Posted by: Jon Fine on October 26, 2007
Glenn over at worthwhile music-biz blog Coolfer—a guy from whom I’ve pilfered many a notion—jumps off from a column I wrote about managers being the next record labels and takes a deeper dive, finding worthwhile examples of bands and managers who’ve actually gone down that road. He concludes:
The manager-as-label model, though, is another model that should be kept in perspective. It works very well for very successful artists who have the kind of fan base that broad exposure through major labels can offer. It works less well for undeveloped artists. Why? Moving to a manager-run-label requires far less risk for any one artist, which means the more successful artists will get access to that capital. The rich get richer.
Can’t disagree! (Ask the Eagles or their manager Irving Azoff; gazillioniares, all.)
Glenn also writes “the media has gone overboard” on the significance of the Radiohead ruckus. Which I agree with in terms of hype, but not as much when you view their move through a business lens. Other venues have made guesstimates as to how much Radiohead netted from their ploy, but let’s play reallllllly conservative here: If the much-reported figure of 1.2 million downloads went for an average price of $2.50—a pound and twenty five pence, approximately—well, that meant that Radiohead made $3 million in the first few days after In Rainbows’ release. Which is all theirs, too. No advance to pay back to a label; no one to share those funds with at all, really.
It’s hard to see how they would have made as much in the context of being a “signed” band.
And that’s not a small deal. Even if, as I said elsewhere, Radiohead is a rare band that would be able to pull this off in such a resounding way-—big fan base, unusually fanatical fan base, and big media play surrounding everything they do.
Elsewhere, in the Department Of Should Have Seen This One Coming: Radiohead on brink of hooking up with the ATO label to release theur physical CDs. ATO is run by Coran Capshaw, head of Red Light Management and who (as I wrote in the column), and who’s definitely a manager-to-watch in this arena.