There was an article in Advertising Age a few days ago (and now, unfortunately, it’s no longer free online) about the amounts bands get for having their songs placed in a commercial and it shocked me. It said that licensing (master + sync rights) a song can bring in $300,000 for a song by a small band, with the band getting up to $195K of that with the other parts going to the publishing company and label[1]. Feist “only” got $80,000 because Apple is a “cool” brand [2] that artists want to be associated with.
I was shocked at how much bands were getting. $300K is a lot of money. In the realm of advertising it’s not a lot, but in the realm of an indie band, it’s huge. I was also shocked, because last time I read actual numbers on advertising licensing was in a NY Times profile of the Apples in Stereo where it stated they got $18,000 for “Strawberry Fire” in a Sony commercial. The article was back in 2001 and the licensing deal was in 1999, but it’s not like inflation in the intervening 9 years has caused $18K in 1999 dollars to be even anywhere close to $80K or $300K in 2008 dollars.
Digital Music News also had an article about SxSW’s increased importance as a place for placing songs.
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In more SxSW news, the Wall Street Journal has an article about the tension between unofficial SxSW-timed parties in Austin and official SxSW events. Apparently, the chief of SxSW, Inc, Roland Swenson has been pretty draconian:
At last year’s SXSW, Mr. Swenson took extreme measures against the unaffiliated events. He reported more than a hundred parties to fire officials saying they were in makeshift venues and could pose a danger to public safety. He says his goal was to create a level playing field for the festival’s official venues.
Right, I’m buying that he’s only concerned for public safety.
Also, an interesting part of the article is this: “The clubs aren’t paid directly, but sign on because of the potential foot traffic and bar sales.” Wow, sounds like a pretty good deal for SxSW, Inc. Blank slate on a free club to do what you want.
One more interesting note on the somewhat draconian practices of SxSW comes from this article by Trespassers William–who’s actually playing Sunday at 12 Galaxies with ipickmynose fav Or the Whale–band member Ross Simonini:
For some reason, selling CDs (or anything) is against the SXSW communist-like law practices — though I saw this rule broken too many times to count — so at the end of the show we just handed out copies of our album to anyone who wanted them.
No wonder I didn’t see merch tables set up and had to hunt down bands to buy things from them! If SxSW is about finding up and coming bands, how do people hear more of that great no-name band they just heard if they can’t buy their CD? Is it actually the expectation that in the massive swarming cloud of bands and people that every fan can remember every band that they liked so they can then hunt down their web pages to buy their albums? I’m not sure I get the logic.
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Finally, there’s been some interesting articles lately about “new business models”. Arts Technica (and Reuters) have articles this week about labels setting up their own digital download sites to bypass the cut that iTunes and other such retailers take and to be able to offer up a wider variety of bit rates and formats.
Coolfer points to a great article on TimesOnline about the contrast between Shayan Italia, who is working on a small-scale investment model (investors own some of his future earnings), and Duffy, who is backed by a major label.
[Italia’s] His Reflection reached No 1 on YouTube’s music video charts last week, with 190,000 plays in the first 24 hours of its placement online, all of which sounds promising enough. Italia owns his material, selling 1 per cent shares in the business that controls all his copyrights, plus any tour and other music-related income for £12,000 a time.
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Glance at this week’s hit parade, meanwhile, and it is Duffy, the Welsh singer, who leads the singles and album chart. The 23-year-old was first signed by Rough Trade, the independent group that manages her, and it brought her to Universal Music, the wearyingly dominant market leader. Backed by the kind of marketing campaign that only big music can provide, Duffy has been compared - rather optimistically - to Dusty Springfield, Crucially, her strong voice and well-crafted album Rockferry do not, at least at this stage, disappoint on that hype.
Rockferry shifted 180,000 CDs in its first week, worth rather more than 190,000 views on YouTube, without the help of a television programme talent contest or any internet nonsense. In fact, the album was marketed conventionally to entice the mainstream buyer.
It looks like the old business model is still working some point. 180,000 CDs is not record breaking, but it’s still a lot. To give you some perspective, Coolfer points out that the highest selling album in the U.S. last week was Alan Jackson’s at 119,000.
I’m all for new business models in the music industry, but if they’re not working–well, that’s something to think about, certainly.
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[1] This is coming from memory now, but I do have a good memory, but you don’t have to trust me if you don’t want to. This article also provides the same numbers, though, citing the same article.
[2] Coolfer has some interesting thoughts related to that article about how Apple doesn’t actually pick independent artists, just indie-sounding artists.