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1. Other Bands

As a rule, I hate other bands.



Quite seriously.



It happens less often these days, but when people interview you because you're in a band they always want to talk about other bands - what have I been listening to? what new bands are good? what's your album of the year? I never know what to say because I hate other bands, new ones especially. My album of the year is always whichever album I have made that year and I haven't been listening to anything except podcasts from America where one of them has a boring name and sounds like Randy Newman and the other one has a name like Grussbaum Snuzzibatch and sounds like a more sincere Chandler off Friends.



I hate other bands. If I liked other bands, I wouldn't have had to form a band in the first place. That's why you form a band - because all these other bands just don't cut it and if no one else is going to make the records that need making it'll just have to be you.



Music journalists don't understand that about bands - they think bands share an interest with them. But we don't. We hate other bands. We wish other bands would fuck right off.



It might seem odd then, that I'm writing this with the intention of helping other bands. I don't know why I feel that I need to do this. What I ought to do is learn as much as I can about how to survive in music and then keep it all a secret until I'm about to die and then pull a Willy Wonka on whichever local poor child manages to circumnavigate my ingenious recording studio full of moral hazards.



But no. Instead I'm going to try and write some of it down now.



If I wasn't a walking contradiction, I wouldn't have formed a band.



I think it's because, despite hating other bands (especially other bands that people who I know like my band say they like on the internet - those bands are the worst), I hate more the idea that being in a band is something for special people.



People seem to love the idea that there's a thing called talent and that talent is rare and precious and that when a thing does well it is because it was made by people who were talented. You get Taylor Swift pulling her music off Spotify and announcing that “Music is art, and art is important and rare. Important, rare things are valuable. Valuable things should be paid for.” and people just go along with it like those were some sentences that made sense and that followed logically from each other.



But it isn't true. It's a big fat marketing lie. Music is art, I guess, and art is important, I suppose - but neither art nor music are rare. Music is everywhere. I forgot to turn the TV off when I sat down to write this and it's gotten onto a Friends repeat - there's music every time someone opens a door. We're going to get deep into the economics in a bit - but the amount of music I can hear without moving from where I'm sat right now is HUGE. It's insanely huge.



If you ever have an afternoon, here's a challenge: find a four letter word in the english language that hasn't been used in a band name on the internet. I tried it once - people spent hours suggesting them - we looked for Yurt, Hams, Goat, Chef, Sony, Ukip, Sage, Lump Bung. Finally, having gotten a little bit too locked on, we found the word Pyic (a word derived from Pyin that means 'of or belonging to pus') and couldn't find a band that had used it. Checking now, I still can't - so if you form a band after reading this, you can have it - might suit some anarcho syndicalist enviro-noise-punks. Every other four-letter word we could think of had been used by someone, somewhere to make music.



The point is that music isn't rare.



Perhaps she meant that good music is rare. And if I was allowed to enforce my definition of what constituted good music (that'd be my band and maybe four or five resented others) on the world I'd agree with her. But 'good' is a democratic concept - in a godless universe without external authorities it has to be - and finding music that someone doesn't consider to be 'good' would be almost as hard as finding a four letter word that hasn't been used in a band name.



So no, music isn't rare, even if it is important. So is it valuable?



Well.



That's not really a word that means very much unless you narrow it down a bit. My baby's smiles are valuable, but you can't get a penny for them in the street if you ask people (apparently). The sunset over the grand canyon is valuable - and some tangential people are profiting from it - but not the river that did the work nor the National Park Service that preserves it. Value is a nebulous concept. Everyone would agree that things like opera houses are valuable - but unless you actively confiscate their money and funnel it through a government, people aren't willing to pay enough to opera houses to keep them open. What matters is not, in fact, value. What matters is price.



And what's price?



I'm going to try and nail down some (very) basic economics here. If you know all this already, then skip ahead. I feel a bit churlish going over it, to be honest, but I think a lot of people in bands are pretty hazy about how all this works. Economics too often looks like a) something complicated and impenetrable that lurks below newsworthy, disquieting icebergs and b) something for tories. As far as b goes, it's worth remembering that Karl Marx was an economist. As for a, I don't think it's true. Economics has some simple rules and concepts that are very adaptable and that can be applied at a high level to get a grip on what's happening around you. You probably have a good idea that predicting the movement of large scale economics stuff is something that never seems to work; but that's a different thing to understanding how the large scale economics stuff happened after it did. The former might have been more useful, but it's separate from and doesn't undermine the power of the latter.



For the purposes of understanding what's going on with music it is important to really get your head around two boring economics ideas: supply and demand; and the difference between fixed and marginal costs.





2. Supply and Demand

This is the basic bedrock concept of economics. And it's not complicated.



There are things in the world that can be sold. These things include precious metals, iPads, hours of human physical labour, ideas, animal shit, associations with an established and trusted name, political influence, hard drugs, sex acts and little china models of hedgehogs wearing people clothes.



All of these have two things in common:1) A quantity of them are available and 2) A number of people wish to buy them. Of these, 1 represents the Supply and 2 represents the demand.



It's not quite so simple as 'there are 50 people who want to buy an iPad' or 'there are 50 iPads for sale' because both supply and demand are affected by each other. And that's where Price comes in.



Ideally, if there were 50 iPads and 50 people who wanted iPads - the best thing would be for those people to buy those iPads - but if the Price of an iPad is too high, the number of people who want to buy one starts to fall.



There might be 55 people who would be happy to pay £100 for an iPad but only 45 who would be happy to pay £200. The trick for the iPad sellers is to find the price where they can sell all their iPads. So they might offer them for £150 and - how convenient - there are 50 people who are happy to pay that much. All the iPads get sold to the people who most wanted them and everyone wins.



But imagine there were 100 iPads. That's more than 50. And only 50 people are willing to pay £150 for one. that's fine for them, they get what they want - but the iPad sellers are stuck with another 50 iPads they don't want.



If they're going to sell them, they are going to have to drop the price. So they offer them for £75 instead and - hooray - there are exactly one hundred people who are willing to pay £75 for an iPad. Who would have thunk it.



Now imagine that there are still 100 iPads, but the number of people who are willing to part with £150 for one suddenly goes up to 200. Maybe Taylor Swift is holding one in a video and that makes them more desirable. Or maybe iPads get more fashionable - for whatever reason - more people want them and are willing to pay.



The iPad sellers could leave the price at £150 and they'd sell out - but that wouldn't be fair on those people who wanted the iPads the most as they'd have no way to show that they did and would be forced to participate in a 'first-come-first-served' system where getting an iPad was mainly down to chance; it also would mean that iPad sellers weren't getting the most they could out of the deal.



The obvious thing to do would be to raise the price and try to find the new point where only 100 people would be willing to buy an iPad.



Let's say £250.



At £250, all those johnny-come-latelies who were only in it for the fashion would stop wanting one and the true iPad devotees would be able to buy at a price they were still comfortable with and the iPads would go where they were wanted and the sellers would be happy and everybody would win again.



And that's how supply and demand works.



There's a supply of iPads and a demand for iPads and, using the mechanism of price, both sides are able to work out where the supply of iPads should go. In this example, iPads are a 'scarce resource' - a thing of which there isn't enough to go round - and the 'market' has worked out an efficient way to distribute them to the people who seem to want them the most.



Now obviously, this is a massive over simplification - and obviously it isn't anything close to fair to let price determine the allocation of scarce resources because access to funds isn't equal across society and a large part of this inequality is endemic because of things like class and racism and all that bullshit.



Governments can bring in policies to try to make the distribution of resources fairer and that's how you get into all of that - which isn't the point of this - suffice to say that those policies can either be attempts to control the supply (as with import restrictions), the demand (as with rationing) and the price directly (as with rent controls) or they can be attempts to level the playing field so that the demand side of the equation draws from a pool of people with more equal access to funds (eg. benefits, inheritance taxes, banning of private schools) and who are therefore better able to express their desires via the medium of price.



And obviously, also, there are no end of complicating factors that can be wilfully or unknowingly involved in setting a price. People might hold back the amount of resource to restrict the supply (like OPEC with oil sometimes) or they might 'price-target' trying to offer different prices to different people so as to sell the maximum that they can for as much as they can get (like 'January Sales' or a market trader at the end of the day - more on this later); or they might misrepresent the current state of supply, demand and price to make people make bad decisions (like the child in Sweeney Todd or the LIBOR rate scandal); or a hundred other things variously labelled as fraud, stupidity or marketing.



What's important for our purposes is that the price of a thing is intricately related to the supply of and demand for it. As a general rule: If demand goes up the price goes up, if it goes down, the price goes down. If supply goes up, the price goes down, if it goes down, the price goes up. It's not a mysterious process that happens out of sight - it's the natural consequence of people making sensible and understandable decisions about what they want.





3. Fixed Costs and Marginal Costs

As you know, when you make a thing that you intend to sell, it doesn't just happen. You have to get the things that will end up being the constituent parts of the final thing, you have to work on making the thing using time and energy, you have to think about how the thing will be made: using more time and probably making prototype things that you can't sell but that help you know how to make the thing that you will end up with.



If the thing you're going to sell is a pill containing a few drops of a new drug - you will have spent money on the raw materials, on hiring the scarce scientists who knew how to invent medicines, on buildings and factories, on testing and re-testing, on marketing, on air conditioning and phone lines and leaflets explaining what your drug does and petrol to get to meetings and fruit baskets for Andrea in accounts and pointless corporate training days and so on and so on. All of these are your costs.



We make these adorable little hand puppets called gobbles. Look - they're on sale here:

http://is.gd/gobble

To get these to you, we spend money on fabric and felt and thread and electricity to run a sewing machine and transport to get to and from Brighton where the fabricland is and table fees for craft fayres where we try to sell them. We spend money on food and light and heat and Julia forsakes time she could spend doing other work to sew them together and embroider their faces. We spent months messing around with puppets for various other things until we hit on the design for gobbles. I researched pattern making and 3D modelling on the internet and we played with foam and cloth and made prototypes and so on and so on. All of these were our costs.



If we were to add up all the money, time and effort we spent on coming up with gobbles, we'd end up with a pretty significant figure and the instinct would be to think - well - we need to make that money back so we should work out the smallest number of gobbles we're likely to sell and then divide our costs by that and then that will have to be the price.



I'm sure you can sense immediately why that wouldn't work - but it's a mistake that people make ALL the time. Every time you see an author lamenting that eBooks should cost the same as paperbacks because of how long it took to write them, or a photographer breaking down their costs to justify what they charge, or the pharmaceutical industry insisting that their drugs have to be expensive in developing nations because of what they cost to research and test, the same mistake is being made.



What they are doing is failing to differentiate between fixed and marginal costs.



Everything here is an oversimplification, but you'll get the idea if you think of it like this: The fixed costs are how much you spend to make one of a thing. The marginal costs are what you have to spend to make a second.



If you make movies, the fixed costs are the millions you spent on actors and explosions and awesome robots that smash shit up and go rarrrgh; the marginal cost is how much you have to spend on electricity, staff and premises to allow the second person to sit in a cinema for two hours.



When we make gobbles, the fixed costs were the money and time we spent designing, refining and working out how to make the first ever gobble we sold; the marginal cost is the amount we spent on material, thread, time spent sewing and so on to make the second.



I'm trying to sell you a gobble right now. I keep talking about them and I put the link up there. So imagine that you're considering buying one. From your perspective, you aren't interested in the prototypes. You don't care if we spent a million pounds travelling round the orient learning ancient puppet making techniques from Bunraku masters. You care about the puppet you're going to buy. You have an intrinsic understanding of roughly how much the materials cost and how much work went into making it and, hopefully, you think it's worth about £8 plus P&P.



In short you don't care about our fixed costs. No one on the demand side cares about fixed costs.



When you go to a movie you don't pay more to see The Avengers than Paranormal Activity because it cost more to make. You're not going to pay more for a paperback copy of The Winds Of Winter because it's taking George RR Martin ages than you would have done if he'd knocked it out in 6 months.



You care about the marginal cost. That's how you decide how much you're willing to pay for something and in turn, how much you and everyone else are willing to pay for something translates into the demand for it and that balances with the level of supply and that informs the price. Our million pound trip to the bunraku parlours of Kyoto doesn't come into it.





4. The Value of Music

Sorry if all that was patronising - but at least we'll probably be on the same page when I say this:



Music is worthless.



Or, more accurately, 42 minutes of generic recorded music transmitted as data over the internet has a market value of as close to nothing as makes no difference.



This is a consequence of two unavoidable facts:



the marginal cost of distributing 42 minutes of generic recorded music is so close to zero that it isn't worth calculating the percentage of costs you'd be paying for anyway (internet access, a computer, power) that are dedicated to enabling it.



The supply of music is so huge and so vastly outstrips the demand for it that the price has collapsed to almost zero.



I don't mean to hate, hate, hate, hate, hate, but Taylor Swift is wrong. Music may be art, and art may be important but it is NOT rare - and it is not scarce. It is, in fact, an abundant resource with more in common with air than with precious metals. As such, while it may be valuable - like air is valuable - it does not follow at all that it should be paid for.



There are so many bands, releasing so much music, and so much of it for free that you could spend the rest of your life just listening to it without ever having to pay a penny or hear the same song twice. In 2009 it was claimed that there were 5 million musical acts signed up to myspace. 5 MILLION. That's so many. If each of them had only uploaded one three minute demo track for you to stream it would take you more than twenty-eight YEARS to listen to them all. This is not a scarce resource we're talking about.



Of course, before the internet, there was scarcity in the recorded music market - but it wasn't because there weren't people making music: it was because there was only so much space in shops, only so much room on the marketing roster and only so much physical stock of CDs that could be produced.



Music itself was always the abundant resource that amounted to an ingredient of the branded plastic product.



They might not have seen it in those terms but musicians always instinctively knew it. That is the only way to explain the sheer indignities we were willing to go through - prostrating ourselves at the feet of those who controlled the scarcity, the Cowells and Walshes and Watermen, begging. We knew we weren't special or scarce. Special scarce people don't have to beg - they get free burritos, company Teslas and stock options.



The old showbiz whispers about there always being someone coming up behind you ready to take your throne were really unavoidable economic realities. Talent isn't ubiquitous - but it isn't rare either. Loads of people can sing well enough to be megastars. Even more people can sing well enough to front cult indie bands. It's a natural instinct to attribute all failures to bad luck and all successes to hard work and talent - but this way of understanding the world just doesn't account for the facts as they stand.



Imagine you are the greatest indie britrock, jangly rhythm guitarist of all time but you happen to have been born in Eritrea, or in 1905. Tough - there's no way for you to be that from where you are. It's impossible.



Even if there was a small element of meritocracy involved in deciding who does well within the tiny closed system of straight white boys born between 1975 and 1995 on the british mainland - it's insanely lucky to be born into a situation where being a jangly rhythm guitarist in an indie band is even slightly an option.



I'm not very famous or successful - but I am a little bit of both and when I try to pin down what the pivotal moments in achieving anything were down to it's so obvious that it was luck most of all.



Lucky enough to be born into a middle class family who didn't urgently need me to hand them wages. Lucky enough that I could move to Brighton - all the usual privilege-y bits of good luck that people like me have in common - but then absurd things too, like, the only reason anyone took notice of our first demos was because Julia had previous with another band. The reason I know Julia is because one day, for no reason at all, I decided to go for a walk in a part of Brighton I didn't know at all and bumped into the host of a poetry slam that I'd been going to for months without really making friends with anyone. As it happened he was looking for allies in a modernist-poetry based revolution he was planning so I went round his house where we decided we'd need to recruit some girls. A week later we saw Julia at the slam and tried to recruit her. If I hadn't gone for a walk, the song I wrote about how I was disgusted with the way music was slathering round Pete Doherty waiting for him to become the new Kurt Cobain so that they could sell horrible fucking T-Shirts with his dates on - would not have been of interest to the internet, wouldn't have been widely shared all over the world and, years later would not have prompted Neil Gaiman to be nice about us on twitter and give us the push we needed to set up Corporate Records and sell our second album without bothering with a record company.



Luck - all luck.



In between I've worked hard and had some talent - but that wasn't what did it. If we divebomb out of the sphere of artistic validity it will be luck that kills us; if we find some opportunity to become the biggest band in the world - that will be luck too. And if I ever say different it will be because I know it and I'm terrified.



Music is an abundant resource, recorded music has no associated marginal costs and the huge machinery of the music industry that made profits for musicians by offering them a small share of the profits they made by controlling the scarce ability to mediate between them and listeners has been gutted by the internet - right in its fundamentals. They are Wile E. Coyote running on thin air having not noticed the edge of a cliff - their business model survives only by force of habit. People buying music because they think that, in some way, they are supposed to because that's what they always did. It's not sustainable.



You'll notice I haven't mentioned piracy at this point. That's with good reason. This post is for musicians and the only thing I have to say to you about piracy is this: Don't worry about it. It's not a problem you have. And even if it was, there's nothing you can do about it - so forget it. It doesn't matter who's right and who's wrong, if information wants to be free or if your copyrights should keep information locked away forever. Unpunished piracy is just the price you pay for having access to all the world's knowledge in your pocket. It can't be stopped. It can't be deterred.



More importantly, it can't be fairly punished by the justice system. If your album is torrented by a thousand people all downloading bits of your data and sharing it with each other and as a result you're able to prove £10,000 worth of harm (you aren't, btw, every bit of research ever shows that you can't possibly equate a download to a lost sale - in most cases the choice of a pirate is only between pirating your album and just being fine with not having it - but if you were) you'd be completely stuck in trying to find a perpetrator deserving of of £10,000 worth of retribution. Either you pin it all on one pirate - which is uneven justice that does nothing to deter; or you punish them all for a £10,000 crime - which is disproportionate in the extreme, like giving a child who steals penny sweets the sentence for grand theft; or you punish them all for what they understood themselves to be doing: infringing copyright in the amount of £10 (not stealing - it isn't stealing if the victim is not deprived of property) -which is pointless.



So forget it. It doesn't matter. The economic case is too strong - your music isn't valueless because people are 'stealing' it - it's valueless because it has no value. That's your problem.



You.



Musician.



Not lucky enough to have been anointed among the two or three acts a year who the music industry are now willing to adequately fund and seeking to survive through making records yourself. Your music is worthless and this is a massive problem for you.



This is excellent news.





5. No Gods! No Masters!

Because the thing about the music industry is that it's terrible.



When I was growing up, this seemed to be a truth universally acknowledged. Musicians were pure of heart and artistically courageous and the great battle which they fought was always against The Man. Against Mr Jones who doesn't know what's happening.



Against the Record Executive - sat in the centre of his web sucking the life from artists and turning their great statements into compromised corporate slurry to gorge on.



They were bastards. Greying, Ralph Steadman bastards and square glasses-wearing, dolly-bird deflowering, paedophile bastards and machiavellian svengali bastards. Bastards who squatted like mammon between the public and the musicians sieving out the goodness to befoul and shitting what was left into the shitty charts. That was why nothing was good enough.



I believed bands when they said this stuff. I believed it hard, right down to my air-cushioned soles. And when I was in a band and all around me the pillars that had supported this evil, bloated edifice started crumbling I couldn't understand why everyone wasn't delighted.



But they weren't delighted. They wrote songs about how rubbish and desperate crowd-funding was. The wrote earnest blogs about the importance of the 'creative' industries (If I could pass any law it would probably be that everyone has to use sarcastic quotation marks when writing the term 'creative' industries). They whipped capes around themselves and struck poses on facebook, disdaining the new models that people were exploring all around them (on facebook). They wrote to newspapers about piracy and how important it was to take the internet away from naughty teenagers who didn't pay them enough. They pined for the old days, when the anointed few could sit in the Good Mixer being lied to by bastards and having to do nothing but surrender themselves to the meat grinder.



I think it broke my heart a little bit.



Of course, you can understand them. For a tiny, tiny fraction of musicians the old days were great. Due to a weird economic feedback loop, their music had made them lots of money and they hadn't had to do anything more than wear nice clothes and make 45 minutes of it every two years.



I've already explained how music is an abundant resource with very little market value - so why, then, was anyone ever able to get rich making it?



The answer has to do with what happens when you introduce an artificial restriction of supply into the sale of an abundant commodity.



Imagine, for example, you own land upon which flows a crystal clear mountain stream. A company may come to you one day and offer to bottle the water from your stream and market it as Bramble Creek Lovely Special Spring Water. Water is (for the sake of argument) abundant and though your water is in the category of waters that are definitely pleasant, there isn't anything much to recommend it above the very great number of mountain stream sourced waters that exist in the world.



But the company, let's call them Edible Materials International, spend a lot of money marketing your water and placing it prominently in waitrose and having it served in the Ivy and left prominently on the desks for when people check into fancy hotels. Soon, the water from your stream is not worth fractions of pennies but is worth several pounds a bottle. By creating a brand, EMI have introduced scarcity: there is water everywhere, but there is only so much Bramble Creek Lovely Special Spring Water and there is demand for it. Where there's a limited supply and a demand, the price goes up.



EMI are making plenty of money from this deal - they, after all, are the ones who created the brand and raised the price of your water. However, their branding efforts have had a side-effect. Their loving watercolours and pornographic descriptions of the mountain stream on your property have told the world a story: sure, there's water everywhere, but this water is unique; it's special; it's a water to look up to. Now your unremarkable stream is itself scarce, because its the stream from the adverts. People want to visit your stream to see it for themselves. They disdain other streams, trampling through them to reach yours.



So what would happen now if you went to EMI and asked to renegotiate your contract? If you threatened to walk away and offer your stream to some other company, they'd offer you much more than they had before because now your stream was famous some of its scarcity value had been passed on directly to you. If it would cost more to brand another stream to the point where it was as valuable as yours than it would cost to pay you off - then hooray! you'd be getting paid.



Fame is a side-effect of a successful corporate branding strategy.



There may be some famous musicians who are truly out-of-this-world talented and whose brilliance need only to be seen to be apprehended. Maybe. But there are far far more who are famous as a side-effect of a successful corporate branding strategy.



Famous people hack the human brain. We're evolved to live in small communities in the low hundreds where social success depends on our friendliness with the best hunter and wisest dispenser of medicine. Someone famous blows our minds. In economic terms, our demand for them - to see them, hear them, possibly get to fuck them - is huge while the supply is tiny: just one little Cumberbatch walking about on his normal human legs. It's not the music that's scarce, it's the fame.



As such, the the thing that raised music out of the mire of the worthless and into the utopia of the sustainably priced - the fame - was entirely controlled by the music industry and their ability to brand products for the mass market.



Sometimes these gate-keepers did well, more often than not they did adequately - but while the tyranny of physical distribution remained in place it was impossible to demand an answer to the question that really mattered: Who the fuck put you in charge?



Well now we have the Internet, distribution is free and we can ask. Who? Who the fuck agreed that these dudes - these peripheral, NHS-spectacled, abortive adults trying to keep up with the gang of drug-addled children they absurdly refer to as friends on late night strolls through Brighton's once proud cruising areas - these slithering, paisley streaks of brylcream - these fucking, fucking dudes - who decided they should get to be in charge?



The answer to that is Supply and Demand. They controlled the supply. They got to keep the beef. And if you were very lucky they let you eat the scraps when they accidentally made you famous.



The thing to remember about all this is that - when there is demand for something with low supply - whoever controls what little amount of supply there is has power. There's a name for it: scarcity power.



Power has lots of meanings, but in human terms, what it boils down to is the ability to control what other people do. To set limits on human behaviour and have sufficient means to enforce those limits when people try to resist you.



Before the Internet, labels had scarcity power and this power was expressed primarily by the granting and withdrawing of permission.



Want to make an album that sounds listenable? Sure, but you need our permission first. Want to talk to the kids? Cool, but you'll need permission. Want to make the art that is trying to burn its way out of your soul into a reality? well that's great, but get in line and start submitting those demo tapes, buddy, because you'll need our permission to do that.



That's still the advice they give you when you ask them how to make it. How to go about submitting your demos to radio, how to submit to promoters, submit to labels, submit to managers. Submit! What a strangely appropriate word for it. Usually you can't even submit directly - you'll see the phrase 'no unsolicited submissions' - you can't even abase yourself without an invitation.



Fuck that. It is beneath your dignity. No Gods. No Masters. No submission. No gatekeepers.



The Internet, that has killed the value of your art, is yet your saviour.





6. It's All Going To Be OK

Which is not to subscribe to the techno-utopianism that prompt well-heeled Harvard graduates to start subsisting entirely on a bio-slurry mixed according to the data collected by their wearables. The Internet has huge problems. Mainly, I think, these are a side-effect of actually knowing what lots of people are actually thinking for the first time and having to come to terms with how ugly some of it is - but great changes are hard to live through. Interesting times, old chinese sayings and all that.



Still though, if you've followed along with all that stuff about economics you should be able to start thinking more clearly about what your problem is and what kind of ways there are to solve it.



So. What's the problem?



It's hard to pin it down precisely. But lets just grant that you're a musician for good reasons: that you have some art you want to make largely for its own sake but that you - nevertheless - cannot survive if you generate no income for yourself. In short, as an artist you must be able to continue to make art.



I think that's what it is for me, anyway. I don't want to stop.



So my problem is that I want to continue to make records in an environment where recorded music has a market value of zero.



Societally, we want people to continue to make good records in an environment where recorded music has a market value of zero.



Philosophically, we want people to continue to make good records in an environment where recorded music has a market value of zero without their having to ask permission from an increasingly impoverished and safe-playing music industry who were only ever powerful because they controlled scarce distribution resources which are now obsolete.



If we're other than believers in the divine order of social class as determined by the hereditary principle then we want people to continue to make good records in an environment where recorded music has a market value of zero even if they have no independent source of wealth to keep them alive while they make them.



It's my hope that being clear about the reasons why you can't make money will make it easier to think of ways that you can.



The most important lesson to learn is that your music is worthless while it remains abundant. It will only start to gain value once you create scarcity around it.



This sounds cold and business-like, but remember the mountain stream - scarcity isn't just about the thing itself, it's also about the context of the thing. For example, if you've ever sat around in a wetherspoons bitterly dissecting the minor success of someone you resent - you've probably made some sarcastic reference to the fact that they only sell tickets to their extended family - the general public couldn't care less. This may or may not be true about your annoyingly well-reviewed acquaintance - but it is a stage that most artists go through: playing gigs to mates and family members.



How does that look in economic terms? Why is your mum more willing to pay to see you play your Banjolele-based Dexy's covers show than the painfully absent public? Obviously it's because she loves you (or at least wants you to think she does) - but this is still a market transaction. How can you apply the laws of supply and demand to account for your mum's buying decision in an instructive manner? What scarce resource is driving up the price?



Basically, it's you. Your mum likely wouldn't pay more than a few pennies to watch anyone else massacre Dance Stance on the banjolele, but her willingness to pay rockets up once she's offered the opportunity to see someone she wants to support doing it. It doesn't feel like it, because it's your mum, but this is all economics.



If you doubt it, imagine that you were charging £5,000 to get in - would she still come? No - exactly the same balancing act between supply and demand is at work. Price it too high: demand drops to nothing.



You can't transform the record buying public into a million clones of your mum, sadly, but you can still apply this lesson:



People value music that they are personally connected to and such music is scarce - therefore it is not worthless.



If you were a label, you'd manufacture this connection by lying about your artists, making them out to be cooler, sexwitchier or otherwise of higher social value than they are. Even better, you could design a talent show that would raise the personal connection people feel to your artists and their stories to hitherto impossible levels - that way, when they finally release a record, the public will feel almost obliged to buy it: a very scarce resource indeed.



You could lie about yourself and strike the kind of poses that might spark worship among the public, but it's harder to pull off without a PR budget behind you.



Instead, learn the lessons of the X Factor and try some of these:





Explain. If you're doing something weird and hard to get your head around, give people a way in. Once they know what they're getting into, they are already more connected to your album than to the next one. Social media. If it suits you, make actual friends with people on the internet.

Don't ever have a social media strategy - that just makes you come off like a douche - but don't imagine you'll sell more as a recluse. Perhaps you'll cultivate a reputation as a difficult eccentric whose rare utterances are lapped up by a public eager to be transfigured by them but - if you haven't written Gravity's Rainbow - its more likely that people will just not notice until they skim read the local news report about how you were eaten by your cats. Be nice, Be available - and if you're going to spam people with links be upfront about it and don't be a dick when they unfollow you.

Don't compromise your vision. There's no point trying to write to fit in with prevailing fashion - by the time you finish it will have ceased prevailing. Write and record music that you want to exist. You are unlikely to be the only one who does. If you can find the others, they will recognise your honesty when they see it and they will be more connected to your work than they ever would have been to some fucking alt-folk single about how insurance companies helped them win a baking competition or whatever.

Write long blog posts about DIY that you hope will be widely shared so that people will feel like they know you and want to BUY YOUR RECORDS. Say yes and go anywhere. If someone wants you to play a show in their local, miles away from the closest indie circuit university town and they are up for covering your travel: Do that right now.

Don't treat internet audiences like pre-internet audiences. There's no point acting aloof (unless you genuinely are aloof and that's your thing), no point referring people to your manager, no point pretending you're too good to play in someone's house. The whole rockstar persona was a by-product of the horrible industry you used to need permission from and it doesn't wash anymore. The internet audience isn't viewing you through a lens built by a dinosaur multinational conglomerate who need you to be more than human in order to justify the money they've spent on you, they are interacting with you on a personal level. The multinational conglomerates that facilitate your communication with your audience these days do so by simulating pubs, village greens and personal letters. Social media is not really media, it's shared space - so treat it like that. At the most basic level, don't have a countdown to your release at midnight - it looks stupid.

As you should see clearly now, all these have one thing in common: they make what you're offering more scarce.



People who have no reason at all to pay anything for 45 minutes of generic recorded music have a host of reasons to pay for 45 minutes of music that they know will explore the happy side of a depression that they recognise in themselves recorded by that nice girl who played in their local, chats to them about Geordie Shore on twitter, wrote that great blog post about economics and such; and who seems like a nice person who you could approach if your download didn't work properly.



There are millions of bands - but how many of them can say all that? That's scarcity, and that's a low supply and balanced with the demand created by all the people who see that in you - that significantly raises the price of your album.





7. Crowdfunding

When I invented crowdfunding (OK so technically this might be disputable, but I was certainly doing it long before it was cool) I didn't really know why it worked.



Everyone knows about it now, and everyone knows that it seems to work amazingly well, but I still think people are pretty hazy about exactly why this particular way of selling stuff works and what exactly crowdfunding is.



According to the government, its just selling stuff - and this is important because crowdfunding money is subject to the same tax requirements as money you get in exchange for any other goods. 'Pledges', 'reward tiers' and so on are just words that have grown up around the practise - according to the taxman (or, y'know, taxwoman - though I can see how that one has largely been left out of consciousness raising initiatives) you're making sales. Your total sales are your gross profit. Your gross profit minus what you spent to make the things you sold is your net profit. Your net profit is taxable.



This is worth bearing in mind because, aside from keeping you out of trouble, it should crystallise the nature of the transaction: it isn't charity, it isn't an investment and it isn't free money that you're owed. Crowdfunding is a means of selling products.



Why then, can you suddenly charge (as my band occasionally does) £350 for 45 minutes of recorded music when, as we've established, music is worthless?



The first part of the answer is pretty much what we've already covered. Crowdfunding increases the scarcity of your work by giving you an opportunity to explain yourself in a friendly video, define your project as something artistically valid and interact on a human level with your customers. A well put together kickstarter dramatically raises the scarcity value of your music because anyone who spends the time to learn about you and your work will automatically value it more highly than work by an artist about whom they know nothing.



That accounts for some of the price increase - but by no means all.



The real increase comes when you understand what it is that you are actually selling - because it's not the music, it's not the T-Shirts and it's not the opportunity to have tea with you at the Ritz to discuss your solos. The product is not the product. What you are selling is a stake in a future where the product exists.



And that is HUGE.



Remember when we were having that introduction to business studies lesson several thousand words ago and we were talking about your costs? You remember that your fixed costs were what it cost you to make the first one of something and the marginal costs were what it cost to make the second? And that it was an unbreakable rule that no one cared about your fixed costs?



Crowdfunding works because it breaks that rule.



Because you are not selling a product but the opportunity to live in a world where that product exists - you have performed the impossible feat of moving all of your fixed costs into the marginal costs column.



Suddenly, the cost of the second item is the same as the first, because if you don't sell both, then neither will be made.



Suddenly, people who would never have cared about your lighting bill if they were deciding whether to buy a CD in HMV have your lighting bill in front of them and they know that if they don't pay for it there will be no CD.



People are astoundingly nice, generous and willing when a structure exists to allow them to be. Crowdfunding lifts the lid on the closed box that was once the music industry and allows people to see a connection between what they put in and what they get out. It clarifies and reframes the question that's being asked:.No longer is it just: how much will you pay for this 45 minutes of recorded music? Instead, it's how much do you want this music to exist? How much do you want to share the existence of this music with others? How much more would you enjoy a world with this music in it?



This completely changes the listener's relationship to the musician.



Listeners are no longer the uninformed dupes at the end of a secretive train of bullshit. They aren't there to be scolded with stupid 'you wouldn't steal a car...'-style admonitions. They aren't there to be lied to by distant image consultants. They aren't fools to be sold to, advertised at, patronised and spoken down to.



In a world of crowdfunding, the audience can buy its way into the decision making space that was previously the realm of the Watermen and the Cowells. That's the product you are selling - the revolutionary opportunity for the public and the artist to co-operate outside of the music industry and defy the edicts of its central authorities.



How much is that opportunity worth? Well - as ever - the price is set by the interaction of supply and demand. But unlike CDs, the price is not limited by the homogeneity of the product…





8. (A Digression Concerning Price-Targeting

If you were the owner of a shop that sold fancy underpants, you would be very like the iPad seller from before. You would be in possession of, say, 100 pairs of said pants and you would be trying to sell them to a number of people who were willing to exchange varying amounts of money for them.



Knowing about supply and demand, you would base your pricing decision on the same formula - you'd work out the optimum point where all the pants would be sold for the most money. That is, the highest amount at which 100 people were willing to pay that much or more. Let's say £10 - they are, after all, very fancy pants.



And that would be fine, and everyone would win, but late at night, lying in your mid-priced bed, you might start to wonder. Sure - you found the highest amount that would let you sell all the pants. If you'd charged £11 you might have only sold 90 pairs. But then - if you had somehow been able to sell 10 pairs to the people who wouldn't have ever spent more than £10 for £10 - then put the price up to £11 - you'd still have sold the rest and you'd have 90 more pounds. And that would be nice, wouldn't it?



What's more, if you'd been able to find out what the most everyone would be willing to pay was, then you could have sold some pairs for £10, some for £100, maybe some for even more; and you'd be rolling in that sweet, sweet pants money right now.



The problem with this is that once the guy who paid £100 found out that you'd been selling them to other people for £10 he wouldn't be willing to pay £100 anymore. After all, just because he's happy to spend £100 on fancy pants, doesn't mean he's happy to be taken for a mug.



So what do you do? How do you adapt your pricing so as to get the extra £90 that he would have been happy to spend?



Here's one idea. Your base price is £10 - you're pretty sure that you can sell all your pairs for £10 - but instead of saying that, you announce your new pants - none fancier! - and tell everyone the price: £100. The suspiciously keen pants-buyer immediately buys a pair. Maybe you sell a few more.



Then, after a month, you announce a fabulous SALE! with AMAZING REDUCTIONS! and you publish the new price: £50. Soon you've sold a pair to everyone who was willing to spend £50 plus a few more to people who see themselves as bargain hunters and can't resist the 50% discount.



Then - on the last day of the sale, you announce an INCREDIBLE, ONE DAY ONLY, FLASH SALE!!! with MASSIVE DISCOUNTS UP TO 90% OFF! and the new price: £10. Now you sell the rest of your pairs to all the people who were happy to pay this much - your real base price - all along.



Hooray.



You may recognise this strategy from, like, every shop ever. In business terms what it is, is a form of something called 'Price-Targeting'.



If you've not come across the term before, it probably sounds like something dishonest or underhand but it isn't really.



Because price is a function of supply and demand - it's very hard to say that something is overpriced if someone can be found who's willing to pay the price being offered. The cheapest price for the pants is still available, it's just that you have to jump through a few hoops to get it. In real terms, what this means is that the £100 pants are NOT the same product - you are paying to avoid having to deal with all that bullshit about waiting for the right day of the sale and not being able to slip into them right away. If you've ever waited for a Steam sale or checked out the deals on black Friday then you're cool with it really.



There are other ways to price target (supermarkets who brand their base price items as 'economy' or something similarly off-putting in order to charge higher prices to people who care more about the stigma of buying economy than they do about the difference in price, for example) but the reason is always the same: to try and get the most out of each transaction based on the individual valuation decisions made by different customers.



When we set up Corporate Records (an online label that lets people pay whatever they want for downloads) we were explicitly trying to price target. We knew that music was objectively worthless, so we were willing to provide it to people who didn't want to pay for free (as that was the most they were ever going to pay) but we also gave the people who were willing to pay a means of deciding how much to hand over.



In this manner, we were able to effectively charge more for a download when selling to people who were willing to pay more.



This sort of works. It definitely works better than you'd think and it works even better when you pay attention to the value-adding personal connection stuff.



However, there is a flaw in it. Aside from the feeling of guilt which free downloaders will have to endure, there's no real extra hoop to jump through if you want to pay less. It's a better model than the de facto combination of premium sales via iTunes etc with free downloads being offered by the Pirate Bay - as the mere fact of downloading directly from the artist creates a sense of connection which enhances the guilt and increases the motive to pay something. But still, there is a missing element of difficulty in acquiring the low price that prevents it from being a full efficient price-targeting system.



end digression)





9. Where were we, Oh Yes

...Crowdfunding allows you to price target very efficiently. If you offer a large number of tiered pricing options, you are allowing your customers to tell you how much they're willing to pay and giving them an opportunity to spend it. Even better, because the product is really the future in which your music exists, you are doing this fairly, openly and without pulling the wool over anyone's eyes.



Bearing all this in mind, here are some tips on effective crowd-funding:





Remember what you're actually selling, and make sure that there's no confusion about it. It's important that the stakes are clearly laid out: If we don't sell enough of these, this will not exist. If you're using a platform that allows you to choose to get the money if it doesn't reach a target, NEVER choose that option. The target is the whole point - the target is what people are buying. If you don't depend on meeting your target then there's no reason to crowdfund, you're just selling music in the old fashioned, no-one-cares-about-your-fixed-costs way.

Don't offer rewards that make you sound like a prick. You know what I mean - you can't charge for backstage passes when you are the kind of cult proposition that needs to crowdfund a record. No one should be paying to have tea with you or get a lesson in bitchin solos. Even if someone does pay you for that, you are treating them terribly and exploiting caveman level inadequacies that they can't help. You're not the product, the work is. Before offering a reward, ask yourself if you could imagine it being worth the money to the right person. The last thing you want is to leave anyone feeling like you ripped them off. This might sound like it runs counter to the idea that you are price-targeting with high-end rewards - but it doesn't: price-targeting requires that you sell something that's worth the extra money, even if the extra thing doesn't cost you much more to deliver. In the pants example, people are paying so as not to wait or be hassled with remembering sale dates. You should do the same - whether it's early access, handwritten sleeve notes or a gig in their house - the high end tiers should be worth paying more for.

Be completely open. This is tough, as years of music industry bullshit have created powerful memes about inaccessible rock stars who are uncheapened by the mundane demands of the worldly - but you need to remember that all of that was created cynically and deliberately as an exercise in adding value to a technically worthless product. You gain nothing from being vague about your costs and intentions - just say what you're doing. Say it cool, if you like, but don't try to mythologise yourself.

Don't act like you're better than it. Particularly a problem for formerly high-profile indie musicians who find themselves without labels and forced into a new paradigm that they don't understand. People like that will endlessly complain about crowdfunding - that having to do gigs in living rooms or whatever cheapens the idea of art and diminishes artists. The implication being that art is better served when it is mysterious and distant. This, of course, is a load of old rubbish, once again, created as a side-product of marketing from a bygone era. There is no compromise of vision inherent in crowdfunding - the money comes from the same place - the same people as it did before, it just removes the middlemen. You might shed a tear for the days when rock gods strutted fifteen foot high onto unreachable stages like they'd fallen from the sky - but they hadn't fallen from anywhere and you were being lied to as you worshipped them. It is ignorance you're longing for and that is beneath you. Artists are not diminished by having to sell directly to and interact directly with the people whose money they depend on to create are - there's no way you can make that case without sounding terrible. The people who spend the money were diminished by being treated as congregations to be fleeced and crowdfunding stops you from doing that or, more accurately, stops you from sitting idly by while other people do it on your behalf. Things might be worse for a few of you, but this is a better, healthier world that we're building - so act like it.

as it did before, it just removes the middlemen. You might shed a tear for the days when rock gods strutted fifteen foot high onto unreachable stages like they'd fallen from the sky - but they hadn't fallen from anywhere and you were being lied to as you worshipped them. It is ignorance you're longing for and that is beneath you. Artists are not diminished by having to sell directly to and interact directly with the people whose money they depend on to create are - there's no way you can make that case without sounding terrible. The people who spend the money diminished by being treated as congregations to be fleeced and crowdfunding stops you from doing that or, more accurately, stops you from sitting idly by while other people do it on your behalf. Things might be worse for a few of you, but this is a better, healthier world that we're building - so act like it. Work out your costs really properly - maybe even do a spreadsheet. Seriously. Find out how much postage is going to cost you, stuff like that. You should know what it will cost to make every reward you're offering - all the way from having nothing recorded to the customer holding the reward in hand. Don't gloss over any part of it.

These aren't close to exhaustive, there are loads more things I could suggest - but that isn't really the point of this. What I want to do is tell you how to think clearly about what you're doing so that you can let that inform your decisions. If you can understand supply, demand, fixed costs, marginal costs, price targeting and how they all come together at a point where a thinking, breathing human being hands you money in exchange for art you made then you're well on your way to knowing how to keep making that happen until you're surviving.





10. Conclusion

A couple of years ago I started to tell people that, like Gene Simmons, I was only about the money. This is not really true - but in a way, it is a helpful way to think about things.



What I meant was that I had started to pay attention to how much actual monetary value was involved in doing things that everyone in music takes for granted.



Press, for example. Everyone knows that it's important to get featured in the press. But is it really? How do you even answer that question?



If you're only about the money, it's simple - you just need to know how many albums you'll sell if there's an article about your band in the press.



It's tricky to be sure, and it largely depends on the obvious factors, but my observation has been that having an article about you in the press doesn't really help much at all. Being mentioned in an article in passing makes you feel famous, but has no effect on your profit. By contrast, being tweeted about by someone who lots of people trust and pay attention to - I can say from real, financial experience - really does boost sales.



We're supposed to be contemptuous of people who are all about the money - but knowing that lets me do what I've wanted to do ever since the first second I wandered into a music industry environment: ignore and look down on music journalists. I don't have to suck up to them or pretend we're friends - it genuinely doesn't matter what they think because I am all about the money and they can't help me get any so fuck 'em.



If you know the economics, you can look at labels - to whom everyone knows you must submit - and work out that if they sign you, you might sell more copies in total, but you'll have to share the money with whoever they want to waste it on. Your turnover will be higher, but your net profit will be lower. Knowing that, you can make an informed decision to not seek a record deal.



There was an article on the sub-buzzfeed content farm that used to be the NME recently where they caught up with the 'stars' of 2005 'indie' - pretty much all of them had given up the day that their labels dropped them and gone looking for jobs and found jobs and had never done the maths that could have kept them in music where, once, they must have felt they belonged. That's the music industry, folks. An misnamed industry, the ultimate effect of which is to reduce the amount of music being made.



If everyone was all about the money, we could say together: no, I am not seeking a record deal, for I have done the maths, motherfucker, and I do not need your permission to make records.



The biggest tip I can offer is just that: Make records. And don't stop making them. Don't wait for a record company or a journalist or a guy you met who knows some really important people and can put the word out in LONDON. Do It All Yourself. If there's something you need but can't afford to pay for, learn how to make it yourself. The tools are free and abundant. Make worthless records and then add value to them and then sell them. You really can do it and you don't need anyone's blessing.



Because I'm not about the money and I don't care about economics. What I care about is the work. The work that needs doing. The albums I have to make - that we have to make together. It used to be that they could stop us, but now they can't. We can keep doing this, and so can you. It's easier if you know what it is that you're doing. Hopefully, this will have helped a little bit with that.





…







This Was An Advert

I am currently in the process of expanding the themes of this article into a book - to be published by Unbound in 2017. In many ways, this is a case of me attempting to practise what I'm preaching as I need you to pledge to make it happen. If you've enjoyed this and want to say thanks - or, even better, if you think these are ideas that deserve a wider audience and want to help make that happen, please go to:

https://unbound.co.uk/books/your-art-is-worthless

...and pledge. Any amount helps, but if you can spare £35 for the complete edition which includes access to a pledger's only podcast feed, a fridge magnet and an extensive digital companion volume - you'd be going a great way toward helping make the book a reality. If you just want to read the book when it comes out, there are cheaper physical and digital editions too. You can also buy my dignity for considerably more, and then I will allow you to come round and flick my face.

Thanks for reading,

XX

Simon Indelicate







For a while now, I've wanted to write a book about all this - the way that music works now and what that says about where we are as a civilisation and DIY and lots of stuff like that. The above represents roughly a condensed eighth of what that book would be. It is contrary to most of what I've said above (apart from the bit about being a walking contradiction) but I'd really like to find a publisher to sell that book to, largely as a means of adding value to our albums - but also because I think it would help a whole bunch of people who want to make amazing things and don't really get that they're allowed to. If you are a publisher, or could help with that - my email address is simon@indelicates.com.



I am currently crowdfunding the best album that my band, The Indelicates, has made. We totally break one of my rules above in that the album is already finished and you'll get it straight away if you help us fund it - but even so, if you enjoyed reading this or if you just want to get a space-glam concept album that everyone seems to really like so far you can buy it now at http://elevatormusic.space









We'd really, really appreciate it. This stuff is hard.



X



Simon Indelicate, Lewes, 2015



