Tuesday, November 01, 2011

Like Pete Townshend, I miss the record companies

I've been reading the text of Pete Townshend's John Peel lecture. He makes the perfectly valid point that what record companies and music publishers used to do was a form of banking. You know banks. They're the people we tolerate when they're lending us money and despise when they're wanting some return. *Just* like record companies.

I've been waiting for this for the last few years. Now that record companies are not the force they were we get nostalgic about them. We realise the things they did and wish they still did them.

When you had to buy an album rather than cherry-pick a track record companies could afford to subsidise acts to go on tour.

When that album cost £10-£15 they could take some of that margin and spend it on marketing, which meant music magazines got advertising.

When record stores were the shop window, the companies could hope that your attention might be attracted by something you hadn't gone in there to get.

All that's gone now. People download individual tracks, which means even successful acts get a fraction of a fraction of the revenue. Record companies can't afford to spend money on promoting records. All that matters nowadays is getting into those few inches of space occupied by the home page of the iTunes store.

What used to work in the artists' favour, although they could never be caught admitting it, was competition between record companies, struggling to elbow each other off the airwaves, out of the front window of HMV and off the cover of NME. In order to achieve this they would spend lots of money. They'd pay big advances, invest in name producers, buy advertising spaces, press up lots of copies, distribute them and then spend more money on ballyhoo in an effort to move them out of the shops.

And when one record company failed to break an artist, as they usually did, there would be another one waiting to have a go. I don't buy the idea that artists are cast aside as soon as they don't sell. I'm consistently amazed to see how commercially unsuccessful artists keep on making records. This is the business from which NOBODY RETIRES. Hope springs eternal in the record business.

I agree with a lot of his analysis but I can't see iTunes, or anybody, adopting Townshend's recipes. I can't imagine lots of talent spotters sitting there patiently ploughing through MP3s. I don't know whether everybody who writes a song has the right for it to be heard any more than anybody who writes a blog has the right for it to be read. In the days when John Peel listened to every demo there was barely any email. He would only receive them from the relatively small number of people who could get up off their backside, make a record, pay to get it pressed up, buy a Jiffy bag, take it down the Post Office and send it to the BBC. Believe me, it's not like that today.


  1. It wasn't only the artist who had to get off their fat arses and make a demo, buy a jiffy bag etc. We had to save our pocket money, work out bus timetables and make the journey into town - there we would scour the record emporiums for the 45s we'd heard on the wireless (and the 33s we hadn't), and so began our emotional and financial investment in the 'heritage' acts we still carry a torch for today.

  2. We're in a major quiet revolution with the internet, and we're only just noticing how wide reaching it will be. It's a similar kind of story with print media. A relative who is a musiican has just lost his studio, paid for by a record company - one more person now having to adjust to a very different life. There are indeed so many spinoff problems for all creative media (except, perhaps, fine art). I wrote a blog post about it myself recently.

    he big question of course, is how to deal with it. I suspect that, just as with the farriers and ostlers, wagon makers and blacksmiths of 1900, the only option is to say goodbye to the old ways and change to something different. The old ways won't come back, and the old crafts will be left to specialists, with no room for the jobbing merchant.

    The next generation will find it easier, of course.

  3. It's the sad story of revolution. There's never a shortage of cheering whilst the old regiem is destroyed, rightly too, as they're invariably despots.

    But the cheering mob gets little say in the direction of what replaces their rulers, instead they're given buzzwords like "freedom" and "democratisation".

    Power builds a new equally unfair structure and a few revolutionaries eventually wake up and go, "hang on? what happened to our revolution?"

    Whilst the old displaced group who used to thrive under inequalities of the old system go, "we told you so."

  4. Radio station KCRW in Santa Monica will only accept CDs in the mail for playlist consideration. It reduces the garbage considerably and has the added filter of the cover to gauge the contents. A&R men take note!

  5. Like banking, the recording industries downfall was unreasonable greed. As a buyer, you would tolerate an occasional squeeze if it met your own needs : limited editions, boxed sets with unreleased rarities, novelty sleeves, completist imports.

    Ways round the system were always available: bootleg albums, home taping (is killing music. It wasn't) but the introduction of CD drew a financial demarcation line and became the first digital crumbling point. From a buyers perspective it was inflated prices for minimal gain (excepting improved, but thinner edition sound and better storage - if you threw out the vinyl version. But who ever did?).

    Another loss on the list is male Rock Archetypes - no record company will underwrite the oustider/indulgent antics of yer Keefs, Bowies, Zeppelin, Orrible 'Oos if there's not an act or artist generating significant amounts of cash ballast to the label's bank balance

    Female icons archetypes - yes. As these (mostly pop based) heavy-hitters crossover with fashion industry

  6. Could be argued that Apple piled into the space that should have been occupied by the record companies, if only they'd been awake. There's an alternative view here:

  7. I'm not sure that the problem of the record companies was unreasonable greed. More like it was the failure to adapt to a new way of selling music, largely because its processes were so firmly based in the old way. They didn't see this coming because CDs were by far the most popular music carrier there had ever been.

    And I'm not sure that they could have got into the space that Apple moved into because that was the space which had once been occupied by retail. I don't see Apple investing in talent or taking the long-term, completely unsubstantiated punts that the record business has traditionally taken. They want to sell the products that the record companies have invested in developing.

    That's not to say that I think they should invest in talent. It's simply to point that once the record business isn't doing it, nobody's doing it. I've observed the music business for a long time and one thing I've learned is it's too easy to hand out the black and white hats.

  8. Take the point about retail, but once downloading became an everyday occurrence, either legally or illegally, the days of bricks-and-mortar retail were numbered anyway. But the record companies could (maybe) have maintained a viable business model by setting up their own downloading services. The signs were there, after all - eMusic pre-dates the iTunes store by a whole 5 years, and the majors spent those 5 years trying to kill it off, instead of figuring out a way of competing.

  9. The record companies did try e-retailing with dire consequences. Pressplay was one and I forget the name of the other. But as you pointed out, retailing is not a record company skill.

    Also, others are investing in developing talent. There are production companies all over Britain developing artists. just not very well for the most part and investment capital remains fraught at that level.

    What intrigues me is the record shop's inability to understand why their customers congregated in their shops. I would (and will) argue that a lot of it was social, and now that others are providing that service better than record shops, they've gravitated there. Check any Apple store on a Saturday afternoon, then HMV.

  10. Eight years ago all the record companies were investing heavily in their own digital download sites. They didn't work because consumers don't think like that.

    And Jonh, re: "others are investing in developing talent". You're right. I met a guy recently who was running a digital PR business in the music "space". He reckoned the majority of his revenue came from seed funding supplied by production companies or the savings of parents. But there are very few people who can write the cheques the record companies once did.

    Maybe the Russian oligarchs and Middle Eastern sheiks will eventually arrive, just as they did in football.

  11. One of the companies who were bidding for EMI in the previous round, and may be now, was a VC fund with Sean Parker as a prinipal member. Parker was a founder of Napster and is a major founding member of Facebook (as played by JT in The Social Network). One would hope he has some new ideas to bring to the business.

    And yes, the days of Mo Ostin and Chris Blackwell backing the Ry Cooders and Robert Palmers for 3 or more albums with real budgets is sadly missing, except for the few like XL/Beggars. Of course, Mo had Sinatra money and CB had Millie Small/Steve Winwood/Free money to play with.

  12. John Terry was in The Social Network???

    The point about record companies having their old download sites reminds me of the way Foyle's used to arrange their paperbacks by publisher which was totally ridiculous. Who goes into a bookstore thinking "I wonder what's new from Picador?"

  13. "old download sites" should be "own" of course

  14. 'Who goes into a bookstore thinking "I wonder what's new from Picador?"'

    Sorry, can't resist this...there was a time, in the 70s and early 80s, when people did just that. I know this because I was the Picador editor at the time, working for Sonny Mehta, and we used to get letters from people who bought every single Picador that came out. Apart from Virago, I'd say Picador is probably the only imprint that has ever inspired such brand loyalty, so your overall point is good. The reason Foyle's was arranged like that is that they made publishers pay for the space...ahead of their time, I'd say.

  15. If record companies were like banks - why have they died out while banks are thriving? Can the music industry learn something from the bankers? After all, banks don't deal with a physical product any more, but they still seem to have an outlet in every high street.

  16. Anonymous4:30 pm

    iTunes is a bit of software, a portal onto other people's talent. They offer nothing beyond convenience in a world where convenience is king. iTunes, Kindle, McDonalds - all part of the same sorry malaise. People make the mistake of criticising record companies and record shops for 'a failure to adapt'. Rubbish or at least unrealistic. Being a software house and being a record company or a shop is not part of the same whole. It is like asking Arsenal to take up Rugby. Can be done I suppose but it is going to take some time and one a lot of commitment.

  17. Actually, it's not like asking Arsenal to take up rugby. Switching sports could be quite simple. It's more like saying, Arsenal get a lot of media coverage, therefore Arsenal are going to be a media company.