as a manager’s cut and then again as the label/publisher (Riches, 2012 pp. 15-17).

Established artists do now have the ability to bypass the major labels/publishers structures completely, and retain the rights in their compositions and recordings by utilising label services groups such as Kobalt, who have financial backing from tech companies the size of Google [Ingham, 2015]. Jazz Summers proves the importance of the alternatives Kobalt offers as he was able to reduce the percentage taken by a record label on one of his artists live income from 20% to 12.5% through the threat of using Kobalt over a traditional label deal [Summers, 2014]. The transparency offered by Kobalt through the use of data that can track royalty payments over 700,000 revenue streams is a tantalising prospect for the 21st century manager and one that could put him centre stage in his artists career, accounting to them like no record label has previously been able to (Collins, 2015). 

The importance of Brand Creation

In the modern music industry, Patrick Wikstrom proposes the idea that the importance of how people interact with the online world lies in the context and not the content of its services. He states that Spotify’s success is down to “the service’s features and structure are superior to those of its competitors” (Wikstrom, 2013 pp. 177) While this may be the case in the online world, the same arguably cannot be said for one of the music industry’s most entrepreneurial projects of recent years. Tyll Hertsen (2011, quoted by Martin, 2011) declared “Beats” headphones by Dr. Dre as “among the worst you can buy” yet the company’s sale to Apple in 2014 was worth a reported $3 billion (Moore, 2014). This is a perfect example of how a fresh idea by an artist that is branded correctly can make waves in the modern music industry. The product identified a gap in the market for fashionable and high quality headphones to be worn as a statement that people latched onto (Martin, 2011). This same model can be seen when looking at Simon Fuller’s success with The Spice Girls and S Club 7 who was quoted in a 2003 guardian article stating “I reflect what’s out there, and if there’s a demand for something I recognise it.” (Fuller, 2003) Fuller’s success went on and spread into the realm of television with the huge brands of Pop Idol and American Idol and all of these point towards the importance of brand power in today’s industry.

Josh Brandon from Insanity Management believes that when it comes to his artists “the music is secondary, it’s the lifestyle or brand that the artist represents is what people buy into” (Brandon, 2015). Perhaps this is one of the key areas for development and could lead to the widespread adoption of artist-specific subscription services. The mass amount of content and slick “context” of an on-line streaming service like Spotify allows consumers to listen to an incredible amount of music at the touch of a button. The potential for this type of service has been identified by Bandcamp, a platform that allows artists to sell their music direct to fans with no middle man. Their next step of development is to provide acts with a self-managed subscription service, where the artists themselves dictate the price-point and availability of content direct to their fans (Williamson, 2014).

One successful brand that has already capitalised on such a service would be Jack White’s subscription service run through his record label, Third Man Records. Platinum membership to the service entitles the consumer to a quarterly package of vinyl records and bonus items, as well as an exclusive on-line members area where video interviews are held with Jack White and other exclusive content can be downloaded (Third Man Records, 2015). This approach, along with marketing stunts such as recording the world’s fastest vinyl record, liquid filled vinyl records and the release of the 2014 album “Lazaretto” on the gimmick filled “Ultra LP” format resulted in Lazaretto being the fastest selling vinyl LP since records began (Caulfield, 2014)

By taking the wisdom of Simon Fuller and identifying what brand value an artist has and developing that, music managers could still retain their worth in the industry today. This would allow artists to concentrate on their musical output, whilst the managers seek to identify ways for fans to buy into artists as lifestyle choices, not just by purchasing their latest record.

21st Century Technological advancements and opportunities

Technology has always been a force that has dictated change in the music industry and led to new ways of generating revenue. One incredibly innovative way that established artists can generate revenue through streaming is through the placement of retroactive advertisements in the YouTube videos. This new technology means that brands can now place ads in music videos that weren’t there in the first place and is a way that they can ensure their message is seen that will benefit the brand visibility and the artist financially (Newman, 2014). 

The app world is another area of potential development in the 21st century for innovative ways of thinking that could open up a whole new world of possibilities for artists and managers. Bjork’s Biophillia application provided an immersive experience that allowed listeners to actively participate in a visual and aural world they could interact with, rather than just listening passively (Beaumont-Thomas 2014). Although this may not be the right approach for more mainstream pop acts, an application that focused on a specific artist rather than album could be developed for this audience. Managers could look into partnering with tech companies to create artist specific apps that are purchased and subscribed to. In return, exclusive premium content would be unlocked and back catalogue works readily available to stream/download, as well as press, video interviews and regularly updated social media channels.

Because of the changing nature of the industry, what is required for an artist’s success is highly based on social media metrics and online “buzz” in order to entice people to get involved with their creative output (Peckham, 2015). It is through applications like Soundcloud and Bandcamp that music can be shared immediately and for free which is becoming key in establishing an artist’s career early on. Music managers need to look further than just the music-focused apps already available though and encourage their artists to adopt and experiment with other platforms. Video streaming service “Meerkat” could provide a key insight for fans into an artist’s life on the road for example. Partnerships could be struck with this service to stream live shows or live chat/interview sessions could be held with competition winners. The services selling point is the here and now and immediate interaction, as the video is not saved after it is streamed, once it’s over, it’s over (Peckham, 2015). It is through the creative use of new platforms like these to showcase artist’s talents, and the insight provided by management teams that will see acts thrive going forward.

The Live music industry and its importance today

The potential revenue from the live music industry is one of the most immediate ways an emerging artist can make their career sustainable through performance fees, live performance publishing income and intuitive merchandise ideas (Allen, pp. 85-98). It is for this reason that the management team of an artist must identify this quickly and capitalise on it appropriately, whilst being careful not to over expose their act. This means they have to act in the best interest of their client and not of themselves, known as their “Fiduciary Duty”. The stresses of earning a living as an artist can be seen when looking at the Martin-Smith VS Williams case when Robbie Williams decided to leave Take That. Martin-Smith sued Robbie Williams for unpaid commission and Williams argued that he did not have to pay because Martin-smith had failed in his Fiduciary duty to him personally. Williams stated that Martin-Smith advised the rest of the band to sack him, but the rest of Take That and Martin-Smith said Williams left of his own accord. The court found that, Martin-Smith had advised Take That’s members individually to the best of his abilities, the interests of the group as a whole were protected and he therefore did not sack Robbie Williams. Martin-Smith was therefore not in breach of his Fiduciary duties and was paid the unpaid commission from Williams (Harrison, 2014, pp.31-61). Disputes like these still arise today and constant media exposure and touring commitments have led to One Direction star Zayn Malik to be signed off with stress from the bands activity. It would be interesting to see if he takes action against Modest Management (Modest Management, 2015), because he feels they failed in their Fiduciary duty to him (Guardian Music 2015).

One example of an entrepreneurial yet controversial approach to the live music industry can be seen when looking at the secondary ticketing market. The demand for entrance to a live show by a highly successful pop/rock act, who’s audience quantity outnumbers the tickets available, opens up a new potential revenue stream on the free market. Some people are able and prepared to pay a significantly higher price than face value to guarantee entry to a live show and this is what the secondary market provides. Promoters have been able to allocate tickets to secondary resellers and take a cut on the profits. Channel 4’s dispatches documentary stated that 1865 tickets allocated for SJM promotions for a Coldplay show sold for £229,230.51 which is around £123 per ticket and almost double the £65 face value and earned 90% of that mark-up (JustMe STKK 2012). Although this is a way to maximise revenue on live shows in a market where the price is dictated by demand, it is seen as unethical and has been met with calls for transparency by managers. Jon Webster, chief executive of the Music Managers Forum, told the BBC: “It reflects badly, at the end of the day, on the artists – probably more so than anyone.” (BBC, 2012).

This has led to legislation put through in the UK to require the face value, seat number and any applicable restrictions to be stated when put on sale though anonymity of the seller has been upheld (Hanley, 2015). The legislation will still allow promoters and artists to reap the benefit of the secondary market if they choose to do so, but the possibility of bad press could result in managers failing their fiduciary duty to their clients by damaging careers in an attempt to maximise revenue.

For artists that already have a following, the secondary market can be avoided through direct to fan sales platforms like Music Glue (Music Glue, 2015). Through a service like this, the artist and manager can set their own price point for their shows and sell direct to their most passionate fans without booking agencies or promoters getting in the way and taking percentages from the earnings. This empowers artists and managers to have their own live schedule and tour when and where they want through using data collection services and is exemplified by acts the size of Mumford & Sons using these new platforms (Reynolds 2012, pp. 312).

Another successful artist in the live area is Skrillex and Jazz Summers puts him forward as an artist that the industry could learn from; “[he] makes these tracks, puts them out, doesn’t worry about whether they’re on a label or not on a label. Then he does 300 gigs a year for £50,000 a night or whatever it is.” (Summers, 2014) Although this is clearly part exaggeration, it gives an example of a key industry figure identifying a trend that is leading to recorded music becoming a marketing tool for artists to earn money through the live sector. This sentiment is echoed by Adele’s Manager, Jonathan Dickins, as far back as 2008 when he said; “when you’re looking at people who are willing to pay more to see an artist live than they are to buy a CD or download an album then that tells you a lot” (Dickins, 2008).

Conclusion

Recorded music is now readily available for free and some industry figures like Jim Griffin, founder of Choruss music believes that “Sound recording’s economy is now a tip jar.” (Griffin, 2009) Griffin’s failed company believed a way forward could be to bundle in the cost of accessing recorded music at ISP (Internet Service Provider) level but the scheme stalled as it could not get licenses for enough content. (Rosenblatt, 2011) The ‘free’ access to music this would have facilitated, along with the significant stature of legal streaming services like Spotify and YouTube, further ads to the belief that the way forward for artists and managers is shifting. It is no longer through selling significant amounts of recorded music, but through finding innovative ways to license it through alternative media platforms that are not specifically music based, like Facebook and even on-line messaging services like Snapchat (Peckham, 2015)

The role of the contemporary music manager is to work with their artists, identify their target audience, and partner up with the relevant brands, tech companies and marketing teams at the time that is right for them. “The music is secondary, it’s the lifestyle or brand that the artist represents is what people buy into” (Brandon, 2015). If music managers can understand this and create worlds that fans want to engage with all year round, not just in the lead up to another album release, then artists can truly flourish. Technology that allows direct to fan engagement could open up a world of possibilities that would allow fans to be immersed in an artist’s activities like never before. The managers that service their acts fan base innovatively, and deliver content that has enriching cross format appeal, have the potential to provide an immersive and interactive experience that would benefit the entire music industry.

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