The Business of
Music
LECTURE – WEEK 12
Last Week
• We looked at the role of entrepreneurism in the music industry.
• As we had previously discussed the industry has changed significantly
and one of outcomes has been that artists and other industry
participants no longer should rely on the model where they are
provided a career by an international corporation.
• While those businesses are still relevant and significant there is now a
real role for entrepreneurs whether they be “artistpreneurs” or other
operators of independent businesses. It was those artists and
businesses that we looked at this week.
This Week
§ We wrap up the unit/subject with a wide ranging set of topics that
may well veer into stream of consciousness (on my part).
§ That could get interesting…or not.
§ Some of it may even provoke some additional thoughts for your
up-coming essays
§ I’ll allocate some time at the end for people to ask questions and
have a chat if you want to – “ask me anything” style
Context
• The unit was called the Business of Music – and thus – not
surprisingly – we have focused on business concepts.
• We’ve considered the importance of legal concepts, most
notably copyright.
• We’ve considered economic concepts like “barriers to entry”,
“economics of scarcity”, “economics of abundance”, “The Long
Tail”.
• We’ve looked at contracts – and came to the kinda scary
realisation that artists are an expense to music companies rather
than an asset – at least in financial terms
Context
• That led us to consider the differences – from a business
perspective – between the investment in the creation of new
music and the exploitation of existing recordings.
• I’ve provided you with some basic principles to build your
understanding from the ground up.
• “The business of music is about connecting the creators of music
with the consumers of music”
• “The business of recording is about four functions – creating
recordings, reproducing recordings, marketing recordings and
distributing recordings”
Context
• We talked about how music has “gone from a business about
ownership to a business about access”.
• “Music is a service industry – its about businesses doing what the
artist doesn’t want to do, doesn’t have the time to do, doesn’t
know how to do or doesn’t realise they need to do”
• OK – so I stole that last one from a bloke named Colin Daniels.
• We’ve looked at the differences between the live music industry
and the recorded music industry – and discovered from a business
perspective that they are very different types of industries – but
obviously industries that have clear connectivity.
Context
• We have considered the concept of bargaining power and
recognised that most business relationships in the music industry
are determined not by a set of fixed rules and measures but by
intangible factors.
• There is no set pay scales, not set working conditions and no
quotas based on gender, race, religion or musical genre or even
talent!
• And in most areas of the music business there are no academic
pre-requisites or necessary qualifications, licenses or permits.
Context
§ Last week we considered entrepreneurism in the music business.
§ It actually flows exactly from everything we just talked about – all
of today’s slides.
§ Where there are no rules, no pre-requisites, where everything is
based on bargaining position and everything is based in providing
services to people who don’t even necessarily know what services
they need – we have fertile ground for entrepreneurship.
§ It’s a business where people are always looking for a better way of
doing things and the digital revolution has fed that hungry beast
Context
• Hopefully what I have achieved in the last eleven weeks is to have
you thinking differently about the business of music –
conceptually, philosophically but also in a really practical and
realistic way.
• Hopefully I’ve tried to make you think about the music business in
the same way that you (especially the musicians amongst you)
think about music – creatively, but with reference to certain
undeniable principles and accepted parameters – but then
asking yourself if those parameters can evolve, be shifted and be
questioned.
The Business of Music
§ But even after all that – there still remains one thing that makes the
business of music different to many other businesses that combine
all of those different elements and concepts…
So what have we forgotten?
PEOPLE !
People?
§ The business of music is a business based in people – people
collaborating, people thinking, people getting excited and
enthused, people making choices, people being creative (both
artistically and in business).
§ Understanding how those people operate, what pushes their
buttons, what makes them bounce out of bed in the morning to
do what they do isn’t something I can teach you on a slide.
§ But maybe you can get some ideas from the people out there
doing it…
David Williams
§ “There are young people building businesses in the same way the
previous and current industry leaders built their businesses. They
saw that there was a possibility and went for it. It’s great to be
able to work in an industry that you really enjoy, but the industry
has to be your life. It’s not a 9-5 job. You have to be out there all
the time. If you are out there and working and creating awareness
of what you are working on, then you start to build. It doesn’t
always work, but if you stick to it you can make it work. I won’t say,
‘if you believe you can make it happen’, because sometimes
even if you believe, it won’t happen, but if you are going to have
that attitude in the first place then it certainly won’t happen.”
Jaddan Comerford
§ “Somebody made a comment about an older person reaching
out to somebody here and they made the joke that they were
trying to stay relevant. And I said, ‘don’t make that joke, we’re
going to have to do that soon!’ We’re already doing it. We’ve got
19-year-old staff and 15-year-old work experience kids. You can’t
go out every night of the week. You need to have a new
generation and you need to look after them. I think a lot of old
companies retained a lot of staff through fear, the fear of not
being able to work somewhere else, whereas we retain our staff
based on really good performance incentives and empowering
people to actually make their own decisions and drive their own
careers.”
Emily York
§ “I don’t think it’s this impenetrable thing and I don’t think that
people should be deterred from getting involved in music,
because it’s a very vibrant scene, and it’s actually such a great
time for the next generation beyond me to come up. I think it’s a
really great time for them because they will be discovering bands
that they go out and see on a Wednesday night at 11 o’clock
when I’m probably asleep. It’s one of those unfortunate things,
that the moment you feel like you get what’s going on and you
have hit your stride, to a point that’s when it’s nearly over and it’s
time to shuffle off and let someone else take over.”
Michael Gudinski
§ “I’ve found with a lot of people that the first couple of bosses they
have had have been very influential on them. That's where you
pick up the right and wrong way of doing things. I’ve seen people
and I’ve looked back in time and seen their first couple of bosses
and they have been the wrong people. You have to knock those
habits out and that's hard to do once those habits are there. To
get in with the right person, you are better off working for nothing
than getting paid working for the wrong person.”
Charles Caldas
§ “I’m still a firm believer that if you truly have a passion for
something and if you have a work ethic you can make it. I know
that is a very old-fashioned thing to say, but if someone has that
level of passion and commitment and is willing to actively put in
the work to put themselves into a field, then they will work it out
eventually. But the way the market is now, it has a different set of
opportunities and a different set of entry points and it probably
rewards entrepreneurship a bit more. I’m a firm believer that any
of these organisations need a mix of people, from educated,
disciplined business backgrounds, to the maverick mad person
who might come up with the killer idea that will make the business
what it could be.”
Mary Mihelakos
§ “Never compromise yourself. Never lose that passion and
whatever you do, do something that you feel good about. Forget
what other people think. There is no one you could bring to me
whose opinion matters more to me than my own. I would never
find myself doing something I didn’t want to be doing. There are a
lot more options these days and the industry has grown.
Volunteer, because a lot of the best stuff is the stuff where there
isn’t money!”
John Watson
§ “I never set out to ‘build a career’ and I’d almost be a little suspicious of
those who do. I just set out to find a way to make a living somehow from
being around music because I truly loved it and found it exciting. I never
knew there was such a thing as networking – I was just making friends
with people who were equally obsessed with music. However, in
hindsight, those relationships I forged through my twenties have turned
out to be the bedrock for my entire career. My advice to young people
starting in the business is therefore really simple – always deliver more
than you promised to deliver, before you promised to deliver it. Bite off
more than you can chew and chew like hell – volunteer for public radio,
write a blog, manage your friend’s band, work the door at your local
venue. Do anything and everything that allows you to gain experience
and meet people. Read lots and ask lots of questions. Don’t be afraid to
make mistakes, but try not to make the same mistake twice. Through all
of it, remember that your reputation is either your biggest asset in
business or your biggest liability, so treat it accordingly.”