Independent music: There's a musical revolution going on

Major labels are losing ground, and the independent scene is thriving. David Sinclair reports

Friday, 3 February 2006

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The record industry began the new year with familiar tidings of gloom. As news came in that the 2005 tally of album sales in America had slumped by a whopping 7 per cent, and a more modest 2.7 per cent in the UK, it was announced that Sony BMG Music Entertainment in America would be making further redundancies. Industry analysts stifled a yawn as this latest round of "consolidation" took the total number of jobs cut since Sony and BMG merged less than two years ago to almost 2,000, or roughly 25 per cent of the companies' newly combined workforce. With consolidation like that, who needs terminal decline?

This continuing trend towards downsizing confirms a growing feeling in the air, on the ground, at the bar and anywhere else that music business folk go to sniff the wind or whatever it is they sniff, that the paternalistic, big budget business model favoured by the major record labels has begun to outlive its usefulness. Yes, the majors still have the financial clout and marketing muscle to deliver blockbuster albums by the likes of U2, Coldplay, Robbie Williams and James Blunt to the mass market. But the money generated by the tiny percentage of acts that succeed on such a scale is no longer enough to finance the hugely wasteful working practices of the major labels. Crucially, it no longer extends to the long-term nurturing of new talent.

"Major labels - what are they good for these days?" asks Mick Hucknall of Simply Red. "Distribution and dosh. I'm afraid that's all they were ever good for anyway." Hucknall has been the most conspicuously successful star to adopt a new, independent business model, effectively taking the financial risk of releasing records upon his own shoulders, and thereby reaping rewards which range from a far higher royalty rate to retaining ownership of his master recordings. Not only that, but Home, the first album which Hucknall released through his own company in 2003, Simplyred.com, actually sold 2.5 million copies worldwide - more than Simply Red's final release on Warner Bros achieved.

Meanwhile, groups such as Arctic Monkeys - who achieved unprecedented sales and a number one album last week - have shown what can be achieved by combining new internet technology with the old-fashioned method of relentless gigging to create a huge fan base. When they could have signed to any of the major labels, Arctic Monkeys opted to go with the independent Domino, also the home to Franz Ferdinand.

But the idea that clicking a mouse is like waving a magic wand, and that artists can suddenly dispense with the small army of manufacturers, distributors, pluggers and promoters that are needed to get their record to the market, is a fallacy. Even Arctic Monkeys had a manager, PR, a label and a distributor all in place before they achieved their "overnight" recognition as torchbearers for a new generation of DIY stars.

"More artists want to control their own destiny and the rights to their music," says Steve Betts, a former sales and promotions manager with Warner Bros, who together with Phil Knox-Roberts, another ex-Warners executive, has launched The Record Label, a new service for acts and labels who wish to pursue the independent route. Betts, who worked with Mick Hucknall to put together the marketing and distribution team for Simply Red, is offering the same service to labels and individual acts on a much smaller scale.

"There's an awful lot of talented people in this country and a lot of them put their own money into trying to break through," Betts says. "But because they haven't got the knowledge or the business expertise to do it, they fail." With the launch of The Record Label, Betts has thus turned the traditional business model on its head. Instead of the label paying the artist an advance, the artist pays the label - on a strictly one-off basis - keeps the lion's share of the profits and retains ownership of their masters. This is all very well if the project is a success. But it is easy to underestimate the burden of risk involved.

The colossal sales of Nizlopi's Christmas hit single, "The JCB Song", were achieved entirely independently of major label funding. But as Kieron Concannon, father of the duo's singer and guitarist, Luke Concannon, and manager of their label, FDM Records, explains, the risks involved could have had terrible consequences.

"If it had gone wrong, I now wouldn't have a house to live in," Concannon says. "I was truly forced to put everything on the line. There was a moment when our intelligence suggested we could sell maybe 300-400,000 singles, but we didn't know that we could sell them. And with no major label backing, I had to raise the money physically to manufacture them and get them into the shops.

"Our family had no Christmas. People think that because you have a big hit record, you must be rolling in it. But although we have now sold that many records, we won't even start to get any of the money back until April. And even then we will only get about three or four pence return per single sold."

Despite these hardships, Concannon nevertheless turned down offers of a record deal from Sony, Atlantic and others.

"When we set up the label, we vowed never to work with the majors," he says. "They have destroyed the industry with their greed and short-termism. This current dependence on reality TV is just another blow to an industry that probably wouldn't be able to give U2 enough support to make it if they were starting up now."

While some highly successful acts, such as Katie Melua, have resisted the lure of major label funding once it became available, for many new artists the harsh reality is that the independent route remains their only option.

"It's virtually impossible to get a record deal these days, no matter how super-talented you are or even how great your manager or agent is," says Cambridge-based singer-songwriter Sophie Agapios, who released her first album, Philosophie, on her own Squeaky Records label in 2003. At that time she found herself exported to America as part of a "Best of British" initiative, organised, ironically, by the record industry trade organisation, the BPI, in conjunction with Virgin Records. Now working on her second Squeaky album, Agapios feels that many artists today are simply discovering how to make a virtue out of a necessity.

"Because the major labels want it all on a plate these days, new artists have been forced to go elsewhere and make their own arrangements. And they have found, because of the new technology, that it is actually relatively cheap to make an album. If you've got Pro-Tools and Logic software you can pretty much make an album in your bedroom. David Gray's breakthrough album, White Ladder, was made in a bedroom. So then you think, 'Well, if I've got the record, so why don't I do a few gigs and get it up online and get a bit of a fan base and see if I can't get something happening myself.' The problem comes when, as an artist, you actually get sucked so much into the business that you haven't got time to attend to your music."

Agapios has no doubt that there has been a complete change of climate since she released her first album. "Two or three years ago when I had meetings with local radio stations, they only wanted to hear from the big major labels and they were only going to put on certain records that conformed to their rigid playlist policy. Any independent act wasn't going to get a look-in. But listeners and fans are now much more open to something a bit different and they are almost expecting to find the next big thing to come from somewhere other than the big record companies."

Four Day Hombre, a band from Leeds, found themselves running their own record label, Alamo Music, after their record deal with an established label fell through at the 11th hour. With a recording studio and producer already booked, they decided to raise the money to pay for it by selling shares to their fan base via the internet.

"We e-mailed our database and managed to raise far more money than we had hoped for, and indeed more than many indie deals that we'd been offered," says singer Simon Wainwright. "And suddenly we were directors of our own limited company."

The process of running their own label has been an eye-opener for the group.

"You really don't have to spend that much money to do really cool things like videos and stuff," Wainwright says. "You need to be prepared to work your socks off and you need to be clever and you need to maybe meet some people who know more about certain things than you do, but no one needs to spend what major labels do on these kind of things. Everything within the industry is so overpriced. It's almost like it's become a self-sufficient, incestuous little village of labels and PRs and video makers and creative types who all have very comfortable lives because they're all in this big conspiracy to bleed money off any people who are from outside of the village. We've met bands signed to majors who spent £10,000 on one publicity photo, or another whose label sent them to make a video in Iceland at a cost of nearly £100,000, and all those things you can do for yourself for practically no money."

Having got themselves included as part of the British delegation to the music business trade show, Midem, in Cannes in January, Four Day Hombre found themselves booked solid with meetings to sort out international publishing and licensing deals. And their debut album, Experiments In Living, will be in the shops on 27 February.

"We must be doing something right," Wainwright says.

"It is changing from being the music business to the musicians' business," says independent PR guru Richard Wootton. "Musicians, especially successful ones, are taking control of their own careers and will increasingly be releasing their own records.

"But I don't think it's necessarily as clear cut as independent labels good, major labels bad. Yes, the whole cost of running a major label is still too high, which is why there are problems. But indie labels can be affected by things if they haven't got a strong catalogue or they are connected to the wrong company."

The fact remains that, profligate or not, Universal, Warner Bros and EMI all seem to have plenty of money coming in, because of the current successes of certain key acts - such as U2 and Coldplay - and the continuing strength of their back catalogues. However, everyone agrees that it is the indies which are going to discover new acts rather than the major labels. As one pundit put it: "The indie labels are the future of the industry. You'd be much better advised to invest in an indie company than to buy shares in EMI, for example."

"We live in interesting times," says Richard England, MD of Cadiz Music, an independent sales, marketing and label management company based in Greenwich. "Major labels have been dropping acts which has created a lot of room for people like me. The internet has given us retail outlets to sell to that weren't there before: Amazon, Play.com, eBay... but that has only made up for the complete disappearance of the indie record shops. When I started doing distribution in 1991, there were all the independent chains: Andy's, Our Price, Sam Goody, MVC, Tower Records, and now they've all gone and all you've got is HMV and Virgin. Some of the indie retailers that are left are going heavily into the second-hand market.

"The major labels and the supermarkets between them haven't quite destroyed the market, but they've had a good go at it. The internet has allowed independent labels to survive."

In with the new breed of bands

Arctic Monkeys

Torchbearers of the new generation of internetworking bands, Arctic Monkeys enjoyed apparently miraculous success in 2005 without the help of a record company, major or otherwise. The four teenagers from Sheffield made their initial mark by gigging relentlessly and making their quirky indie rock songs available to be downloaded for free from their website. Their fanbase exploded, to the point where they were able to sell out the 2,000-capacity Astoria in London before they had physically released a record. Now signed to independent label Domino, the band released their eagerly awaited debut album, Whatever People Say I Am, That's What I'm Not, on 23 January. It went straight to number one.

Nizlopi

Acoustic "folk hip hop" duo from Leamington Spa, Nizlopi scored a surprise Number 1 hit just before Christmas with "The JCB Song". Over the past three years, the duo had become a modest attraction on the local club and summer festival circuit. A low-budget video of "The JCB Song", posted on their website in the summer of 2005 triggered a huge surge of interest. By Christmas it had attracted more than a million hits. The duo remain "signed" to their own FDM label.

Simply Red

Mick Hucknall saw the internet age coming. Leaving Warner Bros at the end of the Nineties he took out a bank loan secured against his house and studio in Surrey and set up his own label, Simplyred.com. Having assembled a team of promoters, pluggers and marketing experts he played the major labels at their own game, and sold 2.5 million copies of his next album, Home. His latest album, Simplified, soon to be joined by a companion collection called Amplified, includes re-recordings of his biggest hits, enabling him to reclaim possession of some of his best-known work. Canny.

Akira The Don

Formerly a music journalist known as Adam Alphabet, Akira The Don has harnessed the power of the internet to turn himself into a new media phenomenon. His website, which features a provocative blog, animated videos, downloadable mixtapes and various other interactive features, has earned him a worldwide audience who follow his adventures in cyberspace with a near religious devotion. When he suggested to his fans that they might like to ask Radio 1 DJ Zane Lowe to play his record "Clones", Lowe's inbox was bombarded with more than 500 e-mails a day until he played it. A paragon of the DIY ethos until now, Akira has just signed a deal with US major label Interscope.

Imogen Heap

Despite an offer from Island/Universal, Imogen Heap, 27, decided to release her second album, Speak For Yourself, on her own Megaphonic label. "I signed my first deal when I was 17," Heap says. "And I've been on one label or another since then. I didn't think I'd end up releasing the album on a label of my own but once I'd finished I didn't want to give it all away again." One of her songs, "Hide And Seek", became a US hit after it was used on the soundtrack to The OC, while a new song, "I Can't Take It In" features on The Chronicles Of Narnia soundtrack.