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SXSW music shifts focus to the biz: 'Everything you've heard, it's probably worse'

March 19, 2009 | 10:43 am

The South by Southwest music festival and conference began its second full day with the cold realities plaguing the independent music business. An early morning panel was entitled "Indie Labels Keep the Faith," but it was more about survival than indie craftiness. In the time since the panel was booked, one speaker had been laid off.

Never mind coffee, Howard Greynolds, formerly of Chicago's well-respected and long-running Touch & Go Records, woke up the sleep-deprived crowd. He noted that of Touch & Go's 23 staffers, 21 had been cut, and the disconnect between the label's, retailer's -- and sometimes even the artist's -- needs are becoming greater than ever. He lit into SXSW performing act Grizzly Bear, arguing the band had delivered mixed messages to its fan base regarding the leak of upcoming "Veckatimest." 

And if bands don't have problems with their albums leaking, Greynold's offered this: "Give back the $20,000 the label gave you to record the record."

In briefly hitting on Touch & Go's troubles, he noted that the economics for independent labels have completely shifted. Today, there is no"middle ground," Greynolds said. He noted that indie labels thrived on selling between 20,000 and 30,000 copies of an album. Those days are over, despite the greater presence given to adventurous music (see the time-conflicting panel on the influence of blogs).

"What has happened is that it is now 5,000 [sales] or less, or 50,000 or more," Greynolds said. "The middle is gone." And the new model of digital sales isn't making up the difference, as Greynolds argued that the margins from iTunes are too thin to "maintain a staff of 10."

And things got worse. Nan Warshaw, who co-owns Chicago's Bloodshot Records, added that "everything you've heard [about the troubles of major labels], it's probably worse." She used the panel, which was moderated by Rounder Records owner Ken Irwin and also featured Barsuk's head Josh Rosenfeld and Portia Sabin, who oversees Kill Rock Stars, to discuss today's retail climate -- or what's left of it.

"The decline in indie retail has continued in a free-fall," Warshaw said. Getting albums into the stores that have survived is more difficult than ever, she added. Most chains, she said, want assurance that an album can sell at least 5,000 units. "If your record can't do that, there's no point," she said. Making matters more difficult, where stores once held onto a record for nine months before returning it,  Warshaw says that now, she gets served with returns sometimes within four weeks of release.

Yet there's no shortage of music. Irwin noted that the number of official releases today tops 8,500, and a record-setting 1,900 bands are in Austin. Warshaw asked, "Why are there more bands than ever at South by Southwest? I think there's less media and less industry."

A number of the remaining panels today will touch on other avenues to make money, such as licensing and so-called 360 deals. Across the hall from the indie panel was a discussion on making money via songwriting and publishing, with authors Jeffrey and Todd Brabec offering copies of their how-to book, "Music, Money and Success," for sale.

Going on as this blog is being typed is a discussion on placing music in film and television, with acclaimed music supervisors Nic Harcourt (former KCRW music director) and Alexandra Patsavas, whose Chop Shop fronted the soundtrack to "Twilight" and places music in "Gossip Girl."

But don't count on a licensing payout, said Greynolds. While he acknowledged that a song in a commercial can translate to a million in sales, Bloodshot's Warshaw quickly brought the discussion back to reality: "But that's one in a million."

-- Todd Martens

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