A major theme at the Rethink Music conference taking place in Boston Tuesday (April 26) and Wednesday, musicians and industry professionals are exploring how the industry can adjust, adapt and survive amid the encroachment of technologies that have upended the business. In fact, technological advancement may present the way forward, as was posited the panel "Financing Creativity - Microfunding and VCS."
The panel, taking place amid other Tuesday morning panels, was moderated by Roger Brown, president of Berklee College of Music (one of the conference's organizers), the panel included venture capitalists Peter Gotcher and Ron Nordin and recording artist Bleu.
Gotcher, a driving force behind companies like Topspin and Pandora, said the traditional three jobs of the record label -- being a source of capital, a means of physical distribution, and a marketing company -- are no longer viable.
"As time passed the barriers to making a good record were lower, the barrier for distribution was lower, and marketing was getting harder," he said. "We live in a noisy world. Finding your audience seems to be the challenging thing." That's where a direct to fan platform like Topspin, or a microfunding site like Kickstarter comes in, he said.
Bleu, a musician who's been through the major label ringer, was Kickstarter's artist of the year in 2010, utilizing that service -- where the musician sets a monetary goal and a time limit, hoping fans will contribute money to fund the recording process -- to collect some $40,000. Of course, not all artists who use Kickstarter, or a number of other sites like it, are quite so successful.
"I think half of the projects still fail," he said. "To me that's great -- it means it's working for the people it should be working for."
It's a curious concept, the panel all agreed, that the microfunding model seems to be catching on, especially when you consider how difficult it has been to get consumers to spend 99 cents on a song. Why would they rather spend $10, or even $100?
"The thing that people want is to be involved directly and feel like they're a part of it," Bleu said.
In earlier days, the music industry was like playing the lottery, Gotcher said. "I'm a big believer in the emerging direct-to-fan business models. Artists need to think about creating a small business and building customers over time. I think there's a real desire among fans to cut out middlemen of any type. There is a patronage motive."
"Paying for music has become voluntary, Ron Nordin, a VC behind companies like Nimbit, said. "Essentially now, everyone becomes a patron rather than a consumer."
That's partly because they appreciate being able to pay the artist directly, but also because consumers are starting to realize if they don't, the music might not ever be made.