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Digital
Distribution
by Mike Grebb.
This article first appeared
in The
Musician's Atlas' June 2005 Atlas Plugged Newsletter
and is used by permission. The
Musician's Atlas is a fantastic
resource for musicians, containing
over 30,000 music
business contacts.
Back to The
Academy
Perhaps no other area of the music
business is more mysterious for emerging artists or indie labels than
distribution. After all, getting your CD into a record store is not only a
thrill--it’s real validation. You must be legit, right?
But alas, wide retail distribution
has never made a whole lot of sense for the vast majority of artists. Retail
space is limited and unless there's a demand for your CD (unlikely if you're not
touring nationally and getting covered in local media across the country),
shoppers probably won't plunk down money for your album. And as if that's not
painful enough, distributors usually charge a hefty fee (deducted from your
royalties) for all the returned, unsold CDs. Ouch.
Happily, the digital revolution has changed
the distribution game significantly in the last few years. Getting your CD into
brick-and-mortar retail outlets is not as vital to
your success as it once was. In today's new music landscape, artists look to
digital distributors such as iTunes, MusicMatch, Napster, America Online and others for
revenue opportunities.
No matter how your music is digitally
distributed, (song downloads, limited license via a subscriber service, streamed
from music sites, Weedshare, etc) one thing is certain: Never before has getting
your music out to the world been so darned easy. With digital distribution,
anyone on the planet can access your tunes from anywhere. And that, without a
doubt, benefits emerging artists who don’t have lots of money behind them.
Navigating the digital distribution
landscape, however, is confusing and rife with enormous complexities. Take music
download sites, for example. Probably no two sites operate in quite the same
way, which means artist pay outs and other factors differ considerably.
Artists and labels must first decide whether
to contract with individual download sites on their own or to use a
digital-distribution service that can get material out to dozens of download
sites in its network. Using a service can save an enormous amount of time,
effort and frustration. Think of all the aggravation you’re avoiding in not
having to collect reports from a kazillion download sites. With a distributor,
it’s all aggregated in one place. To me, that’s more than worth whatever fees
are involved (we'll get to those in a moment).
In addition, a digital distributor
representing hundreds or thousands of artists is likely to have more pull with
the sites than you would have on your own. That can translate into getting your
songs up and selling much more quickly, although patience is a virtue here.
Remember that every major label, along with every indie label and independent
artist, is trying to get their stuff up on iTunes. My distributor, CD Baby, has
been trying to get me placed on iTunes for months, but theses sites are
enormously backlogged, and many obviously give priority to big-name artists.
Hooking up with a top digital distributor can
also help place your music with other emerging areas such as ringtones, which
are potentially even more lucrative since customers typically pay two or three
times what they would pay for a song download just to get a beepy little sample
on their phone. Go figure, eh?
Some outfits have entire divisions devoted to
"mobile music," which can include not only ringtones but also wireless digital
music distribution in general (i.e., to cell phones or other wireless-enabled
devices). The bottom line is that distributors keep their pulse on new and
emerging avenues for getting music out into the digital universe. Unless you
want to spend half your life tracking developments yourself, you might want to
look into a digital distributor so you can focus on… oh, I don't know… music,
perhaps.
Be aware, however, that some digital
distributors (like many traditional retail distributors) require exclusivity,
which restricts you from signing one-off deals on your own. In such cases, you
can only distribute music on sites within their network. (One exception to this
is IRIS, which signs non-exclusive deals with indie labels). Since the object is
to get your music out to as many places as possible, it's important to consider
whether the distributor has a large enough network with some big-name players
included, to make exclusivity worth while.
And, of course they do expect to be paid for
the service that they provide. Typically they take a small percentage of the
sales, but the amount and how this is structured really varies case by case. One
of the most accessible digital distributors is the well-known CD Baby, which takes 9 percent of
your royalty. So under that model, if Site X sells your songs for $1 per song
and keeps 45 cents of the sale, CD Baby takes almost six cents per download from
your 65-cent cut (i.e., 9 percent). Not bad, considering that you get to keep 59
cents for yourself and didn’t even have to deal with the download site directly
(Submitting songs on your own can be a nightmare. Each site has its own
submission standards and metadata requirements, not to mention encoding
preferences).
Shop around. Since each digital distributor
is different and caters to different kinds of artists and labels, you'll have to
shop around. Pick one that's right for you. One caveat is to always read the
fine print. Some digital distributors may require separate fees for encoding
your songs, adding metadata, or other administrative and technical tasks. There
might also be a sign-up fee. Just make sure you fully understand this
stuff.
Shiny discs will be with us for a while, but
everyone needs to understand the world of digital bits rushing around
cyberspace. It's the future. Don't be left behind.
- (Mike Grebb is a writer, journalist and
singer/songwriter based in Washington, D.C.
He has written for numerous publications, including Wired and Billboard. He
just completed his debut solo record, Resolution, which is available at www.mikegrebb.com).
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