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Record Companies & Distribution
|Tony: I'll start by giving you a bit of an introduction
so you'll have an idea of what I've done and understand where I'm coming from,
and hopefully my experience will be relevant for you today, and I can give you
information so that when you want to ask questions, you'll have something to
base them on.
I used to be an accountant ...... didn't want to do it. Music's always been my passion. In 1977 I realised that I actually couldn't be a musician because I was absolutely crap. I just wasn't going to make a living at it. But wanting to get in the music industry, I opened a record shop in 1977 in York. It was punk, it was DIY, it was an absolutely gorgeous time. Lots of loud music, lots of people had a real belief in what they wanted to do.
And you've got to have that belief, you've got to have a passion. Without it, it's not going to happen. It's great being professional - you must be professional, you must be prepared, you must be organised. But you've also got to have this belief in yourselves. Because without this belief, you're not going to persuade anybody else that they should be talking to you and not somebody else.
I had a record shop, it was punk, it was DIY, people starting off themselves. I got involved with wholesale, which is just buying and selling off to people. We had stuff that other people wanted. That grew in '79, '80, into a national distribution company. Distribution is where you have exclusive contracts with people, and you have commitment to people, and labels have commitment to you. And it's a two-way street - I'll go into this further on.
Then I had my own record label, in fact four or five different record labels, music publishing companies, I had a press and promotions company .... I started off the first independent music magazine in Europe, I was involved with management people ..... I was involved with major labels at the end, sadly. And it all got exciting and wonderful.
Then it got to be early '90s, and I suddenly realised I was back in an office again. Vast company - I was actually turning over three and a half million pounds, employing thirty-nine people - great. Things were working, it had actually proved the model that you can have belief in yourself, and you can make things happen.
But I'd ended up in an office again, with paperwork and cashflows and overheads and bank managers and contracts and ... it was crap. It was horrible. So I stripped it all down - down to things which I felt mattered, which was independent labels and musicians. And actually making things work.
And now I do a lot of this, I have my own springboard ..... three record labels, manufacturing brokerage, I do lectures at Leeds College of Music, and at a place in Sheffield .... and it's still about people and musicians, and making it happen. It's actually quite nice to be able to give something back. And this is what hopefully I can do today.
I'd like to start off, if I may, with record labels, something which is very very close to my heart, independent record labels.
There tends to be four fundamental types.
The band's own label, where the only way they're going to make something happen is to do it themselves.
There's the proper bona fide but small independent label.
Then you have the major minors, people such as Gut, Mute (until they sold out to EMI), Beggars Banquet, 4AD as used to be ......
Then you have the major record labels themselves, which are the Sonys, BMGs, Warner Brothers, Geffins, EMIs etc.
I'd like to lead you through the path of them all and how they operate, and how you can then hopefully understand them, so you can then see how you can dovetail into them.
A lot of bands, a lot of musicians in the first instance, think the only way they're going to get forward is to have their own record label. And this is quite often true. Because they need that as a stepping stone, as a springboard for themselves. And a lot of them make fundamental mistakes, because it never seems to happen. If they're not careful, they get caught in the trap of trying to make it pay.
If you're a band or a musician, you get something recorded, be it a good quality demo, or something you do live, or you've got some money and been in a studio .... you do a CD, you get it manufactured .... you can get five hundred CDs done for seven hundred pounds. Professionally done. Nice and mastered with proper artwork and jewel cases, etc. It's not a lot of money in the big picture. If you haven't got anything, five pounds is a lot, but in the general scope of things, it's not a lot of money to invest in your future. Because that's what you're doing - investing it.
So get it done properly. Don't just do a few CDRs and hope somebody's going to like them. If you actually want to launch yourselves, as a band, as a label, get a proper manufactured CD. Not CDR. You can get them done very professionally and very cost-effectively. But then don't immediately look for a return. A lot of people do - they spend six or seven hundred pounds for these things and then think, "God, if we can sell a hundred of them at five quid each, we've got our money back". So that suddenly becomes the focus, and they've actually lost the big plan. They haven't thought it through.
You need to start before that. Because that in a nutshell is what a lot of people do. They get some CDs and they go, "Let's sell them."
It isn't good enough.
First of all, you've got to think about how you're going to approach it.
Who you're going to approach, what you do with them. And what sort of a label you're going to be.
If you want national distribution, which you do need for people to know about you, you need to be a record label. Because distribution companies invariably will not take on one-band labels. If they think it's ... I'll pick on John, John Prendo on Prendo records - it's obvious what it's going to be. "Oh, it's just some guy trying to launch himself, there's going to be no follow-through here, no commitment." Distribution companies aren't interested in that.
So if you're going to be in a band ....... Who's in a band? What's your band name?
Adam: Torso Horse.
Tony: Torso Horse. Right. You come up with a completely different name for your record label. And your first signing is Torso Horse. As a label, you actually come up with press releases for yourselves, and with these other signings on the label. You've got to be economical with the truth, because distribution companies want labels. They don't want one-offs, they want labels. They want labels that have a future. Because their relationship is with the label.
The reason for that is because of their investment in you, which again, I'll come on to later on. So as a band with a label, you need to have a roster. You make it up. You get some friends, you lie, you're economical with the truth. But you have to persuade people that you are a proper label. You don't have your home address, you have somebody else's address, somebody else's phone number, and you have a roster, and you have a marketing campaign about how this label is going to fulfil its needs as a proper label. And with that you can then approach a distribution company. That then puts you on equal footing with the proper record labels.
There's one I've known for twenty-odd years in Manchester, now moved to Leeds, a label called Ugly Man. They do some nice things, they made their money with a lad called Colin, "Wonderful World" .... "Wonderful Life". It's always in adverts and stuff now. It's pretty average AOR stuff, but it's alright. They do other things as well, but it's a proper label, they have a roster, and they have a distribution company backing them. Because the distribution company believes there's a label there, with a roster.
So immediately, you're a step up. Your not just a band .... you're a label - you're being taken equally. Hopefully. An equal footing with other people.
The reason you need to do this is because you need to be known nationally, and then internationally. Local band, local scene, is great. I'm based in Leeds at the moment, and there's some good bands there, who play some great little pubs, and great little clubs. It's fine, but that scene, there's only about three gigs. If you've played the Cockpit, the Primrose, and Jacob's, Joseph's Well .... that's it. it's not good enough. If you're going to do something, you need to get out of that. And with your own label you can actually do that, because you can then be known nationally and then internationally.
You don't just have a few CDs that you can then sell at gigs to get your money back, because all you're doing then is preaching to the converted. You get on the road, you get out of North Yorkshire, you get out of Leeds, you play in Manchester, you play Nottingham. You play Nottingham, you get a club down there. You sell twenty CDs. You've got twenty fans, you sell twenty CD's, brilliant! You go home again. You want to play Nottingham again, you might sell a couple more CDs. But not ... you could spend a year like that. And not move forward at all.
What you need to do is have a presence in the record shops. And with that presence in the record shops through distribution companies, you will actually be known, you'll be seen. People go into the shops. You've played wherever in Nottingham, if you've said, "We've got a CD available in the shops," they'll go and buy it. So the next time you have a release, it could be your own record label again, because you're still doing it, because you like it, because it's working, or you could have got signed. Next time you put a release out, you're in the shops. The shops are aware of you, they know that you've sold .... they will stock you.
Because believe you me, getting stuff into shops is a nightmare. It's almost as difficult as getting a distribution deal. A lot of people are now of the opinion that it's actually more difficult to get a distribution deal than it is to sign to a label. Distribution companies are getting tight, tight, tight, with their money and their commitment, and their investment in labels. Record shops are having a real hard time out there.
And if I can just take two minutes out for a private crusade about record shops, especially independent record shops ....... Support them. Give them the money. For God's sake, don't ...... I argue the odds with my children, I've got two .... eleven and fourteen-year olds. I saw them in Asda the other day looking at something ..... "Don't! ..... Put it down!" "But it's only £9.99, Dad." "I don't care. Here, I'll give you the extra money, go into town and buy it at Crash or Jumbo."
Support independent record label shops. Even HMV and Virgin, because they invariably put the money back into the industry. They're the ones who will support you. Asda, Tesco, Sainsburys, won't. Please don't buy, don't let your kids or your cousins, brothers, buy stuff there. They're putting nothing back into the industry. They're not going to support you. If you go into a shop in Middlesbrough or Leeds, or York, independent shops, they will stock your stuff, they will listen to you, they'll support you. Please support them - we need them. Asda couldn't give a toss about you, they really couldn't. You're just another product, another can of baked beans.
When I was twelve, and I started buying my first records, which was early '60s soul records ..... I had my money for buying my clothes, and money for music. Now, my kids have got, oh, too much choice. Games, computer games, magazines, my son's a skateboarder, and the clothes that goes with it, and the videos ....... Occasionally, he buys some music as well.
I think they have too much choice. And this is our competition, this is what we're part of.
So again, it's getting the big picture, understanding the big picture. You need presence in record shops, so that as you progress in your profession, in your professionalism, you'll be known there. You'll be known, and people will stock you, people will be able to get hold of you.
So, hopefully, you have a marketing campaign, and you've got your release, it's being promoted in the pubs, in the clubs, in the press, on the radio .... there's got to be a reason why a shop in Exeter is going to buy it. So when a distribution company is selling it, it sounds good. In Exeter, "Yeah, I've heard of them, I'll buy it, I'll stock it." And he'll take one.
And it's getting that magic one into the shops, it's all-important in the first place. Because without it, there's going to be no re-orders. Nobody's going to have a chance of buying it.
I've got some relatives who live in the West Country, and Jamie's in a band, and it's a nightmare, buying a lot of stuff down there. Just a lot of mail order. And I keep saying, "No, no .... persevere with the record shops."
Because you've got to spread the word, you've got to get them stocking stuff. So it's very very important that record labels have presence in shops. Because then the bands have actually got a chance of actually being known, and as they progress their stuff is going to be out there.
So though in the short term it may be a good way of making a few bob, getting your money back, selling them at gigs, you're going to have no presence, and you're going to have no development. And that's the same for local band, local label, or a larger record label with bands on tours.
From time to time, they may be selling merchandise, they may be selling a
few ...... but don't, as a band, as a professional ...... unless it is your way of making a living, and you're not bothered about having stuff in shops, whatever ...... whatever - don't. Support your local shops, and make sure your record labels are looking at distribution. Not just getting a few in the shops for a quick return. That's all it is, a quick return, it's short-termism - it's going to do you no good at all.
The difference between the small independent labels and the larger ones is basically money. Mute, a very well-known independent record label until early this year ...... Daniel sold out to EMI for forty-something million pounds - forty-something because it depends on what mood he's in, what he tells you. Basically he got twenty-four million pounds in his pocket, and a percentage of turnover in the next five years, which he reckons is going to give him about forty-odd million.
Daniel, in 1979 .... I can't remember if it's '79 or '80 .... He used to be a taxi driver .... and he walked into Rough Trade, the shop I was involved with, one of my side issues. And he walked in, he was a big smoker, forty cigs in his pocket, his mac on, nervous as hell, and this record, "Will you distribute it for me." He believed in what he was doing, and he wanted to bring stuff out. He'd set up his own label. And then he's given this demo by this band from Basildon that nobody's particularly interested in. "But look, it's electronic music, Daniel, you'll most probably like it. Listen to it, see if you can do anything with this band." And he did, and they were Depeche-Mode, and he's made millions out of them.
And he's had various other bands as well, and other things, one of my favourite ever bands, Nick Cave and the Bad Seeds. Gorgeous music. But Daniel had budgets. And he could do it.
Ugly Man Records in Manchester, hasn't got a budget, and he gets away with it. And sometimes it's as arbitrary as that ......
It's not just having A&R, because a lot of people will sign good bands. Because what is A&R? It's personal taste. I used to have to, sadly, mix with A&R down in London ...... and they don't know what they're doing half the time. And major record companies don't know what they're doing half the time.
A slight digression ..... a year ago, I was in BMG's office, near Putney Bridge, presenting a couple of bands to the Head of A&R there. And this guy said .... we'd got CDs.... and it's quite nicely presented CDs with proper labels ....
"Oh look at that, all that packaging, I don't like this. If I want a band, I just want excitement, I want edge. I want a CD with just something written on it. I don't care about all this packaging, all this bumf about photos and press releases, all this sort of stuff. I just want a CD with something extraordinary ..... music on it. That's going to get me all passionate."
"Alright, fine ..."
That was on Monday.
Tuesday morning, through the post comes Music Week.
Do people know what Music Week is? It's the trade magazine. It comes out every week. There's fifty copies a year, if you buy it in W H Smiths somewhere it'll cost you £3.60, but you can subscribe to it and it'll cost you £130 a year. And you get a directory with it as well, which is quite a useful book. But it's the trade magazine of the industry.
And you could see there, on the front page, was this guy talking about the next tranche of Pop Idols they're going to get involved in. "Because pop music is the way forward".
On the Monday he's telling me he wants energy and rawness on the CD,
"I want something extraordinary, I don't care about packaging."
But the official line is, he wants packaging, he wants Pop Idols.
You know, what's going on? Does he know? Of course he doesn't bloody know. He works for BMG, he's got no chance of knowing, because he's up in his ivory tower.
But they have these vast amounts of money that gets fed through to them, and they have this filtering process, and it's quite obscene at times. But they have power, and you need it at times. And they do have a use on an international basis.
I'm a great believer in using people, and whatever's going on.
So you have band label, make it look good, think of the big picture.
Independent labels ..... the difference between Ugly Man and a Gut is budget and belief. Ugly Man believe in the band, Gut tend to believe in the bands as well. So a lot of the time, it's a matter of budget and actually getting people on board with what you're doing, and then making sure they don't take away too much control.
Because the major independents seem to be a little bit like the majors, and that's why they want to use the word "major", they want to be control freaks. They say, "Look, we're going to spend all this money on you, but we want a return for it." And as such, they'll give you a fat wodge of a contract.
Did you touch on contracts at the beginning, with Elaine? Yes, no? Good, I won't have to cover that area.
Pete: A little bit, Tony, not a great deal.
Tony: Does anyone want to talk about contracts?
Pete: What Elaine mentioned was that if you get a contract, the great thing about being in the MU is that they do have a legal side who will help you vet contracts.
Tony: For an hour, yeah. No, that's fine. Small labels will give you small contracts - it's a commitment, it's a statement of intent. It's invariably not worth a lot, but the label themselves aren't worth a lot, and it tends to be a mutual situation going on there. Large labels will give you large contracts, and you do need advice. You do need advice. Especially if there's a lot of money involved, you do need advice. Because you can easily shoot yourselves in the foot.
I was going to give you some examples, but we haven't got the time really. But basically, take advice on contracts. And with the majors, if you get involved with the majors, be very very careful of what they can and can't do.
Some quick stories - there's a band from Hull I was involved with a while ago. Had their own independent label, there was some good music coming out, they were touted by the majors, and signed to Virgin. And they were given a hundred thousand pounds advance. And there were certain caveats, certain clauses in the contract about what studios they could use ....
They label said, "We want quality products, for a quality marketplace. So we make sure we have quality product, musical, of reasonable quality." Blah blah blah.
They gave them a list of studios they could use, and they gave them a list of producers they could use. Pete's smiling, he knows what's coming. And it's so bloody true. The band got this hundred thousand pound advance, and all they have to do to fulfil the first year was bring them the masters for an album. And, "Here's your list of studios, here's your list of producers, go and talk, do it, blah blah blah blah blah, and here's your hundred grand."
"Lovely jubbly!" say the band, "Lovely jubbly," and off they went, and nine months later, supplied the masters for the album. And it's a nice album.
And as they supplied them, Virgin gave them an invoice. For a hundred and twenty thousand pounds. The Lord giveth, and the Lord taketh away, I say on a Sunday. The studios are all owned by Virgin, the producers are all on Virgin's books.
They went in the studio, did some backing tracks, laid down some guitars and drums, a few bits of vocals, they went away ..... then John the bassist went back and did a little bit more, and the producer, Hedges, did a little bit of this, a bit of that, and kept on sending them cassettes and CDRs of mixes, and they seemed to like this, and the band went back, and it was great ...... was it?
And every time they were clocking up the studio bill. They were saying, "God, what a nice man, he's doing all this work for us," and was he hell as like, he was on the Virgin payroll.
And that is just an example of what they will do to you.
So be careful, be careful, be careful.
That's why you need advice, and you need good management. In the first instance, you will get somebody who'll look after you who's into what you're doing, but be careful. Be who you are, be the label ...... you've got to be really careful about management. You need somebody who actually knows what they're doing, not just somebody who likes you.
Anyway, back to the plot.
Right, so independent record labels. They're great, they believe in you, they will support you, they most probably do believe in you more than the majors.
The majors, they'll have somebody looking after you ... but as soon as they move on, you've got problems.
With an independent record label, they tend to be there because it's their label, they believe in what they're doing, and they believe in you. And they have longevity, they have long-termism.
With the majors, you don't have long-termism. You're signed by an A&R guy, and then he will either get booted out, or he'll be moved upstairs, and then you're left with this quandry of not being known in the company.
I was involved with one band, and I spent a lot of time nurturing everybody else at the label, at Polydor, because I knew my time with the band was short ..... was not going to be very long, through personal choice. But I wanted them to have a career.
So I got them known in the company, so that when I stepped out, they could actually have a future .... whereas quite often it doesn't happen like that.
I want to move on to talk a bit more about distribution.
Distribution companies are what you need if you're a label. Independent labels, right up to Mute, before they went to EMI, needed distribution. If you've your own label, you need distribution.
Distribution is where it's sales and some marketing, and the logistics of getting records to shops. If you have five hundred or a thousand CDs pressed, the distribution company gets them. They've got to get them into shops.
Why are distribution companies awkward? Because of their investment.
You did something - you could have recorded it, you could have manufactured it, you want distribution for it. You want to get it out there. Distribution companies cover the UK, and they cover the international market as well. They all export. The UK's still a big shop window for the world, it's a massive shop window for the world. Not just mainland Europe, but America, Australasia, Japan.
We're not as important as we used to be. When I had a distribution company, sixty percent of my business was export. Now I'd say a distribution company may have about forty percent export. The UK's a great stepping stone for the rest of the world. Another reason why you do need distribution companies is because of this stepping stone.
And they'll help you do this, because it's in their best interests, because they make money out of it. And they'll support you, because then they have a future as well.
Distribution companies are there to make money. They believe in what they're doing, invariably, but they're also there to make money, because it's jobs. It's jobs.
The music industry in this country employs about two hundred thousand people. Of which forty thousand are musicians. The other hundred and sixty thousand are people like me, and manufacturing companies and distribution companies and labels and the press and promotions and venues and everything else that goes with it ...... the merchandisers ...... There's a whole support system around these few precious musicians.
It's a big industry, there's a lot of money, a lot of jobs. A lot of careers. So distribution companies - you send something off to a distribution company, and the clock is ticking. They are racking up costs.
I work in a distribution company, I'm a label manager. If a CD comes to me .... they want distribution .....I get it, I listen to it. I might talk to somebody else about it ..... "Should we, shouldn't we ..... "
It's already costing money. I'm getting a wage. I'm in a building, it's got overheads. So it goes to a distribution label meeting. I say, "Yeah, another label and we want to distribute them ..."
We're going to spend about two hours talking about this label before there's a response made to the label.
Then as label manager I ring up the label, "Yeah, we're interested in having a chat, can you come in," ....... So the person comes in, I have another hour's meeting with them, then the contract is sent, and it can be another three or four hours negotiating the contract, the contract which has to be drawn up by a lawyer which costs two hundred and fifty pounds an hour.
Then we arrange stock to come in. So stock comes in, five hundred CDs come in. Five hundred vinyl come in. And they've got to be put on shelves, they've got to be stocked in ....... so you've got a warehouse with a warehouse manager, and people downstairs with fork lift trucks, getting stuff and putting it on shelves.
It's entered into the computer. There's a computer system both for the stock and for the pre-sell of this going live.
And you haven't actually sold a record, but the distribution company's most probably invested about five hundred pounds already in you, as a label.
That is why they will be arsey about signing any little label. Because if they can't cover their costs, they're not going to be interested. It's not in their best interests to. And they're doing an injustice to themselves, and an injustice to the labels that they are selling.
Because if they don't make it pay, they're going to go under, and there's another distribution company's gone.
So they don't have open door policies.
That's why you've got to sell yourself as a label to them ..... let them know that you have a future ..... that it's worth investing in you.
Because they do have overheads, and some of them have massive overheads.
For my sins, I went to Pinnacle, one of their warehouses in Kent, a few months ago. And it's an aircraft kind of hanger.
Pinnacle do Jive, they do a lot of ... any one time, they've got circa ten, twelve releases in the Top Fifty. I would say the fourth biggest distribution company in the UK .... they're actually bigger than BMG, who are supposedly major.
It's an aircraft hanger. It's systemised, it's wonderful.
The good thing about it - this is where distribution's going - they have this system for supplying HMV where they have these boxes, they're all pre-made boxes, they've all got a number on, each HMV branch, it's got a number on.
So number fifty-two might be Leeds. And as it's brought in by Securicor, one of the delivery companies, it comes in, the order's placed electronically either by e-mail or what used to be known as the EPOS system. Anyway, they place an order with Pinnacle electronically. And number fifty-two's put in, entered by somebody, the box is there, the order comes off and it's put on top. The lid's open and it's put on top. And it goes round slowly, it goes round, and it's scanned, as it goes on these roller balls, round, past these units. It's all infra-red, it's all barcode driven. And it's read, and stuff falls into the box, stuff falls into the box, as it goes round the system. Nobody touches it. At the end, there's somebody else there - it wasn't the same person, because it's about three quarters of a mile round this massive warehouse - and somebody adds it all up, seventeen items, they're actually now doing it by weight, because they know what the weight is. And it's flipped over, off it goes. Nobody's touched it.
That's distribution ..... massive-scale.
And you've got other people, on the other hand, where distribution's just some people in a warehouse, could be a room. There was a place I came across not long ago, and it was about twice as big as this. Four people over there on phones, racks, records, same people checking the order, packing it, sending it out, very hands-on.
That's how I started, in my shop, I used to have records in the back of my shop. People wanted them - the same shelves that were supplying the public, I was also supplying shops. It's developed from that, to people like Pinnacle. That's the way it's developing. That costs investment.
Next year, they're going to be investing two million pounds in bigging up that system so they can use it for a lot more shops, because all they can actually supply at the moment is HMV. That's investment, that's being what they consider prudent, and fiscally sensible to make it work.
To me it's quite inhuman, but if it means we can actually get our records and our music out there in a cost-effective way, that makes it worthwhile. They can keep their overheads down, so instead of having to break even at five hundred to make a band or a label worthwhile, they can bring that break-even point down to three hundred. You've got more chance of having more smaller labels coming through the system. And that can be just the stepping stone that people need.
They're all systemised, but as a label you tend to be working with a label manager. And it's the label manager who will then dovetail with the sales, and it could be telesales or it could be sales reps - they use both.
If you've got a release that's got a chance of doing a bit of business, more than two or three thousand, they will pre-sell it.
And what that means is, they want all the information at least three weeks before it's released, so they can actually get it into their reps and into their telesales people. So they can actually ring round all the shops, so they can ring round Sounds Good in Exeter, Tracks in York, Jumbo in Leeds .... I can't think of shops in Middlesbrough any more .... and shops wherever, and they'll sell the stuff and they'll tell them what they've got, and they'll sell it in.
So the other shops will say, "I'll have three of it," "I'll have five of it," "I'll have two of it," "I'll pass on it."
And they'll do that with the releases for a week. And then the week before it's released, they'll get all the pre-orders together, they might pre-sell five or six different things that week ..... they'll put them in a box, and out it goes to the shop. So on Monday morning, it's known as the street date, the shop gets it, opens its box and starts selling stuff. And you're out there.
So hopefully your marketing campaign of press releases, advertising campaigns, reviews, radio play, be it at a local level or a national level, you're maybe on tour, all dovetails together. It hits the streets, people come into the shops, buying it, buying your single, and then you do the wonderful thing - you chart.
And then the shit does hit the fan, God help you.
It's so exciting ..... it really is sex, drugs and rock and roll then. Such a nightmare.
The single I've been involved with that sold the most, my biggest selling single was four hundred and eighty thousand. We sold four hundred and eighty thousand or something, a band from the north-east, from Newcastle. I'm not going to tell you who they are, it's very embarrassing. And it was one of the worst times of my life. It was horrible. Two months, three months later, when you get the fat cheque, it's great, but at the time ... I've got very little hair, because I was tearing it out. I didn't have the infrastructure in place. And that's why larger labels will have that infrastructure, why they do have a service to offer.
At the moment, I'm involved with a label in Leeds, and we may have a Top Twenty hit in the next four or five weeks, if you believe the hype. It's a garage single, they do a lot of dance stuff as well. But I've spent a lot of time, there's five of us involved in it, trying actually to get the structure in place, so that if it does take off we can actually handle it, we can actually capitalise upon it I suppose.
It's about preparation, it's about organisation, it's about understanding the way it works. And one of the biggest things I've spent a lot of time working at, is the sales and the distribution for it. So that then, when it takes off, it can be handled.
These distribution companies ...... they're all automised as they are, basically, for a purpose. They're dealing with six thousand music accounts, and at chart level, that's what you need.
It's in Garages, it's Woolworths, it's Our Price, it's W H Smiths, it's Menzies, or what was Menzies in Scotland, right down to ... you know, Leeds has got six different independent shops, plus a Virgin and Our Price ... Music Zone .... there's not an Andy's there yet .... Once it takes off, it takes off in a big way.
The last Atomic Kitten single sold a hundred and forty-five thousand copies in its first week. Atomic Kitten may not be everybody's piece of pie. Let's not ... we're not here to talk about that .... I admire it myself, there's obviously a purpose for it ..... but it's sold. Hey come on, you know, who would turn down a hundred and forty-five thousand sales? Come on, put your hand up, I dare you to. And then I'll call you a liar.
It's having an organisation that can handle things at that level, and that's what distribution's about.
But it starts with the musicians and the songs, or a band, working its way through the system.
And at that size, you've then got the international fame .... and you haven't got one manager, you've got three managers. You've got a personal manager, you've got a business affairs manager, and you have a merchandising manager. And your image manager, because that's the one that's going to make you more money than anything else. Especially for David Beckham.
It starts with distribution, it starts at a local level. It starts in your own belief in what you're doing.
But it's a matter then of understanding the marketplace, and how you're going to dovetail into it. And building it up.
Any questions for a minute whilst I take a breath?
Pete: One thing that you haven't touched on Tony, talking about distribution, is the impact of the internet. On one level, organisations like Amazon, on the other level, the band who sets up their own website, and enables mp3 selections, and then purchases. How significant is that, do you think?
Tony: It's not as significant ...... I personally believe it's not as significant as a lot of people believe it to be. Two and a half years ago, HMVs and Virgins were absolutely shitting themselves ... (I'm sorry, I keep forgetting it's a big place, I do apologise......) Bricks were coming out, and they were building a fortress around themselves with a bunch of shite. They were worried that the internet was here, everything was going to happen, everything was going to be free, it's the downfall of them.
It's not. If anything, they're actually getting bigger and stronger.
Because though there is a market ... I actually think the internet is better for marketing than for selling. Because if you're not careful, all you're doing is preaching to the converted. It's the same thing as selling a few CDs at a gig, selling a few CDs on the internet. People search you out and find you, but you're actually not building anything. And it's this building which you need to get big.
So then when you have a certain level .... you may get a certain level where you can release your own release through the internet, and you can sell forty, fifty, eighty thousand, and you manufacture them for fifty pence - because that's all a CD costs to make, if you're doing it in any quantity, any turnover - fifty pence. That's with a booklet and everything. And you can sell them direct for ten quid. Sell fifty thousand for nine pounds difference. You could have half a million quid in your bank account. It does happen from time to time, it's alright.
But you've got to be at that sort of level. Otherwise it's marketing. It's downloading mp3s, it's little bits of this and little bits of that, it's getting the word out, letting people find out about you.
John: They've got their hands on the media, haven't they, thirty seconds on television is like thirty years on the road, innit. Control, really, innit. They control it totally.
Tony: But also again, TV, it's just marketing. People need to know about you. You really could be the best thing since unsliced bread, but I don't care. People have got to know about you. And that's where distribution and shops will help with that. As opposed to a little bit of a twenty-second bite on an mp3 file, or you're on Vitaminic or Peoplesound ... okay, so you've got something there for free, but ... I've got no great belief in it.
It's not because I don't believe in the internet or things like that, or the time, it's free stuff. People are devaluing themselves. And you must have a value, you've got to have a worth. And if you give it away for free, you're devaluing yourselves. And your music. So that when you want to make a living out of it, why should people pay you when you're giving it away?
Pete: You just touched on Vitaminic and Peoplesound. When Peoplesound first came up, I think there was a great rush to sign up with them. Now, I don't know if you've got any cautionary tales, or perhaps not .... perhaps the reverse.
Tony: Oh, I've got plenty of cautionary tales about them.
Pete: Peoplesound was a great idea, and you'd send them loads of stuff through ......... but try and get some money out of them ... is that untrue, or ...?
Tony: No, it's very true. It's really sad, I'm sitting here dissing them in a way, but I know a lot of people who've got stuff tied up there that they can't get out, and they can't do anything with. There's a band there, an Irish band, gorgeous band, gorgeous band. So much potential. And they've got a load of stuff, and they signed it to Peoplesound, and they can't do anything with it. And Peoplesound forced them to sign the publishing, and they gave them five hundred pounds advance, and they signed the publishing, and they're controlling the band. They initially signed them for a hundred pounds, then they said, "Yeah, we think you're great, here's five hundred pounds for your publishing as well," and now their hands really are tied behind their backs. They can't do anything. And they're trying to buy themselves out, and they've got to buy themselves out for five thousand pounds.
You've got to be so careful with these things. But it's like anything, you get something put in front of you, and you need advice.
That's how I make my living.
Quick story. There's a guy called John Kennedy, he's now head of Phonogram Europe. He's the fifteenth most important person in the world music industry. He used to be a music industry lawyer. And there's a band called The Wedding Present from Leeds that he was advising, with a contract, and they were signing to my label. And John said, "Give me your solicitor's name, so I can talk to him." "No you're not, John, you'll talk through me, and I'll go to my solicitor. I'm not having you two talking together and just racking up the fees."
You've got to be careful, but that's why knowledge is something. You've got to just find out a little bit. If you just let them talk, they'll just rack up the fees, which is lovely jubbly.
So he spoke to me, I went away and came back, and at the end of it he said, "Great, thank you very much."
The deal was done, and John Kennedy said, "Here, Tony, who's your solicitor? He's really bloody good." I said, "We haven't got one. It's just me ...and the wife".
And so with enough knowledge you can actually get away with it. But I say that as a cautionary tale, only because I got away with it, and in hindsight I realise that all I did was get away with it. I thought I knew it all, and I didn't. I knew enough to be able to get away with it, and then years later it caught up with me, because I'd missed a bit out of the contract.
But thankfully it wasn't anything too big, and I sold them to BMG, and that's when they found out about it, because I passed them my contract. But I knew enough to get away with it, and it was fine at the time.
So a little bit of knowledge can be useful. It's not always dangerous. But there's a fine balance in there between knowing enough, and knowing nothing, or thinking you know it all and actually shooting yourselves in the foot.
And a lot of managers ..... especially if an inexperienced manager thinks they know it all, and they don't ..... that's what you've got to be careful about with them as well ..... is that if they don't know enough, then they can actually shoot people in the foot, themselves in the foot.
Pete: Another little question. You say you've got to locate good managers, good advice, and so on and so forth. It's a freelance industry, isn't it, and freelancers tend to be a bit insecure because it's not a very secure industry. So trusting people is real difficult. How do you find these people that you can trust? Or is it a nonsense to think that the industry is populated by charlatans?
Tony: There are a lot of nice people in this industry, there really really are.
John: Is there a book?
Tony: Of nice people, no. I haven't written it yet. There's you, there's me.
John: Get it together, it'll be a best seller.
Tony: I know. But it's a business, as well. It's the fourth biggest industry in the UK. We're bigger than the car industry. We're bigger than the steel industry. We get no recognition for it, but we employ two hundred thousand people. It's massively important. And because of that, the turnover ..,... not last year's, I don't know what last year's is .... but the year before, it was three billion pounds. There's a lot of money now, and because of that you get people who just want the money.
So finding people ...... in the first instance it's gut reaction. It really is, it's gut reaction. Can you work with these people?
But on the other side, find out who else they've worked with. It's like taking up references. But you've got to make it personal, you've got to find out what they're about, what they're like, what their habits are, what their vices are. Because we've all got vices, we all do, we're all human. You've got to find out a little bit about them.
Because in the first instance, you're a band, you're a musician, you have somebody helping you, and "I want to manage you, I'll get you some gigs." So it's basically, they're going to be a booking agent. They're not going to be a manager, they're going to be a booking agent. But they're going to be somebody who's going to help you. So don't turn them away. But just be aware that they don't know everything.
And then, as you build up, talk to people. If you see a band, find out their management companies. See who's in the headlines. What band's suddenly being noticed, they're picking up everywhere, they're getting their name everywhere? Find out what label they're on, find out who's managing them. Find out if you can talk to them. Because the one thing you do is talk to people.
I spend a lot of time in record shops, not because I had one for nineteen years, and I miss it dearly, but it's where it happens, it's in the front line, it's where people hand over their money. That's where there are people handing over twelve ninety-nine, fifteen ninety-nine, it's real. That's what makes our money, it makes merchandising money, it makes recording contract money, it makes publishing money, if you're a label there's the PPL, there's all sorts of things go along with it.
I find out what people are buying, and who's making a fuss, and where they're coming from, and do research.
It's very very important that you actually understand ...... again it comes back to understanding the marketplace, so you can not only work your way through it, but you can actually do it in an informed way. Rather than just getting away on ego. There are some amazing egos out there, amazing egos out there. Some of them are very sweet, some of them aren't.
I was very involved with the Goth scene in Leeds in the early eighties and we got in with some people and God, they were horrible. Andrew (Eldridge) himself could be a bit of a twat at times, but at the end of it all he believed in what he was doing, and, most importantly, he had a great vision, a great vision, and some great talent.
And he made a load of money out of it, and it's great, he's got a really nice studio now. But you can't just get away with the ego. He had the vision as well as the ego, and the self-belief.
And again, it's a fine balancing act between the self-belief and the ego and valuing yourselves, and just being a completely stupid ass about yourself and having no value of yourself, in the sense that you don't know actually what you're worth and how good you are or not.
That I think is one of the worst, one of the most difficult things to do ....... getting a feel for just how good you are, and what you need to improve on.
So, with all that in mind, I do wish you all good luck.
I say that not trying to get a laugh .... because it's a wonderful, wonderful ...
I do it because I like it. I couldn't go back to being an accountant again. It's a great industry, and there's a lot of belief in it, and there are a lot of good people in this industry.
Don't be put off by the few baddies that you come across, because you will come across some. But think of the big picture. Just pity them, in some way, and just enjoy yourselves, and enjoy your success.
Thank you. [applause]
Pete: Thanks, Tony.
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