The music business is not the same as it was 40, 30 or 20 years ago yet the majors still run their business as if it was. At some point the light bulb is going to turn on in some of these high powered executive offices. I read a recent article talking about the cost of breaking an artist in the pop genre figuring in around $1.5 million. $1.5 million to break and then the costs keep accruing to actually keep the act popular. Those cost are not met by high record sales anymore. Sure a lot of units are moving but usually at the cost of a digital download. When was the last time you heard about an artists selling 15 million records?
Tate Music Group has created a model that works. It allows the artists to retain all of the rights to their music while earning some of the highest royalties in the business on product sales. We have high level artists through our doors who can't believe our model and pricing charts.
Do you know the difference between TMG and other labels? The difference is that TMG is profitable. Billboard reported today that Warner Music Group's revenue dropped 3% in Q4, Live Nation's operating cost was at a loss of $54.9 million in 2009 and Universal Music Group's revenue dropped 8.2% in Q4. Tate Music Group is profitable and will be around tomorrow to support our artists in their careers.
With the downturn in the marketplace you can be sure to expect more mergers and acquisitions by companies in an attempt to produce stable earnings. Right now you can expect companies to conserve cash, cut costs and ride out the economic downturn. Our artists at Tate Music Group don't have to worry about TMG company wide layoffs, or our stability. The future is very bright for TMG and our artists and I believe in the near future some of the larger labels will adapt to our model.
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