In the decade since music fans began downloading music, album sales have fallen by about half, major labels have been put on a death watch, and Radiohead gave away one of the most hotly anticipated albums in recent memory.
Still, labels big and small keep signing bands and records keep getting made. How to finance this over the long term is yet to be determined. Sub Pop, the Seattle label that pitches artists from Fleet Foxes to Flight of the Conchords, is floating the idea of relying less on the business of selling music altogether.
In a statement, general manager Megan Jasper says that though Sub Pop's known for the albums their bands release, the label's not opposed to "expanding into the fine world of T-shirts, hats, beer cozies, and key chains. We used to give many of these tchotchke items away for free in an effort to entice people to pay for the music, but we're considering flipping our strategy so that people pay for the toy and receive the music for free."
Sub Pop's not talking about specific plans; but basically, instead of downloading an album on iTunes, for example, fans could go to retailers like Everyday Music, Easy Street, or a band's merch table on tour and buy a screen-printed poster that includes a download for the record at no additional cost.
"CDs may end up being like little books. You might spend the time to do a cool package, it just doesn't have a disc in it," says Sub Pop art director Jeff Kleinsmith. (See Q&A, page 117.) "And instead of a disc, you've got a little piece of paper that says 'Go here for your download.' So you're getting everything about it except for that plastic disc, you know? And that could be a magazine, it could be a shirt, it could be a sticker on a banana. It could be anything, really, that has that download."
Sub Pop and other indie labels have long given away download codes with sales of LPs. And record labels, including those under the Warner Music umbrella—Atlantic, Nonesuch, etc.—have experimented with digital/physical combo purchases over the years. Though Warner owns 49 percent of Sub Pop, the label works independently and has free rein on issues such as this.
"CDs are still the majority of our business, but I don't think it's any secret that we're constantly exploring new opportunities for our artists to make a living in the music business, whether it's digital, download cards, music synchs in commercials," says Matt Young, Warner's Vice President for Merchandise. "I think Sub Pop is being aggressive and really smart about the business of music. They're looking for new ways to help their artists make a living in this space."
Jason Hughes, co-owner of Seattle's Sonic Boom Records on Capitol Hill and Ballard, however, isn't thrilled. He's seen labels and bands try to sell non-traditional items with albums—from lamps to USB drives—and he says they've all been more trouble than they're worth.
"It's too hard to merchandise posters or T-shirts," Hughes says. "From a retail point of a record store, I don't want to retool because they want to start selling different things than what they've been selling for the last 20 years. They're just trying to maximize their profits, but when you're devaluing the thing that's the cornerstone of your business [music], maybe they shouldn't be in that business. Maybe they should be in the tchotchke business."