MUSIC INDUSTRY PORTFOLIOWEEK 2THE RECORDING INDUSTRY

AN IMPORTANT CONCEPT?

IN-HOUSE

OUT-OF-HOUSE

AN IMPORTANT CONCEPT?

IN-HOUSE - WORK UNDERTAKEN INSIDE A COMPANY

OUT-OF-HOUSE

AN IMPORTANT CONCEPT?

IN-HOUSE - WORK UNDERTAKEN INSIDE A COMPANY

OUT-OF-HOUSE WORK UNDERTAKEN OUTSIDE A COMPANY BY OTHER PEOPLE/COMPANIES

RECORD COMPANIESWHAT DO THEY DO?

A + R (ARTIST AND REPETOIRE) - ACQUIRE TALENT (FIND AND SIGN ARTISTS, MANAGE THE RECORDING PROCESS (CREATIVE DIRECTION/BUDGETING.

PROMOTION + MARKETING PRESS PROMO, RADIO/TV PROMO, ON-LINE PROMO, PAID ADVERTISING, VIDEO.

DISTRIBUTION MANUFACTURE, SELL AND SHIP PHYSICAL PRODUCT TO RETAILERS. ON-LINE OUTLETS.

BUSINESS ADMINISTRATION ADMIN, LAWYERS, ACCOUNTANTS

MAJOR LABELS

MAJOR LABELS

MAJOR LABELS

WHAT DEFINES A MAJOR LABEL?

MDADMINA + R

PRESS PROMORADIO/TV PROMOONLINE PROMO

DISTRIBUTIONLEGALACCOUNTS

WHAT DEFINES A MAJOR LABEL?

MDADMINA + R

PRESS PROMORADIO/TV PROMOONLINE PROMO

DISTRIBUTIONLEGALACCOUNTSIN- HOUSE STAFF (SALARIED EMPLOYEES)

WHAT DEFINES AN INDIE LABEL?

PRESS PROMORADIO/TV PROMOONLINE PROMO

MDADMINA + R

DISTRIBUTIONLEGALACCOUNTS

WHAT DEFINES AN INDIE LABEL?

OUT OF HOUSEPRESS PROMORADIO/TV PROMOONLINE PROMO

INDIE LABELMDADMIN A + R

OUT OF HOUSEDISTRIBUTION LEGALACCOUNTS

MAJOR LABEL EMPLOYS LARGE NUMBER OF SALARIED STAFF MD, ADMIN, A+R, PRESS PROMO, RADIO/TV PROMO, ONLINEDISTRIBUTION, LEGAL, ACCOUNTS

INDIE LABEL -EMPLOYS SMALL CENTRAL STAFFMD, ADMIN, A+R

UTILISES FREELANCE OUT OF HOUSE COMPANIES AS NEEDEDPRESS PROMO, RADIO/TV PROMO ( PER MONTH)DISTRIBUTER (COMMISSION ON SALES 20 %)LEGAL/ACCOUNTS (PER HOUR)

MAJOR LABEL EMPLOYS LARGE NUMBER OF SALARIED STAFF MD, ADMIN, A+R, PRESS PROMO, RADIO/TV PROMO, ONLINEDISTRIBUTION, LEGAL, ACCOUNTSFIXED COSTS PER MONTH (SALARIES)REGARDLESS OF RECORDS RELEASED OR SOLD

INDIE LABEL -EMPLOYS SMALL CENTRAL STAFFMD, ADMIN, A+R

UTILISES FREELANCE OUT OF HOUSE COMPANIES AS NEEDEDPRESS PROMO, RADIO/TV PROMO ( PER MONTH)DISTRIBUTER (COMMISSION ON SALES 20 %)LEGAL/ACCOUNTS (PER HOUR)FLEXIBLE COSTS PER MONTHCAN EMPLOY OUT OF HOUSE SERVICES ONLY AS REQUIRED

OPPOSITESUNIVERSAL MUSIC EMPLOYS 130,000 PEOPLE WORLDWIDE WORKING IN ADMIN, A+R, MARKETING, PRESS PROMO, RADIO/TV PROMO, DISTRIBUTION, ACCOUNTS, LEGAL.

OPPOSITESUNIVERSAL MUSIC EMPLOYS 130,000 PEOPLE WORLDWIDE WORKING IN ADMIN, A+R, MARKETING, PRESS PROMO, RADIO/TV PROMO, DISTRIBUTION, ACCOUNTS, LEGAL.

MY NEW LABEL BUMGRAVY RECORDINGS.

OPPOSITESUNIVERSAL MUSIC EMPLOYS 130,000 PEOPLE WORLDWIDE WORKING IN ADMIN, A+R, MARKETING, PRESS PROMO, RADIO/TV PROMO, DISTRIBUTION, ACCOUNTS, LEGAL.

MY NEW LABEL BUMGRAVY RECORDINGS.

I WILL ACT AS MD, CARRY OUT A + R, ADMIN DUTIES.

OPPOSITESUNIVERSAL MUSIC EMPLOYS 130,000 PEOPLE WORLDWIDE WORKING IN ADMIN, A+R, MARKETING, PRESS PROMO, RADIO/TV PROMO, DISTRIBUTION, ACCOUNTS, LEGAL.

MY NEW LABEL BUMGRAVY RECORDINGS.

I WILL ACT AS MD, CARRY OUT A + R, ADMIN DUTIES.

I WILL EMPLOY PROMO AND DISTRIBUTION COMPANIES, ACCOUNTANTS AND LAWYERS AS AND WHEN I NEED THEM.

A CASE STUDYTHIS WEEK..

A CASE STUDYTHIS WEEK..

LAWRENCE B

ABOUT 15 YEARS AGO LAWRENCE DECIDED HE WANTED TO START A SMALL RECORD LABEL IN HIS SPARE TIME TO RELEASE SOME WEIRD SHIT HE KINDA LIKED.

ABOUT 15 YEARS AGO LAWRENCE DECIDED HE WANTED TO START A SMALL RECORD LABEL IN HIS SPARE TIME TO RELEASE SOME WEIRD SHIT HE KINDA LIKED.

HE WAS WORKING AT SNAPPY SNAPS AT THE TIME

ABOUT 15 YEARS AGO LAWRENCE DECIDED HE WANTED TO START A SMALL RECORD LABEL IN HIS SPARE TIME TO RELEASE SOME WEIRD SHIT HE KINDA LIKED.

HE WAS WORKING AT SNAPPY SNAPS AT THE TIME

STARTED RELEASING 1000 CD ALBUMS PER ACT ON A STRICT BUDGET.

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORK

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED CDS TO SPECIALIST RADIO PRODUCERS

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED CDS TO SPECIALIST RADIO PRODUCERSEMPLOYED A LARGE INDEPENDENT DISTRIBUTOR (PIAS) AT A COST OF 20% OF DEALER PRICE

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED CDS TO SPECIALIST RADIO PRODUCERSEMPLOYED A LARGE INDEPENDENT DISTRIBUTOR (PIAS) AT A COST OF 20% OF DEALER PRICE

TOTAL COST OF RELEASE = 4200

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED CDS TO SPECIALIST RADIO PRODUCERSEMPLOYED A LARGE INDEPENDENT DISTRIBUTOR (PIAS) AT A COST OF 20% OF DEALER PRICE

TOTAL COST OF RELEASE = 4200

DEALER PRICE IS THE PRICE YOU SELL AT TO SHOPS = 6.90

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED SPECIALIST RADIO PRODUCERSEMPLOYED A LARGE INDEPENDENT DISTRIBUTOR (PIAS) AT A COST OF 20% OF DEALER PRICE

TOTAL COST OF RELEASE = 4200

DEALER PRICE IS THE PRICE YOU SELL AT TO SHOPS = 6.90PIAS TAKES 20% (1.38) OF EACH SALE LEAVING 5.52 PER CD

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED SPECIALIST RADIO PRODUCERSEMPLOYED A LARGE INDEPENDENT DISTRIBUTOR (PIAS) AT A COST OF 20% OF DEALER PRICE

TOTAL COST OF RELEASE = 4200

DEALER PRICE IS THE PRICE YOU SELL AT TO SHOPS = 6.90PIAS TAKES 20% (1.38) OF EACH SALE LEAVING 5.52 PER CDBREAK EVEN LEVEL OF SALES =

TYPICAL BUDGETSIGNED HOME OR FINISHED RECORDINGS ONLY NO RECORDING BUDGETPRESSED 1000 CD ALBUMS @ 1200 INC BASIC 2 COLOUR ARTWORKEMPLOYED A SPECIALIST PRESS PR COMPANY FOR 1 MONTH = 3000MAILED SPECIALIST RADIO PRODUCERSEMPLOYED A LARGE INDEPENDENT DISTRIBUTOR (PIAS) AT A COST OF 20% OF DEALER PRICE

TOTAL COST OF RELEASE = 4200

DEALER PRICE IS THE PRICE YOU SELL AT TO SHOPS = 6.90PIAS TAKES 20% (1.38) OF EACH SALE LEAVING 5.52 PER CDBREAK EVEN LEVEL OF SALES = 760 CDS

ONE DAY.

ONE DAY.LAWRENCE RECEIVED A DEMO TAPE FROM A FRIEND OF A FRIEND.A DEMO TAPE NOT QUITE AS WEIRD SHIT AS THE STUFF HE USUALLY PUT OUT.SOMETHING HE WAS CERTAIN COULD SELL MORE THAN 1000 CDSAS AN INDEPENDENT LABEL HE WAS ABLE TO BE FLEXIBLE IN HIS APPROACH.SO HE DID SOMETHING MAD

LAWRENCE TOOK A BANK LOAN OF 90K

LAWRENCE TOOK A BANK LOAN OF 90K

USING HIS HOUSE AS SECURITY

LAWRENCE TOOK A BANK LOAN OF 90K

USING HIS HOUSE AS SECURITY

HIS WIFE LEFT HIM

BUDGETRECORDING BUDGET

BUDGETRECORDING BUDGET 15,000

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000PAID ADVERTISING = 6500

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000PAID ADVERTISING = 6500

TOTAL =

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000PAID ADVERTISING = 6500

TOTAL = 76,500

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000PAID ADVERTISING = 6500

TOTAL = 76,500

REVENUE PER CD = 6.90 LESS DISTRIBUTION COMMISSION (20%) = 5.52

BUDGETRECORDING BUDGET 15,000MANUFACTURED 10,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000PAID ADVERTISING = 6500

TOTAL = 76,500

REVENUE PER CD = 6.90 LESS DISTRIBUTION COMMISSION (20%) = 5.52

BREAK EVEN NUMBER OF CD SALES =

BUDGETRECORDING BUDGET 15,000MANUFACTURED 15,000 CD ALBUMS IN FULL COLOUR ART 8500PRESS PROMO AGENT 3 MONTHS @ 3000/MONTH = 9000RADIO/TV PLUGGER 3 MONTHS @2500/MONTH = 7500VIDEO X 2 @ 9000 EACH = 18,000TOUR SUPPORT = 12,000PAID ADVERTISING = 6500

TOTAL = 76,500

REVENUE PER CD = 6.90 LESS DISTRIBUTION COMMISSION (20%) = 5.52

BREAK EVEN NUMBER OF CD SALES = 13900

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVEN

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVENTHE BAND..?

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVENTHE BAND..?FRANZ FERDINAND

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVENTHE BAND..?FRANZ FERDINANDUK SALES?

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVENTHE BAND..?FRANZ FERDINANDUK SALES?1,500,000

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVENTHE BAND..?FRANZ FERDINANDUK SALES?1,500,000SALES REVENUE?

NEEDED TO SELL 13900 COPIES @ 5.52 TO BREAK EVENTHE BAND..?FRANZ FERDINANDUK SALES?1,500,000SALES REVENUE?8,280,000 (5.52 X 1,500,000)

WHAT DID HE DO WITH THE MONEY?

WHAT DID HE DO WITH THE MONEY?

HE SIGNED ANOTHER BAND

WHAT DID HE DO WITH THE MONEY?

HE SIGNED ANOTHER BAND

CALLED.. ARCTIC MONKEYS

WHAT DID HE DO WITH THE MONEY?

HE SIGNED ANOTHER BAND

CALLED.. ARCTIC MONKEYS

CURRENT ALBUM SALES 6,200,000

WHAT DID HE DO WITH THE MONEY?

HE SIGNED ANOTHER BAND

CALLED.. ARCTIC MONKEYS

CURRENT ALBUM SALES 6,200,000 x 5.52

WHAT DID HE DO WITH THE MONEY?

HE SIGNED ANOTHER BAND

CALLED.. ARCTIC MONKEYS

CURRENT ALBUM SALES 6,200,000 x 5.52

REVENUE APPROX 35 MILLION

HE NO LONGER WORKS IN SNAPPY SNAPS

HE NO LONGER WORKS IN SNAPPY SNAPS

YOUR RECORD LABEL

YOUR RECORD LABEL

RECORDING COSTS

PROMO (ONLINE, PRESS, RADIO)

DISTRIBUTION

YOUR RECORD LABEL

RECORDING COSTS

PROMO (ONLINE, PRESS, RADIO)

DISTRIBUTION

BUMGRAVY RECORDINGS

BUMGRAVY RECORDINGSRECORDING COSTS = 0 (COLLEGE STUDIOS)

BUMGRAVY RECORDINGSRECORDING COSTS = 0 (COLLEGE STUDIOS)PROMO = 0 (VIRAL VIDEO YOUTUBE, SOCIAL NETWORKS, RADIO PRODUCERS)

BUMGRAVY RECORDINGSRECORDING COSTS = 0 (COLLEGE STUDIOS)PROMO = 0 (VIRAL VIDEO YOUTUBE, SOCIAL NETWORKS, RADIO PRODUCERS)MANUFACTURE = 0 (DOWNLOAD ONLY)

BUMGRAVY RECORDINGSRECORDING COSTS = 0 (COLLEGE STUDIOS)PROMO = 0 (VIRAL VIDEO YOUTUBE, SOCIAL NETWORKS, RADIO PRODUCERS)MANUFACTURE = 0 (DOWNLOAD ONLY)DISTRIBUTION (COMMISSION VIA ITUNES, TUNETRIBE)