Tuesday, April 19, 2011

How is a Gum Ball like a Song?

How Is a Gum Ball Like a Song?
by Amanda Williams

Suppose your favorite restaurant has a bubble gum ball machine by the front door. Every time you leave, you pop a quarter into the machine & out pops a gum ball.

Now suppose there is a man named Herman Smithfield who owns that gum ball machine. Herman is a family man with a wife named Sarah, a son named Norm, a daughter named Kelly & a dog named Rip. He makes a modest living stocking the gum ball machines in town.

Each week, Herman buys a bunch of gum balls at wholesale & then visits all his machines, stocking them with treats. He has learned over the years that he can expect to earn anywhere from $150 to $225 from each of his machines per week. It may not sound like much, but from this money, Herman is able to pay his mortgage, electric & water bills, buy groceries & set a small amount aside for Kelly & Norm’s school fund & his & Sarah’s retirement.

Now imagine that one day someone discovers a tiny button on the side of the machine that you can press to dispense a gum ball without putting in your quarter. It’s not a free gum ball, mind you, because Herman has already paid 2 cents apiece for them, but at least you don’t have to pay for the gum ball anymore. You don’t know Herman or his family, you just see an opportunity to save a quarter. So now, instead of dropping your twenty-five cents into the gum ball machine every time you walk out the door of your favorite restaurant, you just push the button & wallah! a “free gum ball” drops down for you to enjoy.
Word spreads all over town that all you have to do to get a gum ball is push the tiny button on the machine. Everyone is doing it now. No harm, no foul, right? Everybody is doing it! Why pay a quarter for something you can get for free?

What about Herman? At first, he didn’t notice too much. He just thought that gum balls might have gone out of fashion. Then he did a thorough count and realized that he was missing just as many gum balls, but only making a fraction of the profit. After a week or two of only making $75 or so per machine (and some even less), Herman & Norm organized a stake out to figure out the cause of the problem. They sat near the front door of one of the restaurants, pretending to read the newspaper, all the while keeping an eagle eye peeled to see what was going on with the gum ball machine.

Soon enough, they found their answer. The culprit (as we know) was the tiny button! Herman & Norm acted immediately, after all, their family’s livelihood was at stake! They went around to all their gum ball machines & put a piece of duct tape over the tiny button. That should fix it, they thought.

But fix it, they did not. The cat was out of the bag. Everyone was used to getting their gum balls for free now, so someone just pulled off the tape & went back to pushing the button & getting their gum for free. Everyone loves gum balls, after all.
The Smithfields became angry. How dare these townspeople steal their gum balls! They worked hard for the machines! They spent hours checking & stocking each one! They took pride in filling them with the highest quality gum balls, buying the 2 cent ones instead of the 1 cent! And now, these thieves were chewing the hands that fed them! Someone would have to pay for this injustice!

Herman & Norm devised a plan: sue the restaurants who were letting people have their gum balls without paying. The restaurants argued that they couldn’t be responsible for the actions of their customers. They agreed to put up signs to alert everyone that the gum balls were not free & that they should pay their quarters like they used to do. (Yeah, right. The customers disregarded the signs. They hadn’t paid for a gum ball in weeks & weren’t about to start again now.)

What then? Sue the customers themselves! Make an example of someone! Again, Herman & Norm staked out near the front door of a restaurant where one of their machines sat. Sarah & Kelly came along to watch the justice unfold. Herman & Norm had rigged up the tiny button to make a loud buzzing noise when pressed so that everyone in the restaurant would see the thief brought to justice.

They didn’t have to wait long. Little Susie Ann came skipping up to the gum ball machine, her blonde curls bouncing with joy at the thought of maybe getting a pink one! She hadn’t even had to ask her mother for a quarter, because, just like everyone else knew, nobody paid for gum balls anymore.

No sooner had little Susie pressed the tiny button when the alarm sounded & the whole Smithfield family leapt on her! “Stop, thief!” they shouted in unison. “Drop that stolen gum ball!”

In their excitement, little Susie was pushed to the floor. She got a little bit of ketchup on her new dress & a tiny bruise on her left cheek where Kelly accidentally elbowed her. Susie made a terrible poster child for illegal gum ball awareness as her tear stained face was plastered across the cover of the town paper & all over the local news stations. The headlines read: “Small Child Punished for Stealing Gum Balls. $10,000 Fine Levied by Gum Ball Barons.”

This story may sound far fetched, but it is an illustration of the epidemic facing the music business, the wide spread practice of illegal downloading. Just like the Smithfield family in the story, songwriters and independent musicians rely on the few cents they make from selling their recorded music as downloads online. With the internet, it is easier than ever to distribute music to an international audience, but with the benefits of worldwide distribution come the risk of losing all your income to pirates, because it is just as easy to get the same material for free (maybe easier) than it is to pay for it.

Why should consumers be expected to pay their hard earned money on music when everyone is getting it for free?
Here’s why. Let’s say you buy a download for $0.99 on iTunes. iTunes keeps $0.29 to pay the credit card company & themselves leaving $0.70 that is paid to the copyright owner. If you are just the songwriter, guess how much of that $0.70 goes to you? Remember, the songwriter is the creator of the underlying composition, the reason the song is being sung, recorded & released in the first place. The songwriter gets a whopping $0.091 per copy sold. Less than ten cents.

If you are a professional songwriter who is signed to a publishing deal, you can expect even less money because that $0.091 gets split up 50/50 between you and your publisher. Regardless of how many people wrote the song, the amount allotted for the songwriter/publisher share is still $0.091 per copy, so rap songs with 6 writers only get $0.015 apiece (half of that if they are signed to a publishing deal).

I think the reason that most consumers don’t have a problem “stealing” (downloading from sites who don’t charge you) music is because getting music from major label artists for free makes one feel a little bit like Robin Hood. Yeah, he was a thief, but he stole from the rich to give to the poor. Everyone sees the big stars riding around in Bentleys & living in mansions & thinks, “I don’t have a Bentley or a mansion! That person doesn’t need my $0.99 as much as I do. I’ll get the song for free & no one will be hurt.”

What consumers don’t see is the songwriter & his family, counting every $0.091 that comes their way, driving a Hyundai & grocery shopping on double coupon day. Those families are the backbone of the music industry, the under appreciated heart and soul of a dying business. Without them, the music would cease. There would be no “Wind Beneath My Wings” or “16th Avenue” inspiring us to love more freely, to appreciate the little things in life, and to transcend our daily drudgery into the beauty of a well crafted song.

The common misconception among music lovers is that the artist (the guy driving the Bentley) writes all the songs he sings himself. This is not the case. There are countless families who eek out a modest sustenance gathering the crumbs that fall from the plate of these mega stars. Not just the songwriters, but the roadies, the studio engineers, the musicians, the accountants, the business managers, personal managers, on air personalities, make up & wardrobe designers, and the list goes on & on.

Next time you get online searching for that song you can’t get out of your head, know one thing: somebody is counting on that $0.99. It won’t be missed by you in your day to day life, but someone somewhere is counting on that $0.99 turning into hundreds & thousands of dollars that can be used to support their family.

So, what happened to the Smithfields and their gum balls? The choice is up to you, just like the fate of the music industry. Isn’t something that brings you so much joy worth paying a little money for to support the guys and gals who create it? Yeah, the big bad music industry made a fool of itself punishing kids for illegal downloading, but just like the Smithfields, they were at the end of their ropes. If you saw your livelihood threatened by thieves, no matter how well intentioned, you would probably get angry too. Maybe even a little irrational.

Do a songwriter a favor, pay for your music. You’ll get the satisfaction of knowing that you are supporting families just like yours. There’s no need to wait for “the man” or big industry to figure out what to do about the problem of illegal downloading. The cure is obvious - let your friends know what is at stake, the future of real people, families just like yours. Please don’t let the music die or become subsidized by corporate sponsorship. Help the little guy, the indie musician & the songwriter keep his dream alive. Pay for your music & share the word, not the tunes.



PS This work is copyrighted too, but I want you to share it. Please share it with any & everyone.

You can read more articles like this one & support the work by joining the Hillbilly Culture Club @ http://www.hillbillyculture.com

Tuesday, April 5, 2011

Do It Yourself Digital Distribution article

Here is an article that is posted in our member pages of Hillbilly Culture Club. This is the kind of information you have access to as a member of Hillbilly Culture Club. I am posting it here because I think a lot of independent musicians can use this information to better choose which digital distribution service to choose.


Ever since Napster irreversibly changed the face of the music business in 1999, music consumers have increasingly preferred to get their music delivered digitally directly to their computers or mobile devices. According to one report, digital sales have increased by 40% in recent years. Japan actually bought 91% of their music on their mobile devices in 2007, and that number has probably risen since then.
With over 500 legal music services available, it’s hard to figure out the best way to make your music available digitally to consumers. I have researched the top digital distribution sites & offer this article as a way to help you make an informed decision about how to get your music up for sale online.
First of all, we should consider strategy. Would you rather make your music available on a wide array of third party sites (such as iTunes & Amazon mp3), or would you rather sell your music directly from your own web site? Both strategies have their advantages and disadvantages.
If you want to sell your music directly to consumers from your own website, you will have to provide a secure payment solution to protect them from exposing personal financial information over the internet. Also, you will need to be able to steer traffic to your site. Consumers will find your music because they have sought you out & know where to find you. This is a great strategy for established artists with a fan base, because typically, if you do the selling directly from your own site, you will get to keep a larger percentage of the profits.
If you choose to go through a third party site, your music will be available to people who are browsing the catalogues of large music oriented sites, such as Rhapsody, Napster and others. The music lover may be looking for the hot new single on the radio, find your song by accident & end up buying it. The disadvantage of sending your customers to a third party site is that you risk losing them to the same phenomenon: they come to iTunes to buy your single and end up buying someone else’s instead.
Perhaps the best strategy is a combination of the two approaches: make your music available on your site and on the third party sites. That way, you keep a larger cut of the profits if people come to you directly, while allowing customers browsing third party sites the benefit of finding your music there as well.

Chart comparing features & costs for each of the digital distribution sites:

CD Baby
one time set up fee-----$9.95 per single; $39 per album
yearly fee------------------$0
other per song fees-----25% per song for onsite sales;
9% of digital distribution sites sales (plus their fees)
take down fees-----------none listed

Reverb Nation
one time set up fee------$0
yearly fee------------------$59.95 for 44 stores; $34.95 for 35 stores
other per song fees-----flat $0.30 per song or $3 per album on site sales
take down fees-----------$50 or $30 depending on service (goes to 3rd party sites)
Tunecore
one time set up fee------$0
yearly fee------------------$9.95 per single; $49.99 for album 1st year
$19.98 per each additional year
other per song fees------none
take down fees-----------$20 per album or single

My Song Store
one time set up fee------$9.95
yearly fee-------------------$47.70 per year for up to 25 songs
$83.40 per year for up to 50 songs
$203.40 per year for up to 150 songs
other per song fees------25% per song plus additional 1/2 cent for licensing
take down fees------------NA


Until recently, if you wanted to keep the customers on your site while purchasing your music you had to pay for an expensive e-commerce site. These sites cost a considerable amount to set up and maintain, ranging from $5,000 to upwards of $15,000 annually. Now, there are digital distribution companies who create a widget you can imbed in your site which will handle all your sales for you for considerably less money.
One such site is My Song Store. Here, you can sign up for a membership which will provide you with a personalized widget enabling you to sell up to over 150 songs from your own web site. There is a one time set up fee of $9.95, and are several levels of membership starting free up to 4 songs, $3.95 per month for up to 25 songs, and so on. In addition, My Song Store keeps 25% of your total selling price, so in effect, when you sell a download at $0.99, you keep $0.7425. You can, through My Song Store set a higher selling price for your downloads.
Another feature of My Song Store is help in licensing the songs you release, so you can record cover songs with permission. Many people don’t know, but you have to have written permission from the copyright owner to record a song, that’s one of your rights granted under the copyright law, the right to distribute. Even performing songwriters who are signed to publishing deals, or who’s cowriters are signed, are required to license their own songs (because the publisher owns the copyright.)
In order to do this on your own, you have to get a license from the mechanical licensing agent of whoever owns the copyright. For example, if you want to record “You’ve Lost That Loving Feeling,” you have to contact the Harry Fox agency and secure a mechanical license. This will cost you a small fee ($15 per song for up to 4 songs, and $13 for 5 or more).
My Song Store has a special licensing agreement with Harry Fox which allows you to license each download as you sell it, which saves you the $15 or $13 per song fee. To provide this service, My Song Store charges an additional $0.005 per unit sold, thus in effect, reducing the royalty paid you to $0.6465 ($0.091 of each unit goes to Harry Fox to pay the songwriter & publisher.) To put things in perspective, if you’re planning to sell more than 3,000 units, you should go ahead and pay the $15 to Harry Fox. Otherwise, it’s cheaper to let My Song Store negotiate for you.
Reverb Nation is another company that offers you the ability to imbed a widget in your own web site to sell music, and they have the added benefit of being a third party music site themselves, so browsing music lovers can find your songs. Reverb Nation charges a flat $0.30 per download you sell, so a song selling for $0.99 will pay you $0.69. You must own all the rights to your music distributed through Reverb Nation.
Now, let’s look at the other piece of your strategy: selling your music on the third party sites. In 2009, 25% of sales came from iTunes, about 69% of all digital sales.1 Everyone (except Garth Brooks) wants their music on iTunes. But, it is fairly difficult and cost ineffective for the independent musician to get their music on iTunes by themselves. Enter the middle men:
It is better for the independent do it yourself musician to go through a company who will deliver your music to an array of digital distribution sites for you. One of the first sites to offer this service was CD Baby, founded by indie musician guru, Derek Sivers in 1997. Sivers has since sold the company to compact disk manufacturing company, Disc Makers. Other sites also now offering to deliver digital downloads for you number in the hundreds, the best known being Reverb Nation & Tune Core.
There are so many choices available to you on these sites that it is hard to determine which is best for you. Here are a few helpful pointers:

Service--------------lets you pick-------takes a per-----provides-------set-----helps you
which retailers song fee or % bar code your $ license

CD Baby yes yes yes $20 yes yes
Reverb Nation no yes yes free no no
Tunecore yes no yes free no no


When you are considering digital distribution, it is just as important to understand the practices of the individual retailers as it is to understand the practices of these third party companies. After all, they can only pay you what the retailers send them.
Here is a handy chart that lets you know which retailers pay the most money to you, the creator of the content:

iTunes
pay per single $0.70
pay per album $7
fine print for releases over 11 songs, they bundle your work & set a flat rate

Amazon mp3
pay per single various levels for front line, mid line & catalogue
pay per album various
fine print they get final say in pricing - can be as low as $0.21 per song
Rhapsody
pay per single varies
pay per album varies
fine print they allow free streaming for their customers trial period - no pay

ShockHound
pay per single $0.693 per song
pay per record $6.993

LimeWire
pay per single depends on customer’s level of membership
silver =$0.40; gold=$0.30; platinum=$0.27
pay per album NA
fine print they allow 50 free downloads during trial period - no pay to you +
these are the guys that have been stealing our music for years

MySpace Music
you get a portion of ad sales + streaming fees through Tunecore

Thumbplay
pay per single varies; $0.49, $0.70 or $0.91
pay per album NA
fine print pay 50% of streaming revenue

Spotify
pay per single variable
pay per album
fine print pay portion of ad revenue or subscription cost

Nokia Music Store
pay per single 0.49 GBP
pay per album 4.45 GBP
fine print international only

Napster US
pay per single $0.65
pay per album $6.50 for 11 songs or more
fine print variable streaming pay rates

MediaNet
pay per single $0.70
pay per album $7
fine print 40% of streaming income

IMVU
pay per single $0.70
fine print streaming revenue comes from Sound Exchange - more like
social network

After digesting all this information, here are a few basic pointers: with just flat out numbers, you will make the most money from selling your music on your own site using My Song Store & on site selling via CD Baby (not digital distribution through them). If you want your music distributed to the large 3rd party services, you will want to use Tune Core & select only those retailers who have consistent pay scales (such as iTunes & MediaNet). My Song Store is currently going through an update of the “look and feel” of their site to make their widgets more customer friendly. In the future, I will be doing all my own direct selling of digital downloads through their widget on our website.
You may choose to go with one of the other retailers for personal reasons, or you may like one of their supplemental services enough to override the monetary loss. The reason I don’t recommend going through Reverb Nation for digital distribution is that they do not allow you to pick which retailers you sell through. This, after averaging out the variable royalty rates, brings your profit down significantly. You might sell more music through them, but you won’t see the money from it. If your goal is simply to get your music out there, go for it. They distribute to the largest number of retailers - it’s just that many of them give your music away for free.
I know I have neglected to mention a few of the larger independent distributors in this article, such as IODA & the Orchard. That is because those companies make it harder for the independent musician to use their services by requiring you to fill out information requests & disclose the number of sales you currently have. For the person new to digital distribution, these services are not practical, and therefore, I left them out.
I hope this information helps you navigate the tricky world of digital distribution a little better. Please let me know if you are currently distributing from a company and want me to include them in future articles, or if you have a particularly good customer service story to share.
In the meantime, get your music out there! The time is right for independent musicians to take up the do it yourself mantle & show the big boys that indie music is alive and kicking & that you don’t need to spend a fortune doing “buy ins” or paying independent radio promoters to make a few bucks in the music business.

Enter the Blog

I have never been terribly fond of the word "blog". I know, it's a shortened form of "web log." It makes sense, but as far as words go, "blog" may be one of the ugliest words in the entire English language. Just the sound of it - "blog" is reminiscent of a blob, which makes me think of snails & slugs, not the most appealing of creatures.

That said, I have always been fascinated by the ease of creating & updating a "blog" and the interest that people have in reading them. I start this one tonight in order to share more about my new company, Hillbilly Culture, and the Hillbilly Culture Club in particular.

I'm not a web designer, not a programmer - therefore, I'm not able to upload new content to our website every time I would like. Hopefully, this blog will help bridge the gap between what we have on the outside of our member pages, and what is contained within them. The Hillbilly Culture Club is an ongoing labor of love. I will use this blog to share this passion.

Thanks for reading.