Additive Choices Build Label/Artist Success

One of the highlights at this year’s 2nd annual Billboard Country Music Summit (June 6-7) in Nashville was about label business models. Moderator Glenn Peoples, Sr. Editorial Analyst BB focused first on industry measurements and then on the differences between labels of different sizes. Here are a few quotes from the panel participants…

John Esposito

John Esposito, President/CEO WarnerMusic Nashville: I was happy to discover [when I arrived here two years ago] we had a great A&R dept., but bringing focus was key. When I said we were going after Blake Shelton everyone knew that was a rallying cry to raise him up to the next level. We hoped to create energy and momentum with three bodies of work in nine months. Also the promo dept. delivered. The experiment for Blake was hugely successful and profitable. For decades our industry has based success on SoundScan, but now we have business models that aren’t even measured. We’ve been active with music/merchandise bundles that don’t register on SS, but they show up on our P&L. I got good advice from WMG’s Lyor Cohen. “Focus on a very few and give it your all.”

Tom Baldrica

Tom Baldrica, President Average Joes Entertainment: After spending so much time on the biggest boat in the water [Sony], I was amazed that so much was going on among the smaller boats. Average Joes had figured out a smart way to make money on nickels and dimes without nickel and dime-ing their partners. It’s about a level of artist authenticity. Today people put up with less bullshit. Our philosophy is to find things that react and then go fish where the fish are. Connect the dots with a more focused roster. Also we don’t have a corporate time line to contend with that forces us to make decisions, so we can take our time and get it right. This town has ruined a lot of kids by throwing them into the big time too quickly. That’s something we have the luxury or not having to do.

Michael Powers

Michael Powers, Partner/Co Sr.VP Promotion Bigger Picture Group: We don’t do record deals, that model is broken. We do artist deals. The key is having enough gas left in the tank to get there and find the all-important radio hit. Fire a machine gun spray of bullets or shoot carefully, but don’t give up. Our promotion group has just as many people on our digital team as on the radio side.

John Allen

John Allen, VP Bug Music: Most people don’t think of publishing companies as owning masters, but we make lots of recordings every year. Many of our artists are starting their own labels.

It just evolved. We farm out promotion and marketing, but are set up in the digital world. It’s especially advantageous and efficient for songs placed in film and TV.

Jay Frank

Jay Frank, Sr. VP Music Strategy CMT: Why is there a smattering of applause about CD sales in this room? We need to do more about where we are going, not where we have been.

Why focus on the rotary phone? The CD is one revenue stream amongst many. Most people think a hit is just what gets to No. 1 on the radio chart, but the definition of a hit has been obliterated. We need new measurements for what a hit is. Sometimes it’s tickets, sales or radio and more, it is spread out over many things.