
Why I think Apple's Launching a Record Label - dbreunig
http://dbreunig.tumblr.com/post/183159459/tomorrows-apple-announcement-a-record-label-jay-z
======
mr_eel
I don't agree with the general thrust of this post, but first, some
nitpicking:

"Because in the end, all a label really does is market, distribute, and
schedule tours."

No actually. For starters, touring is generally handled by the artists and
their managers. Up till now, it's been uncommon to have labels involved --
although this is changing as we see majors scrabble for more money.

The author is also forgetting the actual production of the music. A label
generally fronts the money for a producer, engineer and studio time. Not to
mention the mastering required for distribution.

This isn't to say labels are the only avenue for funding recording, but it is
one important thing that they do and that the imaginary Apple label won't.

"Digital music has reached an audience where this makes sense. 25% of all
music sold in the US (physical and digital) is sold through iTunes."

That's impressive, but 25% still means there are a lot of other retailers
shifting music. I can't imagine artists -- especially independent ones --
limiting themselves to just that chunk of the market. The only way around that
is if Apple starts distributing music through other retailers. Not likely in
my opinion.

"They’ve been hiring H&R types and artist relation managers."

A few AR and HR hires does not translate into the kind of marketing needed to
support thousands of individual artists. If they did start a label, Apple may
forego this, but a few hires is not evidence enough.

We should not underestimate the importance of _individualised_ marketing for
artists. I have a hard time seeing Apple doing this.

"Why Jay-Z? Well, Jay-Z isn’t really on a major label."

He does run a label though. I don't think he wants to cut himself out of the
loop by helping Apple launch a label.

One of the major roles a label has is to editorialise. They hunt for and preen
artists. They pay for recording, they tailor the marketing and distribute the
music. How can Apple do this on a large scale? If they can't do it on a large
scale, why would they bother?

Is it open to all artists or are they going to pick and choose? Pick and
choose means limiting the scale of the operation. Making it open risks having
Apple associated with music and ideas that conflict with their tightly
controlled marketing. Retail is just retail, but being a label means
"blessing" the content. I can't see Apple wanting to lose that control.

I really don't think the author understands how music gets produced and sold.
I know it's popular to underplay the role of a label and simply conflate them
with distribution, but in reality it's more complex. Some labels are arguably
leeches and some work really hard to make their artists successful.
Irregardless, they're not easily replaced by some monolithic Apple label.

~~~
steveklabnik
> I really don't think the author understands how music gets produced and
> sold.

Isn't this kind of the whole point, though? The old way of music getting
produced and sold is outdated. The industry will go through its own
revolution, just like all the others, even if the labels don't want it to.

> The author is also forgetting the actual production of the music. A label
> generally fronts the money for a producer, engineer and studio time. Not to
> mention the mastering required for distribution.

Why bother paying for all of this, when (as the author mentions) you can just
do it yourself? Equipment is only getting cheaper and cheaper, and as far as
mastering goes, well, "MP3 is enough"
([http://www.readwriteweb.com/archives/radiohead_guitarist_mp3...](http://www.readwriteweb.com/archives/radiohead_guitarist_mp3s_fine_there_goes_fidelity.php))

> We should not underestimate the importance of _individualised_ marketing for
> artists. I have a hard time seeing Apple doing this.

Yep, we won't, because who better to market the band than the band itself? Why
pay somebody, when you can make a myspace/facebook/twitter/whatever and
plaster it everywhere? Now, branding is still pretty important, but still,
quite a huge part of the traditional marketer's job has been replaced by the
Internet.

> One of the major roles a label has is to editorialise. They hunt for and
> preen artists. They pay for recording, they tailor the marketing and
> distribute the music. How can Apple do this on a large scale? If they can't
> do it on a large scale, why would they bother?

I don't mean to sound insulting, but it's early and I can't think of a better
way to phrase this. My apologies.

Have you read The Long Tail? Why bother doing anything on the large scale?
This attitude reeks of the Old Way of Thinking. If you don't believe in that,
then fine, but really, all of that stuff is silly. That's what the old labels
do, let them keep that, go after the vast majority of music instead.

Now, I don't know if Apple will actually do this or not, but it would make
quite a bit of sense, and has the potential to make them quite a large bit of
money. But I won't deny that I'm biased by my hatred of a backwards, self-
centered, oligarchy of an industry. So, who knows?

Luckily, we only have to wait a few hours to find out, right?

~~~
mr_eel
"The old way of music getting produced and sold is outdated."

Recording processes haven't changed that much. If you have a band, recording
still means sound-proofing, monitoring, mic selection and positioning; all the
stuff an engineer does. If you're doing anything more complicated than a demo,
this is not trivial. This costs money.

I agree when people criticise current retail and distribution -- physical
distribution is expensive and wasteful, not to mention the fact that it
inherently limits your audience. However to sell music -- enough to make a
living -- just sticking it in a retail chain is not enough. You need to think
about who the audience is, where they buy music, how you can promote your
music to them etc. Again this is time and money.

"Why bother paying for all of this, when (as the author mentions) you can just
do it yourself?"

Because mixing down and mastering is a skill in and of itself. There are
plenty of musicians with these skills, but not as many as you think. The
problem here is conflating writing and performance with recording and
production. Related, but separate, requiring a different set of skills.

"Equipment is only getting cheaper and cheaper, and as far as mastering goes,
well, "MP3 is enough""

Agreed, equipment is not the issue. It's now possible to get high-quality
results with minimal gear -- assuming you have the skills. However, just
because your target format is MP3, that doesn't mean you have to spend any
less time or effort on the mastering. The final mixed stereo audio file needs
to get the most out of the format. Issues to consider: downsampling, dithering
and dynamic range.

"Yep, we won't, because who better to market the band than the band itself?
Why pay somebody, when you can make a myspace/facebook/twitter/whatever and
plaster it everywhere?"

Two reasons. Firstly, marketing is a lot of work. It takes time. Artists have
a finite amount of time, so it's useful to be able to delegate it to marketing
folk. Secondly, just jamming info on facebook etc, is not a replacement for an
actual marketing push. Doing that in a coherent way takes knowlege and skill.
Again, there are artists that can and do do this, but not everyone wants to
devote the time to it.

"Now, branding is still pretty important, but still, quite a huge part of the
traditional marketer's job has been replaced by the Internet."

That's wrong in my opinion. The internet has just become another medium for
marketing. It's not a question of the internet replacing marketing, it's a
question of who does the marketing on the internet, the artist or some
professional they hire?

I'm not saying pro marketers are the only way to go, I'm just saying they're
attractive part of getting involved with a label.

"I don't mean to sound insulting"

It's fine, I understand the internet makes it a bit hard to say critical
things in a nice way :)

"Have you read The Long Tail? Why bother doing anything on the large scale?"

The problem here is thinking like this:

Labels = Major Labels = RIAA = Evil

In other words, you've been trapped into thinking all labels are large, slow-
moving, customer-hostile entities, that labels on the whole are incapable of
changing, while discounting the things they do for artists. I am not defending
major labels -- I think they're largely fucked -- but it's naive to say that
labels on the whole are incapable of participating in a changing market.

"Luckily, we only have to wait a few hours to find out, right?"

Yeah, and it turned out to be horse-pucky. I think we'll see some more
inventive permutations of labels, but it's not gonna come from Apple.

------
Perceval
I always enjoy the wholly baseless wild speculation that arrives during the
week before an Apple event.

~~~
jobu
FTFA: "They’ve been hiring H&R types and artist relation managers. Alright,
alright, I have no link to the post. But I remember seeing this position when
job hunting about a year ago for client-side marketing roles."

I assume the author means "A&R" (Artists and Repertoire) here, but the whole
article smacks of an Apple fanboy with no clue about the music industry.

------
lurkinggrue
Could Apple be trying to buy out Apple Records?

I can't imagine the remaining Beatles letting them use the name Apple for a
record label.

~~~
hughprime
Indeed, as I understand it starting a record label is exactly the one thing
which Apple Computer is forbidden from doing, thanks to an earlier deal with
Apple Records.

I remember the story that this caused a little bit of concern in Apple's legal
department when the first macs with built-in microphones were released. This,
supposedly, is the reason why the update of the sound software released with
those new macs included the new system beep sound "Sosumi".

I also remember in those days when I read the story how ridiculous the idea
that Apple Computer would start a record label sounded. Just a sign of how
much things have changed.

~~~
butterfi
I love a good story: <http://en.wikipedia.org/wiki/Sosumi>

~~~
amohr
Fun Fact: In the 2004 proceeding in the RCJ, the case was handled by "The
Honourable Mr Justice Mann"

------
dflock
Apple already control the profits and destiny of all the existing record
labels by being the gatekeeper of something like ~80% of digital sales (i.e.
~80% of ~99% of all sales, eventually) via iTunes. They have already managed,
apparently without waking the slumbering record industry, to sneak in and take
over control of distribution - the only profitable thing about being a record
label in the first place. Not just one labels, or one markets distribution
either, but all of it - all 'legal' digital music retail distribution, pretty
much.

I'm not sure that the traditional phrase 'record label' really contains
meaning, from here on out, anyway. If I can record some music using my digital
studio (shhh, it's just a pc, but don't tell anyone), sign up to iTunes Music
Store as an artist and just start selling it, I would. So, not only have Apple
pinched the whole music distribution business out from under the majors,
they've also provided the opportunity for people to sidestep most of the
middlemen altogether. Notably, Apple will also sell you the software &
hardware for your digital studio too, if you like.

So, the App store for Recording Artists, not Software Developers, with the
artists getting a much bigger (like 20x bigger, or more) cut than they do now.
Rating and reviews doing your marketing. Sounds like an idea who's time has
finally come. The Monopoly is dead, long live the Monopoly.

Ties in nicely with this which I was reading just the other day:
<http://www.tbray.org/ongoing/When/200x/2009/08/23/On-Music>

~~~
chrischen
> They have already managed, apparently without waking the slumbering record
> industry, to sneak in and take over control of distribution

Can't the record labels just jack up prices for iTunes?

~~~
dflock
There's a certain amount of internal competition within the iTunes market that
prevents this working across the board. Also, the 99c thing is pretty sacred -
if it went up to $2.50 across the board, there would be a huge backlash, which
Apple (being teflon coated) would just redirect to the RIAA/record labels -
who everyone already 'knows' are evil anyway; ergo (even more) huge PR
disaster for the majors.

------
joao
Apple already allows you, if you are an artist, to submit yourself for
consideration to be featured in the iTunes Music Store.

Many, not label signed, indie bands alreay do this. They go through a similar
process as the app store aproval, and yes, many are refused.

Not mentioning this process in his post, the author shows how he doesn't know
what he is writing about really well.

~~~
nuweborder
That's the problem. Some indie artits may do this, but not nearly enough, due
to Apple's approval process. Most actually are refused as you mentioned, and
this is why itunes is not a viable option for unsigned musicians, as many
sites are not. The industry is catered to major label musicians, and FCC
regulation stricken. It does not meet the needs of the unsigned musician.
Checkout Pandora's plight.

[http://www.portfolio.com/views/blogs/the-tech-
observer/2008/...](http://www.portfolio.com/views/blogs/the-tech-
observer/2008/08/18/first-bytes-pandora-u2-fcc-techcrunch-vs-demo/)

[http://blog.pandora.com/pandora/archives/2009/07/important_u...](http://blog.pandora.com/pandora/archives/2009/07/important_updat_1.html)

[http://www.crunchgear.com/2009/07/14/pandora-teams-up-
with-r...](http://www.crunchgear.com/2009/07/14/pandora-teams-up-with-record-
labels-wants-regular-radio-to-pay-music-fees-too/)

------
ryanwaggoner
Well, I think Apple is going to start a car company, because they already have
deals with some car companies to do iPod integration, and all car companies
really do is design cars, build them, and put stereo systems in them.

I'm sorry, but this seems like the dumbest idea ever. Apple is a technology
product company, not a marketing and touring services company. This would be
completely outside their area of expertise, and I don't even really see the
justification that it would worth the financial risk. iTunes is making money
as the distribution arm for the entire industry...what do they gain by trying
to pick up the less profitable parts of the value chain?

In addition, while the author of the post mentions that labels "book tours",
he doesn't really delve into how much of a big deal this is. Nor does he cover
how labels help setup and finance production.

This is ridiculous.

~~~
philwelch
Apple wouldn't be a traditional record label. They would re-invent the
business. They'd probably handle distribution in a way somewhat similar to App
Store while outsourcing tours and production of physical CD's--or, perhaps,
setting up an ecosystem for artists to hire promotion firms and touring firms
like LiveNation while Apple does the distribution side.

~~~
ryanwaggoner
What? That makes no sense...Apple is already effectively outsourcing
everything except for the distribution. Furthermore, they're not bound by the
bizarre economics of trying to make up for 20 loser albums with 1 spectacular
winner; Apple makes roughly the same amount on each song they sell. And with
the way the music industry is going, it hardly seems clear that it would be a
good idea to move more in the direction of a label, even a non-traditional
one.

------
ThomPete
Isn't it much more likely that they buy a digital distribution service like
<http://fuga.me> ?

------
ryanwaggoner
Yeah, the keynote just ended and no announcements even remotely like this.
What a shock!

------
zaidf
It'd be dumb not to.

~~~
ryanwaggoner
Why? In order for that to be the case, all the other functions that labels
provide need to be:

    
    
      1. More profitable than what iTunes already does
      2. Something that Apple has the expertise to be able to do
      3. Worth the risk of labels ditching iTunes
    

#3 is fairly important...I wouldn't put it above the labels to get together
and pull out of iTunes en masse.

~~~
dbreunig
Author again: #3 is the reason they didn't do this ages ago. Now that they
comprise a quarter of all music being sold, there's simply no way for the
labels to walk. Even if they all agreed to, one could stay and reap the
profits. If they managed to split all at once they risk being caught as a
cartel (but they never could pull it off).

Apple essentially owns the most valuable market they exist in. They can't
walk.

Read the article.

------
chrischen
iTunes for digital mass distribution, social music apps for viral marketing:
the time is nigh for self distribution through Apple to happen!

------
raptrex
Sure Jay Z has his own record label, but he still doesnt tie into the Rock n
Roll theme

