| -- End Ad Box ---> | | | | distribution costs is burning, labeling and shipping CDs |
| Independent records labels are usually more profitable | | | | to retail outlets with no guarantee the CDS will |
| for the owner of the label than being allied with a | | | | actually sell. |
| major label because the artist gets to keep 100% of | | | | You need to understand that all of the above savings |
| the profit. So if money is the only measure of | | | | will not eliminate the need to aggressively market |
| profitably, independence puts more money in the | | | | your music. Artists who already have a following |
| artist's pocket. | | | | have been very successful with their independent |
| But if you are part of a new genre of music, you will | | | | labels. The major benefit of signing with a major |
| probably need the big boys to make your genre | | | | record label is the marketing they provide. Smaller |
| become popular enough to command a world wide | | | | media consultants can do the marketing and |
| audience. Take rap music as an example. Without the | | | | promotion of a CD for much less than a major |
| backing of the big record labels, rap would still be | | | | record label but good marketing and promotion |
| basically a local phenomenon. The support that the | | | | people will never come cheap. However, you may be |
| major record labels gave to rap artists is the reason | | | | able to get a smaller media company to work on a |
| it has become so successful. | | | | low flat rate that covers their basic costs plus a % |
| Riding on the tails of that success is a very profitable | | | | of the profits from the sale of the music. |
| independent market for rapsters and because of the | | | | Piracy...Help or Hindrance? |
| national market created by the major labels | | | | Piracy does not necessarily hurting the artist. It does |
| marketing and distribution efforts, the independents | | | | hurt the big record labels and many of the larger |
| are raking in huge amounts of money. | | | | independent labels that produce other people's work |
| Without the initial backing of their genre, the | | | | because they only make money from the sale of the |
| independent artists will still be making more money | | | | CD or from licensing fees if they own the copyright |
| than artists working for a big label, but the total | | | | to the music. |
| amount of profit would be less because of the much | | | | The file sharing networks that allow the piracy of so |
| smaller market for the music. | | | | much of today's music can raise the music's and |
| The smart independent will leverage the money | | | | therefore the artist's visibility. Being more visible can |
| spent by the big labels to help increase the popularity | | | | actually lead to increased sales for artists who don't |
| of their own genre of music as the basis for making | | | | have huge promotional budgets. By being more |
| their own independent label more successful. | | | | visible, the artist can become more popular and will |
| Other Factors | | | | be able to book more live performances. Even the |
| Some of the changes that can help out the | | | | most die-hard "free downloader" will shell out money |
| independent artist make more money include: | | | | to attend a live concert. |
| * Home-studio systems like ProTools have | | | | The bottom line is music piracy hurts everyone |
| dramatically reduced recording costs. A sound studio | | | | involved in the creation and distribution of the music |
| can be built in your home for around $10,000. | | | | except the performer. Historically, under the big |
| * Selling directly to the customer through the internet | | | | record labels, the performer usually got the smallest |
| and eliminating the 70-80% that goes to the retailer. | | | | piece of the profit pie. That fact is behind some |
| As a result they can offer the public lower prices, | | | | performers giving away MP3 versions of their music |
| take the lessons taught over at for example. | | | | so they can draw bigger crowds to live |
| * Sell music in MP3 format and burn CDs only when | | | | performances and also charge their fans for |
| they are actually ordered. One of the biggest | | | | professional quality CDs. |