JPF Home Page Forums General Messages General Message Forum Legitimizing Pay-for-Play

Brian,

Thanks for the info. It's clear that for there to be any potential value for this this, they have to filter. If they don't filter, then it collapses, can we agree on that obvious point? (I hope so, because I'd rather discuss the more interesting part, which is what happens if they DO filter for talent and keep that filter very high). If you don't agree they need to filter, then we can go back and visit that.

So, you've gotten 144 fans from your 100 dollar investment. On face value that sounds pretty good. So let's learn what calling them "fans" actually means. (And I have no idea of what your answers will be).

1. Do you have their names and direct contacts?

2. Do you know where they are located?

3. Have they actual purchased anything?

4. Have they responded to your notes to them?

The answer may be yes to all those questions. If that is true, then I'd say they are actual fans. That certainly suggests that at .70 cents a piece, that's a good return on your investment. If the answer is no, then they aren't fans so what did you actually get? Would you agree that if they never buy anything and they never come to your show (for example because you don't live near them or you're an artist who doesn't even do live shows) that they actually are of no real use to you in your career at this time? And if they are not easily transported outside of your online interface and onto your personal mailing list, they have no value at all. In fact, you couldn't even prove that they existed as real people right? For that matter, they might just be a marketing ploy to get you to spend more money. But that's all speculation, both good and bad. I'll wait for your factual answers.

Let's assume a best case scenario.. lets assume that they are all 100% real people, they all live in your exact town (because fans in other towns only really help you if they buy something so let's make it perfect for arguments sake) and they all respond to your emails and interact with you. If all that is true, then let's examine what you got in terms of income. If they all bought one song from you (the one they heard) that would equate (assuming they bought it on the open market and not fron Jango) to roughly 60 cents a head if you use CD Baby's digital distrubtion at 99 cents a track. So, drum roll please, after a 100% sales penetration... (i.e. the best case scenario) you have made a whopping... negative -10 bucks.

You could afford to do that for a long time before you lost all your money. But it would be hard to get ahead and make a good return on your investment right?

I guess if you converted 100% of them to full CD sales, you could even make a profit. So I am excited to hear how many CD's or single songs you sold to those 144 fans.

If, as I fear in the other extreme, that you sold nothing, it's unlikely you can afford that much success. And that's also assuming that you continue to get 144 fans per 100 dollars you spend. If you don't get that much, or if those fans don't interact with you, you don't get their email addresses that you can take off site and add to your own mailing list or worst of all, you can't really prove they are real, then you can see where what seems fantastic (wow.. 144 new fans!!!! at only 70 cents a piece) quickly becomes a nightmare.

So going back to the best case scenario, how many fans can you afford to buy? And if they aren't buying at least 1 track 100% of the time, how long can you afford to lose money? Remember, when you spend money, you should be getting something tangible in return.

So let's look at your point that it is a service provided. By strict definition, as long as it's not a scam, then it's a service. But is it a useful service? You can hire a pool cleaning service to come out once a week, but if you don't have a pool, or you don't use the pool you have, or there's no water in it (perhaps the best comparison) there's not much for them to do.

You're a talented guy. If you were any less talented, you'd agree that people would be less likely to want to be fans right, let alone buy something? If you agree, and we've shown how even at 100% sales penetration you lose money, imagine how much worse it would be for others?

But let's say there are far more talented people. If that is the case, as they sign up, your music won't be as good. So your investment will suffer as time moves forward. As the economy of scale is no longer in your benefit (i.e. you can no longer pay this money to have little competition to this huge fan base), it will be harder to pay off the investment. (and remember, at 100% sales, even you aren't doing that). As more talent comes around and spots on the playlist become scarce, supply and demand issues kick. There's only so many spots they can fit in of stuff that isn't what the fans want before they get annoyed and go look for something that more often plays exactly what they want. So if spots become scarce, the cost will have to go up for all those artists who want to buy them. Then things get really tough to afford or to get a return on the investment even if you CAN afford it.

Starting to get an idea about all this?

But artists are starry eyed dreamers. Many are willing to pay money out for their music to get exposed. They see it as an overpriced lottery ticket.

Now.. we've mostly dealt with best case scenarios. If it's anything less than that (and I suspect it is) it's a really bad idea. In a perfect case scenario, it's not a good deal.

And I didn't even get into the fact that you will never make royalties and I would still like to hear from any attorney who can explain how PRO royalties can be waived to make that happen at all. Sound Exchange may be a good source. If 5% of that royalty goes to musicians unions and Jango or Last FM has to pay that Royalty, how can anyone waive them across the board? And if they don't waive them, how can that airplay be counted as legit since it was bought and paid for? And where are the songwriters in this? If you don't control 100% of the rights to the songs (publishing and writers shares) how can you even participate in a pay to play scenario? Seems like a legal battle waiting to happen. But that's all in addition to and separate of what we're talking about.

I have an idea that might be better than this, but I am not going to give it to them. But I know smart people to give it to that might be able to incorporate it into something they are working on.

I understand why Last FM, Jango and others would want to figure out how to make money. I just wish they'd figure out a way to stop making the creators of the product pay them to use it to make their own profits. Doesn't anyone else have a fundamental moral problem with that aside from the business problems it presents?

Brian