curious 2know the status of my album? tweet BlackgroundMG. They control the $ & album date. In the meantime, I’m gonna keep working LoveUAll
In 2004, 13-year-old Joanna Levesque became the youngest solo artist ever to have a number one single on the Billboard charts.
Levesque, who recorded as JoJo, had been building to that moment since she was just a little girl, giving electrifying performances on shows like Kids Say the Darndest Things with Bill Cosby at the age of 6. When Levesque was 12, she signed a seven-album deal with Blackground Records, and later her debut album JoJo was certified platinum. Her 2006 follow-up, The High Road, pleased critics and included at least one bona fide hit, the breakup ballad “Too Little Too Late.” She was quickly becoming a rising star in R&B.
And then she went silent.
It’s been almost seven years since JoJo has put out an official release, though that doesn’t mean she hasn’t been trying. “I’ve recorded about three incarnations of this third album,” JoJo tells BuzzFeed. “We’ve chosen the track listing, we’ve done multiple album photo shoots, chosen the cover, chosen the credits, everything.” But every time her team tried to present the album to her label, Blackground Records, they never received a response.
“Blackground Records lost their distribution deal through Interscope, and if you can get the answer from them on why that happened, that would be a miracle,” JoJo says, “because I am sure they would not engage you in that conversation.” While JoJo says she has no problem with Interscope, she says she’s lost all communication with Blackground.
JoJo’s case is an extreme one. But whether it’s a new artist waiting to release their debut, or a successful musician who’s seemingly disappeared, many artists have found themselves fighting either to release their music or release themselves from their contracts. It happened to Lupe Fiasco. It happened to Sky Ferreira. It happened to Bow Wow, and Metallica, and Big Boi, and Amanda Palmer. The list goes on.
In most cases, even through politics, artists and labels can eventually reach a place where they mutually agree that it’s not working out and it’d be better to part ways.
But what happens when they can’t?
The label merges with or is acquired by another company.
“It is a little confusing because most of these companies, they get bought and sold several times,” says Ben McLane, an entertainment lawyer whose past clients have included DMX, Keith Sweat, and LL Cool J. Repeated changes in ownership caused problems for Blackground Records, an independent label that was distributed by Interscope, a subsidiary of Universal. Blackground’s CEO Barry Hankerson (uncle to the late Aaliyah, and responsible for launching her career) is known for making abrupt business decisions that leave his artists in a constant state of flux. “He’ll have a hit, and then he’ll have hard times with his label, and he’ll sell it to some other distributor and then the artists just kind of float around,” says McLane. “That’s part of the problem — there are a lot of mergers and acquisitions that go on, and the artists get stuck in the middle of it. If you’re not U2 or Justin Bieber, at the top of the food chain, a lot of times artists just get lost in the middle.”
The music industry has changed rapidly in the digital age. Where there were once six major labels in 1998, now there are just three remaining: Sony, Warner Music Group, and Universal, which became the largest international record company after merging with EMI last year. The mergers have left many artists lost in limbo. “Sky Ferreira’s label has gone through four or five label presidents since she’s been signed, and a big merger,” says McLane, who calls Ferreira’s experience “the worst-case scenario.”
“It’s a complicated space,” McLane says, “and I don’t want to say just because one artist’s experience is shitty, it doesn’t mean that another artist couldn’t sign with a major label and maybe get treated really well.” McLane points out that Katy Perry was signed to Ferreira’s label around the same time but has had a very different experience. “Maybe she just got lucky, or she just had a better team, or the right timing.”
A record company’s value used to be measured by the acquisition, protection, and exploitation of copyrights. Exploiting those copyrights by selling songs is an easy business model to understand and used to be the foundation of a very healthy global industry. Historically, the record business was the heart of the music industry. Sell a lot of records and you were a successful business. And artists also succeeded through record sales: they became household names when they had sold a lot of records.
From the business perspective, artists and songs could be viewed as interchangeable commodities. If any given artist failed to deliver hits, another waited in the wings to take their place. This impersonal approach allowed the music industry to grow extremely profitable by simply selling “product.”
But the sale of recorded music has taken a battering over the last decade, and it’s no longer smart to judge an artist’s commercial viability on record sales alone — not least when there is a new generation who questions the need to pay for recorded music at all. For many artists and their managers, record sales are now just one of many revenue streams and one of a number of factors with which to judge success.
Despite this dramatic change in the marketplace, many struggle with the concept of uncoupling success from record sales. It doesn’t help that most measures — the charts by which many fans learn about new music — are still based on this notion. For emerging artists this is particularly precarious, since careers are too often ended early if a first set of recordings fail to sell.
So how should a “content producer” behave in this new environment? And what lessons can we learn from this new model of value? Here are the two keys:
- Do not treat artists as commodities
- Value the artist-fan relationship as highly as traditional rights
Smart managers realize every artist is a standalone business that generates income from multiple revenue streams. A manager’s job is to create those businesses and run them well. This requires thinking globally and being agnostic about which revenue stream or territory is the most important. As long as those channels can deliver the aesthetic the artist wants and make a profit, the business is a success.
But the business of relationship building is not a quick one. Artists have to earn the respect of fans, convert that respect into trust, and, eventually, convert that trust into faith. Building communities takes time, and it can only be achieved over the long-term. In this model, artists can no longer be treated as interchangeable hit makers.
The key to artist-management success is identifying talent early and developing it cost-effectively over a long period of time. Artists — and their art — are the only real assets. The systems and structures that surround them should be treated as a means to maximize the commercial value of each artist. As such, the traditional music industry — be that companies that make and distribute records, publishers who collect performance royalties and create sync opportunities, concert promoters, or merchandisers — should be regarded primarily as service providers to artists.
As the digital age gathers pace, managers must engage in the shaping of the music landscape. That landscape is still plagued by a mindset that regards copyright as an instrument of control (which further limits commercial exploitation to traditional models) rather than as a remuneration right that can generate revenue wherever a market may be. The future is about accepting consumer behavior and looking for as many ways as possible to monetize it.
In addition, managers must also simplify the complex structures of the industry and create healthy businesses based on monetizing the behavior of consumers and those businesses that wish to use creators’ works for their own profit. Without a simpler, better structured digital market, the direct artist-to-fan business will struggle to grow. Moreover, it will undermine the modern-day manager’s opportunities to improve their artists’ business.
Managers must also figure out alternative investment for artist businesses. Traditionally, it was the record business that invested in new talent. Restricting investment to direct rights exploitation keeps the emphasis on making money from record sales, which keeps the “investment risk” for would-be investors high. A viable alternative would be a market for investors to put their money into artists’ whole businesses, where artists retain rights and investors participate in all the profits.
The music industry was the first of the creative industries to be affected by the disruptive nature of the internet. But it’s not all bad news. Disintermediation has forced a focus on talented individuals who produce great art. One of the jobs of their managers is to create an environment that allows them to do so. Ways of collecting fans and connecting them to artists are ever changing, but by embracing new technology opportunities, creative businesses will flourish. Other content producers take note.
Article originally appeared on Harvard Business Review (http://www.hbr.org) and was written by James Barton and Brian Message.