Kings of A&R

KOAR’s only hip hop artist, Swordz, has been a busy man as of late. After being a featured speaker and performer at Florida’s Hip Hop Symposium, being nominated for SE Entertainment’s “Indie Song of the Year,” being featured on YouTube’s “Underground Video Contest,” and a high profile spot in the underground film Grind 2 Shine, Swordz is more than ready to hit the national level. Surely expanding his fan base exponentially, Swordz has been selected by the host of BET’s Rap City, televisions longest running hip hop program, as the subject for his inaugural mixtape. What’s The Problem? Vol. 1, is the first mixtape for host DJ Q45 and will be available online and in selected retail on Dec. 15 with regular promotion on the nightly program. Swordz has also been selected to help kick off Sony’s new SIM program, an online mastering service offering the skills of Sony engineers responsible for artists such as RHCP, DMX, Johnny Cash, U2 and many more. Riding the fence between rock star and rap star, Swordz is known for exposing the truth on subjects other rappers glorify or seem completely oblivious to. Picking up label interest in unexpected places, Swordz is an artist to keep an eye on. For more information, contact DMD Mangement.

• Doug Morris: The people who write music deserve to be paid for their compositions. The also should have some say about how their compositions are altered. I think that people are very lax about the respect that people should have for other people’s works. I hate…to see these groups work for two years, making an album spend enormous amounts of money, putting their creative juices into something that’s $9.99 in Best Buy and people would rather have it for free. For me, being a music person it’s very hard to watch that. (Read the full Reuters interview with Universal Chief Doug Morris)
• Radio exec gets Sirius again about XM merger
  Surius CEO Mel Karmazin has talked about a possible merger before, noting it could eliminate a lot of duplicate operating costs - not to mention, skeptics say, a lot of programming choice. Here is what to expect if a merger did occur:
  it would shrink music choices, since it would presumably not carry duplicate channels. Since XM and Sirius have different approaches in areas like oldies and popular standards, this could wipe out the sounds that enticed some people to subscribe in the first place. (Biz/Money)
• Russia agrees to shut down Allofmp3.com
  Russia has agreed to shut down Allofmp3.com and other music sites based in that country that the U.S. government says are offering downloads illegally. “AllofMP3 doesn’t expect the Russian government to take any action against the company since it operates within the current law,” said Rory Davenport, an Allofmp3.com spokesman. “The company is fully committed to its business.”

 Russia is known not to act out on its claims.

• Australia: Digital Sales are not filling the void of the loss of physical CD sales. (via Coolfer/The Age)
  “Digital ain’t filling the void,” says one industry veteran who did not want to be named. “While iTunes has made inroads there are still vast illegal markets.”

Sony BMG’s director of digital services, Gavin Parry, was one of the few industry executives to talk publicly this week.

“It has been pretty erratic,” he says of physical sales this year. “Some months have been down 10 per cent and other have been down 30 per cent. Globally there are some indications that digital isn’t replacing the void but for Sony BMG, it is. We are up. If people are sitting back waiting for iTunes to fix it, they’re in strife.”

Read the article in Digital Music.

Steve Gordon the author of The Future of The Music Business and the former Director of Business Affairs at Sony TV and Video has this to say……..

Gordon is skeptical that musicians will ever see a dime of money from Microsoft’s “royalty” payment. He writes, “Although this pattern of not paying artists for digital music sales is dreadful, the chances of artists seeing anything from the royalty placed on Zune is even worse. There is nothing in the standard recording agreement that says the labels must share income derived from licensing digital devices. Labels are only responsible for paying for exploitation of music, not licensing electronic devices. So why would the labels share anything with the artists when they already disregard clauses in the recording agreements that would benefit the artists?”

How do labels survive in the techonoligical transition? First,
technological transitions are great times to make gobs and gobs of money. You need to start thinking about creating new revenue streams.

Universal Music Group chief executive Doug Morris said he may try to fashion an iPod royalty fee with Apple Computer Inc. in the next round of negotiations in early 2007.

Universal was the first major record label to strike an agreement with Microsoft Corp. to receive a fee for every Zune digital media player sold.

“The Zune (deal) was an amazingly interesting exercise, to end up with a piece of technology,” he added.

MP3s are a fad like any other. Sure, digital music files will most likely be around forever and will continue to grow, however it’s probably premature to say that it will be the end of the physical product. Digital files are in response to a quality of music- disposable. There is no commitment in a digital file as it can be obtained and erased with a click of a mouse. You may throw a track on your iPod and rock it for a while until a hot new track comes out and you need to make some space. Then it’s like you never had the song in the first place. Digital files are being heralded as ‘the future of music,’ but as someone passionate about great music, I find that somewhat sad. If the future of music is disposable, replaceable and forgettable, then I am glad I hung onto the cds that I purchased, because it looks like I’m shit out of luck when it comes to new music.

Newcomers to the music industry are putting all of their eggs in the internet basket, the polar opposite behavior of old timers who think if they close their eyes and wish it away things will return to ‘normal.’ The web-obsessed entrepreneurs are trying to bank in on the theory that people live their lives almost exclusively online. They live there, they work there, they shop there, they hang out there, and it’s where their friends live. As MySpace and other sites have shown us, the novelty WILL wear off. Young Americans, especially, do not have the attention span to make a real commitment to something like a website, no matter how many people are on their buddy list and no matter how addicted to it they once were. The internet is unreliable, and I am not talking about connection. Sites, often times, are here today and gone tomorrow. Those who do stick around and obtain some level of popularity are quickly purchased and commercialized, stripping it of all ‘cool factor.’

Those in favor of internet only marketing cite the success of Gnarls Barkley as an example since their iTunes sales were so impressive. It seems they have already forgotten how much they spent on television advertising and the large amount of radio play they received, not to mention the video and press. The internet buzz and promotion definitely played a part, but it was in no way their sole outlet for promotion. What got people interested was the band name. It’s clever. Their music is unexpected. A name like Gnarls Barkley conjures up all kinds of assumptions, none of which are realistic. Again, clever. The song was good, hence the downloads. The album, however, is quite another story. If digital files have replaced anything, it’s the single, which hasn’t really existed in the US for years anyway.

One thing has become very clear over the last couple years- things are changing. Everyone is looking for a way to make music marketing easier. The industry wants a simple formula they can plug any artist into and be successful. Unfortunately, that is no longer a possibility. Things have changed and they will continue to change. Cookie-cutter marketing is no longer an option. You need great, unique artists, and you must market them in great and unique ways. If the artists are original and are bringing something special to the table, why would you even consider working them the same way as Joe Average and The Typicals? I’m sorry, but it’s not going to be easy, nor should it be. As professionals in this business we should be armed with the creativity, ingenuity and passion to be successful and work with successful artists. If you can’t take the heat, get out of the oven.

AJ, KOAR

• Madonna Created No Controversy On the Night Before Thanksgiving
  The special Madonna: Confessions Tour was broadcast on Wednesday (22NOV06), the night before Thanksgiving, failed to find an audience. The controversial broadcast of MAdonna’s Confessions tour special on US TV failed to lure viewers and ended up finishing fourth in its time slot.
• EMI - News Alert
  EMI, said it received a “preliminary” approach that may lead to an offer. The Financial Times reported earlier today that the company was in talks with buyout firms that may include Kohlberg Kravis Roberts & Co. and Goldman Sachs Group Inc
• Predicting The Future?
  A research firm said this week that the market of digital music would grow six times in several years and would reach $14.9 billion by 2010. Sales of digital music will account for over 1/3 of record companies’ revenues by that time, it was said, whereas sales of music on physical media is set to decline. The market for physically distributed music will decline to $19.6 billion by 2010, down from $27.3 billion in 2005.

Digital music in 2006 represented 12% of all revenue posted by record labels. iSuppli predicts this will grow to 40% of the overall record label revenue by 2010. With nearly $33 billion in total recorded retail music revenue accumulated in 2005, this is an enormous opportunity for those involved in mobile and broadband distribution across the supply chain, the company noted.

• New Atlantic signs to Eyeball Records

• KOAR is always seeking “new” music to talk about. We want to hear “greatness”; Click here and email us a link with a great band.

• Check out the New Release Schedule
• A new study from Nielsen Media Research claims that despite all the additional bells and whistles that have been added to the iPod over the years, users still primary utilize it for listening to music.
• Red Flags for Sanctuary
  Sanctuary Group shares plunged as much as 30 per cent to 6.75p after the group issued yet another profit warning and flagged a possible break-up of the group, starting with the sale of record label Rough Trade.
• George Clinton Sues Capitol Records Over Royalties

SonyBMG is set to announce a dismantling of its Sony Urban Music division that will hand pink slips to a large number of employees just in time for the holiday. Sources said employees’ nerves have been rattled while they wait for the layoff ax to fall ever since Rob Stringer, brother of Sony Corp. boss Howard Stringer, took over for Ienner in September.