Music Ally

One of the big criticisms of successful new digital models like those tested by Radiohead and Nine Inch Nails is this: they’re Radiohead and Nine Inch Nails, with millions of fans. What about unknown artists?

It’s a valid point, and one that NIN’s Trent Reznor has just addressed head on in a post on his forum. His advice: Make music cheaply and give it away, build an email database, and then work with someone like TopSpin to sell premium packages. And build a community:

“Constantly update your site with content – pictures, blogs, whatever. Give people a reason to return to your site all the time. Put up a bulletin board and start a community. Engage your fans (with caution!) Make cheap videos. Film yourself talking. Play shows. Make interesting things. Get a Twitter account. Be interesting. Be real. Submit your music to blogs that may be interested. NEVER CHASE TRENDS.”

The full thing is well worth a read.

While the likes of Radiohead and Nine Inch Nails making millions from selling their music direct to fans is all well and good, the real impact of new digital distribution schemes is for bands lower down the food chain – not making fortunes, but making more than they did when signed to a label.

A new example is Canadian band Metric, which is label-less for its new album, and instead selling it on its own website (via Topspin) and through direct distribution deals with iTunes. With 24,000 digital downloads so far, the band’s co-manager tells the LA Times that they’ve made more money in three weeks than they made in four years from their last album, which sold more than 45,000 copies.

That’s because Metric is getting a better revenue share from iTunes sales, while also selling $64.99 deluxe packages from its own site.

Next up at MidemNet is a showcase for services connecting artists and fans, with a panel of firms doing just that.

First is Ben Drury from 7digital talking about IndieStore, a service allowing indie bands to sell music while registering their sales for the official UK charts – the top artist has generated $50,000 of revenue through the service.

“When we started, we were focused on working with majors and the big independents, and we built artist stores and our own store, but we got bands coming to us saying ‘we love what you’re doing for Coldplay, can you do it for us?’” he says. So 7Digital created a DIY solution, IndieStores. 60,000 bands are using it.

How is 7Digital making money from this though? “What’s really interesting about it is that there is a revenue stream for bands, but other revenue streams have emerged,” he says, citing a campaign where Puma gave away music from some bands on IndieStore, and ended up using one in a TV ad.

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2008 was a good year in terms of the sheer number of digital music startups and services, but Topspin boss Ian Rogers thinks there’s some way to go. During a panel debate at MidemNet this morning, he said not enough of these startups are truly innovative – although not always through their own fault.

“There’s a lack of innovation at the moment – VCs are scared, and the digital music space is not terribly attractive to entrepreneurs,” he said. “We have to create an environment – and in particular major labels who are holding a lot of the licenses need to create an environment in which innovation can thrive. There are not enough interesting companies out there.”

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We’re here for the opening session at MidemNet, a debate between Topspin’s Ian Rogers and former EMI chairman Eric Nicoli. Rogers is stepping in to replace Michael Robertson of MP3tunes, who pulled out this week. He will apparently be joining the debate via Kyte around 15 minutes in, though.

Moderator Ted Cohen kicks off saying that recommendation is a key part of the music industry’s future – “helping curate the experience, and I really believe that without this curation, it’s just not a good experience”.

However, he says there are still problems, including the recent lawsuits against search engines – the Playlist and SeeqPods of the world. “These are sea-change technologies, we have to get past litigation and look at monetisation,” says Cohen, who goes on to say mainstream ISPs need to come to the table, and mobile music needs to shape up.

“We need more innovation, we need more experimentation, and we need to communicate,” says Cohen, setting up the debate. “We need sustainable agreements, it can’t be about large advances any more. We need the labels and the services and the technologies talking to each other.”

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There’s a lot of excitement in the music industry around startup Topspin Media, which is promising to reinvent digital music marketing. Unsurprisingly, its rivals are kicking back against the hype. For example, Echo CEO Mark Montgomery has written an open letter on the company’s blog to Bob Lefsetz, who praised Topspin. (more…)

We wrote about Topspin Media earlier this month – the music marketing company recently came out of stealth mode, and is headed up by former Yahoo Music exec Ian Rogers. Now it’s emerged that the company has taken a second round of funding, led by Foundry Group. (more…)