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The Record Company Cookie, Crumbling

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Interesting article in the Rocky Mountain News back in May on record companies and artists titled, Cutting Record Companies Out of Record Deals:

OK, here’s a good bit of unintended music-industry irony.

For four years, Big Head Todd & the Monsters struggled in their effort to break free of their record label and be allowed to put out their music on their own – without a major label involved.

They were signed to Irving Azoff’s Giant Records, which finally released the band from its contract back in 2001. Last year Big Head Todd released Riviera on their own Big Records and made more money in sales than they ever had.

So singer Todd Park Mohr laughed at the irony this week when Azoff, who manages The Eagles, announced that the new Eagles studio album is almost ready – and that the band will bypass the record industry by releasing it on its own Eagles Recordings.

Why? From Big Head Todd to the Eagles, they’ve all learned the lesson that Prince learned years ago when he started putting out his own music. On a major label, an act gets 10 percent to 12 percent of the wholesale price of a CD – and from that they have to repay the record company’s upfront costs, including recording and promotion. Even superstar acts get their royalties bumped up only to the 20 percent-to-25 percent range. And at the end, they don’t even own the recordings.

Do it yourself, however, and suddenly you’re in the 60 percent-to-70 percent range – and you retain ownership of the music. Big Head Todd found that out. Riviera sold nowhere near what the band’s big-label blockbuster Sister Sweetly did, but the band suddenly finds itself with more money, more options and more self-determination.

Go read the rest . . .

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