I had the pleasure of attending the NARM 2010 conference a couple of weekends ago. I’ve been a bit delayed at providing what I came away with because I started a new job two days after the conference ended. But there are some key things that every person interested in the music business needs to be aware of. After all, I think it’s fair to say the music industry is a finicky world, to put it mildly.
Before the convention began, NARM and A2IM gave a Music Business Crash Course which was largely given by Rich Begloff, president of A2IM, and Ted Cohen, managing partner for TAG Strategic, a digital entertainment consulting firm. Throughout the day and a half crash course, information was offered about the current state of the industry, perspectives about artist economics, label economics, publishing, licensing, and much more. In about twelve hours, insight was provided about what happens at a label to how artists can leverage website tools to manage their own careers.
Understanding the environment
My biggest take away was learning how all parties – artists, labels, retailers, licensers, etc. – have created a toxic environment where everyone is trying to “out do” or “out smart” each other. Fairness is left out of the playing field. This means that Darwin’s “survival of the fittest” mantra is the phrase to always keep circulating in the back of the business mind.
The root of survival and back stabbing in the music industry is the battle for cents, in many cases literally. The novice party is walking into a complicated numbers-based maze forcing everyone involved to make difficult choices. The amount of fees associated in a music deal is mind boggling: recording, legal, marketing, packaging, distribution are just a few. Every media channel has its own set of fees as well. Let’s not forget the under-the-table bribery that often happens. In the end, artists have to ask themselves: where is my piece of the pie?
Advice for artists: It isn’t just about the music
Artists often do not want to compromise their art. Their art being music is holy ground. But in order to make a living in this industry, musicians need to understand this is a business world. As a musician myself, this is hard to grasp. As a person who attended a music conservatory, setting aside artistry for dollars doesn’t always mix. The reality is comprise may be a choice depending on the type of career being sought. Establishing goals for yourself are critical. Goals set priorities around performing, recording and/or licensing your music. What this means for musicians is that they need to become more business minded.
Like any business venture, there are some important cautions. When the second most important business partner in any musical business venture is the lawyer, beware. Beware of the self-interested lawyer. Based on conversations and recommendations offered by presenters and panelists, the lawyer can make or break a business and/or artist. Just because a major label, like Atlantic or Sony Music, offer you a deal, doesn’t mean you are about to become a star. Malik Yusef, a hip-hop artist who has a contract on Kanye West’s label, Good Music, learned the hard way. “When you fall from a major label, you fall hard,” stated Yusef as part of the artist panel during the Crash Course.
Although it wasn’t mentioned by a presenter or panelist, an artist’s best friend might be an accountant or financial advisor. At least someone who understands how to read through spreadsheets closely and decipher what a contract or potential financial outcome might be. If the lawyer creates a binding agreement, then the finance person’s role is to help the artist understand what is at stake financially – and there is a lot at stake.
“The best artist is the one that doesn’t need you,” said Gary West co-founder of Compass Records. This was perhaps the best advice I heard all conference long. It absolutely makes sense. Your music career is in your hands.