Record labels: The Domino effect

One small label has given us the fastest-selling debut album ever, as well as Franz Ferdinand. Alastair McKay investigates

These numbers make it the biggest selling debut album in history. Definitely Maybe by Oasis sold 55,854 in its first week, while Coldplay's Parachutes managed 70,000. Even Franz Ferdinand, whose first album was released on a high tide of public enthusiasm, managed only 75,457 copies, when their album emerged in February 2004 to give Domino its first No 1. Only Hear'Say's Popstars can compare - with 306,631 copies sold - and it had the advantage of months of free marketing on a television talent contest. "It's been a word-of-mouth phenomenon that none of us have really seen in music," the Domino founder Laurence Bell told Billboard. "I'm not sure there's anything we can compare it to. It's completely unprecedented."

The Monkeys' success is remarkable, but has not emerged from a vacuum. Bell compared the young Sheffield group to "the Who fronted by Mike Skinner" (the English rapper The Streets, whose songs are like extracts from the scripts of Shameless), but there is an obvious debt to the Libertines, who developed a scratchy version of English rock which joined the dots between The Kinks and The Clash. The Libertines' Pete Doherty and Carl Barat attempted to promote the idea of a band and its followers being united in a gang. Their vision was less a business, and more a social club. Concerts were convened in pubs and advertised on internet bulletin-boards - all outside the traditional music business.

The internet is implicated in the rise of Arctic Monkeys too, though this may have been a product of innocent enthusiasm rather than design. The group's early demos found their way onto downloading sites, and established their reputation before they had a label or a manager. Bell has commented that the web has changed the relationship between bands and record companies. "They are not so desperate for the record company to magic up the audience," he said. "They come with an audience."

Even so, Domino makes an unlikely hit factory. Founded in the South London flat of Bell and his partner Jacqui Rice in 1993, it began as a showcase for American post-grunge acts such as Sebadoh, and singer-songwriters such as Will Oldham and Bill Callahan. By the time of the label's 10th anniversary celebrations in 2003, it would have been easy to interpret as ironic Bell's announcement that the label was about to enter a "Motown-influenced phase" with "a few more hits". He told the internet magazine Incendiary: "We've just signed a band called Franz Ferdinand from Glasgow; I think they're going to do really well. They're like a sort of pop rock/early Josef K art-school band. They've got great songs and they're very colourful and fresh, so I've got high hopes for them."

A year later, after Franz had won the Mercury Music Prize, Bell explained how he had discovered the group in Glasgow. "There was a feeling that just totally came off Franz. What struck me about them was that the guitarist was wearing a cape, the drummer was wearing a 1930s' sailor's outfit and they were very striking. The first five rows were full of girls jigging around and everybody looked interesting. They were very hip people, but they had no pretension whatsoever and weren't afraid to have fun. The look in their eye made you just want to join in."

Stephen McRobbie, whose group The Pastels record for Domino, and who runs the splinter label Geographic Music with Bell, suggests that Domino's success can be credited to the family feeling engendered between Bell and his acts. "Most of what Domino is comes down to Laurence, and he is a person with a fantastically optimistic, bright outlook. He communicates this tremendous sense of enthusiasm. The groups on the label love Laurence and love Domino. For instance, Franz Ferdinand on their bass drum always have a Domino logo. It's not that common for groups to be publicising their record label like that."

McRobbie also suggests that the music industry has become less predictable in recent months. "It's very difficult for major labels to understand what's going on, and they never really understood the whole downloading phenomenon. Things have gone really out of control, and it has suited labels that are smaller and can react much quicker."

There are obvious parallels between Domino and Alan McGee's Creation Records, an independent that enjoyed phenomenal success with Oasis and - to a lesser degree - Primal Scream. The notion of a label run by a visionary maverick stretches back further, to Glasgow's Postcard (hosted by Alan Horne) or Edinburgh's Fast Product, run by Bob Last, which gave the world the Human League and the Gang of Four.

With the Arctic Monkeys success, Domino moves into a new phase, with new temptations. "It's been funny to see him on News 24 waving his arms around," says McRobbie. Previously, when the label enjoyed unexpected success - when Elliott Smith's songs appeared on the soundtrack to Good Will Hunting, for example - Bell talked about the dangers of expanding too quickly, and then having to lay off staff as normality returned.

Meanwhile, the response of the more conventional music business is to imitate - so we may confidently expect bands to be clumsily marketed via advance downloading - and when that fails, for it to wave the cheque-book.