MUSIC AND FINANCE
New Yorker
In the summer of 1924, a Kansas City band called the Coon-Sanders Original Nighthawk Orchestra did something unusual: it went on tour. Popular as live music was, bands in those days tended to serve as house orchestras or to play long stands in local clubs; there was hardly even a road to go on. But Jules Stein, a booking agent from Chicago, convinced the Nighthawk Orchestra that it could make more money by playing a different town every night. The tour, which lasted five weeks, was a smash. Soon, bands all over the country were hitting the road to play ballrooms and dance halls.
Stein’s original vision hasn’t changed much, despite some modifications over the years—parking lots, hair spray, the disposable lighter. Consider Metallica, the Coon-Sanders Original Nighthawk Orchestra of our day. Though Metallica still sells a fair number of CDs from its back catalogue (it has made just one album in the past six years), it makes most of its money from concerts. Two years ago, the band brought in almost fifty million dollars with its Sanitarium tour. Last year, it brought in sixty million with its Madly in Anger with the World tour. God knows what it would take to make Metallica happy.
The music industry may be in crisis, what with illegal file-sharing, stagnant CD sales, and the decline of commercial rock radio, but the touring business is as sturdy as ever. In some ways, it is healthier than some of the mediums (radio, recorded music) that at one point or another were supposed to render it obsolete. Since 1998, annual concert-tour revenue has more than doubled, while CD sales have remained essentially flat. Last year, thirteen different artists grossed more than forty million dollars each at the box office. (Prince made eighty-seven million.) Consumers who seem reluctant to spend nineteen dollars for a CD apparently have few qualms about spending a hundred bucks or more to see a show.
There are still artists who make huge sums of money selling records, but they are the lucky few. A longtime recording-industry rule of thumb holds that just one in ten artists makes money from royalties. Today, it’s probably less than that. So the best model, if you’re in it for the money, may be the Grateful Dead. Although the Dead didn’t sell many records or get much airplay, they worked the big stadiums and arenas long enough and often enough to become one of the most profitable bands out there. As in politics and sales, nothing beats meeting the people face to face.
Most musicians, from a business perspective, at least, would wish it otherwise. Selling CDs is, as economists say, scalable: you make one recording, and you can sell it to an unlimited number of people for an unlimited amount of time, at very little cost. A tour, on the other hand, is work. You have to perform nearly every night, before a limited number of people, for hours at a time. You can knock a few seconds off each song, fire a percussionist, or sell more T-shirts, but in the end efficiencies are hard to come by.
The trick is that musicians get a much higher percentage of the money from concerts and merchandise than they do from the sale of their CDs. An artist, if he’s lucky, gets twelve per cent of the retail price of a CD. But he doesn’t get any royalties until everything is paid for—studio time, packaging costs, videos—which means that he can sell a million records and make almost nothing. On tour, though, he often gets more than half of the box-office, so even if he grosses less he can profit more.
Traditionally, tours were a means of promoting a record. Today, the record promotes the tour. The decline in record sales has shrunk the size of the pie for labels and artists to fight over, so they’ve had to find new ways to make money, and artists have come to see how lucrative touring can be, given what people will pay to see them live. (Ticket prices for the top hundred tours doubled between 1995 and 2003.) And, while high prices may be starting to put a dent in attendance, the dollars keep pouring in. Last summer’s concert season was considered a dismal one, yet, according to Pollstar, the industry’s trade magazine, concert revenues rose for the year.
Inevitably, touring rewards some artists better than others—graying superstars, for example, with their deep-pocketed baby-boomer fans and set lists full of sing-along hits. The economist Alan Krueger has estimated that the top one per cent of performers claim more than half of all concert revenues. But even indie rockers are reaping the benefits, with bands like Wilco and Modest Mouse selling out venues like Radio City Music Hall, at decidedly non-indie prices.
The upshot is that the fortunes of musicians and the fortunes of music labels have less and less to do with each other. This may be the first stage of what John Perry Barlow, a former lyricist for the Dead, once called the shift from “the music business” to “the musician business.” In the musician business, the assets that once made the major labels so important—promotion, distribution, shelf space—matter less than the assets that belong to the artists, such as their ability to perform live. As technology has grown more sophisticated, the ways in which artists make money have grown more old-fashioned. The value of songs falls, and the value of seeing an artist sing them rises, because that experience can’t really be reproduced. It’s funny that, in an era of file-sharing and iPod-stealing, the old troubadour may have the most lucrative gig of all. But then Metallica knew it all along. “Send me money, send me green,” the group sang in “Leper Messiah,” twenty years ago. “Make a contribution, and you’ll get a better seat.”
Lucinda Williams, Live at Fillmore (Lost Highway Records)
Lucinda Williams writes and performs heart-searing roots rock on the rarefied level of demigods like Tom Petty and Neil Young; she's also opened for Petty and Young. So the least she deserves is her own Seventies-rock-style double live album, recorded at San Francisco's Fillmore Auditorium, no less. She and her impeccable three-piece band give her songs' meticulously recorded original versions a run for their money; led by Doug Pettibone's Crazy Horse-esque lead guitar, they deliver "Changed the Locks" (from 1988's Lucinda Williams) with the spiteful fury of Bob Dylan circa '66, and crack open the downcast title track of 2001's Essence, transforming it into a brawny rocker. The twenty-two-song collection suffers from bloat, uneven pacing and an overabundance of tunes from 2003's World Without Tears. But it's still an effective summary of Williams' career as a prophet of, as she puts it, "all that's alarming, raw and exposed."
OTHER
Struggling Towards a World of Services (On IBM)
Can the Police Commandeer Your Car?
Pitchfork skewers Weezer ("Sometimes an album is just awful. Make Believe is one of those albums."). A dissent from elvithprethley.com: Weezer - "Perfect Situation". "If you, like me, gave up on Weezer after listening to the Green Album more than a few times, tune in. This is pure Blue, to me, updated for this year. The guitars soar blue and shiny, Rivers sighs but then double-hikes it to full-blown emo longing, and the chorus has the cheer of a chicken-chested man proudly clucking at the hens. It's fantastically written and produced, with that downward scale of guitar notes, the homey ding-ding-ding of piano hiding in the mix for the choruses. And where elsewhere on Make Believe, Rivers' autotuning is frustrating, here it's just a guy who fussied himself up for his visit to the cliffs, so that the sirens might give him a second glance as he bellows at them."
As the iPod Stays Hot, It Risks Losing Its Cool.
I recommend this documentary.
Revenge of the Sith review.
The last days of Kurt Cobain's life (as rendered by Gus Van Zant).
The Wired 40: They're masters of technology and innovation. They're global thinkers driven by strategic vision. They're nimbler than Martha Stewart's PR team:
1. Apple Computer
2. Google
3. Samsung Electronics
4. Amazon.com
5. Yahoo!
6. Electronic Arts
7. Genentech
8. Toyota
9. Infosys Technologies
10. eBay
11. SAP
12. Pixar
13. Cisco
14. IBM
15. Netflix
16. Dell
17. General Electric
18. Medtronic
19. Intel
20. Salesforce.com
21. Vodafone
22. Flextronics
23. EMC
24. Nvidia
25. Jetblue
26. FedEx
27. Monsanto
28. Microsoft
29. Nokia
30. Costco
31. Comcast
32. Pfizer
33. Li &Fung
34. Taiwan Semiconductor
35. Gen-probe
36. Citigroup
37. L-3 Communications
38. Ameritrade
39. Exelon
40. BP
Mondrian
Ocean 5
1915
Charcoal and gouache on paper
87.6 x 120.3 cm (34 1/2 x 47 3/8 in)
Peggy Guggenheim Collection, Venice
New Yorker
In the summer of 1924, a Kansas City band called the Coon-Sanders Original Nighthawk Orchestra did something unusual: it went on tour. Popular as live music was, bands in those days tended to serve as house orchestras or to play long stands in local clubs; there was hardly even a road to go on. But Jules Stein, a booking agent from Chicago, convinced the Nighthawk Orchestra that it could make more money by playing a different town every night. The tour, which lasted five weeks, was a smash. Soon, bands all over the country were hitting the road to play ballrooms and dance halls.
Stein’s original vision hasn’t changed much, despite some modifications over the years—parking lots, hair spray, the disposable lighter. Consider Metallica, the Coon-Sanders Original Nighthawk Orchestra of our day. Though Metallica still sells a fair number of CDs from its back catalogue (it has made just one album in the past six years), it makes most of its money from concerts. Two years ago, the band brought in almost fifty million dollars with its Sanitarium tour. Last year, it brought in sixty million with its Madly in Anger with the World tour. God knows what it would take to make Metallica happy.
The music industry may be in crisis, what with illegal file-sharing, stagnant CD sales, and the decline of commercial rock radio, but the touring business is as sturdy as ever. In some ways, it is healthier than some of the mediums (radio, recorded music) that at one point or another were supposed to render it obsolete. Since 1998, annual concert-tour revenue has more than doubled, while CD sales have remained essentially flat. Last year, thirteen different artists grossed more than forty million dollars each at the box office. (Prince made eighty-seven million.) Consumers who seem reluctant to spend nineteen dollars for a CD apparently have few qualms about spending a hundred bucks or more to see a show.
There are still artists who make huge sums of money selling records, but they are the lucky few. A longtime recording-industry rule of thumb holds that just one in ten artists makes money from royalties. Today, it’s probably less than that. So the best model, if you’re in it for the money, may be the Grateful Dead. Although the Dead didn’t sell many records or get much airplay, they worked the big stadiums and arenas long enough and often enough to become one of the most profitable bands out there. As in politics and sales, nothing beats meeting the people face to face.
Most musicians, from a business perspective, at least, would wish it otherwise. Selling CDs is, as economists say, scalable: you make one recording, and you can sell it to an unlimited number of people for an unlimited amount of time, at very little cost. A tour, on the other hand, is work. You have to perform nearly every night, before a limited number of people, for hours at a time. You can knock a few seconds off each song, fire a percussionist, or sell more T-shirts, but in the end efficiencies are hard to come by.
The trick is that musicians get a much higher percentage of the money from concerts and merchandise than they do from the sale of their CDs. An artist, if he’s lucky, gets twelve per cent of the retail price of a CD. But he doesn’t get any royalties until everything is paid for—studio time, packaging costs, videos—which means that he can sell a million records and make almost nothing. On tour, though, he often gets more than half of the box-office, so even if he grosses less he can profit more.
Traditionally, tours were a means of promoting a record. Today, the record promotes the tour. The decline in record sales has shrunk the size of the pie for labels and artists to fight over, so they’ve had to find new ways to make money, and artists have come to see how lucrative touring can be, given what people will pay to see them live. (Ticket prices for the top hundred tours doubled between 1995 and 2003.) And, while high prices may be starting to put a dent in attendance, the dollars keep pouring in. Last summer’s concert season was considered a dismal one, yet, according to Pollstar, the industry’s trade magazine, concert revenues rose for the year.
Inevitably, touring rewards some artists better than others—graying superstars, for example, with their deep-pocketed baby-boomer fans and set lists full of sing-along hits. The economist Alan Krueger has estimated that the top one per cent of performers claim more than half of all concert revenues. But even indie rockers are reaping the benefits, with bands like Wilco and Modest Mouse selling out venues like Radio City Music Hall, at decidedly non-indie prices.
The upshot is that the fortunes of musicians and the fortunes of music labels have less and less to do with each other. This may be the first stage of what John Perry Barlow, a former lyricist for the Dead, once called the shift from “the music business” to “the musician business.” In the musician business, the assets that once made the major labels so important—promotion, distribution, shelf space—matter less than the assets that belong to the artists, such as their ability to perform live. As technology has grown more sophisticated, the ways in which artists make money have grown more old-fashioned. The value of songs falls, and the value of seeing an artist sing them rises, because that experience can’t really be reproduced. It’s funny that, in an era of file-sharing and iPod-stealing, the old troubadour may have the most lucrative gig of all. But then Metallica knew it all along. “Send me money, send me green,” the group sang in “Leper Messiah,” twenty years ago. “Make a contribution, and you’ll get a better seat.”
Lucinda Williams, Live at Fillmore (Lost Highway Records)
Lucinda Williams writes and performs heart-searing roots rock on the rarefied level of demigods like Tom Petty and Neil Young; she's also opened for Petty and Young. So the least she deserves is her own Seventies-rock-style double live album, recorded at San Francisco's Fillmore Auditorium, no less. She and her impeccable three-piece band give her songs' meticulously recorded original versions a run for their money; led by Doug Pettibone's Crazy Horse-esque lead guitar, they deliver "Changed the Locks" (from 1988's Lucinda Williams) with the spiteful fury of Bob Dylan circa '66, and crack open the downcast title track of 2001's Essence, transforming it into a brawny rocker. The twenty-two-song collection suffers from bloat, uneven pacing and an overabundance of tunes from 2003's World Without Tears. But it's still an effective summary of Williams' career as a prophet of, as she puts it, "all that's alarming, raw and exposed."
OTHER
Struggling Towards a World of Services (On IBM)
Can the Police Commandeer Your Car?
Pitchfork skewers Weezer ("Sometimes an album is just awful. Make Believe is one of those albums."). A dissent from elvithprethley.com: Weezer - "Perfect Situation". "If you, like me, gave up on Weezer after listening to the Green Album more than a few times, tune in. This is pure Blue, to me, updated for this year. The guitars soar blue and shiny, Rivers sighs but then double-hikes it to full-blown emo longing, and the chorus has the cheer of a chicken-chested man proudly clucking at the hens. It's fantastically written and produced, with that downward scale of guitar notes, the homey ding-ding-ding of piano hiding in the mix for the choruses. And where elsewhere on Make Believe, Rivers' autotuning is frustrating, here it's just a guy who fussied himself up for his visit to the cliffs, so that the sirens might give him a second glance as he bellows at them."
As the iPod Stays Hot, It Risks Losing Its Cool.
I recommend this documentary.
Revenge of the Sith review.
The last days of Kurt Cobain's life (as rendered by Gus Van Zant).
The Wired 40: They're masters of technology and innovation. They're global thinkers driven by strategic vision. They're nimbler than Martha Stewart's PR team:
1. Apple Computer
2. Google
3. Samsung Electronics
4. Amazon.com
5. Yahoo!
6. Electronic Arts
7. Genentech
8. Toyota
9. Infosys Technologies
10. eBay
11. SAP
12. Pixar
13. Cisco
14. IBM
15. Netflix
16. Dell
17. General Electric
18. Medtronic
19. Intel
20. Salesforce.com
21. Vodafone
22. Flextronics
23. EMC
24. Nvidia
25. Jetblue
26. FedEx
27. Monsanto
28. Microsoft
29. Nokia
30. Costco
31. Comcast
32. Pfizer
33. Li &Fung
34. Taiwan Semiconductor
35. Gen-probe
36. Citigroup
37. L-3 Communications
38. Ameritrade
39. Exelon
40. BP
Mondrian
Ocean 5
1915
Charcoal and gouache on paper
87.6 x 120.3 cm (34 1/2 x 47 3/8 in)
Peggy Guggenheim Collection, Venice
posted by D @ 3:21 PM
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