What’s the new A&R?

LEGO: Recording Studio at Brickcon 2010

LEGO: Recording Studio at Brickcon 2010 (Photo credit: FlintWeiss)

In my previous post, I discussed the recent announcement by Thom Yorke of Radiohead that he was pulling his music from Spotify.

This announcement has caused quite a stir, with lots of people taking pro and anti Spotify positions.  It’s important to have this sort of debate, but the focus on Spotify is causing people to miss the real point.

Although his target was Spotify, Producer Nigel Godrich defined the real problem when he posted, “Making new recorded music needs funding. Some records can be made in a laptop, but some need musician[s] and skilled technicians. Pink Floyd’s catalogue has already generated billions of dollars for someone (not necessarily the band) so now putting it on a streaming site makes total sense. But if people had been listening to Spotify instead of buying records in 1973 I doubt very much if Dark Side [of the Moon, Pink Floyd’s record-breaking album released that year which sold hundreds of millions of copies] would have been made. It would just be too expensive.”

Although record labels have been cast in the role of the villain by many the tech industry, for years they have been playing an extremely important role of identifying and developing new talent. Apart from their public face as promoters and distributers of music, the labels once spent a great deal of money on A&R (Artists and Repertoire). In this way, the labels filled the roles formerly held by patrons and impresarios.

Although oft reviled and the butt of many jokes, along the lines of:

Man # 1….”So just what do you do for a living”?

Man # 2…”I’m an A&R man in the record industry…but please don’t tell my mother. She still thinks I play piano in a whorehouse”…

a good A&R person like John Hammond, who signed Billy Holiday, Bob Dylan, Bruce Springsteen, among others,  would act as a talent scout, an advocate, a mentor, a confidant, and a producer.  A trusted A&R person would be allowed by the label to have a number of artists on development deals, looking to provide them with the space to develop their work before taking it to the public.  A rule of thumb was that one hit would pay for five artists in development, and artists were given three albums to “make it.”  Because this isn’t an exact science, you’ll find different ratios quoted, but the basic formula is sound.

Because the bottom has dropped out of the record business because of digital downloading, both legal and illegal, the labels no longer have the money to support this system, and are now only focussing on immediate hit makers and squeezing the last penny out of their back catalogues.

So, in the words of John Luther, “what now?”

The DIY approach is getting a lot of attention these days. Over the past few years, we’ve seen both Radiohead and Nine Inch Nails release albums on a “pay what you think it’s worth” model, and more recently the rise of crowdfunding sites like Kickstarter and Indiegogo. Amanda Palmer, formerly of The Dresden Dolls, is perhaps the most famous recipient of the largess of the crowd when she raised $1.2 million to support an album and tour.

These stories are heartening, but missed in all the hype is the fact that these were all established artists. Even Palmer herself has said, “You can’t meet at a bar and say, let’s start a band and let’s Kickstarter a record and let’s get everybody really excited about it on the Internet. It doesn’t really work that way. You need to have your audience in the real, tangible world, then Kickstarter is your tool.” For every Amanda Palmer, there are hundreds of unsuccessful Kickstarter projects, and thousands of musicians who don’t have the types of skills needed to even think about starting and managing something like that.

Which brings us back to the original question, “What’s the new A&R?”  As I said in the previous post, Spotify is not a record store.  But should it become a record label? There’s a developing model, and that’s Netflix. It has gone from being a video rental store who’s two USPs were free delivery and no late fees, to being an online version of a cable movie channel, to becoming a funder of episodic television. They realised that as long as you’re only in the business of shipping products to which you have no exclusive rights, you risk being overtaken by the next person with a slightly more efficient way of doing the very same thing. Thanks to programmes like, “Arrested Development,” “House of Cards,” and “Orange is the New Black,” Netflix has been signing on hundreds of thousands of new subscribers, getting great press, and seeing its stock price recover to the highs of two years ago.

Beyond simply being a funder of programmes, Netflix is also very selective in the programmes and creators it’s backing initially, and working hard to create an environment that is appealing to them as well. It is now the only company doing what it does, and it will take some time for competition to catch up.

Spotify now finds itself in a similar position to Netflix before it made this bold step.  It’s got Rdio, Pandora, and iTunes breathing down its neck, with no exclusive product of its own. Is perhaps time for one of these services to move from being a simple carrier of content to become a producer of content? Could it be as simple as resurrecting the old A&R model within these companies?

The response to Thom Yorke’s decision from both artists and fans indicate that it is time for a change.  It won’t be pretty, but it will be interesting to watch.