Trent Reznor of NIN had a wake up call one day. He realized that he was only making .80 cents from every record he sold for $18.98. The record company got the rest.
Reznor says, “Anyone who’s an executive at a record label does not understand what the internet is, how it works, how people use it, how fans and consumers interact – no idea. I’m surprised they know how to use email. They have built a business around selling plastic discs, and nobody wants plastic discs any more. They’re in such a state of denial it’s impossible for them to understand what’s happening.
“One of the biggest wake-up calls of my career was when I saw a record contract. I said, ‘Wait – you sell it for $18.98 and I make 80 cents? And I have to pay you back the money you lent me to make it and then you own it? Who the f**k made that rule? Oh! The record labels made it because artists are dumb and they’ll sign anything’ – like I did. When we found out we’d been released (from their recording contract) it was like, ‘Thank God!’. But 20 minutes later it was, ‘Uh-oh, now what are we going to do?’ It was incredibly liberating, and it was terrifying.” …continue reading
As Reznor and other artists realize that they can keep a much larger percentage of their product and tour sales themselves, they are beginning to go solo (business wise) and take responsibility for their own digital sales, tour promotions and merchandise. Of course, it is probably much easier to have someone else take care of the business side of things; but the Internet (and a new generation of digital music enthusiasts) makes the business of selling music and communicating with fans much easier today. And the reality is that it won’t be very long before CDs (like LPs before them) will be gathering dust on the shelves they remain on.
As Reznor says, “As an artist, you are now the marketer.”
