Amazing stuff in music!

A look at music distribution and the pioneers who are changing everything.

Music has been a part of culture, more specifically American culture, since its inception. Whether it's a flute and drums playing a marching tune or the invention of the phonograph transforming parlors everywhere, Americans have always had music integrated into their lives. Yet in recent years, the recording industry has been knocked back on its heels.

In 2007, a Rolling Stone article entitled "The Record Industry’s Decline" had one senior music-industry source predict, "Here we have a business that's dying. There won't be any major labels pretty soon." Two years later, the Big 4 still control more than 80 percent of the market. While it is obvious no one should write obituaries yet, the industry isn’t exactly booming. Even with digital sales continually increasing, the overall health is shaky at best.

CD sales have dropped 48.9 percent since 2000. Approximately 2,680 record stores closed in the U.S. in the past 4.5 years. While upstarts are trying to branch in new directions, the established industry is scrambling for alternative ways to profit, like collecting from the 30-second iTunes clips and cell phones packaged with music downloading. iTunes latest attempt to recapture the album market centers around the iTunes LP, packaged with videos, liner notes, lyrics and discographies.

Recent defections from labels and the continued success of bands like Radiohead and Nine Inch Nails have destroyed the ideology that one needs a record label to have commercial success. But these two are titans in the business. Radiohead’s In Rainbows was offered as a download to consumers, letting them pick the price. The pre-release sales profits were still greater than the Radiohead classic Hail to the Thief. Nine Inch Nails’ The Slip was downloaded for free and was downloaded 1.4 million times … and still sold 250,000 copies when released as a physical CD. Not exactly the same concept as a small-time band, struggling to get their name out.

But they are on the cutting edge that may turn this “dying” industry’s loss into long-term gain. The record industry wasn’t getting the job done. Record sales were falling and nothing was changing. The crazy thing is that these strategies, giving music away or letting fans pay what they want, are working. Even for the little guys. Just ask Derek Webb, artist and pioneer of NoiseTrade.

“Better to let [the record] go out there and pass friend to friend and find its audience," Webb says. "As long as their information is coming back to you. Then go and see them all, or offer them something beyond the record that enhances the experience of [it]. I’d rather be a pioneer today than a victim tomorrow."

In 2006, Webb gave away more than 80,000 copies of his Mockingbird record for free online, asking in return for name, email address, postal code and, as part of the process, for fans to invite their friends to download as well. The spike in sold-out shows and record sales was the impetus to create NoiseTrade, a website that enables artists to essentially do the same thing.

NoiseTrade is currently hosting almost 800 CDs, and by offering the service at no cost to the artist, they are taking the same risk they're asking their musicians to take. Judging by the 20,000 downloads in two weeks after the Independence Day 2008 launch, people are liking what they have to offer.

Another new website looking to shake things up is BriteRevolution. Started by another musician, Billy Cerveny, and Nashville entrepreneur Winton Elliott, Brite has the novel goal of bringing music back to its root: music. Hoping to help fans connect on a more regular basis with artist’s music, the current (and expanding) roster of 30 artists put out two songs a month that consumers get access to for a subscription fee.

BriteRevolution is attempting to stand the traditional business model on its head. From their unconventional viewpoint, they don’t tie up the masters for songs, publishing rights or any future obligations. Simply post the songs on the website for two months, and then all rights revert back to the artist. Musicians collect based on number of subscribers and downloads. If their artists have reached a certain benchmark, Brite foots the bill for the recording process.

“We believe in the power of circling the wagon, capitalizing on each other's success,” Cerveny says. “Quality is quality and chances are if you come for one artist, you will end up staying for the other ones. There are a lot of rabbit trails you can chase here, discovering new music.”

Seeing itself as a way for fans to filter through the thousands of bands out there, the artistic community is invite-only. The “musical version of a USDA stamp,” you may not like the flavor of songs, but the quality is always guaranteed. From the 500-600 downloads a day, the early subscribers seem to agree.

The other unique way that Brite operates is their belief in the need to give back. As part of their business model, Brite artists and fans have chosen a number of charities to support with 10 percent of the gross revenue.

“Our catchphrase is that success and philanthropy are different sides of the same coin,” Cerveny says. “Rather than pay lip service to that, we decided to build into that a significant percentage of our gross revenue.”

Both NoiseTrade and BriteRevolution have been around for less than 18 months. Their continued success remains to be seen, and they are by no means the only ones out there trying to do things different. But the system is broken, and they are among the ones trying to fix it.