The Internet Killed the CDSales Star. Madonna dumps record label.
October 11, 2007
Always the trailblazer, Madonna has done it again. She’s dumped the record industry, signed a US$120 million deal with LA based concert and promotion firm Live Nation to distribute studio albums, promote concert tours, sell merchandise and license Madonna’s name.
Sooo, while Madonna will not be offering direct to public albums, as Live Nation isn’t a record company- this deal shows that even for a world famous artiste like her, a record company is no longer required in these days of digital downloads and P2P music sharing.
In short, Madonna is showing where the money is: tours and promotional merchandise not CD sales. It was also reported earlier this week that Nine Inch Nails, Oasis and Jamiroquai also joined in on the movement away from the record label model. Add to that hip hop, neo soul, edgy artists established and emerging have been experimenting and succeeding with this model for a while…(to hell with CD sales, focus on singles, tours and merchandise for a larger piece of your blood-sweat-n-tears pie)…but Madonna may just be the proverbial tipping point.
Note to Caribbean Artiste: You are as good as your last single and hot video. Make them count!
It’s not so much that the Internet killed the star as it did the record companies that have exploited artists for years. The record companies have been taken by surprise by online technology because their role in the industry has been to sell records, not music — which would primarily benefit the musicians and the listeners.
A record/CD often has only 3 out of 12 good songs, but before Napster (and other spin-offs) people were forced to purchase all 12 songs at excessive prices of up to USD $21.00 — when only 1 cent per song (for each CD sold) went to the artist (and that was if they got a “good deal”). Thanks to e-commerce, today we can get the three songs we want for $3 bucks. The ‘Napster movement’ informed musicians that they could sell their music online directly to consumers, keep at least 90% of the $3 we pay for their three good songs versus get only 12 cents in widespread one-sided record “deals”.
At least online music sales have humbled record companies and put the power back into the listener’s taste and the artist’s worthwhile creations.
Let’s hope that Caribbean musicians wise up and start working with those of us in the e-business community to get their share of the pie!
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