Equations for the future

So the internet has been around a while now, the major labels are still suing their customers as their first response to free advertising (i call it sharing, the more dramatic amongst the industry call it piracy. Really? Piracy? Read some news articles on Somalian waters or the East China Sea to find out what modern piracy really is) but somehow they're still there and, more depressingly, we're still here.

But these things take time, a lot of time when your opponents (and perversely this includes people like the BPI who are supposed to represent me) have the ears of the government.

But to recap...

I think what we're seeing the beginning of is a mass levelling of the playing field. Basically we will end up with fewer superstars but more people making a much more modest living from their music. There are a multitude of alternative business models out there, they're all evolving, the trick is finding one that works for you. Most of them are based around the following (which you'll see in a number of places on the web but i think it originated at Techdirt): Connect with Fans (CwF) + Reason to Buy (RtB) = $ This is much the same as the 1000 True Fans theory but expressed differently. Effectively it comes down to your ability to engage with your fans and persuade them to support you (CwF) and your producing a product that's sufficiently high quality to make it worth buying instead of downloading (RtB). Personally i think there's a factor missing here, which, for lack of a better term, i shall call Elevation. And this what the current major labels do. With the rise of free distribution mechanisms and cheaper technology there is more and more really good music being made. The challenge now for any artist to stand out from the crowd, to raise yourself or your band above the level of everyone else and get noticed. Sadly it's not enough just to be really talented, you still need some mechanism to elevate yourself above the noise level. The major labels have massive publicity and marketing budgets, that's how they do it but it doesn't work for an independent act.   Unless you're an independent act with a corporation-sized bank account. No? let's move on then...  As always though, there are a number of alternative ways to do this. One way is via working out what your niche is and targetting that, there's a lady who writes songs about sailing (whose name i forget, irritatingly) who sells very well to, funnily enough, the yachting and sailing crowd. That's her thing and it's effective for her. Another option is to consider your location and work out if you're in the best place for your music, different areas have different scenes, sometimes it helps to be part of that scene, sometimes it's best to be unique in your region. What you don't want to be is stuck in the middle. Another option is to partner with a publicist / advertiser, there are people trying to make careers there as well and some mutual backscratching might be possible. One approach that appears to be coming through is to target a really, really small niche, with a very high-end product (hat tip to Confused of Calcutta). The mass market is always going to be the territory of the major labels - don't try and compete, figure out what your Unique Selling Point is and work out how to make the most of it. So i think the equation should actually be: e(CwF + RtB) = $ But at the end of 2010 i find myself no nearer establishing what my business model is. So i suspect 2011 will be no more successful for me than this year was. Hopefully others will get further along that particular line.

1000 just isn't enough

In my opening post i mentioned the stuff i'd been reading on the technium about the concept that's been doing the rounds for a while now, that a band can get by with 1000 true fans.

What defines a true fan is probably up for debate but for the purposes of these arguments it can be taken as someone who'll buy everything you release. Which is nice of them, but, and this is where it gets interesting, being a true fan they're more likely to want some kind of hard-copy product rather than just a download.

This, therefore, means upfront production costs. This is particularly true of any merchandise other than music (ever tried downloading a t-shirt?).

Production costs rack up quickly. Let's say that your true fan will spend £25 on your products per year, say, for the sake of argument, an album, an EP and a t-shirt. That's going to cost you about £1500 for a thousand t-shirts, about £1000 for a run of a thousand albums and a similar amount for the EP. These are ballpark figures, you can probably find cheaper if you search around but it's a good place to start.

That's £3500 you've got to find upfront (albeit potentially in installments) to produce the physical item.
Let's talk studio costs now. In fact, let's do it in reverse.
You have 1000 fans all willing to spend £25 (+ or - a few fans and + or - a few £)
So your merchandise income is £25k
less VAT of 17.5% (£3723)
less production cost (£3500)
leaves you 17700 (and remember this is your full time job)
Studio time will cost you probably £20 and hour for the studio and another £20 an hour for the engineer (last time i looked)
Now if you spend every penny of that £17700 on studio time, that works out at about 444 hours. If you compare that to a 9-5 job that's about 3 months. That's probably enough time to record an album and an EP.
But you're not going to be eating in that time, out of that money, partly because you won't have made it yet, partly because there isn't any left.

So you're basically going to need to live off your live performances.

Now i don't know about you but i have found one thing to be consistent on the live circuit - the "better" the venue (i.e. the more it is a recognised venue with appreciative audiences and big name draws), the lower the payout at the end of the show for a supporting act.
If i wanted to live off music i could probably manage it playing covers in bars 3 nights a week in the region. Just*.

But playing covers in bars doesn't get you true fans; you want true fans you have to be playing your own stuff. And that doesn't get you gigs in bars.

I dunno, maybe that's just me, but that's my experience. So basically, 1000 fans isn't enough. 2000 might be, 3000 is probably closer to the mark. And that's for a solo artist/duo. If you're a band then you've got to be looking at around 5000 i think.
And that's a helluva a lot of people to get interested in your music by yourself.

Which i'll come back to in the next installment...

* Money is drying up in the recession, fewer places are putting music on and fewer people are going out.

Yet Another Music, Design And Cycling blog

Welcome, Wilkommen, Bienvenue, in the words of the best band in the world ever*.
So here we are on our first of an irregular series of blogs that will cover, generally speaking, Music, Design and Cycling. I've chosen to write about these three things as they are intrinsically linked in a singular way.
I.e. I'm interested in them.
But nowadays with music comes technology; so i'll be touching on that here and there as well.
In fact, we'll be starting with that.
I've just finished reading a very interesting article on The Technium called Better Than Free; it talks about ways to monetise a product in a world where copies are free. And it's a lot better thought out than most posting on the subject.
This is especially true when read in conjunction with two of his other posts: The Reality of Depending on True Fans and The Case Against 1000 True Fans.
It seems the debate is still very open with only one clear example of someone managing to make the new paradigm (did i really write that? I guess i did, oh well) work being Jonathan Coulton.
I suspect that where we will end up is with the rise of either the marketeer / artist or close collaborations of the two. Either way, it's not enough just to produce music and publish it on the web, nor is it enough just to produce music and play live. There's a huge amount of effort required to persuade people to get off their arses and come to a gig, and then another chunk of effort to persuade them to buy what they can otherwise get for free.
And sometimes that's kind of hard to do at the same time as holding down a day job.

* Blot - Midnight Oil