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In Reply to: RE: What record deals are major classical labels offering these days? posted by andy evans on August 11, 2016 at 02:25:47
Klaus Heymann famously promoted the self-financing concept for classical recordings for his Naxos label. As he points out in a 2012 Washington Post article linked to the Naxos site, CD sales and even downloads do not produce enough revenue to finance the records. (Interestingly, 75 percent of the revenue they do produce comes from youtube hits.)
I think his successful model has been influential on a number of labels. I don't know what DG usually does, but obviously there must be some form of self-financing.
Some classical musicians have thrived with this model. Notice the large Naxos discography of Marin Alsop. That is largely due to her success at raising money -- not necessarily for the Baltimore and Sao Paulo Symphonies or any of the other ensembles she has directed, but for herself and her recording projects.
Edits: 08/11/16Follow Ups:
And here is the Washington Post article I mentioned above.
When I first read Andy's post, I was thinking, "That's just what Naxos does." So, as you suggest, the practice might be spreading to other labels.
Yes -- Notice that according to the Washington Post article, Decca has moved in the same direction. And Decca is part of UMG, as is DG. So I guess that suggests an answer to Andy's question.
UMG may be calling the shots here for Decca or DG.
It seems to me that record companies see themselves as vehicles of "promotion" for the artists, and the 10% cut is on that basis. As long as Decca and DG have a stable of major artists, it will certainly help an upcoming artist to be seen to be signed to a major label. Maybe the major labels have some kind of back door deal with other managers and agents, who are all working to promote the artist. It's all about credibility.
The guy who gave me this information also talked about how important promotion was for new artists, and how they might take out a year long contract with a PR company to promote them. He said this did generate results and was becoming increasingly common.
Think of all this as "promotion". Promotion generates revenue. Unfortunately it's the artist in the end who has to pay percentages to a lot of people for this promotion.
Percentages are common in the popular music business. Producers routinely ask for a percentage of the songwriting rights even if they don't actually write any of it - it's just how they take their cut.
Soloists and conductors make their names on stage first. And that happens through management. Managers are scowering the major music schools to discover the next potential star soloist and are signing management contracts with them often while they are still in school. It almost reminds me of high school and college athletes going pro and being recruited by high profile sports agents. And once management signs them they are looking to book them in major venues. This often happens when established artists have to cancel and someone has to fill in last minute. Then once an artist has a few major concerts under their belt and some good reviews. Then the career starts to gain momentum. Publicists and recording deals follow. they don't come first. And this is why the DG deal makes zero sense for the artists. Classical musicians make their money off playing concerts. There is no record deal worth 10% of that income under any circumstances. Concert goers don't care if an artist is a DG artist or not. The concert fees an artist gets do not go up by 10% by virtue of being a DG artist. It would be 10% for nothing. A bad deal no matter how one spins it.
If this is the deal that DG and other major labels are offering, then they wouldn't do it if there wasn't some take-up. It's as simple as that.So even if theoretically you could say that "it doesn't make sense" for the artists, it has to make some kind of sense if they are taking the deal.
The truth is that there aren't any really good deals for artists these days - musicians or writers are good examples - unless you are absolutely top tier and can dictate terms. We've gone over this ground often enough.
Publicity and credibility is everything when you are trying to climb that slippery ladder, and being signed by a major label is one of the ways to get a step up. Not the only way and maybe not even the best these days. You can win competitions and you can be a Youtube hit and you can also be a bit of a media celebrity if you're good looking or distinctive - there are various ways of doing it. But doing nothing about publicity isn't really an option in this media saturated world.
Add to that the fact that there are other factors involved other than "a good deal". I'm a published author - 5 books. My advances and royalties have been completely slashed since 1994 when I first published - that's life for authors these days. I'd probably make more money if I self published, but I carry on writing for publishers like HarperCollins and Methuen. For a start, it's simpler and they have good editors and I'm not ashamed to admit that there's a degree of vanity involved.
It doesn't have to be "the best deal" for artists to take it - it just has to be a deal they want for their own reasons.
Edits: 08/14/16 08/14/16
Who on the DG label is covering the cost of recording and paying DG 10% of their concert fees? I personally know one person who absolutely is not.
I would be very surprised to find out that *any* of DG's marquee artists are paying anything to DG for either recording costs or a percentage of their concert fees.
And then what's left? Newbes and wannabes? Which of them have the cash sans an established career to finance a DG recording session?
I am skeptical of this scheme. I am skeptical that it would work for the artists in any way and I am skeptical that anyone other than a few suckers who were badly represented by their management or didn't have management in place took this deal with DG.
And if they did manage to sucker any artists into this lose lose deal i am confident that it would be a one and done. No resigning.
All I can say is that my source is a a concert artist who is close to a lot of things in the music business. I have no difficulty in believing him. If you don't believe any of this that's entirely up to you, though I don't buy a lot of your reasoning at all.
As I said all along, this is about new artists and not established DG artists. I have no difficulty in believing they're on different terms entirely, especially the big names.
I just think it's such a crap deal for artists that it's bordering on being a scam and I doubt that any artists of note would take this deal. If DG has suckered some new artists with this deal those artists have my deepest sympathy and I wish them a quick financial recovery.
It would be a shame for any artist to pay for recordings that will likely never recoupe their costs and then give up 10% of their real income to do so with little hope of getting anything out of it
I know a few DG artists personally. They are not paying DG for recording costs and they are not paying DG any percentage of their concert fees.
what reasoning are you not buying and why?
I know a few DG artists personally. They are not paying DG for recording costs and they are not paying DG any percentage of their concert fees. > >If you were accused of stealing a sheep and one witness saw you do it, how useful would it be to produce 25 people that didn't see you do it?
Edits: 08/15/16
Got anything more than that? I hope....
if the label is demanding 10 percent of concert fees, they are probably acting as the artist's agent for those appearances. Otherwise, that would be a very difficult agreement to enforce. The WP article I linked to only suggested that the labels are routinely requiring artists to pay the upfront production costs.
BTW, Decca and Deutsche Grammophon are now really just brand names owned by UMG. So a Decca business policy would also be a DG policy.
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