Back to the essence of this business being, effectively, spotting and scouting talent and promoting and commercializing the talent. Historically, was that with artists at a young age?

Without being over misty-eyed and nostalgic about this, the business, which really grew up in the 60s and 70s, has been built on relationships with talent, which lasted over many years and was developed. If you look at an artist like Bruce Springsteen, he was signed by a legendary A&R guy, called John Hammond, and the first couple of albums didn’t really cut it. But his talent was deemed worthy enough to continue to invest. But the difference between the game then is, for artists signed at that period, the royalty rate was, invariably, much lower. The upside could be that much greater because the volumes of physical product were there, in the market and the rights were, generally, in perpetuity. I guess you could take a longer view, because the rewards could be greater.

If you go back to the 80s, 90s and even 20 years ago, it seems as if the artist needs someone to distribute to radio, to physical, with scale. Whereas today, you can go viral, if you’re lucky and good, pretty quickly. Is the record label business somewhat predicated on signing that talent in the first or second album or quite early in the career?

It’s predicated on signing them out of the box. Again, you’re absolutely right. You can look at all the levers that the majors had, 20 years ago, where they not only controlled manufacturing distribution, but they controlled the relationships with media and retailer; you needed to be with a label to be able to have a proper global reach. Obviously, all that’s gone. The other thing which has changed dramatically, in the last 20 years, is that the cost of recording has reduced massively. You needed to go into an expensive recording studio to create a master quality recording, 20 plus years ago. Now, you can do it on a laptop in your bedroom. All the economics have massively changed.

I would look at the business, right now, and ask what the majors are, primarily, offering? Well, they offer cash and they offer reach. To be fair, there is an awful lot of expertise within major labels, as well. There are very good marketing people; there are very good digital marketeers. There are also very good A&R people in there, who can really help an artist develop. But as an artist and as an artist representative, you have to weigh up, okay, I’ll take a cheque from a major and, in exchange for that cheque, I get access to that expertise and access to that reach, but I’ll get, maybe, a 20% to 25% royalty; I’m giving away 75% of my income for that and I might actually have to give away rights, if not in perpetuity, but for 15 or 20 years. Versus, I can go to a third party and maybe access smaller funding, where I can build a team around me and I retain ownership of my rights and I’ll get paid 80% of my revenue share.

10 or even five years ago, there were far fewer options for artists to do that. Now there are a plethora of options for artists to do that. Even each major also has what they call a label services or artist service business.

These are not indie labels, but separate service offerings?

They are not labels. They are primary distributors, with services bolted on. You can either have a straightforward distribution which will give you a set of pipes; we’ll push it out to all DSPs. We can handle physical for you, if you require it, and we’ll account to you on a monthly basis.

But the artist has to become, effectively, the start-up owner?

100%. New artists certainly have to be CEOs of their own business. They are CEOs of their own start-up business. Interestingly enough, this all comes back to the Napster conversation. As Napster took hold and file sharing took hold and piracy was rampant in the music business and you saw a massive downturn in revenues, in terms of where there was more data, the majors became risk averse, in terms of investing in very early-stage talent. They were waiting for the data to justify the investment. Data is not fool proof. What tended to happen was, you would get a situation where artists who were savvy enough or who had management or representatives who could invest some money into them, were building a platform; they were building a connection to an audience.

By the time the major came back and said, okay, we’re ready for you now, the artist would say, thanks, but you know what, I don’t need you. There is a case in point here, about two years ago, and it is an anecdote, but it sent real ripples through the business. The British Record Industry Awards, the BRIT Awards, have BRITS Critic’s Choice, which is like a golden ticket. It was the artist that most critics or music professionals deemed to be the most likely to break through and achieve global success. It has been won by Adele and Sam Smith; it was a golden ticket. A couple of years ago, it was won by Jorja Smith and Jorja Smith was an independent artist. It was the first time that a true independent artist had picked up this award, largely because she had taken advantage of these third-party distributors, built a very good streaming business off her own back, creating her own music, cherry picking a small team of people to work around her. By the time the majors came calling, she was saying, thanks very much, but I don’t need you. I’m generating money for myself now and I don’t need to hand away my rights or my control. She has actually ended up doing a deal with Columbia in the States, which is a Sony company. But she is in control of her destiny.

Does she own the masters and they just become a distributor? What are the terms of these new types of deals?

Again, certainly as far as the UK and rest of the world, she owns the masters. I’m not sure about the relationship with Columbia, but I’m pretty sure she does retain or she’s licensed for a shorter period of time – maybe 10 years – so they will revert back to her. That is now becoming fairly common; that’s not unusual.

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