Breaking news: Record label makes money
Finally, an article about a record label that’s actually making money, and, of course, it comes from those journalistic busybodies at the New York Times. Zomba, home of Justin Timberlake, R. Kelly and Ciara, among others, made more than $40 million in profit(!) last year, according to the Times. Their secret to success? Eliminating extravagant expenses and being unapologetically commercial. Plus, almost half their sales are in digital form, including ringtones. Here’s an excerpt from the article:
“[Zomba president, Barry] Weiss makes no apologies, and suggests that some rival labels have chosen to whack away at their overhead costs — resulting in hundreds of layoffs — rather than take on the potentially more difficult pruning of day-to-day production and marketing expenses. ‘On the one hand,’ he said, ‘they’re laying off all these people from these companies to the point where you’re cutting into the bone. But nobody’s focusing on the fact that that album that should’ve cost $800,000 cost $2 million. Or the video that the egotistical president of the company decided to scrap, for $400,000, because they didn’t like the colour of the pants that the artist was wearing. Those things still kind of go on in the business.’”
1 comment:
I think record labels are suffering the consequences of succumbing to the unfortunate financial incentives that exist in the recording industry. Instead of nurturing artists and letting them develop (i.e. The Police getting better with each album ;) ), they are trying to score the lottery-like payoffs that arise from signing unknown bands on the cheap and then experiencing sales figures in the range of Pearl Jam's "Ten". It was a good few years before Floyd released Dark Side of the Moon - I'm not sure the labels would wait it out this long in this day and age. And is there anyone now like Richard Branson willing to take a chance on a modern-day version of "Tubular Bells"?
This is coupled with the sorry state of the acts that they do decide to sign. In our day we had Iron Maiden, The Smiths, Sex Pistols and Duran Duran. Now kids must suffer through Good Charlotte, Simple Plan and other tripe that LOOKS edgy but is innocuous enough that parents will let the kids listen without Tipper Gore having to enact her powers of intellectual veto on their behalf.
And yet the labels persisently resort to the straw man of illegal downloading. We had it back in the good old days too - except blank cassettes were the medium of choice. Somehow we were still compelled to get to Sam the Record Man...
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