Ok Go Explains There Are Lots Of Ways To Make Money If You Can Get Fans

from the everything's-possible dept

Over the last few years, we've covered many of the moves by the band Ok Go -- to build up a fanbase often with the help of amazingly viral videos, ditch their major record label (EMI), and explore new business model opportunities. In the last few days, two different members of Ok Go explained a bit more of the band's thinking in two separate places, and both are worth reading. First up, we have Tim Nordwind, who did an interview with Hypebot, where he explained the band's general view on file sharing:

Obviously we'd love for anyone who has our music to buy a copy. But again, we're realistic enough to know that most music can be found online for free. And trying to block people's access to it isn't good for bands or music. If music is going to be free, then musicians will simply have to find alternative methods to make a living in the music business. People are spending money on music, but it's on the technology to play it. They spend hundreds of dollars on Ipods, but then fill it with 80 gigs of free music. That's ok, but it's just a different world now, and bands must learn to adjust.

Elsewhere in the interview, he talks about the importance of making fans happy and how the band realizes that there are lots of different ways to make money, rather than just selling music directly:

Our videos have opened up many more opportunities for us to make the things we want to make, and to chase our best and wildest ideas. Yes, we need to figure out how to make a living in a world where people don't buy music anymore. But really, we've been doing that for the last ten years. Things like licensing, touring, merch, and also now making videos through corporate sponsorship have all allowed us to keep the lights on and continue making music.

Separately, last Friday, Damian Kulash wrote a nice writeup in the Wall Street Journal all about how bands can, should and will make money going forward. In many ways the piece reminds me a bit of my future of music business models post from earlier this year -- and Kulash even uses many of the same examples in his article (Corey Smith, Amanda Palmer, Josh Freese, etc.). It's a really worthwhile read as well. He starts by pointing out that for a little over half a century, the record labels had the world convinced that the "music" industry really was just the "recorded music" industry:

For a decade, analysts have been hyperventilating about the demise of the music industry. But music isn't going away. We're just moving out of the brief period--a flash in history's pan--when an artist could expect to make a living selling records alone. Music is as old as humanity itself, and just as difficult to define. It's an ephemeral, temporal and subjective experience.

For several decades, though, from about World War II until sometime in the last 10 years, the recording industry managed to successfully and profitably pin it down to a stable, if circular, definition: Music was recordings of music. Records not only made it possible for musicians to connect with listeners anywhere, at any time, but offered a discrete package for commoditization. It was the perfect bottling of lightning: A powerful experience could be packaged in plastic and then bought and sold like any other commercial product.

But, he notes, that time is now gone, thanks in large part to the internet. But that doesn't mean the music business is in trouble. Just the business of selling recorded music. But there's lots of things musicians can sell. He highlights Corey Smith and Smith's ability to make millions by giving away his music for free, and then touring. But he also points out that touring isn't for everyone. He covers how corporate licensing has become a bigger and bigger opportunity for bands that are getting popular. While he doesn't highlight the specific economics of it, what he's really talking about is that if your band is big, you can sell your fan's attention -- which is something Ok Go has done successfully by getting corporate sponsorship of their videos. As he notes, the sponsors provide more money than the record labels with many fewer strings:

These days, money coming from a record label often comes with more embedded creative restrictions than the marketing dollars of other industries. A record label typically measures success in number of records sold. Outside sponsors, by contrast, tend to take a broader view of success. The measuring stick could be mentions in the press, traffic to a website, email addresses collected or views of online videos. Artists have meaningful, direct, and emotional access to our fans, and at a time when capturing the public's attention is increasingly difficult for the army of competing marketers, that access is a big asset.

...

Now when we need funding for a large project, we look for a sponsor. A couple weeks ago, my band held an eight-mile musical street parade through Los Angeles, courtesy of Range Rover. They brought no cars, signage or branding; they just asked that we credit them in the documentation of it. A few weeks earlier, we released a music video made in partnership with Samsung, and in February, one was underwritten by State Farm.

We had complete creative control in the productions. At the end of each clip we thanked the company involved, and genuinely, because we truly are thankful. We got the money we needed to make what we want, our fans enjoyed our videos for free, and our corporate Medicis got what their marketing departments were after: millions of eyes and goodwill from our fans. While most bands struggle to wrestle modest video budgets from labels that see videos as loss leaders, ours wind up making us a profit.

Of course, that only works if you have a big enough fanbase, but that doesn't mean there aren't things that less well known bands can use to make money as well. He talks about an up-and-coming band in LA that doesn't even have a manager that was able make money:

The unsigned and unmanaged Los Angeles band Killola toured last summer and offered deluxe USB packages that included full albums, live recordings and access to two future private online concerts for $40 per piece. Killola grossed $18,000 and wound up in the black for their tour. Mr. Donnelly says, "I can't imagine they'll be ordering their yacht anytime soon, but traditionally bands at that point in their careers aren't even breaking even on tour."

The point, Kulash, notes, is that there's a lot of things a band can sell, focusing on "selling themselves." And, the thing he doesn't mention is that, when you're focusing on selling the overall experience that is "you" as a musician or a band, it's something that can't be freely copied. People can copy the music all they want, but they can't copy you. "You" are a scarce good that can't be "pirated." That's exactly what more and more musicians are figuring out these days, and it's helping to make many more artists profitable. And, no, it doesn't mean that any artist can make money. But it certainly looks like any artist that understands this can do a hell of a lot better than they would have otherwise, if they just relied on the old way of making money in the music business.

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Parade Magazine has a new extensive interview with Oprah ahead of the launch of Oprah’s OWN Network in January 2011. Oprah comes off as less sanctimonious than I often find her, although she does talk about how much more personally enriching we will find her new network as compared to most of the crap that’s on TV. She could be right.

In this age of everything on demand I would bet that Oprah and her people are making a huge mistake and will completely fail to offer content online. You can’t get the Oprah show on Hulu or iTunes and ten to one you won’t be able to get OWN shows if you don’t get that network either. (The Oprah show and OWN don’t even offer embeddable versions of promotional videos or clips.) Oprah runs everything and she operates on her own assumptions about making money through technology. When people on her Oprah.com message boards ask to watch the show online, her staff tells them to order transcripts, which cost $24.95 and contain no videos. Oprah isn’t about to sell shows for the $1.99 going rate on iTunes.

Anyway here’s what Oprah says about how she feels omnipotent and is adding so much to our society with her newest venture. She also admits that it was her idea to give Duchess Sarah Ferguson a reality show after the bribery scandal. Fail! Maybe if she paid more attention to popular trash TV she would realize that no one is interested in Fergie.

What’s OWN about?

It is mindful television. I think so much of television is a minefield that just zaps your energy, wastes your time. What I want to do is build a channel that is a respite for your mind, an oasis of stimulation, that you come away from with little pieces of light. I’m aiming for a moment where somebody could say, “I never thought of it that way before.” I just love that.

How many of the shows are your idea?

Master Class. Finding Sarah [a six-part documentary with Sarah Ferguson, Duchess of York, premiering in spring]. That came from an interview I did this summer with her. We had a moment of real connection, watching the tape of her trying to get £500,000 [for access to Prince Andrew]. She said she didn’t want to go into bankruptcy. I said, “But when you look at that tape, don’t you see a morally bankrupted person? The one thing you were trying to avoid, you already are.” She said, “I never thought of it that way before.”

Ah, there you go again!

I remember the last thing I said to her when I left that interview: “Don’t let me see you on Dancing with the Stars.” She started e-mailing me and at one point asked what did I think of her doing a celebrity chef show. And I said, “That’s not going to help you. How are you going to rehabilitate yourself on a celebrity chef show? You should be working on yourself.”

You’re tough.

I said, “I’ve never mentioned it because I don’t want you to think I’m trying to use you, but if you’re going to do TV, this is what you should do.”

And she said?

“Let me think about it. I’d have to expose myself, and what does that really mean?” I said, “ All the things in your e-mails are so fascinating.” Like, she sent me an e-mail about how it’s so difficult to give up going to Spain this year. And I said, “You have no money. People who don’t have money don’t go to Spain on holiday. Hello!”

And now you’ve got her doing a show.

The great benefit of having your own channel is that you can be walking down the street. . . The other day I was in a restaurant, [and there was] the most handsome waiter. I was like, “Well, what are you interested in doing? You have a very good TV face.” [ laughs] I look at everything. If I have an idea, it feels like a huge paint box. So I have moved from “Omigod, what am I going to do?” to “I can do anything.”

You’ve said, “I know that as I start out on this next chapter there will be some mistakes and what others perceive as failures.” What will you perceive as a failure?

What will be a failure is if nobody comes and watches this network. What others will perceive as failure is if some shows don’t succeed. I’m concerned about the bigger overall picture: my belief that people are basically good and want to see the good in them reflected through their experiences and the shows that they watch. This is a gamble I’m taking. I believe that the banal state of television, the kind of insipid space that we’re in—that you can have as many channels as we have and not find anything that really interests you—means that to a great extent we’ve lost our way.

As a nation?

No. I think that television programmers program to the lowest common denominator. I happened to be on the treadmill one night and passed one of the Housewives shows—I don’t know which city—and literally my mouth was open ’cause I thought, “This is on television?” I recognize that there’s a whole group of people who find that very entertaining. I wonder for how long. I think that there are people who want to be fed just a little more.

On being a “brand”:

“I hate the word brand, but now I have succumbed to the fact that I guess I am one.”

On being the subject of a reality show (on Season 25: Oprah Behind the Scenes, premiering on OWN January 1 at 8 p.m. ET/PT):

“What did I say yes to that for? You know what that’s taught me? All these people doing these reality shows–I don’t know why anybody wants to be followed by a television camera all the time. There was great discussion amongst my team as to how we would document this last year [of The Oprah Winfrey Show]. I said, ‘I think it should be a documentary.’

“But I saw a first cut last week that they’ve been working on since August. Didn’t like it. And I’m bringing the team in here today to say, ‘Ya’ll have got to get real and the whole thing has to be restructured.’ I don’t like trying to create tension where there isn’t any. I think that there is enough natural tension and anxiety and exasperation going on here all the time without having to create it. If I’m going to have a piece that is representing my life behind the scenes, it has to be truthful.”

[From Parade]

Mindless television doesn’t zap your energy, it enriches you with the adrenaline that comes from other people’s problems and fighting! Plus we can order it for a couple of bucks and watch it while we’re on the damn treadmil. Unlike Oprah, we don’t have to flip the channel and be subjected to whatever happens to be on at the time.

So Oprah watches a super popular reality show and is revolted by it and thinks she can “feed” us better content, like that reality show with Fergie that she got the brilliant idea for after Fergie sent her a couple of well worded e-mails. Then Oprah sees her own reality show and demands that it be entirely reedited so that she doesn’t look like as much of a taskmaster. Oprah knows how to give advice and cover topics, she doesn’t know how to run a network. Some of the shows coming up sound interesting, but I’m thinking that Oprah’s network will be struggling and won’t have a blockbuster show to carry it.

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Thursday, December 23, 2010

Making Money Online With

Ok Go Explains There Are Lots Of Ways To Make Money If You Can Get Fans

from the everything's-possible dept

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