Viral, direct marketing is nothing new, but for the music business and musicians, putting more and more of their work out onto the Internet, it's different. Madonna is selling her latest single, "American Life", available for download with a $1.49 payment via Paypal. Simply Red has released their eighth album, HOME, on their own label, simplyred.com, including lyrics and samples of the music. They apparently hope to make 300-400 percent higher returns than on standard record company contracts. Mick Hucknell refered to these contracts as "immoral" in a series of articles at FT.com about the music business and ditching the major labels. These marketing scenarios turn old models upside down, and while this isn't really new for the audience, who've downloaded directly for years, it is new from the business end. Madonna is doing this through her label, Warner Bros., but Simply Red is on their own. While Simply Red may be the game to watch these days, there are some other smaller artists out there giving this a try, like Eleni Mitchell. But the theory is that having an established fan base and quality music are the only way to make the direct model succeed.
Hucknell says he will never go back: "No, this is how I will make records for the rest of my career," he insists. "There's not a chance I'd go back to a major -- not a chance. I'll do distribution deals with people, but nothing beyond that."
On the other hand, Max Hole, at Universal, where he has licensed the Simply Red album for some territories, says that, "It's an option for a successful financially secure artist, but it's risky and expensive. At least with a major you are going to be paid. Generally, artists are better off with a major."Posted by Mary Hodder at March 26, 2003 09:01 AM