Independents' day

Independents also pay profits only after recouping expenses, but they keep those down by curbing marketing and overhead costs. They also have more equitable arrangements with artists, often sharing profits 50-50.

But perhaps the biggest difference is that they let artists keep the rights to their work. Michael Hausman, who manages Mann, says once the large labels get those rights, they may choose not to release a note of music but won't let the artist work for anyone else - essentially bringing career momentum to a halt.

When rock critic and author Dave Marsh spoke on a panel at last month's South By Southwest music conference in Austin, Texas, he pronounced bigger-label contracts a bad deal for artists from Day 1, "because of unequal leverage."

John Doe, who gained fame with then-wife Exene Cervenka in the '80s punk band X, says majors pump artists' expectations to unrealistic levels.

"With majors, your visibility is much higher, but it's for a much shorter period of time," he explains. "I feel bad for today's bands because they're loved and then they're discarded."

Doe, now on ArtistDirect imusic imprint, also says there's no word to appropriately describe the meddling of major-label A&R people, whose job is to "hear a hit" on each album.

"I personally wouldn't like to be told what kind of album to make," Doe comments. Most indie labels pick up already-recorded albums, or give artists creative freedom to make the music they want.

Adds Doe: "You can't replace the feeling [of] making a record that you're proud of."

Many industry participants, including Michael Caplan, cofounder of just-launched Or Music in New York, go so far as to predict that the current major-label model is as doomed as the dinosaur - partly because majors are unable to read and react quickly enough to market activity. If a record stops selling, it takes weeks for them to "turn the semi around." And if an artist's sales pick up in a market, the majors can't capitalize quickly enough to maximize profits.

"The idea is to keep it lean and mean," Mr. Caplan says. "We're gonna be nimble."

Caplan, who spent 21 years as an A&R (artist & repertoire) man with Sony-owned Epic Records, says big labels also have lost sight of what music is about - the artists, not the songs.

By seeking home-run hitters at the expense of solid team members, he notes, "They're just ceding a whole big part of the marketplace that we can go after."

Even some major-label executives agree that the current model isn't working. Zach Hochkeppel, director of marketing at Capitol/EMI-owned Blue Note Records (home of multiple Grammy winner Norah Jones), admits, "There's a lot wrong with the record industry as a whole, and a lot of it comes from the fact that the major labels have too much power."

Majors have the muscle to pay radio-promotions people to push for airplay, and product-distribution systems that far exceed the reach of indies. Bigger distributors won't deal with indies because the numbers are too small for their chain-store clients.

Big-box stores won't carry an album unless they know it will sell at least 5,000 units - which new artists won't necessarily do right away.

Page: 1 | 2 | 3