Business models in today's music business that work?

[HeadCrusher]

1. Run a small studio with quality gear (Good prize/performance ratio is important! Go to rehab if you have GAS!) and record young/local bands for reasonable prizes while maintaining good quality with your recordings. With EUR ~150 a day one could (realistically) make something between 15k and 24k a year in net income.
2. Be in a band that caters to a passionate underground audience, does most things DIY (in order to cut out the middle men), tours constantly and sells records (Vinyl?) and merchandise to hardcore fans.

Keep 'em coming! Curious to see how long a list we can get these days...
It only counts if there's money left at the end of the day! Sure, recording an album just because you are passionate about your music is a model but not a business model in the sense that I'd like to discuss here.

 

[Genius Gone Insane]

3. Get a real job and keep AE as a hobby.

 

[Jarkko Mattheiszen]

I have been wrestling with the idea of opening a commercial studio for the past two or three years now, checking out potential buildings, writing down different kinds of business plans, calculating possible expenses and income, discussing loans and funding with banks, talking to people who have been in the business for a while and so on, and I'm slowly coming to the conclusion that going that route with loaned money and/or risk funding is a total financial and mental suicide. I have been to several decent studios that are struggling to stay alive, and honestly, I'm pretty sure they are going under in a matter of years unless things will change drastically and fast. Perhaps I'm being cynical, and I'm sure this varies on a regional level, but that's all based on quite extensive personal research.

I have to choose between going full-time or finding a job in some other field of work in the beginning of June, and from my experience I feel the most risk-free and manageable solution is to concentrate on running a small mixing and mastering studio while picking up freelance engineering gigs at commercial facilities when possible. Minimal overhead, large potential customer base and being able to keep rather reasonable rates are things that make that solution feel like a pretty decent deal to me.

I'm sure the DIY-trend will lose it's appeal in time, and it's totally possible that I will change my opinion in the future, but right now I think the keywords of being a full-time AE are "minimal overhead" and "versatibility."

 

[Torniojaws]

There is no money in music nowadays, it seems. I've seen it from many viewpoints: musician, engineer/recorder, songwriter, guitar teacher, etc.This is the reason why I only keep it as a hobby, alongside my (mostly) unrelated day job. This way I can just enjoy the fun parts of music, without any of the pressure.

 

[Jarkko Mattheiszen]

There is no money in music nowadays, it seems. I've seen it from many viewpoints: musician, engineer/recorder, songwriter, guitar teacher, etc.This is the reason why I only keep it as a hobby, alongside my (mostly) unrelated day job. This way I can just enjoy the fun parts of music, without any of the pressure.

I still think this is BS I know lots of AE's on a personal level who are making a decent living out of it, it's just that none of them operates a large commercial studio.

 

[colonel kurtz]

4. sell drugs, use money as front to keep studio afloat. record lots of stoner bands, and watch the $$ roll in...

 

[HeadCrusher]

Jarkko, I think I'd have a fairly decent plan for a studio with some cool Advertising/Marketing to get potential clients in. I think it could earn me a living and even justify a loan. But just out of regional restrictions potential clients would be semi-pros at best. As a result I'd probably be stuck in the "3 things you hate about being an AE"-thread.

Torniojaws, I believe there is money in Songwriting. It definitely is. It's just very difficult to get to the point where you can get some from being a Songwriter.

 

[Jarkko Mattheiszen]

Jarkko, I think I'd have a fairly decent plan for a studio with some cool Advertising/Marketing to get potential clients in. I think it could earn me a living and even justify a loan. But just out of regional restrictions potential clients would be semi-pros at best. As a result I'd probably be stuck in the "3 things you hate about being an AE"-thread.

Unfortunately, one of the things I have most often been told is "Advertising doesn't mean shit in this business, it's all word of mouth."

But seriously, don't let me discourage you, that's absolutely not my intention. As I said, this might vary greatly depending on the location, and I might even be completely wrong here

What ever you do, go over the business plan with an experience economics professional, banks and financer over and over again if you're going to pull the trigger.

 

[Mago]

I believe there is money in Songwriting. It definitely is.

For sure, you just have to write the most shitty songs for people who don't know fuck about music. Look at Mr.Bohlen for example, or all the Schlagerfutzis

The guy I know who makes the most money out of music and a REALLY decent living out if it does 2 things:
1) Teach instruments during the week
&
2) "Plays" in a partyband who do weddings, bierfesteln ect on weekends...those guys make BIG money, holy fuck. sometimes they are on half-playback, sometimes even full. No one of the drunk bastards gives a fuck, and each band member gets like more than 4x as much money as my whole band when we play a local gig. that's life...they dont even have rehearsals as far as I remember

Christoph, wo würdest du dein Studio aufmachen? Würd in dem Fall sicher mal gerne runterschaun wenns geht

 

[HeadCrusher]

Well, actually I'm going to finish my Master in Business economics this year...
You're right, word of mouth is far more powerful than advertising. In fact I shouldn't have put the word "advertising" in there since it's likely to be misunderstood. Newspaper ads and such are hardly what I meant. And Marketing isn't exactly advertising either...

Anyway, I don't think I will pull the trigger since as I posted earlier there isn't hardly anyone worth recording around here and I don't really see myself producing High School kids for the next 40 years. All I said is that I'm pretty sure that I'd be able to pull a solid number of clients but that doesn't necesarily say anything about their level of professionalism or that I'm going to actually do it.


So... we are at 4 (3 if we want to keep it legal )... Anyone else?

 

[HeadCrusher]

Marco, sorry, seems like we were posting at the same time (my above post was directed to Jarkko). Well, IF I were to do it it would be in Graz but as I said above it's most likely not going to happen.
Been toying with the idea of moving to a bigger city to record more serious bands there but then again: The bigger the City the more studios it has... And there's already at least 15-20 Studios in this small town that I could name from the top of my head.

 

[HeadCrusher]

Oh and about Songwriting: I actually don't mind doing commercial Pop music. Well, the Bohlen stuff sucks hard but for example there's nothing wrong with Katy Perry tunes or something of that sort. Still it's anything but easy getting to the point where an established artist will sing your songs...

 

[Genius Gone Insane]

4. sell drugs, use money as front to keep studio afloat. record lots of stoner bands, and watch the $$ roll in...

So true. Viable!

 

[DanLights]

as regards my band, I´m planning to go the Trent Reznor way, following the tips he gave on a post that was linked in this forum not long ago. Record album for cheap but Good (I have enough confidence in my mixing skills to believe it will be good), give it out for free download, and a short time later when everyone has it and has heard it, sell physical copies but with some added value, like extended booklet (kickass artwork always helps), bonus tracks (I´m thinking some well thought out covers and probably wellrecorded live tracks of the songs from the previous demo), special edition (digipack, different type of packaging, maybe even Vinyl if there is demand) and obviously sell merch as well.

I have hope that it could turn out decently well with that method, and if it doesn´t well the initial investment will be minimal anyways I guess

 

[Revson]

Well the problem is you can't just record bands if you want to make money. You should get a great vocal room so you can do voice-over work for commercials or videos or even video games. There's a lot more money in that if you can get hooked up with it. You need to make your studio a fully capable post-production house. Hell, I had a friend who got hooked up with some doctor that simply needed audio edited. The doc would have seminars recorded, send him the audio files, and my buddy would do clean up work. He billed out $18k doing that last year from the one client on top of having a 9-5 job.

Yes, recording bands is a lot of fun, but choosing between having fun and eating on the regular isn't that difficult of a choice. Now I'm not saying anyone should give up on working with music, but rather find ways to augment your income so you can keep on working with music.

 

[Loren Littlejohn]

Keeping your overhead as low as absolutely possible.

 

[sprack]

5) Release broken software. Charge $250 every 18mo for bugfixes.

 

[Nebulous]

I have been wrestling with the idea of opening a commercial studio for the past two or three years now, checking out potential buildings, writing down different kinds of business plans, calculating possible expenses and income, discussing loans and funding with banks, talking to people who have been in the business for a while and so on, and I'm slowly coming to the conclusion that going that route with loaned money and/or risk funding is a total financial and mental suicide. I have been to several decent studios that are struggling to stay alive, and honestly, I'm pretty sure they are going under in a matter of years unless things will change drastically and fast. Perhaps I'm being cynical, and I'm sure this varies on a regional level, but that's all based on quite extensive personal research.

I have to choose between going full-time or finding a job in some other field of work in the beginning of June, and from my experience I feel the most risk-free and manageable solution is to concentrate on running a small mixing and mastering studio while picking up freelance engineering gigs at commercial facilities when possible. Minimal overhead, large potential customer base and being able to keep rather reasonable rates are things that make that solution feel like a pretty decent deal to me.

I'm sure the DIY-trend will lose it's appeal in time, and it's totally possible that I will change my opinion in the future, but right now I think the keywords of being a full-time AE are "minimal overhead" and "versatibility."

If you want to keep your overheads low and make some money, why not try to organisemore clients to record at the existing studios which have all the equipment you require, then mix at home or at the studio if funds allow it?

I see that being the only way these studios will keep afloat- freelance engineers bringing them work.
There's no point opening another studio and saturating the market untill the clients realise the importance of them again IMHO.

 

[amarshism]

1. Run a small studio with quality gear (Good prize/performance ratio is important! Go to rehab if you have GAS!) and record young/local bands for reasonable prizes while maintaining good quality with your recordings. With EUR ~150 a day one could (realistically) make something between 15k and 24k a year in net income.
2. Be in a band that caters to a passionate underground audience, does most things DIY (in order to cut out the middle men), tours constantly and sells records (Vinyl?) and merchandise to hardcore fans.

Keep 'em coming! Curious to see how long a list we can get these days...
It only counts if there's money left at the end of the day! Sure, recording an album just because you are passionate about your music is a model but not a business model in the sense that I'd like to discuss here.

The trick is to combine the two. I by no means am one of the elite AEs on this board but being well networked and having a fantastic reputation nationally from the band scene certainly helps bring in work.

 

[Erik Monsonis]

I'd say run a small mixing/mastering studio and freelance in already existing studios as engineer for your clients.