Re: Labels

From: Steve Silvers (steve@seattlegroove.com)
Date: Sat Jun 17 2000 - 02:22:59 MET DST

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    what about dischord?
    they jut print on their cds how much it would cost to buy the cd directly
    from them.
    makes it awfullyhard to mark it up much.

    ----- Original Message -----
    From: "Dirk van den Heuvel" <dirkv@groovedis.com>
    To: <chad@thedownbeat.org>
    Cc: "Acid-Jazz Mailing List" <acid-jazz@ucsd.edu>
    Sent: Friday, June 16, 2000 4:25 PM
    Subject: RE: Labels

    > Chad,
    > the reason why you don't pay $6-7 when buying direct is because the label
    > can't live without distributors and retailers RIGHT NOW. That means that
    > they have to be careful not to piss us off :). Selling to you at what we
    > distributors pay would do that and risk us not carrying the records, ditto
    > for the stores...for the money they make off you they can't afford that.
    > Yet. A similar thing happens many times when stores buy direct--they get a
    > better price, but NOT the same price as a distributor. That's to keep
    > everybody happy and doing their job.
    >
    > And the system is never paid for...there's always rent, phone, labor, etc
    > costs that must be paid. Plus dead stock. Bad debt. You get the idea. The
    > start up costs are comparatively small. And that's true whether we're
    > talking about a distributor like me (ESPECIALLY a small distibution
    company
    > like Groove Dis) or a record store. And lastly on a philosphical note I'd
    > like to think a good distributor (or a good store) deserves to make a
    living
    > for ADDING some value. We are not a freight company. We don't simply take
    > records from one place and send them to another (though there are many
    > so-called distributors who do exactly--and only--that). Ask anyone who
    buys
    > from us, store or deejay, if we add some value and I'm sure they'll say we
    > do. And for that we deserve to make a living (mind you I said living not
    > "killing").
    >
    > Hoping I don't sound (too much) like a corporate tool (though I AM on
    record
    > on the mailing list for being anti-Napster :)
    >
    > Dirk van den Heuvel (dirkv@groovedis.com)
    > Groove Distribution
    > http://www.groovedis.com
    > Your Guide To The Underground
    >
    > -----Original Message-----
    > From: chad downbeat [mailto:thedownbeat@thedownbeat.org]
    > Sent: Friday, June 16, 2000 6:01 PM
    > To: Dirk van den Heuvel
    > Subject: RE: Labels
    >
    >
    > dirk,
    >
    > one question about the following....
    >
    > "If labels were to sell to you direct with no middlemen needed the cost
    > could come down to $7-8 tomorrow..."
    >
    > tell me then why when i buy direct from a label that i still pay the same
    > price as at the retail store? i realize the cost of the
    > system/medium/website/whatever in place, and it's maintenance, to connect
    > with the buyer is money. however that doesnt really explain the same
    costs
    > after the system is in place (and payed for).
    >
    > i guess im just trying to say i realize everyone wants to make a bit more
    > money. i dont fault any label, distributor, middleman, businessman, or
    > person on the street for that. i do however find it insulting that it
    > cannot be spoken for what it is, and that is that it will -never- be
    > $7-8/cd. unless you are a label that has no other options or are in it
    for
    > the excitement of being a label, you are going to use capitalism to it's
    > advantage.
    >
    > i do think capitalism has been used, by far, to it's advantage in the
    music
    > industry. it's only a matter of time before it deflates. that is all
    from
    > my point of view of course, and i will be the first to point out im a
    > simpleton when it comes to the industries system that is in place. but i
    > see aol on the rise with time warner communications/time warner music.
    how
    > long will it be before we pay a flat rate for music, as we do video.
    >
    > i also just wanted to say thanks for your insight dirk. it has on several
    > occasions, after reading your emails, opened my eyes to some of the
    reasons
    > why.
    >
    >
    > cheers folks (it's friday),
    >
    > chad
    >
    >
    >
    > -----Original Message-----
    > From: Dirk van den Heuvel [mailto:dirkv@groovedis.com]
    > Sent: Friday, June 16, 2000 1:20 PM
    > To: Elson Trinidad; angedella isafella
    > Cc: acid-jazz@ucsd.edu
    > Subject: RE: Labels
    >
    >
    > Elson,
    > That's just a little too simplistic. The production costs of a CD are
    maybe
    > $1.35 but that doesn't take into account artist royalties (and therefore
    > advances), recording costs (not including mastering which can is part of
    > $1.35 or so), mechanical royalties, promotion & marketing, label overhead
    > and admin costs and many other little assorted bills. And keep in mind the
    > usual cost of a CD to a distributor (in other words what the label
    charges)
    > is between $6.50 on the low end and about $8.00 on the very high end. The
    > money between that and what you at the store goes to distributors (and
    their
    > costs) and a much bigger slice to the retailer (and their costs). If
    labels
    > were to sell to you direct with no middlemen needed the cost could come
    down
    > to $7-8 tomorrow...
    >
    > FYI: I am not pro label, pro artist, pro major, or pro indie (I may be pro
    > distributor, but that's because I like being able to eat and pay my rent
    > :). I'm just pro good music. Period.
    >
    >
    > Dirk van den Heuvel (dirkv@groovedis.com)
    > Groove Distribution
    > http://www.groovedis.com
    > Your Guide To The Underground
    >
    > -----Original Message-----
    > From: Elson Trinidad [mailto:elson@westworld.com]
    > Sent: Friday, June 16, 2000 11:51 AM
    > To: angedella isafella
    > Cc: acid-jazz@ucsd.edu
    > Subject: Re: Labels
    >
    >
    >
    >
    > angedella isafella wrote:
    > >
    > > Dear list: I heard that labels rarely ever lose on a cd.
    >
    > Oh obviously. It costs like, what, $1.35 to produce a CD at cost, and they
    > sell
    > for $13-$18 retail?
    >
    > Plus, record companies who had albums pay for themselves many times over
    as
    > LPs
    > (i.e. any Beatles album, Pink Floyd's "Dark Side of the Moon," "Eagles'
    > Gretest
    > Hits" etc get even more profit as releasing them as CDs (and even more
    when
    > they
    > put out "limited edition digitally remastered" versions).
    >
    >
    >
    > - 30 -
    >
    > :. elson trinidad, los angeles, california, usa
    > :. elson@westworld.com
    > :. www.westworld.com/~elson
    >
    > [ the futurethnic beats of e:trinity - www.e-trinity.org ]
    >
    >
    >



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