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Ar Ar tists sign to digital-only label tists sign to digital-only label
ANGELINA WAGNER
A&E EDITOR
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Bands that can’t afford the dollars for tour buses and CD production now have a new alternative to promote their music. The Shazam and seven other bands will be able to get the same treatment a major record label can provide, thanks to an experiment through Universal Music Group.
The artists will be signed to this digital-only label and be able to make profits off of their CDs through services like iTunes, Rhapsody and MSN Music. Universal’s move is saying a lot for how the record companies out there are dealing with the Internet and illegal file sharing of music. After seeing CD sales lowering since the past four years, labels have been looking for a way to boost their economy. Now for the first time they’re taking steps to look at digital sales in today’s marketplace.
Most record stores are hurting because of this, but have turned to stocking their shelves with more DVDs and video games. Music industry executives are also saying that they can use the Internet to create a fan base and interest before an album is released. Universal Music Enterprises Digital is hoping to sign enough small acts and make a way to market these bands through a low-risk way without making a physical album.
The shift to this digital world comes with the consequences of a shaky financial stronghold because fans can still go and download songs for free.
According to Nielsen Sound Scan data, fans buy singles over albums at a ratio of more than 25 to one, even when they’re paying for their music.
Warner Music Group is also trying to develop a similar unit to Universal’s to sign artists with potential for later CD releases. The downside for artists though will be that there will be no advance pay or the covering of the cost to produce an album. If an artist’s sales reach to 5,000 songs then they will have the option of sending CDs to record stores. Universal will be paying these artists a 25 percent royalty on the price of downloads. Also artists will be able to retain ownership of master recordings but will license them to Universal for a limited time.
