1) Educational Materials: Some sort of presentation or booklet highlighting the important differences between a contract with your "Un-Label" versus a more traditional label such as Warner or EMI. Points to bring up would be the same you already listed:

• Artists always retain ownership of their work.
• Artists get worldwide distribution with transparent accounting.
• Artists get a dedicated partner with aligned incentives.

Also make sure you very clearly state the profit sharing aspect of the plan: "For the financing of albums, an artist will sign a temporary exclusive license to his/her music in exchange for initial funding (if necessary) and a share of revenues from tours, shows, physical and digital sales, merchandising, etc." This temporary exclusive license is a bit confusing. How long is temporary? What does the exclusive license entail? Is it purely distribution rights, or does it cover performances and so on? Is it distribution via a specific medium (CDs, mp3, iTunes, etc)? Furthermore, what is the 'share of revenues from tours [...] etc.'? Are the profits split 50/50, 70/30? Who gets how much of the profit? That is a pretty big deal that as an artist I would want to be clearly highlighted.

2) If I were a musician this proposition would be intriguing. I would want the questions above answered first. I want to know how long the exclusive license lasts and exactly what that exclusive license covers. I would also want to know the profit sharing ratio. If I was considering signing I would not like the look of a 70/30 profit sharing if the artist is getting 30% and the 'Un-label' 70%. I think a 50/50 ratio could be possible, but for greatest chance of success with artists I would make sure that they keep most of the profits. After all, it is their product that is fueling the business to begin with.

3) Most attractive portion: Maintaining copyright over created works. Potential to become very attractive: Profit sharing ratios. Least attractive portion: No clear definitions yet on the exclusive licensing or profit sharing ratios.

4) Similar businesses: Venture Capitalist/Marketing Firm. It seems like the benefit you could bring to artists is up-front capital with marketing expertise. You give the artist some money and equipment to produce music and then help the artist learn how to market themselves and break into new markets. So it seems to be a mix-mash of businesses. If you clear up some of the issues I have raised I think you will have potential to be very successful.

5) Partnerships or collaborations: Try partnering with concert venues. Maybe you have some venues across the nation that you partner with when booking tours for your artists that you will go to that venue first in the given area to book shows and they give you some sort of discount. Something else I have seen work well is having newer/younger artists on your label open for the more established acts. I have found out about a few excellent musicians on the same label as the headliner who I now follow closely. The key to this, however, is make sure the music is similar enough it will still garner the interest of the fans of the headliner. Don't pair two acts when they are on totally different ends of the musical spectrum, you are just setting the lesser-known act up for failure. Also, look to collaborate with other types of artists. I am a fire performer, and I like to do shows to live music. The audience seems to enjoy the show much more, I enjoy performing more because I have a band right there who we can feed off of eachothers energy. Look to collaborate with fire performers, painters, dancers, body painters etc. Anything that will add a new quirk to the show.

For the non-professional musician or layperson reader here at this site, you need to immediately go read the following record contract stories to understand the level of disillusionment artists have with the label experience. 

To Cybearsonic: you need to explain to your intended audience exactly how your new model is going to prevent these types of situations.

Some of the language is harsh, but that's what it takes to tell the story:

http://www.negativland.com/albini.html

http://www.jestertunes.com/2006/ 08/22/the-record-contract-part-i-the-audition/

As a musician, I embrace and appreciate the spirit of what you are trying to do.  However, there are many things you could do that would really help artists and musicians most of all that have less to do with your core plan and more to do with communication and options.

First, what you are doing is exactly what a label is, so calling it an 'un-label' is just confusing.  What you really are is a label with a focus on low overhead, creativity, freedom, and independence.

Next, the one thing that big labels don't do is spell out their contracts openly with everyone. I encourage you to post the exact legal text of your contracts for everyone to see. Spell out the concert liabilities and waivers, spell out how exactly you intend to finance the artist's projects, and spell out where exactly the money is coming from/going to.  Spell out where you are advertising, give us all the info that you can.  For musicians to enjoy creative freedom, they need to know exactly what you are or aren't doing.

Your key points are attractive; however, my first reaction is to be incredibly, incredibly skeptical of how you intend to support me creatively (for example, I don't believe that you can deliver on anything you're claiming).  I currently have an album that requires some self-production and mastering.  I know what the cost will be already.  If I don't intend to do any touring, how can your model help me to pay for my albums?  Would you be taking a cut of the sales?  What if it doesn't sell, do I owe you the money?  That's how most labels work.  Do you own the work until you make back the money?  What is the incentive for you to help me finish my project? 

Of course there are similar businesses, for example, every label in the world is the same as this.  What you are describing is no different than a traditional record deal.  In fact, I would argue that most bad deals start out sounding exactly like this, but magically by the time the deal is in front of the artist, the terms are such that loopholes allow the label to own the music.  How does this happen?  Easy, the artist doesn't sell enough to recoup the costs, and so the label reposesses the music.  Magically after they own the music, the music starts selling like crazy.  Hmmm.... conflict of interest? 

Could labels squash promotion in order to force artists to hand over the work, then start to promote like crazy once the labels own the work and can actually turn a profit instead of handing over the money to the artists?  I think so, and I wouldn't put it past you to do the same thing.  If you swear you're not going to do this, fine, but spell that out somehow and please explain how you intend to spare the artist the losses when the artist can't sell records for some reason. 

You should partner with iTunes and similar services, and provide a direct track for artists to sell there.  If you really want to make some cash, allow artists to sell any old junk on itunes, and then rotate out the spots based on who's selling the fastest, and use no other promotion.  That puts the pressure on artists to do their own shows and to promote their own work, since the more sales they get on your label's iTunes site, the more exposure their record gets via your sales-based ranking on iTunes.

It still doesnt explain this one equation: if my production costs < my sales, who pays for that? Me or you?  And how long is that debt allowed to exist before you collect?  Some bands take off after a few years of a release, rather than in the first week of the release.  If you really wanted to be an un-label, you would grant artists sinecures to produce their music... but I know you're not just going to give away money.  Or are you?

I would still recommend that any artist signing any deal with this company to get your own legal representation that works for YOU.  You need to be sure that even though the company lawyer says the deal has no loopholes, your lawyer agrees with that.  I can guarantee you that your lawyer will come up with riders that the label will want to reject and there you go, you're started off in your first recording contract dispute!  YAY!

For an example of how simple your contracts should be, and how they should be made without loopholes, and for another endorsement of getting your own legal representation, see this article:

http://www.musicbizacademy.com/articles/kh_contracts.htm

I think the basic premise needs examination.

True, sometimes an "artist" has a single hit, which is never repeated. If the goal of the artist is wealth, and art is merely a vehicle, then iron-clad ownership is a must. I would therefore argue that if the "artist" knows (s)he has no talent, but might be able to make a figurative "hole-in-one", then the basic premise is right.

If, on the other hand, the "artist" has talent (staying power, whatever) then why would a vise-grip on ownership matter? Like all sustainable businesses, the artist may want to donate some of his/her works to the public (and hope that the public cares). If the desire for more of the same shows up, so will the money.

I recently found cases where authors gave away copies of their books - in one case, the book was awful, and the gift was wasted. In another case, I enjoyed the book so much that I was quite ready to do <whatever> to get a follow on book!

Treating "artistic" property as being somehow different from "mere" property is, IMO, a little on the side of stupidity. You are offering a product, which may generate no money, a little money, or a lot of money. In most cases, if you attention is solely on the money, as the premise above suggests, your product is not worth much.

I like being a patent attorney, and my work is good enough that I consider much of it to be pure art (and the kind of art envisioned by the founding fathers; I do only small entity patenting, a "whole 'nother thing" from "conventional" (ripoff) patenting. I sometimes give my art away for free - so what?

• What kind of educational materials need to be created to help this business compete with the more traditional recording contracts? 

Number one, as a credible service, you cannot rely on Google Translate to be the way you communicate with potential clients that speak English.  That goes for your website and presentation (which someone should mention has a number of misspellings and difficult to understand diagrams).  Maybe I'm missing something in the translation.

As kayetech and Devin Moore noted above, your site and presentation need to spell out the details of the kinds of contracts and deals you would like to offer to artists.  I would imagine that being vague like you are currently does not pass the "smell test" for interested artists, and hurts your credibility -- despite the seemingly unique contracts you intend to offer.

Why not display sample contracts and explain how they might fit "Artist X's" needs depending on the circumstance?  Make it easy for artists to compare your simple contract to a complex "major" contract.  It also helps to highlight how your service is different.

• If you were an artist, how does this proposition sound to you? 

As I noted above, I believe that your service may sound appealing in text, but when you actually visit the website and see your presentation, your credibility falters.  If the English speaking market is one you're appealing to, you need a native English speaker, and one who can spell.  Also, the presentation should be simple and diagrams should be easy to understand foremost -- 3D graphics are secondary (and 3D graphics that are difficult to understand should be removed).

• What are the most attractive portions of this plan for musicians?  What are the least attractive parts of this concept?  

The first two bullet points are attractive, I would think, to artists.  However, they need meat on their bones.  What is the $ split and for what kind of services? How long is the exclusivity (in my opinion it should be no more than five years).  What does transparent accounting entail when an artist doesn't know how much of the cut they're getting?

As far as a "dedicated partner," you have to be able to show your history on this and show examples.  If you're starting from scratch and have no track record, this is going to be a difficult sell for artists.  You're going to have to be precise as to how you plan to serve and sell new artists.  Talk about the strategies you plan to implement to connect artists with fans.

Perhaps you want to focus on a kind of artist -- newer artists that do not already have a following or knowledge of "how the business works."  Perhaps you want to focus on a specific genre of music? Or locale?  I think your services could use some more focus and specifics.

• Have you heard of similar businesses?  How do you think similar businesses are doing? 

Beyond the first bullet, don't most labels claim to do what you are claiming here?  I don't think labels say that they are being opaque about accounting, and they also say they're dedicated to the artist.  Without being specific, you're not doing a credible job of distinguishing yourself from other labels.  Big ideas aren't enough, the devil is in the details.  Artists that have been around for even a short time know when things are not right.

I believe that there are small record labels that allow artists to retain their copyright in their works, as well.  Perhaps these services are more talent management than they are labels, but regardless, they're both middle men.

• Are there services that exist that could improve this business?  Can you think of potentially good partnerships or collaborations?

Yes.  For the performance side of things, you should partner with:

Band Metrics and Bands in Town.  The reasons should be self-evident by the services these sites provide to artists.  For those artists that would rather someone else work out the details of listener metrics and the next concert venue, using tools like these should help your service be data-driven and help you to know the viability of your artists as well.  

The smaller your artists are, you may want to experiment with fan engagement using Kickstarter, as it's a tool that not only provides artists with revenue, but also can help them find a dedicated (and paying) following.

Of course, to keep with the common mission of those that bring you this Insight Community, you should work with artists and others to develop scarce goods and one-off performances, a la "Connect with Fans (CwF) and give them a Reason to Buy (RtB). CwF+RtB=$$$"

Good luck!

While the presentation begins by acknowledging today's disruptive technologies, I don't see a clear plan to help artists leverage them in a positive way.

Your label has an important role for artists in that you can provide them with the initial funding necessary to make a recording. From there, the focus needs to be not on selling that recording but on distributing it. Creating the new work and recording it is valuable, but digital copies of that work are infinitely reproducible and cost nothing to create. Yet the potential audience that can be reached by spreading those files far and wide is powerful.

After helping a new artist make a recording, a label with a good grasp of the online music community could have lossless-quality files rapidly distributed around the world. If you begin to build up a reputation for distrubting quality files and artists it would be a powerful way to bring fans to each new artist who works with you.

I think it's fundemental to understand that monetary income is going to come from areas other than selling physical or digital copies of the recording; rather, the recording once made is largely a promotional vehicle. As a label, you could build up a knowledgebase of what kinds of promotions and items make fans want to spend money on an artist, be it signed album covers, exclusive time playing an online game together, or lunch dates. Seed those files far and wide, and make sure that incoming fans have ways to spend money on unique items or experiences.

A label/artist combination that understands the power of freely sharing files and building a reputation as an organization that releases quality music from talented artists stands to win big.

most artists want the freedom over their music that is not for the record company to say dont think we need a guitar on this track and remove it the artist wants the riht to say what is used on his/her track. the artist should have final say as too final production.

their is a exception to the royalties going to the artist where costs of production raise to a high leval most artists would agree to the company taking a short and agreed amount of no more than 50% of royalities for a period not exceeding one year after that all rights return to the artist. I am thinking here of a 40 piece orchestra being used on a album.

The “un-label” is right in that they attempt to put the artist first and allow them more independence. After all, when you sign a record deal, chances are you’re signing your life away. Unfortunately in order for an “un-label” to work, it needs to be run by an extremely rich and extremely altruistic bunch as there are several problems from a business perspective and from an artist perspective.

1)    The “un-label” is essentially the same as the current record label structure only with less opportunity for profit. Let us not forget that a band is essentially a business, and like any other business it takes a long time to turn a profit. The “temporary exclusive licensing agreement” is suggested (in the original article) to last 18 months. The idea that this is enough time to break an artist is optimistic at best. Should the licensing agreement run out after 18 months and the band hasn’t recouped their initial expenses, what happens? Does the investor take a loss while the artist walks away with their masters? If yes, then this is an unwise business plan, as it requires unrealistically quick profit turning in an extremely difficult and competitive industry, without a chance to capitalize on future successes. Does the investor keep the masters until the debt is repaid? If so, it is still a bad business plan as the band, taking advantage of their freedom from the temporary agreement will move on to new investors and a new album, leaving the original “un-label” holding the bag on an album that will no longer be promoted by the artist. The original investor also holds no potential to capitalize on a more successful second album, and considering all the work they put into funding and promoting the artist’s debut, why should they let a new investor piggyback off their previous efforts? The bottom line here is that the earning potential for the investor is limited at best and extremely unlikely and non-existent at worst.

2)    The “un-label” is supposed to include management and publicity in-house in order to “avoid multiple management teams.” From an artist’s perspective, this is generally not a preferred method. The major roles of management are to be a liaison with label executives to ensure fair treatment of the artist, objective decision-making, career advice, and streamlining communications between the artist and its professional team. When the management works for the label, its motivations are no longer in line with what is best for the artist, as it is beholden to the label and the maximizing of its profits. Similarly, having an outside publicist is preferred as it allows for better chances of fair treatment within a stable of artists. In-house publicists are more likely to devote attention to the larger acts on the label rather than evenly distribute that attention among all artists because, once again, their incentives now lie with maximizing label profits.

3)    The artist is required to participate in a 360 deal under the “un-label.” This assumes that artists actually make money on the road. As a former touring artist without a 360 deal, signed to a successful label, with well-connected management and a booking agent, this is really a difficult proposition. By my estimates, in order for each member of a 5 person band to make a lower middle class income ($32,500-$60,000 individually), the band needs to gross $500,000 a year. This figure factors in a 10% booking agent fee, 12.5% management fee, merchandising expenses, van/bus purchase/rental/maintenance, equipment, living expenses, etc. This figure does not include the impact of a 360 deal, which would obviously increase the required income. 360 deals really only work for bands that experience significant successes, and with the “un-label” this success has to be achieved within 18 months in order for the investor to capitalize on their investment.

4)    Lastly, the main problem with the “un-label” is that it doesn’t address the fact that the industry is in shambles because no one is buying CDs and the majors won’t adapt to changing technologies. The music industry will never be what it was and sales will continue to decline until we figure out a new business model. The “un-label” is a valiant attempt, but all it really does is limit the benefits of labels, while providing a few perks for bands, but also some new detriments.

Re: Bullet #1 "What kind of educational materials need to be created to help this business compete with the more traditional recording contracts?"

Education is key here.  My experience with musicians has shown that most artists have barely an inkling of contract intricacies and let alone revenue splits and the various licensing and royalty arrangements.  In this day and age of the social web, an education arm in the form of a wiki or blog to inspire conversation and continuing self-education is important not only for prospective artists but as a hub for community interaction.  This all points back to transparency.

As for recording contracts, it would be interesting to see whether the movement for standard/boilerplate VC term sheets can be equally applied to recording contracts in this situation.  Fred Wilson, Chris Dixon, and Paul Graham of Y-Combinator, among others have been examining this approach for VC term sheets, which may prove to be an interesting test case:
http://www.avc.com/a_vc/2009/08/the-ideal-first-round-term-sheet.html
http:/ /www.cdixon.org/?p=271

In terms of transparency and education, I would like to see either a boilerplate contract, or even a sample contract, posted online wiki-style with each section of the contract displayed in legalese AND deconstructed in plain English either in footnote-fashion or wiki discussion-style.

Re:  Bullet #4 "Have you heard of similar businesses? How do you think similar businesses are doing?"
The closest model to this is the "artist-as-start-up" model of Polyphonic, started by Terry McBride (Nettwerk Music & Management), Brian Message (Radiohead manager) and Adam Driscoll (MAMA Group).  While all agree the Polyphonic model is innovative, others are more skeptical about its viability -- indeed, David Pakman, former eMusic CEO and now partner at VC firm Venrock, has an excellent post that crunches the numbers like any good venture capitalist would to measure the potential upside and downside of prospective investments:
http://dpakman.wordpress.com/2009/07/22/a-new-music-model-perhaps-bu t-not-for-vcs/

For further links about Polyphonic, I rounded up a few links that I posted here:
http://allenlouison.blogspot.com/2009/07/artist-as-start-up-diy-bootstrappi ng.html

Overall, the scale, scope and vision of the venture will dictate the financial viability.  At the risk of sounding a bit callous by quantifying an artist's creative work in terms of accounting and investment terms:

• What level of artist yields the most favorable ROI?  Targeting the mainstream pop star for maximum input of resources and large returns or mid-level indie artists who need less resources inputted into their career, but creates modest, yet positive returns.
• What spectrum and scale of artist support/services will the venture provide?  The old "recorded" music revenue model is broken which means that artists need to maximize the diversity of their revenue streams.  This, in turn, means those tasked with managing or developing the artist's career will be pursuing more and more opportunities which can be a huge time investment.  It can be a full-plate for the firm just to manage music and touring-based services, not to mention pursuing traditional and non-traditional publishing/licensing opportunities, sponsorship deals, etc. 

This lends itself to strategic partnerships alluded to in bullet #5 which also has trade-offs between potential revenue increases vs unfavorable dilutions of the revenue stream.  In this respect, partnerships in niche specialties will be vital: branding/advertising agencies, booking agencies & labels with expanded artist services (re: William Morris Agency, EMI Music Services), music placement services (publishers, music supervisors, video game placements, etc).

(On a side note, for those of us in the states, and particularly California, there are laws in place that prevent entities from operating as both management and label to the same artist which could put a kink into any firm looking to provide a full-service outfit for artists.)

I was both surprised and increasingly excited as I read this. I am a musician following an extremely similar path to the one you describe. I cannot provide much hindsight because I am in the post-first-album/pre-first-tour stage, but I can share both the good and the bad of what I experience with this kind of support.

I am officially signed to the independent record label Traveling Dog Records. The company is owned by my father, who does not rely on it as a sole source of income (although he does not rule out the possibility that he may someday). The absolute most important quality an artist needs with the people they work with is a sense of implicit trust. I trust my father as a business-person and I trust him as a person, and while some of that is circumstantial of my being his daughter, a lot of it comes from effective communication. I also have faith in my record producer and my musicians, and I would have very different work if I didn't. Conversely, they need to have the same level of trust in me, as you will need with your artists. They know my level of commitment and work and quality of music I will make, which is essential for any working relationship, but even more so in the music business.

The most effective way to draw artists to this kind of plan is to understand and internalize that trust is the most important issue. Immediately you are offering an alternative to the biggest reason why musicians are wary of record contracts. Why are you interested in doing this? Why is the artist interested in doing this? You need to have an honest conversation about those questions with anyone you potentially work with. Talent is a prerequisite, but passion and commitment will get you both farther than anything else can. As far as educational materials go, the choices are limitless as long as you are effectively relaying this message.

I am incredibly lucky to be able to start my career this way (I'm 21). Background information: I am a piano-rock singer/songwriter with the ideal of success being a life of writing, recording and touring concert venues (i.e. not bars and not stadiums). However, obviously, I needed money to record my first album, a lot of money that I didn't (and still don't!) have. This is where lengthy conversations between my parents, my producer (of various demos and one EP of mine) a lawyer, and countless helpful others ensued. What was the best way to go about this? No doubt we wanted a fully produced album with the highest quality we could reasonably afford. Should I use a demo and shop around for a small label's interest? A big label's interest? Or should we try to finance it independently? Ultimately this is what we went with for two reasons: one, because my dad's main business (construction) was doing well enough that he could make a significant financial investment. Two, as you already mentioned, I would retain ownership of all my work (incredibly important), and any professional or legal actions would remain our decision. Again, this is why trust is the most important issue. I am a signed artist which legally limits my freedom, but in reality it gives me freedom as a creative artist and protection as a business entity. So, Traveling Dog Records funded the making of my first album, going in the hole about $16,000 when all was said and done and we had 1500 copies stacked in boxes. We take a 50/50 split on everything until the losses are recouped, then switch to 80/20. TDR also funds the rental fees for mid-level clubs because of a shared belief that my music would not work great as a background bar band, but has very good potential to reach people who are there for the music. We have made significant profits doing the live shows this way, but it's something I would not be able to do alone because of the financial risk.

Promotion is something that I am deeply involved in, yet, again, could not keep up alone at the level that I can with TDR's support. They cover costs, finalize designs, share the workload of necessary communication with business related issues (venue bookings, interview set ups, etc...) and physically produce what we decide is needed (press kits, press releases, business cards).

As I have implied, this plan works very well for me, and I think I've highlighted the many reasons why that is so. There are definitely a couple of drawbacks though. The main issue is that, just like me, Traveling Dog Records is an independent unknown in the business. We don't have relationships established with label reps, radio promoters, radio stations, booking agents, etc like a larger label does. In a business that's becomes nearly incestuous the higher up you go, networking is so important and we are definitely at a disadvantage. I have found that this means that "big" things do not happen fast. For example, it takes much longer and we have to work much harder to get an email to the guy who could already be working on my behalf if I was on a larger label. It takes a lot of patience and a lot of optimism to work this way. You may find that some artists don't want to do that. And although there is rarely a choice in struggling as an artist, some may still want to chase the dream of someone else doing most the leg work for them in all non-creative aspects.

I may just be speaking from my own experience, but I think you would do best with new artists who are very serious about building a career. A short contract time (either by months or by albums) is advisable for all parties involved. If an artist becomes fairly successful, they may need to move to a label that can provide more distribution or has more money to work with and they will want the freedom to do that. At the same time, you will have to consider a buyout clause, whether it be fixed from the beginning or determined if and when negotiations are needed.

I hope this is helpful in giving you a musician's perspective. Like I've said, this plan works great for me and it has piqued the curiosity of many others I've worked with. If you'd like to talk more then feel free to shoot an email over to travelingdogrecords@gmail.com or itspronounceddobro@gmail.com. Good luck!

Lucciana

I'm responding to this because it's a subject I find immensely interesting (of course), but as an employee of Floor64, I'm obviously ineligible for the award.

I of course love the concept of an artist-centered record label.  I think that a big part of the problem with the overall music ecosystem today is how far from an artist-centric approach it has taken.  While (tragically) the media and politicians often look to the record labels to "represent" the artists, as most artists will tell you, the record labels have often gone out of their way to not represent the artists' best interests.  This isn't entirely surprising -- as the management of those labels (especially as they got bigger) viewed artists as a cog in their hit making factory, not as individuals.  And, thus, their incredibly short-sighted goal was to squeeze more profits out of each artist at a lower cost.  The end result were ridiculous contracts that bordered on indentured servitude, dodgy accounting whereby some of the biggest selling artists never seemed to see any money from album sales, and the odd situation whereby the labels, rather than the artists, end up with control over the music itself, even long after the label has jettisoned the artist.

While some might say this is a perfectly sensible business strategy (decrease costs, increase profits), I'd argue that's only true in a very short time frame -- especially in an increasingly crowded market, where there is growing competition.  It's killing the golden goose, as treating artists badly just leads them to seek alternatives.  Which is, in fact, exactly what we're seeing today from many artists.

But getting from there to here still requires a lot of work -- which is why we see so many new attempts and new models, and no one's quite sure what will work yet.  One thing is certain, however: artists are willing to try new things, but they are very skeptical initially, and want to understand the details first.  And that's where I think the plan above needs the most work.  It's great to say that you are artist centric, but it needs to abundantly clear in the messaging exactly how this works.  And that should be a simple, clear and concise message -- not one mixed in a long powerpoint.  If there's some way to simplify that message down to a single image, that would be key.

To do that, I'd highlight a single point that you think is the most compelling to artists, and just hammer that home.  The other points are all useful, but put them as secondary.  So, make this "the label where the artist retains all his or her rights" or something like that.  Have a single clear message that artists will get immediately, rather than a PowerPoint deck as the initial opening.  I'd then try to weave a compelling story around that point, which gives you a chance to highlight the other benefits of the plan as well.  So, as you explain the benefits of retaining all of the artists' rights, you can also mention the clear and transparent accounting, along with the single source for financing everything.

Remember to focus on what's most important to the artist in that story.

That brings up my second key point.  While I like the idea of the "unLabel" being artist-centric rather than label-centric, it really does feel like the "fan" is left out of this.  Recognize that many musicians -- while certainly interested in making a living from their music -- believe that the best part of being a professional musician is the chance to connect with or "wow" an audience of fans with their music.  So, I would also make sure to play up the fact that a key part of your plan is to better connect the artist to fans, to help grow that artist's fanbase and to offer new and unique opportunities for more people to hear their music.

Because if the goal is to be truely artist-centered, I think that's almost identical to being fan-centric.  The more value you can provide fans, the better off the artist is going to be as well -- and many artists' understand this intrinsically. 

A key benefit to musicians signing with record labels in the past hasn't just been the financing, but the marketing help, which has been used to increase a fanbase.  To many musicians it's this part that's key.  So to make this work, any new "unLabel" needs to show the ability to not just finance an album and let the artist retain copyright, but to build the fanbase as well, and help the artist connect.  I know your plan mentions that the artist will be expected to do various fan-centric things (which is great), but I would play up how the unLabel will help setup and organize these types of activities in order to increase the fan base.

I think if you can make the message more clear and concise on those two key points: artist retains the rights plus here are a bunch of ways we can increase your fanbase (along with some kind of evidence that you really can do that), then this has a much better chance of taking off.

On the whole, I love the idea of an artist-centered "unLabel" and I think it's great to see new ideas hit the marketplace, giving artists greater and greater choice and options.  But execution (as always) is key in making sure this works.  So, look to clean up and simplify the message, and amplify the ability to build fan relationships, and the plan becomes a lot stronger!

I may not represent the average music buyer but Mike's suggestion about being fan-centric inspired me give my views as a fan and how I spend my money on music and what motivates me to do so. This could and should be one of your selling points for the artist.

• Give away the music for free or sell at a reasonable price ($15 is not a reasonable price when digital distribution costs next to nothing), in the highest quality possible and in multiple formats and without DRM. This is what I would consider good value (for me):
  
  • Free lower quality MP3 (but still good enough for most people ~128 Kbps).
  • $3 for highest quality MP3 (320 Kbps).
  • $5 for FLAC or other lossless format.
  • $10 for autographed CD.
  • $20 for autographed limited edition CD with liner notes by artist.
• Distribute the music globally, should be available anywhere there are people willing to listen to it.
• Don't stop with the studio recordings, give away and sell live recordings, stuido outtakes, DVDs, anything that comes to mind. Package them as I described above. There's an audience for all these things.
• I pay more for a single concert ticket than I pay for all the albums by an artist ($30+ usually), and from the amount of people that are at the venues, I think many many people are generally willing to spend money for this. Selling the music for cheap will get you a bigger audience willing to spend even more money.
  • Let the artist connect with the fans at concerts, stop by for an interactive session, take song requests from the audience, sign CDs & posters. The more connected I feel, the more money I'll usually spend on merchandise at the concert :)
• Connect through social networks: Facebook & Twitter are what I use, run special contests and giveaways through them to build a following.

Clearly, this isn't as easy as just recording the music and waiting for the money to roll in, but you're looking to break the mold anyway.

The basic premise described of an artist-centric label is the only way a record company will be able to move into the future of the industry.  But there are simply too many ways artists differ in temperment, motivation and intellectual properties.  This has most labels well out of their area of expertise when it comes to exploiting most talent, though they would never admit to it.  Because of this, most labels end up shoehorning viable talent into a mold the label feels comfortable putting resources into.  That methodology is all wrong.

The talent needs to be highly motivated to most of the legwork, because they are the ones that know their audience.  All the label needs to provide is the infrastructure and the business acumen.  As far as financial considerations go, the more an artist brings to the table in terms of quality properties, performance expertise and technical production skills, the higher the portion of the revenue the artist should walk away with.  It should not be the place of the label to define the artist, but rather to give the artist the tools to define himself in terms of concept, mission and definition of the core market to be targeted.  These tools can be as straightforward as walking the artist through a preparation of a business plan.  That is something artists simply do not do on their own, and is a blockage to success, regardless of their talent.  When a label tries to do this work for the artist without the artists engagement, the core principles are never properly identified and it is an uphill battle to exploit the artist, usually ending in dispute.

I myself subcribe to the Wagnerian unified art theory, so I have undergone the training and taken the time to do it all myself.  The technological resources are available to carefully choose the tools needed to control every aspect of the business, though some areas such as physical distribution, booking and radio promotion have a ways to go.  Assistance in the selection of these tools and assistance with these complicated aspects of the business is where a label really has a chance to shine.  The label can demonstrate valuable expertise and still allow the artist to be himself, which is what is required for an act to be successful.

I think for such a business to succeed you need education at two levels. First, you need to show to artists the big "moral" advantages to owning their works. Much more than people in other professions, artists are connected to their work. They can easily develop an attachement to it. As a result, they are often much more possessive as to what can and cannot be done with the product of their work. Point out to them that if they loose ownership of their work, they might end up being alienated from it. A big faceless corporation might decide to do something they don't like with it. However, if they still own it, they can control how it's used and retain their connection to it. There are plenty of examples out there of people who were completely alienated from their work by big labels. Find them, and point them out to your clients. Nobody wants to be alienated from their creation.

The second level of eduction is after they have agreed to come onboard. They need to be tought how to use mechanisms to connect with their fans. I am not just talking about the technological know-how to open a blog or twitter account, but mostly about the social interaction skills that will make the difference between them and anyone else. A possibility is to make them watch TV appearances or read blog posts or interviews of experienced artists you select and make them take the eternal public speaking class. But preferably, you would want them mentored. If you can, find an artist in the genre of your client. Have your client follow that person behind the scenes and see how they deal with their fans and the public. At first that may be difficult. But as you launch more people, you should be able to convince them to mentor new-comers.

Also, try partnerships with free content distributors. Now obviously, you clearly want to sell content and are probably not interested in giving the music away for free. However, a little bit could go a long way. Maybe release a couple of tracks for free and get the benefits of viral marketing without having to pay for it. Also, develop with the musician a personalized policy in dealing with IP infringement that fits their public persona. When the punk anti-establishment anarchist rebel is seen hiring lawyers to sue people, it looks bad. It breaks character and the character is a lot of what you are selling.

I can't see anything else that would improve upon this model.  Creator retains and controls the rights provided by our Constitution and BIG BUSINESS gets an opportunity to exploit those rights as for long as the Creator allows - fantastic!

I might add, include the support of new revenue streams such as the one datarevenue.org seeks for the support of statutory rates via mobile networks.

Now you've really got something that should last at least 50 years!

You propose that "Artists always retain ownership of their work."

This may reveal some confusion.

A problem with English is that possession is used for authorship as well as ownership.

Thus you may be using my basket ('my' as in the basket I crafted), but you may well be the one who owns it (having purchased it from the previous owner in a chain of umpteen intermediaries).

Authorship is not the same as ownership.

An author always remains the author of their work, because this is an inviolate fact. It can never change because history cannot change.

However, an author, as with any craftsman, will cease to be the owner of the work they deliver to their customers in exchange for their money.

Ownership (the ability to exclude others from use of, or access to something) naturally applies to intellectual or material work in an individual's private possession, whether it got there through creation, discovery, or exchange.

So, an artist naturally owns the work they create until they deliver it to their audience (as a promotional gift in exchange for goodwill, or in exchange for money, etc.).

An artist therefore has to choose between retaining ownership of their work and having a very small audience who must visit the artist's private premises, or relinquishing ownership of their work and having a very large audience.

If you are catering for the artist interested in a large audience then the last thing you should propose is that they will always retain ownership of their work.

It is possible that by 'ownership' you mean the unnatural privilege of excluding others from making copies of the work they possess, i.e. copyright. If so, you should be aware that this unethical anachronism is now completely ineffective and incompatible with modern communications technology. The printers/publishers/labels whose business depended upon this are now coming to an end, as is the 18th century privilege itself.

As I recently explained to Billy Bragg in FACing the Music, the decision now facing artists is whether to continue selling their music to the record labels (in their declining business of selling copies at monopoly protected prices) or to sell their music to their audiences instead (in a free market).

Change in the music business is a long needed thing. But I think the key aspect to address, really, is what value does your un-label provide.

Back in the 1950s or so, the recording industry largely followed the model established by 1930's-1940's Hollywood... the artist was attached to a studio or label, given all kinds of support, and maintained as long as they were successful. This was necessary.. the artist could do virtually none of this themselves.

Today, it's at least technically possible for an artist to self-produce an album, or at least a sophisticated demo disc. And the studios know this... outside of some weird cases, or perhaps the few who make it through on "Idol" TV shows, artists simply don't get recording contracts until that first disc is created. Add in the fact they can pretty easily build their own web sites, they can self-publish online, from the web site or through stores like iTunes and Amazon, and you have to ask, just what does a label-replacement bring to the party.

Certainly the big one is publishing... you need someone to make the CD and distribute it. The second one is publicity -- ensuing the new disc gets reviewed, that it gets heard, whatever that takes... these are the big things beyond the artists experience or, to an extent, need to control. The final one is funding... it may well be they need more resources to produce that CD than they have available, particuarly if there's a schedule involved.

In short, this is very much the model established for authors. If I open most any book, I find the author's copyright, not "Random House". They have assigned the rights to produce that book to one publisher, for a certain term or whatever, but they retain significant control. The publisher has limited ability to prevent the author from using that book's material in other ways... they don't own the story, they own the hardcover or paperback publishing rights, for awhile.

When you look in a CD, more often than not, you see the label claiming copyright, not the artist. Some artists (REM, Metallica, Prince, etc) do own their rights, but it's less often the case. They lose control of the use of the music, and they may need the label's permission to use it themselves. That's just plain wrong, but particulary given the very thin layer of support a label is going to provide these days.

• Artists always retain ownership of their work

Yes, this is critical... the un-label needs to behave as a publisher. There is no salient argument any more as to why the copyright for a release is assigned to the label, other than "we got these stupid musicians to agree to this". In this day and age, artists have enough support resources to not make the mistakes of the past that had rich labels riding high on the backs of the artists.

• Artists get worldwide distribution with transparent accounting.

Right. The terms need to be open, and designed in such a way that neither corporate greed, mismangement, or accounting tricks can affect the artist's bottom line. If you haven't, read "Courtney Love Does the Math" for more on this kind of thing.

• Artists get a dedicated partner with aligned incentives.

Presumably.. the un-label/publisher only makes money when discs sale, so they have an incentive to sell discs.

I think they perhaps get a more interested partner, too. The publisher's involvement in any given project should be less than that of a traditional lablel... this become a bandwidth advantage. The traditional labels have been cutting artists from their rosters on a regular basis, and this has ultimately been hurting them. The business used to be fairly regular, these days it's strongly driven up and down by the reliance on massive hit releases, rather than a steady average. While the publisher's resources ought to scale to the success of the artist, there should be much less of an incentive to drop a reliable artist, even if they don't make the Billboard 100.

• What kind of educational materials need to be created to help this business
  compete with the more traditional recording contracts?
  

I think they need to show themselves as the proper kind of business to take the artist's music to the customer. Illustrate the antiquated and, sometimes, downright evil practices of the major labels. Prove to the artist that the un-label will be able to provide the same essential services as the traditional major labels... that this is not some compromise. Talk up the "publisher" model.

• If you were an artist, how does this proposition sound to you?
  

Knowing what I know about the industry, I would not be comfortable with a traditional label. I think there's a strong meme, established over decades, that only a traditional label can deliver success to an artist, so that's the big thing you have overcome. It's also cyclical.. in some generations (kind of like now), the major labels have been so far away from the music actually happening out in the world that Independents became trendsetters, and successful. Then you have a round of buy-outs of the indies, and the major labels (or, "a division of") seem cool again.

• What are the most attractive portions of this plan for musicians? What are the least attractive parts of this concept?
  

I think the real issue is that this needs to be flexible. If I'm self-producing an album in my home studio, I might not need much up-front money.. maybe something to cover mastering. In other situations, the album is expensive. A friend of mine, a jazz pianist, hired a number of well known session musicians for her fourth album. She didn't expect to make any money on the disc itself, as a result, but it was a great ad for her live shows, and career in general. The un-label needs to be able to handle both situations.

The attractive part, of course, is that this un-label is, more or less, assuming the proper role of publisher. Of course they should make money from that (money yes... profit is largely their problem, not the artists'), but they should not be taking the lion's share of revnue, they should not control the music itself.  The artist may look at the un-label as a soup-to-nuts service, but it may also be "CD publisher", and have nothing to say about online distribution, movie sync rights, etc... just as a book author may use one publisher for hardcover, another for paperback, yet another for audiobook (not always, but it's certainly possible).

• Have you heard of similar businesses? How do you think similar businesses are doing?
  

As I mentioned, book publishing. When you start out, you get no money from a publisher. An established author is likely to get an advance, if they want it... the primary goal of offer that advance is to allow the author to be more productive -- she can work on the book, rather than take on articles or some other filler to pay the bills.

• Are there services that exist that could improve this business? Can you
  think of potentially good partnerships or collaborations?

Book publishers all contract a realtively small number of book printers... same thing here with CDs right now. Big labels have their own, and probably contract outside manufacturers to offset load. The un-publisher needs to have established business relationships with manufacturers. Every new band probably thinks they're the next big thing... if not the Beatles, they probably hope they're another Bon Jovi, or at least The Killers or some-such. One barrier to entry will be the fear that this un-publisher is small potatoes, and will limit the artist's chance for big-time success. Same issue with Independent labels, and why so many indies eventually move to the majors.

Whilst I like the "un-label" idea, it isn't a completely new idea, and a few on the single release indies have worked with this this and it can work.

The problem is that this leaves no room for the major labels and some famous artists who treat music as a business and are after profit over and above artist development and it is there which the music industry is in trouble. And without these majors there are also very very few artists/bands that can become very rich off the back of it. I don't see this as an issue, and good artists will play music as long as they get paid enough to continue - they don't need to be millionaires.

If a band gets into the business for the purposes of getting famous and rich (I'm not commenting on the quality of their music here), then this is massively more difficult under the "un-label" idea. The amount majors spend on promotion to get over that magic number of people talking about their music outside over and above the tastemakers to get into the mainstream then they need to have stronger control of the music to gain that money back.

Getting big in the industry is supposed to be very hard work, and then get big rewards. A lot of the complaints with the recent failings of the industry has to do with some lazy artists/bands who feel that just because you have a handful of great tunes you should get fame and fortune without much more work on your part, thinking the labels should do the rest. With your model this problem would be even more notable as the labels would be making less profits and less likely to spend money on promotional activities.

There's an interesting take on the current laziness of some bands here
http://lorenweisman-bge.blogspot.com/2009/10/what-happened-rant-about-work-e thic-of.html

Some bands get this and are making names for themselves, but without massive investment from labels hardly anyone is going to get the fame once possible.

In all the great music I know of (exception may be the Beatles) money was not the central issue. In all the plans I have seen, money IS the primary issue; and that leads to abusive business methods.

I think we need a model where artists (and we aren't saying, generally, "special" people, we are talking about ordinary people who, because of looks, or personality, or a flair for showmanship, etc., catch the public eye - then the "sheep" effect kicks in) develop their art for the love of the art, and are content with normal, reasonable returns.

For that to work, we need to address the "sheep" effect. I like music that others don't - why? I think for myself, and they don't feel right about music that does not appeal to the people they want to relate to.

I have known people who religiously attended ballet - they hated ballet - but they really wanted others to see them religiously attending ballet!

Why not have a "Facebook" type relationship where one person provides part of a melody, another provides another part, "someone" provides an instrumental part, "someone" provides another instrumental part, at all stages, the group as a whole votes on what stays and what is discarded ...........

Seems to me the suggested model is similar to what is happening in the book business: Self-publishing is becoming more and more popular, the established publishing houses only taking on authors who are expected to sell - either because their self-published books sold, or because they are famous.

In that business, the publishing houses have turned to marketing machines, and the production (which was once their strength) has been completely outsourced. The same thing happened in the music business some time ago, I guess. But there are a couple of important differences.

The first is that there are lots of secondary rights around music. Sampling a book is pretty meaningless if you are writing one of your own, but sampling a song adds great value to the song you are working on. There are commercials which want to use the music as background, there is income from collection societies, and so on. A musician has more ways of getting his music spread than a writer has to spread his text, and that shows in the industry structure. It also has to be part of the management of the musicians works - if it is not, then the artist risks missing out. This is something some record labels do (and others take it to the extreme, buying up all rights for the works of a musician).

The other main difference is that as a writer, you can actually make a decent book yourself, without more equipment than a computer, a camera, free software, and elbow grease. You only need the idea, the writing skill, a place to sit, and a lot of perseverance. It does benefit from an editor, but as a writer, I know that many times the editor really only checks the grammar and language, not the content; and may not add much on top of the Word grammar checker in reality.

The musician on the other hand is dependent on a lot of other people to get the music right. Not all musicians are singer-songwriters, some only play one instrument, and need others to play with to make their music work (a band, or an orchestra). But that is not all: You also need professionals to help out with the sound mixing. Sure, there is free software which is pretty good, but producing music is a special skill, and equally important to most hits as the singer. So making music is inherently more complicated than writing a book. Rights are more complex too; all members in a band has to sign releases, and so on. Or, indeed, agree to the Creative Commons license.

The "un-label" sounds to me more like a management agency than a label, and the truth is that most famous artists (and sportsmen) already use those - very successfully. They tend to be invisible, because they do all the grunt work, and the audience is not particularly interested in who booked the venue and signed up the band members anyway. So the concept is good, and already works. Actually, it works best in sports already, and as musicians are becoming more of live performers than recorded artists, we will see that becoming clearer (perhaps the current case is a symptom).

But like all business models, it can be tweaked. Here are a couple of ideas:

1. Transparency is great, so put everything online. Look at what Baseline Agent (https://www.baselineagent.com/Default.asp) does for tennis pros.

2. Maybe the really important source of income is not the slice of the income from the concerts and the record sales (and other income), but the fees from secondary or even tertiary parties. Making travel arrangements easy for musicians (who have a lot of gear - which usually can be rented to some extent) should help getting their music out, and means a source of income from ticket sale kickbacks etc. Especially if the cost can be deferred against the takings from the concert. Selling tickets online would also be smart, but that may not be possible if the venue has signed away the rights to e.g. Ticketmaster.

3. Creating a "stable" of venues which can be booked by the artist online is a great idea, and  having your own venues signed up allows you to tool the presentation of the music (you do not want a hard rock act to play in a church, usually). It would also mean being able to move musicians into slots which are not filled, helping the venues get filled up when there is a slack night, and booking lesser known artists when the venues are normally full anyway (Friday nights). Essentially, combining the booking agency with the management. That means the online tool for the musicians would need some intelligence (or human intervention), though.

4. Crossover media made easy would be good for musicians. They typically are not very good at video production etc, so having people (maybe independent filmmakers) who could help them make promotional videos would be nice. Mentoring is not a bad idea either. And why not sign up a good ghost writer, and make some promotional books? Or a real writer (or poet) for mutual promotion. A book with a CD would be different, if the music and the text complement each other.

5. We are talking about long tail here, so the agency needs a lot of musicians to get enough money to survive. That means personal attention will be at a premium, and the web can help with that too. Many musicians will need handholding and charging them for it is going to be difficult, especially if they happen to be down and out right then. But not all of them will need it all the time. So it is a little like insurance: The musicians have to pay a fee whether they need it or not, instead of the management agency charging them a percentage when they succeed. That mean a "one fits all" offering (and that the artists will leave when they are successful). Perhaps with options that can be purchased, also similar to the emerging self-publishing offerings.

Hope this helps.

//Johan

First, compliments to CybearSonic for seeing a huge potential market and seeking to empower rather than exploit musical artists.

Many parts of the music industry serve as cheap "filtering mechanisms" to take large groups and winnow them down to a few who then become huge stars.  A developer-centric model like CybearSonic is both "fairer" and builds a broader and more robust musical ecosystem where niche artists can thrive even if they have no potential to become a pop superstars, and most importantly where new and innovative musical forms can thrive rather than be stifled by more "pop" artists who may be seen as posing less risk for labels.

For long term success CybearSonic probably needs to meet the needs of artists globally, so I'd recommend English language services and probably an entire website for the huge English language music markets in USA and UK.    You will not need many differences in form or function between the French and English Online services so it seems there is little reason not to at least take a stab at the larger markets: 

Source: Wikipidia

Consider re-evaluating or at least adding to your pitch to artists.  Now it seems focused on ownership and rights issues rather than the marketing issues. Given the number of free online venues to showcase work while retaining all rights, I think CybearSonic will need to demonstrate quickly to artists that they will provide powerful support, distribution, and community benefits

For example, how much will CyberSonic be spending promoting themselves to concert venues or to the public or to agents?    How many artists are you supporting now and how many do you expect in the future?   What markets and niches are you best able to help artists understand?

Explain why CybearSonic is a much better proposition for artists than simple self promotion via MySpace and other online communities.   Note that many projects are asking people to "help us build a community".  This is not powerful.  "Be part of our existing community" is a far more appealing idea to most assuming their is a thriving community to join.   It's something of an online catch-22, but websites generally need to establish an active, thriving community before they'll be able to easily attract followers.

You'll also want consider creating a "welcoming" environment for existing agents, concert venues, and other promotional entities, some of whom might see CyberSonic as competition.   Consider affiliations with agents where your services can expand and enhance rather than replace some of the more conventional arrangements, especially for bands that are already "on their way" and may be attached to the more traditional forms of promotion.

What kind of educational materials need to be created to help this business compete with the more traditional recording contracts?

    The education material can be a website consistent with a printed booklet that clearly explains the business. The material should compare  and contrast the Un-Label with the traditional record label contracts and the current 360 contracts. Although we know in practice record labels do not typically offer transparent accounting as a dedicated partner, they make those claims. And right now to a new artist what you say you offer is only a claim. Therefore the most apparent difference between Un-Label and the traditional Record Label is the artist represented by the Un-Label retains the copyright. And this is a very compelling offer and you should emphasize this offer in your educational material.

If you were an artist, how does this proposition sound to you?
    As an artist the proposition sounds good. The problem is the propositions from record labels typically sounds good but are not really good. Careless execution after the deal is done will make the artist irate. So the true test of the deal is how it's executed after the artist agrees to sign the contract. In practice even when the artist sign a fair contract, with approval from their lawyers, unforeseen problems arise and one party may sue. The best way to avoid this is to anticipate potential pitfalls. For example:

• What happens if the artist is never profitable during the contract period but becomes very popular after the contract expires, will the record label try to recoup it's losses ?
• During the unprofitable years the artist may have amassed a back log of unsold merchandise, who owns the right to sell the material after the contract expires ?

What about creative control ?

     I ask about creative control because if the artist owns the rights to the music it should naturally follow that the artist control how it is created. Based on the spirit of the Un-Label deal I think granting the artist creative control should be included in the deal. If the Un-Label agrees the lawyers should put it in writing. An artist needs artistic freedom, creative control. The Record Label should not dictate the creative process. The Label should only facilitate it. If you sign a live jam band, like the grateful dead, the creative process involves playing live. The performance includes improvising, feeding off the vibe of the fans, being in the moment.  The live performance comes before the album because the album is mainly a collection of live performances. The record label can not enable this if they require an album before the band tours. Conversely the record label can facilitate the creative process by organizing a great tour schedule. This means:

• Booking locations that are accessbile to the most fans.
• Providing an experienced live recording team.
• Providing a good touring crew.
• Making sure things work
• Taking care of any problems that may occur.   

Vice versa if the band does not perform shows often but wants to record a lot the Un-Label should facilitate this. I think the Un-Label has a good objective so it's important to let the artist define the experience. If the artist wants to primarily perform live or be in studio primarily that's the artist prerogative, and it's the label prerogative not to sign the artist. However most artist enjoy doing both. Let the artist stay true to to their art that is the best way to attract artist and market them.


Have you heard of similar businesses? How do you think similar businesses are doing?

Elite Artist Service tags themselves as the "record label support without the label "
According to their website they offer:

   * CD, DVD, and Vinyl manufacturing
   * Content syndication to iTunes, Amazon, MP3, Rhapsody, Napster, eMusic, and digital music retailers.
   * Traditional retail distribution through MRI/Sony/RED.
   * Retail co-op advertising and promotional services.
   * Custom merchandise design and production.
   * CD, direct download and merch sales directly from artist website.
   * Finished product warehousing and order fulfillment.
   * Web site development and maintenance.
   * Digital Marketing (newsletters, e-blasts, Electronic Press Kit development)

You can see the full list of services on their website. http://www.eliteartistservices.com They are a full service provider but It's not necessary for an artist to use all their services. It's a new service therefore only time will tell how well they do. The service is only open to relatively popular artist with a fan base.

Are there services that exist that could improve this business? Can you think of potentially good partnerships or collaborations?

There are so many services and businesses out there that are working with the music industry.
Here is a short list of services and businesses Un-Label can work with.

Online Radio
It's important as independent label to get your music to all the popular music radio sites.
Lala, Jango, Pandora and Last.fm to name a few.

Eventful
Enventful's demand service allow fans to request bands to perform in the town and the software provides the results to the bands. They call it "fan-generated touring"
http://eventful.com/demand

Tapulous
Theses iphone software developer are creators of the popular music based Tap Tap Revenge series of games. They license music from artist to use in their games.
http://tapulous.com/press/

Rock Band
Producers of the popular Rock Band games are opening up their platform to indie labels and unsigned bands.The new system will allow artist to create payable game content for the "Rock Band Network"
http://creators.rockband.com/

Merchandise Services
Here is a short list of companies that can create artist merchandise like hats, sweaters and of course, t-shirts.
http://www.jakprints.com/
http://www.discmakers.com/merch/products/

I've been observing my local music scene for more than two decades. So here's how this sounds to me.

The major thing you'd need is: credibility. Every label will promise good publicity, but artists know that's hard to deliver. After years of struggling to build an audience at local clubs, artists will want to know specific things you'll do to publicize them. Can you get them national attention -- on radio and on television, and in chains that sell music? So the biggest problem with this vision is a lack of real-world specifics.

Some artists are even more interested in being famous than in earning a lot of money, so the first question they'd ask a label is: what other artists have you signed? They'll judge the label's credibility in part by which artists are already working with the label. It's a reflection on your label's powers of publicity, but this tends to work against new labels. If you can attract (or hire) a major music figure, it will help your label's prospects. But if you can't point to anybody that your prospect has heard of, then new artists will be less impressed by your ability to publicize!

It's a familiar dilemma -- how can you attract artists to your label without having some impressive artists that are already signed? For this reason, you might want to "start small," focusing resources and attention on a few good prospects. If they achieve popularity, it will also attract more artists to your label. This could take several years -- but there is another alternative. You could try to attract hundreds of artists, and hope that one of them breaks out of the pack. (Then you can point to that artist as proof that your business model works.) Unfortunately, it can be difficult to produce and promote hundreds of new artists. But this does increase your chances of signing your own credibility-boosting star.

Some people would also settle for creative satisfaction rather than a lot of money. (If you could guarantee that my album would be produced by Steve Albini, for example, I'd be willing to license the music to you on very generous terms!) If you can't guarantee industry-leading publicity, you could still attract artists by promising industry-leading production. And here's where it gets interesting. Technological advances have lowered the costs of state-of-the-art equipment. There's even new instruments, where a new label could carve out a niche as an innovative musical pioneer. This could attract people to your label, even before it's got a track record of high-profile musical stars.

Remember that besides new distribution channels, the internet is also offering new forms of publicity. Everyone's heard stories about viral marketing, but it's hard to manufacture that kind of buzz. Still, if your label could point to a few successful viral marketing campaigns, it might establish a new form of credibility. Today's technology now makes it possible to seamlessly splice new vocals directly into a sound mix. So here's one simple example: imagine publicizing the ability to have your name (or your girlfriend's name) replaced in the lyrics of a song, or even an online video. Christmas songs, birthday songs, songs for major football games. Not every genre fits that style of promotion - but it's a new possibility that has yet to be tapped.

Depending on your publicity budget, you might even consider hiring an established major artist to participate in an online publicity event for one of your new artists. And if the goal is simply online publicity, maybe you could stage an event where you record an online celebrity. Imagine having the top bloggers participate in the spoken-word bridge of an exciting new rap number -- and then publicizing the song on their top-rated blogs. If the goal is to increase publicity online, these new alliances could produce real results

A more conventional way to approach this is by forming partnerships with existing independent labels, offering them packages of some or all the services you're offering your own artists. These alliances can help your label grow fast, and tap into an already-existing independent music scene. And since many labels are short-lived, these relationships might ultimately lead to their artists being passed on to you! It's a good way to publicize the services you're offering.

Your label would benefit from the obvious alliances -- iTunes and Amazon are great, not only for distribution but also for publicity. But don't underestimate the power of conventional publicity. The best publicists could get your artists considered for airplay on MTV, or even booked on national television shows. And they may even generate promotion through the top online portals, like AOL and Yahoo. You might want to consider an alliance with an established publicity firm if your in-house publicists can't reach the industry's biggest players. Unfortunately, much of the music industry is still dominated by a few established players.

Even an alliance with the major online players like MySpace or YouTube could generate huge publicity online. And you might consider filming your band's concerts, and making the footage available on NetFlix or other online video sites. There are new distribution channels today, and they haven't been fully tapped. Yes, music audiences have become fragmented. But there's some new players that still aggregate large numbers of listeners in one place.

One problem today's artists face is the legal problems around sampling --so you might consider setting yourself up as the world's most sample-friendly label. If the artists retain all rights to their music, they can also grant permission to sample it. That's something most major labels won't allow an artist to do, even though sampling (and "mashups" are the wave of the future. Imagine the publicity that would result when cool sound excerpts from your artists start turning up on major-label CDs. And a lot of artists would be thrilled to know that their music could be distributed with these additional permissions.

You could attract massive interest to your label by creating a library of royalty-free sound clips. One of the surprising results of Amazon's digital reading device, the Kindle, has been increased popularity in royalty-free books -- including classics from the 1800s, and even pulp fiction stories from the 1920s. But no one's collected together a definitive library of our musical heritage. Just as an example, many of the great blues artists have left behind recordings which are exciting, moving -- and 100% royalty free. Your label could try packaging some historical music collections -- which could help to build your reputation.

I think most people understand that it's nearly impossible to break into the mainstream music business. This is why people have settled for alternate outlets -- alternative radio stations, as well as alternative forms of music and even alternative forms of success. (I know of one artist who simply records a single song each day, and posts it on their blog.) I think there's a trend to redefine music industry "success" as something that's within reach. "I may not get rich, but maybe my song will be heard by 1 million people."