Kings of A&R

The Arrival (Madison, Alabama) has posted a brand new track,
Put Your Money Where Your Heart Is on their myspace profile. The band was in NYC last week meeting and showcasing for a few indie and major labels. The Arrival formed in the fall of 2004 and recorded their debut EP “Residence Lift” that drew attention from indie labels. Once again, the band released a set of self written, recorded, and produced songs drawing on influences ranging from Justin Timberlake to The All-American Rejects. The band is currently continuing to write and record new music while performing shows.

Hip Hop producer and artist Jermaine Dupree rants about the current state of music affairs. He believes Apple’s sell-by-the song model is great for consumers and bad for the music business.

Jermaine Dupree says:

These days people just assume that you need a number one single to have a number one album. But look at what’s really happening. Soulja Boy sold almost 4 million singles and only 300,000 albums! We let the consumer have too much of what they want, too soon, and we hurt ourselves. Back in the day when people were excited about a record coming out we’d put out a single to get the ball going and if we sold a lot of singles that was an indication we’d sell a lot of albums. But we’d cut the single off a few weeks before
the album came out to get people to wait and let the excitement build. When I put out Kris Kross we did that. We sold two million singles, then we stopped. Eventually we sold eight million albums!

Did consumer complain? Maybe so. But at what point does any business care when consumer complains about the money? Why do people not care how we - the people who make music - eat? If they just want the single, they gotta get the album. (silicon alley)

The Bottom Line: Jermaine speaks some truth regarding most people assume you need a #1 single to have a #1 album. Jermaine and most music execs and artists do not want to live in the singles business. I do agree that marketing campaigns around the release of albums has lost it’s sexiness. New releases rarely excite consumers and music companies forgot how to tease consumers. In fact, its tough to tease consumers due to illegal downloading. Regardless, sexy marketing campaigns won’t save the singles world. The best solution is new configuration (bundling tracks) and better albums.

The latest ad supported music experiment comes from the new company Rcrd Lbl which is a joint venture of Downtown Records (Gnarls Barkley, Cold War Kids) and a journalist and entrepreneur who founded the technology blogs Gizmodo and Engadget.

Rcrd Lbl is a cross between a music label and a blog. The releases will be posted on the company’s Web site for free downloading. In order to attract viewers the site will offer eye candy including articles, social-networking features and internet radio stations. The company has signed up 3 big name advertisers  and will rely on multiple revenue streams.

Of course new models will bring new schools of thought. For instance, artists with songs on Rcrd Lbl won’t get a cut of advertising associated with their music instead they will get advances. Advances range from $500 a song for unknown artists and $5,000 for bigger name artists.

Will this experiment work? Who knows, it all comes down the quality of acts and the ability to expose these acts.

Album sales have fallen 14% this year compared with last year, a trend that shows no sign of reversing. Given those “sobering” numbers, Mr. Deutsch says, “if you’re not trying to monetize the experience of sharing music, you’re slowly going out of business.”

The latest talk among industry execs are 360 deals where the label gets a piece from artists merch and touring revenue. Skeptics believe artist 360 deals is highway robbery and that music companies are only entitled to the music itself.

Sean “Diddy” Combs has built a successful empire that revolves around music, fashion, fragrances, restaurants, television and film production.

“Right now, everyone just says this brand-building concept out of their mouths so easily, claiming it’s revolutionizing the industry,” he says. “But it takes a certain type of superstar who understands at all times what it takes to be in the middle of a 360 situation. This is not going to solve the labels’ problem.”

“Early on, I made a 360 deal with myself,” Mr. Combs says. “What separates me is that I always had a blueprint to be a lifestyle brand. The things people are talking about doing now I already did. I always wanted to diversify.”

“You have to become and understand the business you take on,” he says. A towering poster in Times Square of Mr. Combs, decked out in clothing from his eponymous Sean John line, says it all. “This is not about me just throwing a couple of parties and sticking Ciroc in a music video,” he says. “Music is that thing that makes [my products] sexy and edgy and gives me that direct connection to the consumer,” says Mr. Combs.  “It’s an endorsement of how cool my brand is.”

The bottom line: Today, music is only one piece of the puzzle. If you want to hit the ball out of the park an artist needs to deliver more that just music. It’s about lifestyle. It takes true effort and creativity for an artist to create an “individual expression of life”. This separates the superstars from the one hit wonders.

The new owner of EMI has said he will drop artists the music group believes are not working hard enough and will overhaul the company’s own executives’ pay packages, the Financial Times reported.

EMI, which has Cold Play, the Rolling Stones and Kylie Minogue on its roster, also threatened to withdraw stars’ lucrative advances if record sales are disappointing.
CEO of Terra Firma Guy Hands said the company would in the future be “more selective in whom we choose to work with.”

While many spend huge amounts of time working with their label to promote, perfect and endorse their music, some unfortunately simply focus on negotiating for the maximum advance … advances which are often never repaid,” Hands said.

The company, which Terra Firma bought for $4.9 billion, has been plagued in the past by late delivery of albums by some of its biggest acts.

Hands also criticized EMI’s “compensation and management system put in place over the last 20 years which does not encourage the right behaviors or reward the right actions.”

“What worries me is that the existing structures have been put in over a couple of decades and unpicking them in a way that releases the good in the company is not going to happen overnight,”.

The bottom line: What is he really saying? That he paid to much for EMI? Basically, he spent 4.9 billion dollars and he can’t get the biggest acts to record and put out music. Hands is crying because he has to pay more and motivate artists to put out records in a shrinking business.

Physical and digital sales this week were up +7.6% for W/E 11/4/07. Sales were down (-16.9%) from the same week last year. 
Year-to-date business is down (-14.7%). 

Sales trends…
Chains were up +42% from LW,
Independents were up +18%,
Mass Merchants were up +295%,
and Non-Traditional was up +54%.
 

Jay Z ‘American Gangster’ 424,959k
Eagles ‘Long Road Out of Eden’ 359k
Garth Brooks ‘Ulimate Hits’ 351k
Josh Groban ‘Noel’ 115k
Britney Spears ‘Blackout’ 86k
Kid Rock ‘Rock n Roll Jesus’ 35k
Bruce Springsteen ‘Magic’ 30k
Daughtry 20k
Seether ‘Exile on t…’ 20k
Paramore ‘Riot!’ 14k
Feist ‘Reminder’ 13k
Maroon 5 ‘It Wont Be Soon…’ 12k
Finger Eleven “Them Vs You’ 10k

The Silicon Valley article discusses the downfall of Warner stock and retailers cutting back on floorspace for CD’s. Some think big boxes may cut more than 30% of dedicated music space.

If you look at the history of CD sales physical outlets have changed throughout the years. The record biz has never been in the situation of figuring out where to sell music.

The record industry is making 1/10 of what they could be making. They are selling songs rather than an album. Music is in the digital age, the outlets will be digital.

We have two people fighting. The label wants to sell at retail and Apple wants to sell digitally.

The body of work from an artist is not judged anymore. Its all about the song and the song sales. Until the psychology of consumer is more concerned about the body of work, you will see dramatic changes in retail space.

It’s no wonder the record biz is in the situation because the last couple of years the album content has been de-valued. Even prior to entering the digital age, columnists and reviewers would write that only one or two great songs were on an album setting the stage for a singles world.

EMI removes Radiohead Ad: The saga between Radiohead and EMI continue when the band’s former label removed a misleading ad for the group’s back catalogue from the internet.

Anyone typing in Radiohead into Google would see an ad at the top of the search results reading: “Radiohead - New Album ‘Rainbow’ now available as boxset”.

The ad was not directed the “discbox” edition of In Rainbows but to a website where EMI subsidiary Parlophone is selling a box-set of the seven albums Radiohead recorded while they were still signed to the label.

Its been said that EMI is trying to compete with its former charges’ independent release. While EMI has denied this, the ad (visible in a screengrab from Friday, above) raises new questions about the label’s
motives. (The Guardian)

Are Games More Relevant Than Radio? Guitar Hero III sold over $115 million in its first week, making it the best launch in the company’s history. Not only is Guitar Hero popular among gamers but it also exposes new music. For instance, Roadrunner Records said that sales of Dragon Force’s album “Inhuman Rampage” increased 126% week-on-week in the wake of Guitar Hero III’s release. Slipknot, another Roadrunner artist featured in the game, also saw its album sales increase. EA’s Steve Schnur asserted that games were now more relevant than radio when it comes to promoting new music.