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TVT's Steve Gottlieb Speaks Out

“We will continue to promote Pitbull f/Lil Jon’s ‘The Anthem,’ which goes Top 10 at Rhythm this week. Ying Yang Twin’s ‘Drop’ is #32 hip-hop track on iTunes despite it only being at mix show."

"We have been an agent of change, most notably fighting for respect for independents when most major media and trade outlets minimized their role, and fighting for industry change in the digital arena whether in our breaking ranks and settling with Napster in 2001, or in numerous other initiatives. I am optimistic that the company’s independent spirit, history of innovation and willingness to pioneer new music and new business models are more valuable in this marketplace than ever before and that we will emerge from this reorganization a stronger more vibrant entity."

Gottlieb says the publishing arm is not effected.

via Hits

A Guide To The Music Industry In China - Part 2 Indie & Major Labels

The media is filled with articles on doing business in China, but nowhere is there a primer for understanding the music industry there. Ed Peto lives and works in Beijing as a promoter, music consultant and writer shares his insights. (Read Part 1- Piracy & Retail)

INDEPENDENT & MAJOR LABELS -

The major labels are shadows of their western motherships and there is a gaping hole where the independent record label scene should be. In order to survive it has become necessary for labels to take over an artist’s entire life - recording, publishing, management etc. - obsessively tapping all revenue streams in order to survive. You can count the number of recognizable independent labels on a pair of chopsticks.

Modern Sky is one such label. It has just celebrated its tenth year in existence and, much like its rabbit warren of an office in West Beijing, it’s business model is a convoluted arrangement of media company, record label, artist management and design house - a model that has allowed it to survive in this most hostile of environments. In the process of surviving it has also amassed a significant percentage of the Chinese rock catalog. Physical releases are practically a loss leader for Modern Sky with digital revenue also remaining a minor consideration.

Label Manager Meng Jinhui explains that they normally take over management, allowing them to promote the hell out of the artist rather than the album. Resultant brand co-operations with these artists and the label itself generate the bulk of Modern Sky’s income.

The ‘big four’ majors are all over here in some form or other...

RoyaltyShare Adds Digital Distribution, Expands Beggars Deal

Read an exclusive interview with RoyaltyShare President and COO Steve Grady here.

RoyaltyShare, a provider of technology services to the music industry, has announced a new web-based platform for managing and distributing digital music. The service, which could offer serious competition to digital aggregators like The Orchard and IODA, provides labels and distributors with a lower cost way of managing the digital sales process including metadata, encoding, storage and delivery to retailers.

When combined with the company's royalty processing service, labels can manage the entire digital sales cycle through RoyaltyShare.  Traditional digital aggregators do not offer comprehensive royalty processing.

The new RoyaltyShare service targets record labels and small distributors looking for an alternative to costs and restrictions imposed by...

WMG, Universal, EMI and Sony BMG Deny Qtrax Deals plus Commentary

UPDATED: Qtrax's announcement on Sunday that it was launching its ad supported download service at midnight with music from all four major labels may have been premature or at the very least misleading.  Warner, Universal and EMI are denying deals with Qtrax. Only Sony BMG has not commented.

“Warner Music Group has not authorized the use of our content on Qtrax’s recently announced service," WMG spokesman Will Tanous told Silicon Valley Insider.  The LA Times is reporting that EMI also has no deal. Sources at Universal Music Group say they have no agreement with QTrax either, but is "very, very close to one".

Now Sony BMG has joined the other services in saying it does not have a deal with Qtrax, according to a source.

COMMENTARY: If Qtrax chooses to launch - as thy now say they will -  content from WMG, EMI, Universal and Sony BMG, it could find itself in legal hot water.  But this strategy has been used in recent months by several music 2.0 services who have used major label content to build an audience and leveraged that audience into funding and deals with the labels.  Stay tuned...

MORE: The latest on the Qtrax launch

IODA To Labels: No Deals With Imeem & LaLa

In a letter to its labels this week, digital distributor IODA recommended not granting licenses to prominent net services imeem, LaLa and others that offer full song streams due to inferior royalty structures.  The distributor's struggles underscore that even in Music 2.0, there are vast inequities which leave indie labels fighting for position behind the major labels and their large catalogs.

According to the letter, "imeem proposes to pay out a percentage of advertising revenue from its site, but will not thus far commit to a base per-stream floor rate...in contrast to the deals many of the majors received (more)...Under this structure, the imeem royalty rate could end up lower than the compulsory DMCA rate paid by non-interactive internet radio webcasters (just $.0014 per performance)...

IODA CEO Kevin Arnold said further that Lala intends to "stream full songs for free on its' site in the hope that these streams will result in sales of downloads and CDs. They have proposed a complex payment structure...that includes caps on streaming payments which would result in rates uncomfortably below the levels paid by other streaming services. It remains to be seen the degree to which free streams will result in sales..."

The letter also names Grooveshark and Aime Street among sites that IODA are negotiating with and causitons against making individual label deals siting the power of collective bargaining and the growing strength of indie trade groups like A2IM, WIN, Merlin.

UPDATE: A clarification from the IODA's CEO here.

READ THE FULL TEXT OF THE LETTER AFTER THE JUMP.

EMI Pacts With Christian Indie Vertical Shift

EMI CMG Distribution and new indie Vertical Shift have signed a worldwide distribution agreement for Christian, general market and digital and mobile outlets.  The new partnership launches with new releases from successful indie bands Re:zound and Ever Stays Red in early 2008.

Ken Mary, President of Vertical Shift Records is a veteran of both mainstream and the Chrisitan comtemporary music industries and his work as a producer and musician has included such diverse artists as Alice Cooper, LaRue, Gene Simmons, Ricardo, Everybodyduck, The Beach Boys, Trik Turner, and Megadeth. The first two Vertical Shift artists will hit on March 11th with Re:zound and Ever Stay Red.  Releases by new artists Kelly Mack, Out of Ruin and Vikki Jordan follow.

Expect more similar deals in the coming year as EMI and other majors try to shore up their declining bottom line by aligning with or  even purchasing independent labels.

New Label Models: Which Will Survive?

As CD sales and label profits tumble, a great deal of hope and excitement has been attached to a variety of new models:

• Music Is Free - And hope to make money elsewhere
• Name The Price - Radiohead asks the fans to pay whatever they want
• D.I.Y. - The artist is the label handling or hiring out distribution, marketing, etc.
• Label As Partner - Band delivers master and label does the rest sharing profits more equitably - often 50/50
• Ad Supported Releases - One-offs like Prince and the UK newspaper or Pennywise and MySpace
• Ad Supported Labels - The new RCRD LBL
• 360 Deals - The band as brand. Labels get a percentage of all revenue streams (albums, tours, merch, etc.) in exchange for longer term career investment
• The New Old Label - Keep costs down and hope to monetize across multiple revenue from downolads to ringtones to YouTube

Which model has the greatest chance of success?  Its far to early to tell, but several of the models above will probably find traction in the months and years ahead alongside new ones not yet imagined.

Instead of a single business model controlling an artist's career, wouldn't it be better if release methods become situational depending on genre, where an artist is in their career cycle and their goals for the release?  If a band is new or about to embark on a tour, perhaps giving it away (supported by ads or not) makes sense.   If you're a budding pop star in need of grooming and mainstream media, then the 360 deal may be for you.

Artist and fan empowerment is the mantra of Music 2.0.  Replacing the old model with a single new one serves no one but the gatekeeper.  Choice is freedom; and freedom leads to better music.

What label model(s) do you think will survive and thrive in the coming months?

Six Degrees Gives Away "Emerging Artist" Tracks

Today Six Degrees Records is launches “Download of the Week” to highlight their hip digital only Emerging Artists series.  For the next nine weeks you can download a free MP3 on their blog and the price of all the “Emerging Artist” tracks in its own web store a are reduced to 79¢.

The web has enabled this kind of inexpensive promotion, distribution, and discounting for direct sale; and it's surprising that more labels are not experimenting with the possibilities.

Analysis: What The Amazon Store Is... And Is Not.

You can find our in depth first look at the new Amazon DRM free download store here. But just how "industry changing" is it?

The Amazon MP3 Download Store IS:

• An important step forward for digital music.
  
  • Amazon has set the bar higher and that's good for the entire industry. Plus Amazon name and buying experience and the universal usability of the tracks should help expand the universe of download buyers.
• A another big nail in the DRM coffin.
• A boost for the record industry.
  
  • Amazon is a partner the labels already know and trust who just gave them everything that Apple is fighting not to: variable pricing, full album downloads, universal compatibility and DRM sales of indie artists.
  • Come on WMG and Sony BMG...walk towards the light...
• A serious threat to every other download store.
  • Not only does it have all of the major label DRM free product that they do. It has hundreds of thousands of indie tracks that the others do not.
• A possible eMusic killer.
  • With defections from some a few of their most important labels, eMusic is left competing on price alone. I predict that when the checks from Amazon downloads equal those they get from eMusic that more indie labels will pull out.

The Amazon MP3 Download Store IS NOT:

• The iTunes killer.
  • Serious competition yes. Killer no. Too many people are used to the iTunes to iPod experience no matter how easy Amazon makes it.
• The answer to all your download buying needs.
  • It's not their fault. The labels won't let them...yet.
• A mobile solution. 
  
  • With the Verizon's deal with Rhapsody/MTV and the the iTunes Wireless store, Amazon needs to move quickly to add over the air downloads.

Tell us what you think. We'll post the best comments and reaction from around the web tomorrow.

Six Degrees Of Music Repositioning

Product repositioning is a buzz concept that is easy to dismiss. But for labels trying to monetize existing investments and artists attempting to make noise in a crowded marketplace, repositioning can be a valuable tool.  For fans, these new projects can be a whole lot of fun.

A new release from indie Six Degrees titled Cinematic smartly features new remixes of music composed for film. Classic scores by Quincy Jones, Nino Rota, Ennio Morricone, Henry Mancini, Duke Ellington, and others are re-imagined by top producer and DJs.

Here's a free mp3 from Cinematic of Birdman of Alcatraz repositioned as Shawn Lee's Ping Pong Orchestral Maneuvers in the Dark Mix. (mp3)