Music sales: Unsigned, sealed and delivered

You don't need a deal to sell your songs. A new website is the missing link between itunes and MySpace, says David Sinclair
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Much has been made of the impact that MySpace has had on the music business, and in particular its power to help bands locate an audience without having to rely on either the mainstream media or the record company establishment. We've all heard how Arctic Monkeys apparently used the internet in this way to build a huge fan base long before they had a record deal, and how other artists like Lily Allen have benefited along similar lines.

But now that musicians have got used to the idea that they can put their music in front of such a potentially vast audience - 111 million MySpace members and still soaring - some awkward questions are being asked. Who really stands to gain more: the bands who are putting their music on MySpace for free, or the fans who (with the bands' permission) are able to stream and download the music for free? And what about News Corporation, who stand to reap the benefits of owning one of the most frequently visited sites in the history of the web, yet continue to rely on virtually all the content being generated for them (for nothing) by the membership?

Not everyone who puts their music on MySpace goes on to sign a record deal and sell a million albums. Indeed, the vast majority of bands are giving away their work for no financial reward whatever.

"MySpace has become hugely popular for bands, but the only person making any money out of it is Mr Murdoch, by selling ads all around other people's music," says Ben Drury, MD and founder of a new site called "The bands don't get any of that revenue. It's not fair. If a band gets played on the radio they get royalties paid. MySpace have got all those millions of tracks playing and there's no royalties being paid to anybody."

Drury plans to redress the financial balance in favour of the musicians with indiestore, an online downloading store which is launched in the last week of September. The idea of the site is to enable unsigned musicians to sell their music instead of giving it away. The premise is simple. Anyone who is not already signed to a record label can acquire their own indiestore page and sell their music as a download. Whereas established online music stores require artists to be signed to a record label, anyone can acquire an indiestore site, and the standard version is free (there is also a "Pro" version which costs £75). Like MySpace, it is a simple procedure to set up and manage your own page. People can still hear your music for nothing. But if they want to download it onto their computers or MP3 players then they pay a sum - varying from 77p to £7.99 - decided by the artist. The band takes 80 per cent of the revenue generated, which compares very favourably to iTunes where all tracks are sold for 79p, and the payout is around 55 per cent (from which the label then takes its cut before the artist gets their share).

Indiestore has been testing in "beta mode" for the last couple of months. With only word of mouth promotion they have acquired almost 3,000 acts from 54 countries. The sums of money that have been generated during this trial period are "in the thousands of pounds" according to Drury. "The average take, so far has been £14," he says, "which may not sound much, but it's a start. The best stores have generated over £500 and there is one that has passed the £1,000 mark."

One of indiestore's more high profile members is David McAlmont - of McAlmont & Butler fame - who was signed with Hut records until 1998 and then with EMI until 2002. On both occasions he was encouraged by the labels to get into debt, while fending off unwelcome interference with the creative direction of his music. He currently has a lovely but unfashionable album of jazz standards, You Go To My Head, out on a tiny independent label called Ether. As well maintaining a presence on MySpace sites, he has now put five tracks from the album on Indiestore.

"Thanks to Ether and Indiestore, I've been able to release the record I wanted to release without any compromising," McAlmont says.

But how much money is he making from the arrangement?

"Enough. You don't have to sell so many copies for one thing. With the bigger labels you have to sell far more to even cover your costs. So many things happen independently now. It does feel like a revolution."

Indiestore operates on a global basis - unlike iTunes and emusic - and its sales count towards the download charts in both Britain and America. It may sound fanciful, but when you can place a song in the UK Top 20 (download) chart with about 2,000 sales (in one week), it may not be that long before an unsigned band is making chart history via the Indiestore route.

Realistically though, there could be more danger at this stage of creating an unsigned band ghetto. After all, who is going to come looking for music to buy from a bunch of unknown groups?

Indiestore is part of 7 Digital, the online retail company whose clients include Universal, EMI, Warner Music and many others. And Drury is quick to emphasize how he will use the stores of their "professional" clients on 7 Digital to cross-promote the acts at indiestore.

"The fact that we've got hundreds of thousands of tracks from all the major labels on 7 Digital puts us in a unique position to be able to do this. So people who are looking for music by, let's say, Coldplay will also be pushed towards the relevant indiestores, and encouraged to listen to new bands who sound similar to Coldplay."

Another feature designed to guide the browser is the in-house, indiestore chart, compiled by a combination of artists' profile views, number of track listens and sales.

It seems an odd coincidence that MySpace has suddenly announced that it is now investigating the possibility of enabling bands to sell music downloads via their MySpace sites. Whether or not MySpace has been influenced by the arrival of indiestore, it seems that this is an idea whose time has come.

"Indiestore is a completely new model," Drury says. "It looks simple but, technically, it's pretty hardcore what it's doing behind the scenes. It sorts out multiple formats when you upload the tracks; international currency issues, even taxation. Hopefully it will help unsigned bands make a few quid and level the playing field a bit."