A quick bit of music business history revision…

The 20th century saw the rapid development of the music industry as we now know it. In that time, the committing of recordings to a purchasable physical product, and the development of the recording artist as the star, became well and truly established. The record company was the entity that chose what to record and who to record it, financed that process, and then made the end result available to the general public to purchase.

It resulted in a well-established business framework; recording was an expensive process that required lots of studio equipment, musicians and personnel. Manufacture and distribution required vast amounts of factory space and machinery to reproduce records, and then a means of supplying those to the wider retail environment. Marketing and promotion required know-how, a network of relationships and a series of sometimes dubious processes to incentivise media support. Placing records into retail likewise required a similar breadth of contacts and often equally unspoken means of procuring that all-important window display space. 

In short, the artist, recognised as the undoubted star of the show, needed the record company to perform all of these functions on their behalf. Their reliance on this model though (and the almost complete absence of an alternative route to market), meant that it was the record companies, and not the star artists, who held the balance of power. It was the record companies who chose who to sign, often what would be recorded, how the artist would look and be presented, and even the means by which the general public would commercially engage with that artist, be it on shellac disc, through vinyl record, myriad types of cassette and ultimately onto digital CD.

A key point here is that the record company, through its fundamental role in the process of funding and enabling the artist to reach an audience, chose exactly what music that audience was allowed to hear. As a result, the record companies exerted a rare power, not dissimilar to that of the early movie business whereby star actors were not allowed to pick and choose which movies they made and for which companies, but were exclusively contracted to one company, and were more or less compelled to release whatever output that company deemed suitable.

Of course that creative control loosened somewhat over the years as artists flexed their collective muscles and took greater control over their recorded output, but the necessity of operating through and with one recording company for the bulk of their career, remained throughout. Fundamentally, if an artist sought to record and release their music to the wider public, their only option to do so was to seek a business agreement with a record label. No record company, meant no career.

In deference to the great cost and resultant enormous financial risk of launching a new artist into the market, the ensuing artist/label contracts were overwhelmingly stacked in the favour of the record companies. Not only would they own and retain the rights to release any recordings in perpetuity (basically without those rights ever reverting back to the artist), but they would also claim the lion’s share of the resultant sales income. Complex notions of recoupable advances offset against artist royalties (more of which later) meant that the artist’s income was kept largely subdued until such time as the record company had not only broken even, but returned a substantial profit.

None of which is to demonise the record companies, who existed in a commercial environment after all. That the individual artist needed the record company more than the record company needed any individual artist was just a fundamental of the marketplace. Someone had to front the costs of taking that individual to market, a fact which also made heavily-weighted deals easier to justify of course; and frankly who cared anyway, because without them, the artist was simply frozen out.

But that was then, and this… is now…

Now imagine that none of this happened. In fact more than that; erase it completely and imagine instead that you’d been asked to outline the commercial environment for a new business here and now in 2019. A business called recorded music.

Much of the processes of recording, manufacture, distribution, marketing, promotion and retail (not to mention accounting) are digitised. If an artist can fund those themselves, then they don’t need a big brother figure to take them to the promised land. They can do it themselves.

So they need partnerships, collaboration, communication and creativity. They need expertise, cunning and know-how. None of which necessitates the handing over of copyright, and all of which maintains the artist at the epicentre of their own world.

Might that artist hire in the expertise they need on a piece by piece basis? Or would they sign it all over to a third party to own, and hope that the voyage to the promised land is a smooth one…?

There’s no right or wrong of course, but its a fascinating thought to muse upon; if we disregard what has been, and consider only what could be, then the world can look a very difference place indeed.