[linux-audio-user] Internet Music Business Models + Logos

tim hall tech at glastonburymusic.org.uk
Sun Mar 26 11:11:51 EST 2006

R Parker wrote:

>>OK, I understand what you're saying now. This is
>>exactly the kind of 
>>hard headed reality I have trouble wrapping my head
>>around and 
>>subsequently why I'm not earning 2 grand a month
>>from music.
> It doesn't help when we love producing songs more than
> we appreciate business.


No, but it does make this conversation all the more worth having.

One of the questions we got asked a lot at the Sounds Expo in London 
this year was 'Yeah, but how are you making money out of all this? 
what's your business plan?' - Not everyone is as prepared to leap across 
the chasm believing that angels will save them as I was. ;)

>>Do you honestly think that banner ads are the most
>>effective means of 
>>advertising or was that just as an example?
> I don't know the most effective means for selling
> music on the internet. We're putting a toe in the
> water and during this phase a bobber in every pond.


>>The trouble is, if you run on a donations basis,
>>it's easy to believe 
>>that you can only afford free advertising. It is
>>hard to make any kind 
>>of business plan when you have no guaranteed income.
> I think you can formulate a useful business plan on no
> budget but it will have meager beginnings. Imagine
> find ing one new fan every day for a year:
> * 365 fans
> * $10 profit on every CD sale
> Cut two albums a year and keep finding a fan every
> day.  One a day is probably unrealistic until we have
> an advertising budget. I imagine. One a week?

Yep, basic principles understood. Chunk it down until you've got 
something you understand that is real, like apples and oranges.

> My partners and I have a business plan and alot of
> product:
> *five albums
> *a half dozen live multiple camera video productions
> *a couple dozen pieces of fine art for album covers,
> song posters
> *a nice studio that we built and own
> *an advertising campaign with two mostly completed
> advertisements

Having a range of products in different price brackets seems to be 
important. As we're open-sourcers we will have a frontline of free 
products. Next there needs to be product which can cost 5/10/20/50 
quid/bucks for pocket money, some people may prefer to do the donations 
button thing here, which I think also covers the 'tipping economy' 
strategy. Then we can offer a layer of paid-for services, which could 
include live performances, commissions and studio sessions.

It's the advertising campaign I need to work on. I like the idea of 
growing it from a small seed.

I made a rather offhand comment about 'middle-class luxury' a while 
back. Now might be a good time to attempt to explain that in better 
language for the viewers back at home. ESR explains that as: 'gift 
culture behavior arises in situations where survival goods are abundant 
enough to male the exchange game no longer very interesting'. For the 
majority of musicians survival goods are not terribly abundant. Selling 
albums and doing gigs means being able to put the heating back on and 
buying something to eat other than rice and beans. My sax player has 
been without electricity for a week and she's a jazz vituoso of 20 years 
experience. I want to be able to pay her wages so she doesn't have to 
think about playing for anyone else or be too cold to practise. I'm 
asking for a fair old leap of faith to ask her to give her work away for 
free. Already most of the gigs we've done this year have been benefits 
and the equation just doesn't resolve. This has been the story of my 
life for the last 20 years, I have probably given more away for free 
than most of you have had hot businesses and I intend to carry on doing 
so, but this time I want to make a profit which I can pass on to those 
whose skills I depend upon, like my Sax player, my distro maintainer, 
the guy who wrote my MIDI sequencer | drum machine | multitrack recorder 

The same as with other zero-cost goods, the 'Music wants to be free' 
myth needs exploding.  Music IS free - free to give away AND free to 
make a profit on. There are some musicians out there who deserve to be 
able to do nothing but practise scales and turn up in time for the 
soundcheck. There are some programmers who deserve to be able to spend 
all day thinking up new algorithms or even just recording their own 
albums. How do we make that possible without invoking magic? I don't 
want to try and browbeat the tipping economists into submission, I think 
it's a great idea. We have many choices and I'm into considering the 
more grounded sounding ones and trying them all out.

> I figure a year of executing the plan should be
> sufficient to demonstrate the potential for building a
>  fan base and selling product. If I spend $100.00 a
> month that's less than the bands budget for ass wipe.
> Well, if the band has a typically poor diet of beer
> and chips.


I'd be very interested to hear how this works out for you. You surely 
deserve to succeed.


tim hall

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