Bruce Dickinson's air business has wings

Bruce Dickinson out of Iron Maiden continues to prove his credentials as the Freddie Laker of Hard Rock (only successful), as he's expanded to help growth of an African airline:

Now he’s got a new flag carrier role – having signed a memorandum of understanding with Air Djibouti to develop a national airline for the East African nation.

Dickinson signed the deal in his role as founder of Cardiff Aviation, the aircraft repair business he helped set up in 2012. The company is now to manage a European air operator’s certificate for Air Djibouti, find aircraft and provide operational management, and offer maintenance support from its base in South Wales.

This is good news for that nation, good news for Dickinson, and good news for music hall comics:

- I flew in on that new African airline, and I've just been to freshen up
- Air Djibouti?
- No, I just washed my hands and splashed on some cologne

Songs about facilitating successful meetings

Remember Groupon? The boss the company deposed when it turned out that selling money-off vouchers actually wasn't a business at all, Andrew Mason has been busy. Presumably having worked through the nineteen vouchers for one-hour massage sessions that he got as a payout, Andrew has recorded a motivational business album:

Before I leave you to your speaker system or headphones, one word of advice for managers thinking about how to make best use of the album: Context is king. Sure, you can just leave copies of Hardly Workin' on your employees' desks and achieve an incremental increase in productivity and morale (productivity is a function of morale, people!), but I wrote this album as someone someone who believes that messages mean different things depending on the time and place they're delivered. Try ending your next all-hands meeting with "It's Up to Us," for example. Or, having trouble communicating with a low-per/hi-po employee? A "Thinkin' of You" note attached to a flash drive preloaded with "My Door is Always Open" might be the catalyst you need for that transformational breakthrough.

Here's my own management tip - if you go round leaving stuff like that on people's desks, that's going to attract lawsuits.

And if you do plan to end a meeting with a rousing song, I'd suggest you get IT to block access to LinkedIn first because if anything ever said "update your CV and contact employment agencies", it's that.

Interestingly, Steve Albini also has a view on the record. Go on, Steve, get all Big Black-y on this one:

“I think it sits in a tradition of absurd but sincere gestures,” Albini said when reached by phone at his studio. “I think it’s one of the most amazingly realized great ideas I’ve stumbled across in a long time.”

That seems... surprisingly warm. But mostly surprising.

Still, Steve Albini is an independent voice, and if he says there's something in this... oh, hang on, what's this?

Mason holds a degree in music from Northwestern, once played keyboard in a punk rock band and interned for legendary producer Steve Albini, who also counts him as a personal friend.

Let's just pause before going 'oh' and imagine what it might be like being an intern for Steve Albini.



Okay, and now lets go 'oh, he's a pal.'

But could Albini be right, rather than just doing a mate a favour?

Paste supplies a sample of lyrics from Hardly Workin:

Don’t make me cut through no thistles / You can keep all your fancy bells and whistles and shove them / Where the sun don’t shine.

You've got to say: by endorsing that, Steve Albini shows he really sticks by his friends.

Great news for HMV

Well done, HMV - with the agreement of a sale of Waterstones, you've managed to offload the bit of your business that wasn't a total basket-case.

Pay to listen

It is, of course, a wry stunt rather than a new business model: The Reclusive Barclay Brothers are offering 'incentives' to people who listen to their music, reports Music Week:

The video asked viewers to visit the aptly named site www.newlowformusic.com to submit their e-mail address and over the subsequent 30 days, the band will randomly pick 100 people to receive their £27 share of the cash.

The band claims that paying people to listen to music is the only logical conclusion to the current trend of giving music away for free.

It might just be a smart use of £2,700 worth of promotional budget - cash that might otherwise have gone on small adverts or flyposting. Can't help wondering if they might have been better off having one huge prize though. If you're going to turn fans into a lottery, make it a big lottery.

There is no sum of money large enough to compensate for listening to Olly Murs.

[Thanks to Peter D for the link]

Smashing Pumpkins push pay-as-we-play model

The only thing that's less than glittering about the plans coming from Billy Corgan is that the stuff you get is very-late-period, Corgan-as-Caligula stuff from Smashing Pumpkins. But it might be a neat model for other acts:

Billy Corgan has been hinting at future models for providing music and media from the studio to the fans during interviews and other press. Plans for this service are now underway and will be executed in the form of a 12-week paid subscription service for access to various media updates detailing the creative process within the studio. The media updates will be in the form of exclusive web-video and photographs. Subscribers will be able to watch the next era of Smashing Pumpkins music take shape.

Here are Billy's hopes and expectations for the upcoming project:

The goal is to create a working model that is not profit motivated but rather information and access motivated. In exchange for a fixed resource base fans will be let inside in an unprecedented way to the creative process of preparing to make the next SP album while also inspiring an inter-active dialogue that will help shape the work. Because of the open window, further efforts will be made to provide content so that anyone participating can more readily follow the arc over the 12 weeks, with unprecedented access to lyrical and musical content.

I guess you might have to be Billy Corgan to try and sell the idea that 'rehearsing and dicking about in the studio' constitutes a twelve-week artistic arc, but the basic idea is sound.

How businesses fail

Consumerist has an interesting chart depicting Circuit City's fall from grace - on the day the remaining stores in the US chain files for protective bankruptcy. The first major mistake? Sacking 3,400 staff to replace them with cheaper replacements. When will companies learn that people who earn a little more usually do so for a reason, and while you can cut a few bucks off the wage bill, you're going to lose more by the drop in customer service.

EMI splits into three

There's a certain degree of logic in the plans for no-not-failing EMI splitting its business into three. It'll now have a division for its catalogue, a division for music services and a division for new music. It's not immediately clear where the splits are - music services, presumably, is going to use catalogue to provide these services; what point does a new Coldplay album become a catalogue album? The main reasoning would seem to be it'd make it simpler to spin off any bits - like making new records - which cost more than they bring in, should the need arise.

Still, Terra Firma is committed to trying to make the thing work:

[Recorded Music chief executive] Leoni-Sceti said: "EMI is absolutely not bankrupt, far from it. EMI has never been in such a financially sound situation. Terra Firma is a solid financial owner and is committed to this company … and committed to putting in more equity if it is required."

Well, in a market like the one we're now in, it's not like it's hard to raise money to throw about in a desperate fashion, is it?

Napster tries to block shareholders from board

The long, slow, public death of Napster enters a new wave of spasms, as "dissident shareholders" attempt to get voted onto the company's board in the face of stiff opposition from the current board. Why, say the current stewards of Napster, they don't even know about the business:

Their SEC filings describe work experiences—musician, nursing home executive, ice cream franchisee, middle management banking executive and other positions—that are irrelevant to a company like Napster competing in the highly sophisticated digital music industry.

If I was catty, I might point to Napster's flailing swoosh on the downward spiral and ask how all the current board's glitzy experience is actually helping them in the highly sophisticated digital music industry.

But it's worse than that, wail the board: the would-be members haven't even been on a board before:

The dissident group has provided no evidence showing that any of its members have ever served on the board of a public company, meaning they would require on-the-job training.

Goodness - can you imagine? Never mind that they might have some good ideas, or plans about how to salvage the mess - you'd have to teach them how to sit at a big table, and who knows if any of them have even seen a flipchart before? You know, the important Napster Board will be trying to do important business things, and these guys will be sitting there needing to have the hands-free telephone explained to them.

If 'never having been on a board before' disqualifies you from being on a board, what are we going to do when all the current board members of companies die off?

While we appreciate that the dissidents are music enthusiasts and subscribe to Napster’s service, such interests hardly qualify any of them to serve on your Board.

Yes: the Napster board think that being enthusiastic about the company and the business it is in doesn't really qualify you for having anything to add to the way the company is run. That's a tacit admission that anyone who really understands the highly sophisticated digital music industry has long since abandoned Napster as a bad deal - so any current customers clearly must be a bit klutzy. But, hey, the board have put it in a nice way.

The real beef, of course, is that the dissidents want Napster sold, and Napster sold quick; the current board know it has got to be sold, but want a more cautious approach - in other words, one which doesn't involve their arses being kicked out of the door.

eMusic already crying foul over Apple's all-you-can-eat

The vaguely worded possibility that buying an iPod might, at some point in the future, come with some sort of music subscription ready bundled has caused a big, flashing red light and a honking great alarm to go off over at the headquarters of eMusic, as they voluntarily raised their status from 'struggling' to 'beleaguered':

Apple's reported plan to bundle unlimited iTunes music store access with iPods could bring antitrust allegations similar to those faced by Microsoft for its bundling of Internet Explorer with Windows, according to David Pakman, CEO of iTunes competitor eMusic.

"They're basically saying, 'Let's give a piece of every iPod sale to the record labels in exchange for bundling in all the music you can eat with every iPod'" said Pakman. "That's classic Sherman Antitrust Act behavior. It's called tying, and it's where a company with a monopoly position in one market uses that monopoly position unfairly to compete in another."

Pakman does, however, stop raging for long enough to suggest that Apple is making this move because they've got an eye on eMusic:

"We've been successful at now convincing the rest of the music industry ... that consumers want to buy music in a universally compatible format. Who's the winner and who's the loser? Well, the winner is the consumer, because you get a whole bunch of other retailers that can sell music that works on the iPod or any other device. That puts some pressure on Apple. There's no question, I think, that iTunes market share will diminish as a result of that over time."

It's a nice sentiment - and it's true that the general spread of DRM-free tracks must be nibbling at the very, very bottom line of iTunes, but we suspect it's more Amazon's music store than eMusic which is alarming Steve Jobs.

Duffy proves life in the record companies yet - possibly

The Times' business section carries an analysis of Duffy's album to offer hope to the executives in record company boardrooms around the world.

Dan Sabbagh compares Rockferry with Shayan Italia's YouTube number one Reflection:

Rockferry shifted 180,000 CDs in its first week, worth rather more than 190,000 views on YouTube, without the help of a television programme talent contest or any internet nonsense. In fact, the album was marketed conventionally to entice the mainstream buyer.

This, concludes Sabbagh, proves that all this talk of new business models and death of the label is hogwash:

[I]t is easy to get distracted: these companies are really creative businesses, allying marketing muscle with nothing more complicated than good music.

Spending too much time banging on about a new business model while failing to discover new acts, hiring management with little credibility in the industry or simply not bidding for talent when necessary are sure ways to fail, as Guy Hands many find out if he is not careful.

There's a degree of truth in this: there's still a healthy market for CDs, and the four majors are still massively successful businesses - this is why it's hard to shed many tears for them when they tell us about how beastly the peer-to-peer networks are.

But it also misses a crucial point - Duffy's album sold less than a fifth of a million, and went to number one. That's despite the enormous might of the marketing department behind it, with commercials on TV and in the papers, a hectic circuit of appearances, and an effective press office operation generating much warm glow around Duffy. As Sabbagh concludes, Rockferry has put much more money through tills than Italia's effort - but we bet that in terms of earnings, the gap between what Duffy's made from her record and Italia has made from his isn't going to be as wide as you might think.

It's also odd for Sabbagh to dismiss the idea of new models out-of-hand while opening the article with a reference to an unsigned artist who has found an audience of 190,000 people in a day and then concluding:

[I]t would have been a lot easier for him to find an audience if a well-organised music major had snapped him up.

You think? Leaving aside the question of just which label would be snapping up an Indian-born guy, on the cusp of his thirties, with an 80s fixation in the first place (unless the other majors also had aging retro Anglo-Indians on their books), it's hard to imagine how they would have marketed him - you can imagine meetings coming to grief over the question of what genre to tick on the iTunes form. Italia would have been a non-starter for a major label and, sure, while he would have found a home on a smaller, boutique imprint, it's hard to imagine that the old-school radio and TV networks would have known what to do with him, either. You only have to look at what happened to Sheila Chandra's career for an example of how the old business model worked.

Yes, Italia isn't doing as much trade through chart-return shops as a major label. But then a 2008 major isn't doing as much trade through chart-return shops as a 1990s major, either. But he's finding a way to take a niche product to an audience that's bordering on the mass. Dan, can you really not see that we're living in a transfer between business models?

50 Cent hangs G-Unit clothes out to dry

Trouble at the edges of the Fifty Cent business empire, with reports suggesting the G-Unit clothes brand is to shutter in the next 24 hours.

The deal under which the clothes have been made and sold - a split-ownership between 50 and Ecko - has come to an end and staff are being let go as a prelude to winding up. It's unclear if the decision to close is due a problem in renegotiating the deal or because the once-glittering brand has lost its lustre.

Shrinking floorspace sends Warners through the floor

Troubled times for stockholders of Warner Music Group: Market expert Rich Greenfield has rubbished their shares for the second time in a week. He now reckons they're worth five dollars a piece; the markets are working hard to make his prediction come true.

His main reason for the gloom - besides, obviously, looking at the artists they're working with - is rumours that US chains are looking to cut back the shelf room they give to CDs, possibly by as much as 30%, in order to use the space for something a little more profitable. Like customer washrooms or something.

EMI plans: stage three - profit

We're half-impressed by Terra Firma's steering of EMI; it's still getting a lot wrong, but does at least seem to have accepted that things can't go on like there was no internet.

However, the long-term prospects for the company still don't look all that rosy. TF is seeking other partners to share the risk - a common move in the private equity world - and, in order to tempt them, is circulating half-business plans. One has (apparently) wound up in the hands of the New York Post.

They pledge that they're going to be making loads of money by 2012:

Terra Firma plans on increasing cash flow at its recorded music unit from $43 million to $1.1 billion in 2012

Blimey, that sounds like a lot. How will it do that?

Well, like the Tories, they're pledging to cut costs without actually being sure if the costs are cutable:

Terra Firma thinks it can cut another $223 million in fixed costs at EMI

This is cutting everything, across the board. So how will the record label function?

The firm also wants to reduce costs in artist-and-repertoire and marketing by $58 million by using social networks and user-generated Web sites like MySpace to discover and promote talent.

[The NYP fails to mention that it shares a parent company with MySpace.]

It's a nice idea, but what TF doesn't apparently reveal is why artists would choose to go with EMI if they're able to market themselves online without the company's help. It's a little bit like Marks and Spencer promising to cut its costs by sourcing its food from soup kitchens. Terra Firma needs to do more work on what it is that EMI intends to offer the artists it finds on MySpace; presumably, having dismantled its distribution network and cut its A&R department to save money, it's not going to be the size of its operation. So, what would an eEMI have, exactly?

Fripp flips

Record companies are, you'll recall, fond of behaving like they're part of the criminal justice system - going on raids, pushing prosecutions. And yet, when it comes to their own behaviour, they're slightly more Capone than cop.

Robert Fripp, for example, has detailed what he claims is a slightly-less-than honest range of behaviour by EMI:

We are looking, inter alia, at payment by EMI for illegal out-of-period (post 2003) sales, and returns of unsold CDs. A concern with returns is always that they are not dumped back onto the market by mistake (by mistake, dear reader). We seem to be close to agreement on these two matters, on the basis of our current researches.

But it goes further. Not only has EMI "accidentally" been selling records it had no rights too, but King Crimson tracks have been popping up on download sites, with EMI's blessing:

After the licence expired, King Crimson tracks repeatedly appeared on various download websites licensed from EMI. If this had happened during the license period, it would have been disturbing - even though shit happens and we should have gotten over it! - because EMI never had download rights from us. At the beginning of the licence period, there was no such item as downloads; at the end of the period (December 31st. 2003), downloads were clearly an important part of the future. The EMI license was not renewed because we were not willing to approve download rights

Fripp then sidebars that the artists - in whose name the battle against illegal downloads is fought - aren't actually any better served by legal downloads.

So, we have EMI taking money for putting online King Crimson tracks it doesn't own the rights to. Isn't that, ooh, illegal uploading of the sort for which the RIAA punishes single mothers and postmen to the full extent of the law?

Oh, and it turns out that EMI were tardy in returning the master tapes to King Crimson material when it no longer had legal rights to them.

[Thanks to y for the tip]

The dark side of equity EMI

While the approach to the customer-facing business of Terra Firma's EMI has been encouraging, the nasty underbelly of private equity buyouts is still there: hundreds of jobs are being threatened as the company looks to balance its high-debt buyout; it's also seeking a range of partners to spread the risks across.

The future of music has two faces

There was an interesting contrast in the last half-hour of this morning's Today [Real link]. There was a piece on Radiohead and the honesty-box approach to flogging albums, which fitted in to the "technology has killed the traditional record label" scheme that has been the narrative set running by the RIAA.

By contrast, though, the feature of the Gramophone awards for classical music explored why there is suddenly a large movement of young, exciting and talented classical artists appearing. The conclusion was that, as technology has forced down the costs of production and distribution, allowing small labels to suddenly flourish, with each nurturing their own superstars. In other words, in the classic genres, the breaking of the power of the large labels has stimulated a wider, more vibrant music scene - precisely the opposite of what the rock labels warn will happen if their businesses collapse in the face of the future.

Sanctuary lost

Universal Records has announced plans to close Sanctuary Records for all but catalogue work in the UK. Universal intend to concentrate on the management and merchandising side of the business; no word yet on what will happen to the sizeable roster of artists, which includes The Charlatans and, um, Lordi.

Frog still not-quite croaked

Remember SpiralFrog? It was an iTunes killer that got a few people excited about eighteen months or so back, with its promise of an advertising-supported free-music webservice.

It's still not quite got round to launching, or making any cash, despite having got through twelve million dollars; it's now hoping to pull in another $25million.

Quite where they see these fools hovering, waiting to be separated from their money, isn't clear. Back when they managed to generate a bit of buzz, they might have been able to persuade some people to part with millions; but now, surely, it's time to just drown this box of frogs.

MP3s to flow from Amazon, says source

The much-delayed launch of Amazon's MP3 service - the most plausible iTunes Music Store threat (if not actual killer) to date - could be happening in the next couple of week. The New York Post has read its runes and predicts a big switch-on for September 17th.

The birth is set to be troubled, though, as record labels seem to be more interested in setting unrealistic prices rather than helping create a proper rival to Apple's behemoth:

Amazon is expected to have at least two prices for individual songs: 99 cents for new and popular MP3s, and 89 cents for music from emerging artists and back catalog tracks.

Albums are expected to cost between $7.99 and $9.99.

That strategy is said to be rubbing some labels the wrong way. Amazon is said to still be negotiating prices with the majors.

Multiple prices for music, a concept known as variable pricing, has been a priority for the major labels, who have chafed at iTunes' one price for all songs, regardless of their popularity. But many large record companies want to charge more than $1 for songs from superstar acts, and possibly less for music from undiscovered artists.

You've got to love the way the music industry bleats for years about wanting someone to challenge Apple, and as soon as someone comes along who could, credibly, do so, they expect the appearance of competition to work in the opposite way in the download music market to how it behaves elsewhere in the world, bringing prices up rather than forcing them down. It's like an entire industry without anyone who understands business,

LiveNation, Ticketmaster hate each other as much as they hate you

There's nothing sadder than seeing two evil megacorporations fighting each other.

Sorry, we meant "more amusing", not "sadder". We often get those two muddled up.

TicketMaster has not-quite-announced that it's not going to work with LiveNation any more. The pair have fallen out over how the money gets divided when the US' largest ticket company flogs tickets for the US' biggest concert promoter. And who gets to use the secret super evil hideaway on Labor Day.

It's not clear how LiveNation plans to sell tickets without access to the biggest box office, not quite what Ticketmaster will sell in place of tickets to LiveNation gigs, although it's been rumoured they're considering the possibility of trying a lemonade stand.