What are the key points you might want to consider when starting your new Music Business Enterprise?

In Unit 2 of the Managing a Music Business Enterprise course we dive deep into the kinds of research and analysis that you should consider in the early days of planning your new music business. Below, we offer a few pointers to get you thinking.

Having a clear idea of what area in the music business you want to go into and plenty of enthusiasm to drive that idea along is not a guarantee of success. Unless you do some planning and research you are taking the risk of not being informed about the business environment and your potential clients when you start your new business.

Perhaps you want to start a record label specialising in a particular genre of music. Do you have reliable data about what countries consume this genre more than any other?   What if you want to start a series of club nights at venues, are you reliably informed of what potential competitors are operating in the towns and cities that you want to operate in? If you just going on your feelings and instinct you might be heading towards problems.

Many people have gotten into planning or even several months into running their business only to discover market forces affecting their business that they did not know existed.

So here are some key points for you to consider based on Unit Two of the Managing a Music Business Enterprise course that we currently offer.

Discover What Makes You Unique: Maybe there are lots of labels who’s artists are performing the style of music that your artists are, but perhaps guest appearances on tracks from fellow label artists make your releases and label unique.

There might be a similar club night to the one you are planning down the road but do they have a VIP programme, or concierge service as good as yours?

(Hint: Mixing with other Music Business School students is a good way to discuss and test how unique your ideas really are.)

Know Your Market:  One thing that is certain about the music business today is that nothing is certain. You need to keep on top of the flow of information that arrives every day via various music business publications.

(Hint: Being a Music Business School Student, gives you discounted access to some of these key publications.)

Do the Research: You really can’t just go on your instincts. Chances are you only have enough funds and support to have one go at starting your new business.  There are no excuses in an age where all the information can be found easily via the various organisations who service the music trade.

(Hint: A number of these organisations send representatives along as our guest speakers – which is a great chance to get the info first hand and build your network.)

Unit 2 of Managing a Music Business Enterprise will help equip you with the knowledge that you need to engage in the preparatory work for starting a successful music business. It can also help you to understand the research that needs to be done for building a business case if you are seeking investment.

Our Students get an insight; & One of our guest speakers wins pitch!

An important part of building a music business is keeping up with developments on both technical and on-line horisons. Tech developments in Europe are moving at break neck pace so students enroled in the winter Managing a Music Business Enterprise course at Music Business School were pleased to be invited along to an event hosted by EMI Music called ‘techpitch 4.5′.

Music techpitch 4.5 is a regular event that brings together tech startups, investors and entrepreneurs for an evening of business idea pitching by startups and productive feedback from experts.

Students at Music Business School are regularly invited to music business events such as this and we generally find that students benifit greatly from the information gained as well as the music business networking opportunities. Not all events are staged every intake however there are usually opportunities each term for students to attend one or two similar events as an added benifit on each course.

One exciting aspect of this Music techpitch 4.5 event was that the winning ‘pitch’ was delivered by School guest presenter Denver from Music2Text. Music2text gives labels and artists the ability to sell or promote single tracks and ringtones direct to consumer with SMS.

So a big shout out and thanks to the team at techpitch 4.5 for having us along and to EMI Music for hosting the event and a huge congratulations to Music Business School presenter Denver for his pitc

Photos from Music techpitch 4.5 can be seen on our Facebook Page.

Links:

For information about attending other techpitch 4.5 events their website can be found at www.4pt5.co.uk

Denver and his amazing Music2Text service can be found at www.music2text.com

We take a quick look at planning for success in a new Music Business.

Before you start a record label, artist management organisation or putting on your own club nights there are two pieces of planning that you should undertake to help ensure your success.

Your Business Plan.

This document should give anyone who reads it a clear indication of what your music business does, how it does it and the time scale you have set to achieve some initial goals. For some people, writing your music business plan will actually help to refine your thinking about what you are setting out to achieve.

The more specific you can be the better. In the early days of running your business keeping focused on the tasks and when you need to achieve them will help you succeed. Referring back to a clear business plan can help keep you on track and not get distracted.

The other benefit of this plan is that it can help you to attract investment if getting financial support from others is part of your plan.  Any potential investor will want to see that you have clear goals in your sights. They will also want to see that you have a realistic idea of the costs of running the business until money starts coming in and how soon they can expect a return on their investment.

Company Structure.

Another essential part of your music business planning will be in regards to the legal structure that you are going to operate under.  Are you going to be a Sole Trader or a Registered  Company?

Becoming a sole trader is ideal for a small business that is just starting out. It’s a simple structure that only requires basic book keeping.  If your plan is to start small and grow your business this can be a good way to operate.

If however you are going to spend a reasonable amount of money and perhaps have legal agreements with artists, such as a record company might then perhaps you will require the protection that a Company registered at Companies House can offer.

However you need to allow time to investigate the options before you get going so you can make an informed decision and seek advice if you need to.

The music business is going through a lot of changes at present, so having a clear business plan is a great way to start you on the right path.

In Unit One of the Managing a Music Business Enterprise course, Music Business School tutors detail the structures, pre start-up planning and provide you with details from some of the music trade organisations that can help you as you grow your business.

Apart from selling your music at gigs and online via services such as iTunes there are a number of music business organisations that have been formed to generate revenue for the artist, manager and record label. Let’s take a very brief look at one of these organisations and what it does.

PRS for Music.

The PRS for music collect royalties on behalf of songwriters for either live performances of their songs or for production of copies of their songs. In the latter case here they do this via the MCPS but both these organisations now brand themselves under the PRS for music brand.

Every time you or someone else performs one of your songs in a licensed venue in the UK a royalty is generated. The PRS collects these and passes them onto the songwriter – if that songwriter is a member of the PRS that is.

The other instance we mentioned above is the production of copies of songs.  This refers to when a physical copy is produced such as with a CD or with a digital download. In this instance it’s the MCPS section of the PRS that collects the royalty.

The collection and distribution of these royalties is a little more complex that we are setting out here however the PRS have tremendous member services people and they can help you to understand how to collect what is owing to you.

Music Business School can help you understand this too!

Understanding all the ways you can make money from your music business is essential. As part of our new Managing a Music Business Enterprise course we now dedicate a section of the course the key revenue streams in the music business.

This unit looks at Copyright and the management of Rights and the organisations such as the PRS and the PPL who are dedicated to helping you manage those rights.

To apply for a place the next Managing a Music Business Enterprise course or to come in to the school and see if the MMBE is right for you, fill in our contact form and we’ll arrange either an interview or a visit to Music Business School.

Winter Class of Music Business School 2012 - London

Meet Our First Students studying to graduate the MMBE Music Business qualification.

It was a great day for us at Music Business School when our first group of students began classes for the new industry recognised MMBE Music Business qualification.  We’re sure you agree they look like a smart bunch and it was encouraging to find that so many of them are already either working in the music business or developing their own business plans. We’re confident that the information they are receiving as part of the course will support them as the begin to grow their music business plans.

Day One of the new year not only saw us teaching the new course but saw the return of our industry guest speaker programme. This week Dave Goggin from the PPL came along and informed us of the role that the PPL plays in the music business. Perhaps the PPL is one of the most important companies in the music business that you’ve never heard of.  Well Dave’s presentation fixed that for our students.

The current course was fully subscribed, however if you want to find out more about attending Music Business School London then now is the time to act.  We are now taking applications for the next course which commences on May 09 2012.  To find out about an interview and coming into the school to meet tutor Steve Melhuish to go the contact page and fill out the form.

We’ll also be introducing you to some of the students over the coming months so that you can hear first hand from them what they are getting from the course and where they are hoping to go in the music business. To keep up with this and other useful music business news subscribe to our newsletter via the subscribe form on the side of this page.

We look forward to meeting you soon.

Steve and the Music Business School Team.

In a post towards the end of last year we looked at the issue of how much artists are getting paid for their plays on Spotify.  However reading Jay Frank’s blog today confirmed what I have been thinking for some time.  That for new artists and their teams the strategy of being on Spotify should not actually be about the income.

Jay points to data that shows

In an iTunes world, the average person consumes music by, at most, 7 artists a month. In a Spotify world, the average person consumes music by, at least 40 artists a month.

With consumers listening to music by so many more artists per month and with much of that listening inspired by viral recommendations from friends the chance of discovery for new artists is so much more. As has been said on numerous occasions recently – for new artists the aim should not be how much money are you making from your sales but how much scale are you achieving? How many new fans are you adding to the tribe and how many friends are they bringing along.

The way Spotify is becoming an music discovery tool is a real opportunity for both new artists and promoters who book and promote new artists but tell us what you think.  Good or Bad, Friend or Foe? Which is Spotify?

Let us know your thoughts in the comments section here or over on our Facebook Page.

PS. Jay Frank might just be one of the smartest people in the music business.  His compelling blog FutureHit DNA is here and his blog post about Spotify is HERE.

Is this the end of the cover song on YouTube?

The big announcement this week for new and developing artists was that YouTube owner Google had purchased rights administration and payment company RightsFlow. However the news was hardly reported here in the UK on the usual unsigned artists networks.

Why is it significant? Industry pundits have been observing that earlier this year Google made commitments to music rights owners to do something about all those cover versions that new artists post on YouTube; or more particularly the fact that when they get posted the songs rights owner rarely gets compensated.

In the future, if things pan out as expected artists will pay a small fee by way of compensation to the owner of the published work – that is the songwriter.  This should be seen as a good thing in a business where declining incomes have become an issue and this new source of income will hopefully be seen as fair by all parties concerned.  However we expect some disquiet when the new and unsigned community realise they now need to pay for uploading those cover songs in the hope of attracting new fans.

But what do you think?  Are you happy to pay for the right to use someone’s song on YouTube? Are you a rights holder and do you think this will work?  Let us know what you think either here via the comments section or back on our Facebook page.

The full RightsFlow announcement is here and there is an excellent article by Matt Rosoff on Business Insider here. But don’t forget to come back and comment after reading.

Jon Webster – CEO at the MMF

The Music Managers Forum is the peak industry organisation representing artist managers in the UK and their CEO, Jon ‘Webbo’ Webster is one of the best known and best liked identities in the UK music business. We’re proud that Webbo is one of our brilliant guest speakers so we thought we’d take a moment to introduce you to him and the organisation he represents.

The MMF as it’s known is the largest representative organisation of featured artists managers in the world. The membership of the UK organisation has over 400 members who between them represent some of the most successful artists around today.  The MMF is in turn part of the International Music Managers Forum (IMMF) which is the co-ordinating organisation between the 17 MMF groups around the world.

Webbo’s CV includes devising the Now that’s What I Call Music brand, the is the founder of the Mercury Music Prize and in 1992 having left Virgin and working with Richard Branson set up his own company to work closely with Genesis, Peter Gabriel and UB 40.

Webbo’s Presentation.

His presentation at the London Music Business School brings real life examples about managing artists in an ever changing environment to life. it gives students an opportunity to ask questions directly of someone who has not only done so much himself but from someone who is working day to day with some of the UK’s leading artist managers.

Jon also talks through the Music Management Bible – a leading publication produced by the MMF and sought globally as one of the must have tomes of the music industry.  You find it listed on our Recomended Reading List.

Meeting key industry figures such as Webbo and our other guest speakers is just one of the benifits of attending the London Music Business School. To enquire about enroling in the next course intake send us a note via our Contact Page or if you’re ready to Apply Now for an Interview with Course Leader, Steve Meluish.

 The Business tops our list of must read books.

Anne Harrison’s book has been the go-to resource for people new to the music industry for some time.  Now in its 5th Edition the book covers all the essential topics. One of the prime reasons that Music: The Business continues to top our list of must have books is that it is written about the UK music business. Whilst some of the best music business books in the world come from across the pond, having such a comprehensive reference book written about the UK legislative environment is a blessing.

To give you an idea of exactly what the book is about look no further than its sub title, The Essential Guide to the Law and the Deals. Chapters within the book cover information on things like, Putting together your team and Finding a Lawyer; What is in a management contract; What is a good record deal and much more.  Too much in fact for us to list here.

Reviews from across the industry have praised Harrison’s book with The Daily Mirror calling this ” The most comprehensive and accessible guide to the workings of the British music industry.”

Need we say more?

There are e Book options for those of you who have the latest devices however at the time of writing the newest 5th edition, published July 2011 hard back is the only current option.

For a copy of the full London Music Business School – Recommended Reading list please have a look HERE.

If there are any music business books that you have enjoyed or thought useful get involved in the conversation over on our Facebook page and let everyone know about them.

No matter what segment of the music business you are considering entering, the income that artists receive from all sources will affect you in one way or another. Knowing the ins and outs of sometimes complex revenue issues is really important in a time when collecting every penny counts.

This issue was highlighted recently when artist Jon Hopkins recently tweeted – “Got paid £8 for 90,000 plays. F**k Spotify! There have been numerous stories around artists receiving little income in return for a high number of plays on digital platforms at they become ever more popular.

However consider the response to this situation from MMF member and independent manager Erik Nielson who looks after the business interests of UK act, A Genuine Freakshow.  He recently told Music Ally – “I saw the Spotify row starting, so went into my sales figures for A Genuine Freakshow for October 2011. In short, we got paid £7.29 for 1,923 plays,” he says. “This is based on £10.24 gross income minus 85p mechanicals, minus £2.10 PIAS distribution fees. And this is based on worldwide Spotify plays.”

Erik’s act is self-released and it would seem is doing a lot better for it. However it raises all sorts of questions that you might need to answer for yourself when you enter the music business.

Is £7.29 a fair income in return for 1,923 plays of a song?

Do you understand how to track this revenue and how to ensure you receive revenue from all sources?

Tell us what you think about this issue. You can make comments below or back on our Facebook page.

Also if you want to ask any questions that relate to this topic ask them here and we’ll answer them on our Facebook page.