Now that ain’t workin’
that’s the way you do it
You play the guitar on the MTV
That ain’t workin’
that’s the way you do it
Money for nothin’ and your
chicks for free

(©1985 Chariscourt Ltd./Adm. Almo Music)

 

Dire Straits’ “Money for Nothing” ironically sums up the popular attitude toward the music business. After all, performing on stage for an hour or two a night does not seem all that tough. And we all know that little “work” goes on in recording studios. Yet groups like Motley Crüe have financial portfolios that the rest of us can only read about in Money magazine case studies.

Readers of Tarnished Gold: The Record Industry Revisited by R. Serge Denisoff, assisted by William Schurk (Transaction Books; New Brunswick, NJ), will have a different opinion of making it in the music industry, at least in the pop/rock segment, which represents more than 50 percent of the market. First, “Talent is commonly defined as a natural or acquired ability or as a natural endowment of ability of superior quality. This common and popular definition does not totally apply in the music industry. Talent is the commodity that has economic potential.” In many cases, that potential may not be realized by the recording artist. (And simply being recorded is no mean feat: the groups Boston, Heart, and The Police, all of which have tremendous banking power, started out with vanity records.)

A record can sell 100,000 units, the record company can make $88,000, and when all expenses are accounted for, the recording artist can owe the company $31,200. You can bet that more than one group wishes it had spent less time in the studio or made a less-elaborate video, since these costs ultimately come out of this group’s coffers. The record companies should not be thought of as money-grubbing leeches that suck the already anemic bodies of rock musicians. The fact is this: “Records, artists, and even record companies rise and fall strictly according to the bottom-line, profit-loss principle.”

The record companies must provide a large—and expensive—support structure for recordings, which ranges from getting music on black vinyl, compact disc and tape, to developing publicity, bringing the product to market, and a myriad of other activities. And don’t overlook the need to discover or develop bankable talent that can replace or support old talent. Imagine what it would have been like to be working at Capitol Records when The Beatles announced the end.

Then there are the radio stations, which continue to play the leading role. Commercial radio stations are interested in selling commercial time. Sponsors are only interested in buying market. The playlist that the radio program director develops determines who will be listening. And if pop/rock radio stations around the country all sound the same, it is because the program directors know what formulas sell. Similarly, record stores are only interested in stocking products that will move out the door quickly. And that is determined by what’s being played on the radio, which is determined by what the companies are offering. It’s a closed loop. What about the recording artist? He must work hard—and be lucky.

The music industry is just that: an industry. The groups can be thought of as small businesses. And the failure rate of small businesses in general is probably far less than the failure of rock enterprises. As Tarnished Gold convincingly details and explains, there’s no free lunch—and no money for nothing.