I talk to many labels and bands as a part of my job. These conversations opened my eyes to a number of interesting trends, particularly around distribution. One that I find particularly strange is that even as many bands and artists have trouble making ends meet, they stubbornly refuse to put their music where fans are looking and ready to make a purchase. To that end, streaming is a good way to help get you noticed… but it is not a way to make a living. In 2012, the industry players will have to deal with this as many labels, bands and artists are taking matters into their own hands.
Here are some of my top distribution trends and issues to be on the lookout for in 2012:
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Let’s Not Get Physical
I am always surprised when distribution is an afterthought, if it even gets that much attention. Often a up and coming band or artist will tell me they have distribution — they are on iTunes and sell from their own website. Even the more well-known bands I talk to haven’t considered physical distribution as a significant way to add to their digital sales revenue, and increase exposure to some influential music industry people (record store owners). When I mention physical music, the labels and bands I’m talking to say what everybody else says…”people still buy CDs?”. When I tell them yes, AND vinyl records, they get psyched. Labels and bands don’t believe in physical because the media tells them not to. Heck, until I saw the actual sales numbers, I hardly believed it. The reality is that no band or artist can be successful without a strategy for digital AND physical distribution. They MUST use BOTH of these mediums (and more) to penetrate through the clutter and be where fans are seeking to buy music.
Streaming is Dead, Long Live Streaming
Another thing I hear over and over again – bands and artists HATE streaming services. Yeah, I said it! They don’t get anything from it, and they aren’t shy to talk smack about it. Interestingly, there was an article in Spin recently about the Black Keys’ “diplomatic” statement on why they do not like or plan to use streaming services. They feel like they are not yet able to “replace royalties from record sales with the royalties from streams, particularly for a band that “makes a living selling music.” Hmmm, well said. I’d say that is a key revenue component labels, bands and artists are going to need to consider in 2012.
Let the Digital Dust Settle
Digital – streaming and downloads – is on the upswing, and cannot be ignored. The issue is going to be how the deals between labels and bands can be made more fair so band and artists recognize more of their revenue from streaming – but also the streaming services and the differences between free and paid subscription needs to be reviewed and changed to better compensate the artists. The dust has not settled on having a solid and fair digital streaming service. To make this point, last month U.K. music distributor STHoldings pulled more than 200 indie labels off of Spotify, Rdio, and other streaming services, complaining about the services “cannibalizing” their digital sales, according to the Spin article from above. While the debate doesn’t appear likely to be resolved anytime soon, clearly a band’s got to have both digital downloads and physical sales to bring in those royalties and make that living.
So HEY YOU! BAND! LABEL! Whoever is reading this, if you have a following somewhere in the world, I’ve got news for you. Physical accounts for the majority of recorded music revenue; let Altavoz put your music in stores and also make it available digitally. We’re a full service direct distributor. We do it all. My number is: 301.95MUSIC and my twitter account is @followmealexg - I’ll text or talk to you all day about it, or anything music industry for that matter.
I’ll be back to scouting bands in the DMV area after the holidays. Let me know if you are playing and I will make an appearance. Maybe even buy you a beer or two if your music is extra awesome.
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