Madonna signs radical record deal

[minus-sounds.com]

BBC NEWS | Entertainment | Madonna signs radical record deal

Madonna has signed a ground-breaking recording and touring contract with concert promoter Live Nation.

She is the first major star to choose an all-in-one agreement with a tour company over a traditional record deal.
It gives Live Nation rights to all her music-related projects - including new albums, tours, merchandise, websites, DVDs, sponsorship, TV shows and films.
The deal, reported to be worth $120m (£59m) over 10 years, ends her 25-year relationship with Warner Music.
The pop star, 49, has been with Warner for her entire career, during which time she has sold 200 million records and CDs.
For the first time in my career, the way that my music can reach my fans is unlimited... with this new partnership, the possibilities are endless


Madonna


Madonna, the first performer in Live Nation's new Artist Nation division, said the deal offered her the chance to take advantage of new models of music distribution.
"The paradigm in the music business has shifted and as an artist and a businesswoman, I have to move with that shift," the singer said.
"For the first time in my career, the way that my music can reach my fans is unlimited. I've never wanted to think in a limited way and with this new partnership, the possibilities are endless."
NEW TYPES OF RECORD DEAL
Radiohead - Released their new album as a download from their website and told fans to choose how much to pay
Prince - Gave his latest CD away with the UK's Mail on Sunday newspaper and at gigs
Sir Paul McCartney - Signed a deal with record label owned by Starbucks, which sold his new album in its coffee shops


Live Nation chief executive Michael Rapino said they had created a "new business model for our industry".
"Madonna is a true icon and maverick as an artist and in business," he said. "Our partnership is a defining moment in music history."
Madonna has become a shareholder in the company, the statement said, but further financial details were not provided.
She must still make one more album for Warner, due next year.
Warner will also retain the rights to sell and license her back catalogue of hits such as Like a Virgin, Vogue and Music.
Traditionally, companies like Warner Music Group have focused on recorded music, while other firms have arranged tours, managed artists and sold merchandise.
It shows the music industry is being less record-centric


Jean-Bernard Levy
Chief executive, Vivendi

But shrinking CD sales have led artists and entertainment companies to consider wide-ranging deals that bring all activities under one roof, helping cross-promotion and boosting profit margins.
Jean-Bernard Levy, chief executive of Universal Music Group's parent company Vivendi, said the music industry was at a turning point.
"It shows indeed the music industry is being less record-centric," he told the Reuters news agency.
"It used to be just focused on the record and everybody thought all the rest was just promotions in order to sell records.
"Now it's a more balanced business where you have records, TV shows, merchandise, touring revenues and so on."
Madonna is the latest big name to eschew a major label deal and find a different way to distribute music.
Last week, Radiohead made their new album available to download from their website and asked fans to choose how much to pay for it.
Prince recently gave away his latest CD with a newspaper, while Sir Paul McCartney signed up with the Starbucks cafe chain.

[JP11]

Yay.

I wonder who will distribute?

They always make it seem like it's a whole new thing, and it's the end of the system as we know it, but Radiohead is apparently in negotiations with a traditional co. to distribute their "real" product, and Prince is signed with Columbia, and McCartney's label is a huge company and a member of the RIAA...

so even though it's somewhat different, what's the difference?

I mean, why would anyone care, except these artists themselves. They're huge established stars making a lot of money from huge companies, and that's great, but so what?

[Phaidon]

I agree 100% !!!

[ddageek]

I wonder how much of live nations stock is still owned by Clear Channel? and how this will influnece air play? At the very least most CC stations are "parntered with live nation for promotions so expect to hear More Maddona!
Other wise same stuff different name!

and Would you like a Paul Macarntey withh your Latte?

[theblue1]

"The paradigm in the music business has shifted and as an artist and a businesswoman, I have to move with that shift."

I think she stole that line from Britney Spears. I'm sure I heard Brit muttering that as they poured her into the back seat of a squad car.


I can't say I've been much moved by her music but Madonna has long impressed me as the proverbial sharp cookie.

[Grizzly]

Originally Posted by ddageek

and Would you like a Paul Macarntey withh your Latte?

His stuff tastes like plastic anyway...

[joelpatterson]

Madonna who?

[Sigma]

the downhill slide of madonna begins..these deals are the last breath "cash outs"

and whatta huge one

[Doublehelix]

Originally Posted by ddageek

I wonder how much of live nations stock is still owned by Clear Channel?

My understanding (somebody correct me if I am wrong) is that Clear Channel no longer owns any part of Live Nation. I think that happened about 2-3 years ago?

[mtstudi@pacbell]

Another stab at trying to figure it all out. Time will tell.

[blaugruen7]

Originally Posted by joelpatterson

Madonna who?

that soccer star from argentina.

[Sqye]

Originally Posted by joelpatterson

Madonna who?

madonna YOU....

wudduyah think for madonna live - sdc's in x-y????

wuddup, joel.....que fa, stromboli?
keepin' warm on the mountain, or what??

.

[BevvyB]

There are a thousand ways to skin this one

However, artists can now dictate the way they want to go themselves, and then figure out who can help them along the way

It's just a shift in control, but you can't throw baby out with bathwater

You can find a good direction for yourself, and then figure out how a label can keep you going in that direction as part of the puzzle instead of the be all end all of the old days

Especially if you're established. In fact, it's the established acts that have the most to gain from this turnaround in focus and control.

[JSpark]

What this reveals is that the entity known as the major label is a dying animal. More specifically the "major label contract" which has been the means to exploit artists for over 60 years is dying.

We should all be celebrating if our meal tickets were not on the sinking ship. Anyway, it means survive this storm (and the coming financial storm), and there are more options than there ever were before.

[joelpatterson]

Originally Posted by joelpatterson

Madonna who?

My dona.. uh... damn, this would make a GREAT knock-knock joke, somehow.

[camitchell]

I humbly disagree with some of the thoughts posted in this thread. Very smart move by Madonna. It's so much money its a no brainer and Live Nation will have plenty of incentive to make it successful.


These are not last breath moves by aging artists. These are artist going where most other artist are not going to be able to follow in the new digital paradigm.


Current declining record sales and a new artist is supposed to make money on touring instead? That is very questionable when historically, touring was(is) considered an expense in order to sell records.


Hello? Good luck with that.


Yes, it can be done but the indie artist will want to be on a label or a have a "boutique management" company handling things at some point past the regional level.


If record sales continue to fall and income is expected to be derived from corporate licensing, endorsements, etc..... has the game changed all that much? Is it really going to be a better world for an indie artist?


There have been some sesmic shifts in the past few years for indie artists. Low cost recording gear, digital distribution are all great things..... but the marketing and radio play are still huge hurdles to overcome for anyone who wants to make "real" money without a label.


So I don't think the "demise" of labels is going to happen quite the way people think.


.

[edcampos]

Originally Posted by camitchell

Current declining record sales and a new artist is supposed to make money on touring instead? That is very questionable when historically, touring was(is) considered an expense in order to sell records.


Hello? Good luck with that.

Are you serious? Touring is where artists generate a huge part (if not most) of their income. A good friend of mine puts on very big events in Brazil (Snoop, Ja Rule, 50 Cent, U2 to name a few) and the "guarantees" are huge numbers. U2 and Coldplay were reported to having charged upwards of $500,000 for each performance on recent tours. That's half a million dollars a day...
I have many friends in bands as well, who tour non-stop. When they come to town we usually hang out and I ask about numbers. The answer I usually get to the, "How are sales?" question is usually something along the lines of, "I have no idea, we don't make much off of that." They are out on the road year-round selling tickets, merchandise, and getting paid to perform. That is how artists make most of their money.

Ed

[camitchell]

Yes, but you are naming bands that were developed under a major label. If everyone is cheering that the labels are going out of business ....who is going to develop new acts?


It's not so easy to get people out to see an unknown band with no following. That is what I'm talking about.... and to have to tour _all_ the time to make a living......

[edcampos]

Originally Posted by camitchell

Yes, but you are naming bands that were developed under a major label. If everyone is cheering that the labels are going out of business ....who is going to develop new acts?


It's not so easy to get people out to see an unknown band with no following. That is what I'm talking about.... and to have to tour _all_ the time to make a living......

First of all, I was only responding in regard to your comment that implied that touring is a financial burden for bands. I am not cheering that majors are going out of business. Are they evil? I personally don't think so. They are in the business of making money, like any other for-profit business. Is it a good thing they're dying? Doesn't make much of a difference to me. It's just a paradigm shift in the music business.

The bands I did mention are in fact "major label acts," but I also did mention personal friends who are in touring groups (non major label artists). Some of these artists include The Sleeping, We The Kings, Farewell, and I didn't mention names solely for the reason that they are not very well known so most people people wouldn't recognize them.

So regardless of "label status" these acts are making a large portion of their income on touring. The major artists, the independent label artists, and the unsigned artists as well.

I was in a band for years and made most of my income on touring, so I can tell you first hand.

Secondly, the way you get exposure (as a signed OR independent act) is you advertise and you play shows. It works the same way if you're signed or not. Budgets and avenues are different, that's for sure, but it's the same across the board. If no one knows you, you tour and people will start to know you. I sold thousands of records that way.

And lastly, as far as touring all the time to make a living, what is so bad about that? It's the career one chooses. If you're accountant, you crunch numbers everyday to make a living. If you're a musician, you play music everyday to make a living. I don't know of anything better than that... besides, if you do it enough and you do it right you might end up with lots of down time down the road to focus on other things, just as a retired accountant might. Hm, what a thought...

[camitchell]

Originally Posted by edcampos

If no one knows you, you tour and people will start to know you. I sold thousands of records that way.

And lastly, as far as touring all the time to make a living, what is so bad about that? It's the career one chooses. If you're accountant, you crunch numbers everyday to make a living. If you're a musician, you play music everyday to make a living. I don't know of anything better than that... besides, if you do it enough and you do it right you might end up with lots of down time down the road to focus on other things, just as a retired accountant might. Hm, what a thought...

Cool, I think we are mostly on the same page here. The question I was trying to raise is "Will it be harder for bands to tour independently if CD sales have gone away?" Sure, digital downloads might be there, but perhaps consumers will just pick out one or two songs they liked during the show and that will be it.


I'm just saying the direction the industry is going .... licensing deals, sponsorship, etc... it might be harder for unique bands to break out. Maybe, maybe not but I don't think it's going to be the ultimate liberation for musicians if the current system goes away since I think it may actually be replaced by something even more stifiling ... for lack of a better word.


And there is nothing wrong with touring, but the economy is headed for a recession and who knows if bands who were successful last year are going to have the same luck this year.


I was just trying to make the point that always needing to be on tour to generate income (and not having other income streams that do not depend so much on touring such as publishing, royalties, etc) could put the band on thin financial ice in the event of economic downturn, change of popular taste, illness within the group, etc....


But back to the topic, I think Madonna was smart to take the deal she did. Does not seem like much risk on her end and Live Nation is betting the farm on it.

[edcampos]

Good points. I think we will have to wait and see what happens. I don't see this as a "liberation" or a disaster either. I think some new doors will be opened while some old ones will be closed. Things will become "normal" again, eventually.

Ed

[camitchell]

What I am very curious about is if the mobile phone becomes the "defacto music player" over the next 10 years. It certainly seems to be headed that way.


That would put the wireless companies in the drivers seat as far as distribution and some of them (Nokia at least) have announced they will be using DRM.


I can see a future where CD sales are no more and people are much more locked into buying content for their cellphones and little demand to transfer it anywhere else for the "average consumer".


Average consumer is the key point here.


That may be one answer to the current "wild west days" of file sharing. I have no idea what will happen but once the big boys are taking a slice of profit, they will probably be much more keen on cracking down on illegal content on their networks.

[bogeyeater]

Originally Posted by camitchell

These are not last breath moves by aging artists. These are artist going where most other artist are not going to be able to follow in the new digital paradigm.


.

oh please. i may be in a curmudgeonly mood tonight, but this sounds like the kind of breathless twaddle pumped out by madges new label press dept.

it's exactly the same. 'live nation' is a major record co that takes touring and merch in on the rake. whatever.

[camitchell]

Originally Posted by bogeyeater

oh please. i may be in a curmudgeonly mood tonight, but this sounds like the kind of breathless twaddle pumped out by madges new label press dept.

it's exactly the same. 'live nation' is a major record co that takes touring and merch in on the rake. whatever.

Haha ... yeah but you read it the wrong way. My point is that Live Nation's proposed plan (as stated by their CEO) is to cherry pick top artists from labels to do 360 deals.


That sounds like a great plan until you realize that major labels are not doing too well building "career" artists anymore so who exactly is going to be the farm team for Live Nation down the road?


Yes, they are taking over the responsibilities of a label, but it sounds like they are thinking they won't have to do some of the ground work in building new artists. It's going to be interesting to watch play out.


Clear Channel thought if they owned the radio stations, the billboards, the sheds and ampitheaters that they could control the whole ballgame and promote artists, sell shows, etc.... "true synergy" if you will...... but it didn't work out like that at all.


Now we have Live Nation (spun off from Clear Channel) taking a different version of it, hey they are going to sell their own tickets, and we'll have to see how far they get.


But when you look at the number available for the Madonna deal and where she is at with her career it's a no-brainer.
.