The New York Times today documents the green shoots of a new model of music business, spurred by the Polyphonic not-label.
It’s not really a new model at all; instead simply a sensible combination of existing ways to make money.
Under the Polyphonic model, bands that receive investments from the firm will operate like start-up companies, recording their own music and choosing outside contractors to handle their publicity, merchandise and touring.
Instead of receiving an advance and then possibly reaping royalties later if they have a hit, musicians will share in all the profits from their music and touring. In another departure from tradition in the music business, they will also maintain ownership of their own copyrights and master recordings — meaning they and their heirs can keep earning money from their music.
“We are all witnessing major labels starting to shed artists that are hitting only 80,000 or 100,000 unit sales,” said Adam Driscoll, another Polyphonic founder and chief executive of the British media company MAMA Group. “Do a quick calculation on those sales, with an artist who can tour in multiple cities, and that is a good business. You can take that as a foundation and build on it.”
Exactly. Music business academics have long predicted the death of major music labels, because artists can no reach consumers directly through the internet. And, course, artists are. But that hasn’t meant the immediate detah of the label concept, in part because labels were in many cases merely investment holding companies anyway, and in part because labels still employ and/or contract to a pool of expertise about music marketing, distribution and concert promotion – as the artricle itself admits:
Even the major labels themselves are demonstrating new flexibility for musicians who do not want to sign the immersive partnerships known as 360 deals, in which the label manages and profits from every part of the artist’s business.
In late November, for example, EMI took the unusual step of creating a music services division to provide an array of services — like touring and merchandise support — to musicians who were not signed to the label.
The Polyphony model, therefore, is a sensible way of re-organising music industry capital that takes advantages of the diversified risks of a large artist portfolio, but can still capitalise on the hits and modest successes. It’s still going to require a lot of clever hit curation. But if Polyphony can’t do that, it shouldn’t be attempting this model.