Sony Music

No wonder the major record labels are in trouble

August 31, 2009: 8:00 AM ET

A look at music promotions exposes inefficiencies in the business

By Cliff Hunt, chairman, Yangaroo

Hunt: labels aren't embracing digital. Photo: Yangaroo

Hunt: labels aren't embracing digital. Photo: Yangaroo

Does anyone really understand how the record industry promotes new music to the public? If you knew, perhaps it would help you understand why the major record labels are in the trouble they are today.

A watermarked compact disc (the file is embedded with the individual's identification) is delivered from a mastering studio to a couple of key executives at the record label headquarters, most likely in New York or Los Angeles.

These CDs are then duplicated and again watermarked with the identities of additional key executives, and distributed to them in order to get their feedback on the album, and to begin the process of choosing the first single to be released to radio. This process takes time and money as these watermarked CDs are created at specialized labs.

These additional discs are then distributed, within the label headquarters and in many instances to regional promotion offices throughout the country, all by secure courier at significant expense. When a consensus is arrived at as to what should be the first single -- the one that the label will promote most heavily -- a release date is chosen, and literally thousands of promotional singles known in the business as "CD Pros" are pressed and readied for distribution to radio, press, consultants, concert promoters and other individuals that are influential within the music business. More

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