Independent Record Labels and Artists Flourishing

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Tim O'Reilly
Apr. 11, 2003 04:59 PM
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In Piracy is Progressive Taxation, I described how obscurity, not piracy, was the greatest problem for artists. The Christian Science Monitor just did a story called Independent's Day that describes the success of numerous small independent music labels, many of them started by artists.

The article opens "What record industry slump? Independent labels say business has never been better." It describes how grassroots marketing, closer relationships with the target market, and lower costs, with more of the profits passed on to the artists, make successes out of records that would never have gotten over the profitability threshhold at the majors. While the RIAA is complaining that P2P networks are cutting into their sales, independent labels say 2002 was the best year in their history. In particular, avoiding the high cost of radio promotion, which forces labels to focus only on the top hits, is a big win for the small labels. As one independent record producer noted, "By seeking home-run hitters at the expense of solid team members...they're just ceding a whole big part of the marketplace that we can go after.

In the interest of fairness, I do have to note that the article does also claim that "Another secret of their success is that the labels target consumers - namely, adults - who are still willing to pay for their music, rather than download it for free." However, I will note that there was little evidence for this assertion. And I stand by my point that file sharing networks and other grassroots mechanisms for raising music's visibility can actually lead to increased sales for artists who don't have huge promotional budgets.

Tim O'Reilly is the founder and CEO of O'Reilly Media, Inc., thought by many to be the best computer book publisher in the world, and an activist for open standards. O'Reilly Media also publishes online through the O'Reilly Network and hosts conferences on technology topics, including the O'Reilly Open Source Convention, the O'Reilly Emerging Technology Conference, and the Web 2.0 Conference. Tim's blog, the O'Reilly Radar "watches the alpha geeks" to determine emerging technology trends, and serves as a platform for advocacy about issues of importance to the technical community. For everything Tim, see tim.oreilly.com.

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