Every day new bands emerge in an effort to have a hit record that can push
them to superstardom. Although very few actually make it to the label level, those that do are all faced with a career altering decision; go to a major record label or stay independent. This day and age, many people ask if a major label is necessary to have a successful career in music and since the emergence of the internet, the answer is no. The Internet has led to new mediums of music sales and has had a large impact on physical CD sales, “Cake’s “Showroom of Compassion” bows atop the Billboard 200 with just 44,000. It’s also obviously the tiniest figure racked up by a No. 1-debuting album.” (Billboard).” Since SoundScan began tracking sales, more generations are growing up with the Internet, leveling the playing field for up and coming artists.
The rise of the Internet and digital distribution is taking away the power major labels have held over aspiring artist for decades. For years, major record labels provided content for the CD shelves in shopping malls and retailers. In 1999, the music industry was a $14 billion industry from the control it had over consumers on CD sales. This same power also gave the Majors the power to create international superstars. As many know it today, they created the allure to the superstar lifestyle. However, websites like Tunecore.com or Reverbnation allow independent artists to pay a cheap flat rate to get their music hosted on an array of online stores such as iTunes. Tunecore operates by charging $ .99/ single or $20/ album. Once your song or album has been uploaded, 3 weeks later your music will be available globally on iTunes, Rhapsody, or Amazon, you keep 70% of royalties from digital downloads and the online host store will take the remaining 30% (Tunecore). Tunecore only takes a flat rate, no percentage; unlike most record labels. Reverbnation is another similar website but operates slightly different. It essentially creates an electronic press kit for the artist. Meaning it gives them a social homepage they can use for a home base fully equipped with bio and show info as well as use it as their medium to get their music to online stores.
With physical album sales down more than 20%, the national media has taken hold of this spiraling trend. The New York Times has even featured such headlines as, “Artist’s find backers as labels wane”, stating, “Now, with the structure of the music business shifting radically, some industry iconoclasts are sidestepping the music giants and inventing new ways for artists to make and market their music — without ever signing a traditional recording contract” (NY times). Clearly the business model is not working for major labels. Since the money is no longer based on CD sales, there are new emerging ways for independent artists to manager their careers; Instead of needing a record label, which traditionally has everything from distribution, to marketing, public relations, and Radio departments, to potentially outsourcing the majority of work to private firms. Essentially contracting the different departments a label would provide to work for you. If an artist is able to provide for themself, what a Major normally would provide for an artist, as well as own the rights to their music and release it to the same grand spectra of consumers a Major could, why would signing to a Major be a good move?
The wave of digital distribution provides a platform for independent artists to compete with household names for chart positions. Some argue that record labels still have the power to make an artist an international superstar. However, these digital distribution websites are capable of releasing your music in global digital markets and even household names, such as Jay-Z, have used Tunecore to release their music. Given the fact signing a recording contract requires you to sign an unfavorable royalty split and alternative options for an artist to get their music heard; the demand for a major label is in grave danger.
Caulfield, Keith. “Cake Scores Lowest-Selling No. 1 Album in SoundScan History | Billboard.com.” Music News, Reviews, Articles, Information, News Online & Free Music | Billboard.com. Web. 24 Feb. 2011. <http://www.billboard.com/news/cake-scores-lowest-selling-no-1-album-in-1004139371.story#/news/cake-scores-lowest-selling-no-1-album-in-1004139371.story>.
Stone, Brad. “Artists Find Backers as Labels Wane – NYTimes.com.” Mergers, Acquisitions, Venture Capital, Hedge Funds – DealBook – NYTimes.com. Web. 24 Feb. 2011. <http://dealbook.nytimes.com/2009/07/22/artists-find-backers-as-labels-wane/>.
“Facts.” TuneCore : Digital Music Distribution – Sell Your Music Online. Web. 24 Feb. 2011. <http://www.tunecore.com/>.
Pham, Alex. “Business & Technology | Digital-distribution of Music Goes from Fee to Flat Rate | Seattle Times Newspaper.” The Seattle Times | Seattle Times Newspaper. Web. 24 Feb. 2011. <http://seattletimes.nwsource.com/html/businesstechnology/2013366433_bttunecore08.html>.