Saturday, June 1, 2013

Is that festival worth it?


            With Memorial Day weekend, summer has finally arrived and for most music fans that means one thing; festival season is here! Finance blog Nerd Wallet has taken out some of the guesswork and figured out which festival gives you the most bang for your buck. The blog broke down the general admission ticket cost of three major festivals: Lollapalooza in Chicago, IL, Outside Lands in San Francisco, CA, and Austin City Limits in Austin, TX. How the net value was calculated was the blog calculated the ticket cost of each artist, calculated what artist a festivalgoer is most likely to choose, favoring main stage acts, deducted from the ticket price based on shorter festival sets, and then took that combined ticket cost (the gross value) and subtracted the ticket price.

            Using this method, Nerd Wallet determined that in 2013, the festival with the biggest value is Austin City Limits. It’s has a net value of $631.66. Also, its top artist ticket price is The Cure only $103 meaning that the value is better spread between the artists. That’s compared with Outside Lands whose top artist ticket is $154.33 for Paul McCartney. After that is D’Angelo valued at $89.40, a steep drop-off for a sub-headliner.  Outside Lands ranked second with $621.94 but was considered a waste if one did not wish to see McCartney. Lollapalooza ranked third which was interesting considering it the lowest ticket price and not the fewest amount of artists. The reason being is the artists are smaller priced artists throughout the entire festival keeping the gross value low.

            While this is a tried and true method in determining whether or not a festival is a good buy for your summer, it doesn’t tell the whole story. First off, there are two large omissions from the study named Coachella and Bonnaroo. Bonnaroo may have a unfair advantage as music goes from noon until 4 AM. I don’t know whether that makes Bonnaroo have more artists than other festivals but it’s an important factor in making a decision. Coachella is also a juggernaut and has a similar lineup to Lollapalooza. Another good comparison would be The Hangout in Alabama.

            The other problem is intangibles that are not included in Nerd Wallet’s study. The three festivals selected take place in major cities. That means you have to factor in hotel costs, food costs, afterparty costs, alcohol, and transit costs among others. It would be nice to average out those costs to get a real feel on cost of attending a festival. Bonnaroo and Coachella offer camping, cutting down those costs. They also have less afterparties and no travel cost, adding to their ability to be less cost prohibitive.

            A third issue is the rise of the regional festival. Less likely these days are people making a cross-country trek for a festival lineup when they can have a similar experience close to home. Firefly in Delaware, Sasquatch! In Washington, and Newport Folk in Rhode Island would be more interesting festivals to add and breakdown this concept further. Hopefully, an intrepid statistician will break this down for a music blog and get the real answer.

Wednesday, May 15, 2013

That Old Black Magic Calling: Daft Punk’s Marketing


            The veil has finally been lifted on Daft Punk’s Random Access Memories, easily the most anticipated album of 2013. While now the debate will rage on whether or not it was worth the wait, there is a key aspect of this album that will be interesting or not to see if it impacts the music industry. It is the decidedly old school and cryptic marketing approach the duo and Columbia Records have taken so far to promote the album.

            In a recent interview with Pitchfork, Thomas Bangalter stated that “Everything about RAM and its buildup is about the surprise, the magic. ‘When you known how a magic trick is done, it’s so depressing,’ he explains. ‘We focus on the illusion because giving away how it’s done instantly shuts down the sense of excitement and innocence.” That magic is just as equally a key to the hype as much as the fact that it’s the duo’s first new album in 8 years.

            It started with just a mysterious image at was posted to the duo’s website DaftPunk.com on February 26th. The image was just the duo’s iconic helmets set together with the Columbia Records logo on the bottom. 



           This image would soon spread from the web to reality, first all over Austin, TX during the SXSW festival in mid-March but it would soon be high above major cities on massive billboards. The idea behind the billboards was revealed to SPIN magazine as Bangalter stated, “we wanted to bring back some ideas from the past, from a time when you could drive down Sunset Boulevard and see a billboard for a new David Bowie or Pink Floyd album. Our imagination was triggered more by this physical presence then looking at an Internet advert.”

            If the use of imagery was not enough, the band could also merely tease music to get people interested. Shortly before SXSW, a mysterious 15 second ad debuted during the March 2nd episode of Saturday Night Live. It aired twice but the next day, it was all over the Internet. Fans had even patched together 10 hours versions for those who wanted to groove to 15 seconds of new Daft Punk all night long and remixes putting the hot single “Suit and Tie” by Justin Timberlake over the snippet. It was amazing how crazy people were going over a 15 second piece of music.



            That was it for a whole month until the Coachella festival. Coachella was of course were the duo made their mark on America’s new obsession with electronic dance music. They unveiled the Pyramid, the set for their now legendary Alive 2006/2007 tour. While waiting for acts to come on, a new ad for Daft Punk appeared on the stage video boards. It was a full minute showing Daft Punk and guests Nile Rodgers and Pharrell Williams playing the new song “Get Lucky.” It also gave the album’s title Random Access Memories and a release date of May 21st. It also meant that fans had to wait another month for the whole thing. A fan-shot video captured the ad and it spread like wildfire. A better quality one would debut during Saturday Night Live during the weekend and also announce the album would be available on iTunes.  



            Later that week, on April 19th, the “Get Lucky” radio edit single debuted and instantly became the number one downloaded single on iTunes and became the duo’s first UK #1 single. It also peaked at #14 on the Billboard Hot 100, a new record. This all happened with no other television, radio, or Internet promotions. No banner ads, no search engine optimization, no Twitter, nothing the current music industry would consider standard. Is it because of the clout Daft Punk has in music? Potentially. Any other artist may not have succeeded. Is it magic? Thomas Bangalter might have you think so. It’ll be interesting to see if the industry can disconnect in some ways to give life back to music, to use a Daft Punk song title form the new album. The album has since leaked, as is standard for the music industry these days. Daft Punk has partly helped fend against this leak by streaming the album for free on iTunes a week early. It has revealed some of the magic. It won’t be the same when fans open physical copies or download it from iTunes at midnight. But it will be interesting to see if the magic will translate to sales. 


Sunday, May 5, 2013

Reflections on Experts' Views

     In my last blog post, I went off topic and profiled two of Silicon Valley’s most iconic venture capitalists, Sean Parker and Peter Thiel. Both had great insight into what can make a company and business plan better. As I tighten up my own business plan, to be revealed later, have I used any of this insight to make it better? As for Sean Parker’s advice, it was mostly that you need flexibility. I don’t think I could have more room for flexibility in my business plan. There is a lot of room to breathe in there, even down to the location. So that isn’t too much of a change.

    More important is the advice of Peter Thiel. Thiel’s advice was that even a bad plan is better than no plan and it’s important to make sure you have at least that needed guideline and know what you’re setting out to accomplish. When I first came up with this business plan, I had about 5 ideas it could be and it still might get there. The urgency to distill it down to one very solid idea to build on is very important; in making sure there weren’t too many balls in the air while juggling. By focusing on what’s important, you can make it better and maybe work on those ideas after the success of the first.

   As far as the most important part of my business plan to investors, that would be the financials. You can say everything you want about every other aspect but if projections are that it’s not going to be worth the money, why invest? Or why put out this project? Even in my case where my business plan is a non-profit organization where there’s no return on investment for an investor, it’s still important to be able to break even and if we have a profit, return that to the community.

Wednesday, April 10, 2013

Expert takes on investing in business plans


            Sean Parker is probably most known for being portrayed by Justin Timberlake in the film The Social Network. But his career has been much more successful than that. Two of the first three companies he has worked with are ones that changed the world forever. In 1999, he helped found Napster with Shawn Fanning. Napster was a music file-sharing program that enabled users to easily download digital music files illegally. The program quickly drew the ire of the Recording Industry Association of America and was forced to shutdown in July of 2001. It ignited the industry’s response to take their music online.
            Parker then attempted to revolutionize the address book with Plaxo, an online service that will automatically update your address book. The company was founded in 2002 but due its inability to be successful, he was fired in 2004. It turned out to be a blessing in disguise as at that time, while plotting his next move, he stumbled upon TheFacebook, while visiting a friend at Stanford. He had already wanted to tap the potential of social network and got excited about an existing service named Friendster but got cold feet when the service’s system began crashing. He quickly found out how to contact founder Mark Zuckerberg and the rest is history. He became president of Facebook until being fired in 2005.
            Parker today is an investor in Spotify, the world’s foremost music streaming service, is the CEO of Airtime.com, a new video chat service, and finds startups to fund for the Founders Fund. In a recent interview at the LeWeb conference, Parker has this advice for getting your business noticed. He says that he looks for “great teams. A startup needs to have an effective leader who can hire and attract great talent. A complete team that can execute is his benchmark” for making an investment. Parker also gave the example of Gowalla, a location-based social network that stuck too tightly to its business plan, and the not being flexible led to his loss of interest. So flexibility would also be a guideline.

            Peter Thiel also was a major factor in the beginning of Facebook. He unlike Sean Parker has a less colorful past. He made his fortune in founding PayPal, the huge digital payment system. He sold the company to Ebay which helped solidify his career. Thiel now runs Clarium Capital, the company he founded after PayPal, and the Founders Fund. Thiel was one of Facebook’s first investors with a startup fund of $500,000. Companies he has invested in include LinkedIn, Slide, Geni.com Yelp, and Yammer. He also is commentator on CNBC, executive produced the film Thank You for Smoking, and frequently writes for the Wall Street Journal, Forbes, and Policy Review.
            In a recent interview with TechCrunch, Thiel put into words exactly what he’s looking for in investment opportunities.

“We try to find technology businesses that nobody else in the world is building. So, the people who are actually starting them are much more braver and crazier than we are. We are for the most part just investing but I think that’s what really makes the difference. It’s where you do something where if you don’t do it, it’ll never get done. And so the question I always want people to ask is what idea do you know to be true that nobody else agrees with you on. The business version of it is what business can you start that would be valuable that no one’s thought of? So we always try to find things that are not being done and if we didn’t back a particular entrepreneur, this thing would never get created for the world.”

Thiel also went on to emphasize how important it is that you have a business plan and a clear vision for the company.

“This is sort of a minor nit, but it’s one that I think is always a good one to be aware of. They shouldn’t say that there are a whole bunch of different things they could do with their product, all of which would be good. Normally you want just one thing that’s going to be fantastic. And so when you say, ‘We could do A, or B or C or D or E, and we could make money doing A or B or C or D or E,’ that’s often that you don’t really have a plan, which isn’t going to work. It’s always better to have a plan. It’s one of the things I learned in chess: A bad plan is better than no plan.”

Check out the full video here:


Friday, March 22, 2013

Anti-gay marriage comments cancel tour


            Singer/songwriter Michelle Shocked found herself in hot water and potentially out of work after making anti-gay marriage comments at a San Francisco concert. According to MSN Music, Shocked was playing a show at Yoshi’s on St. Patrick’s Day and when returning for her second set, she went on a rant against gay marriage. Her alleged comments contained, “When they stop Prop 8 and force priests at gunpoint to marry gays, it will be the downfall of civilization, and Jesus will come back," she reportedly said, and "You can go on Twitter and say, 'Michelle Shocked says God hates fags.'” According to the San Francisco Gate, about two-thirds of the crowd walked out after the rant. The venue then shut off her microphone and stated that the show was over. Refunds were provided.

            As news of Shocked’s comments traveled across the Internet, venues began to cancel Shocked’s upcoming tour dates in April and May. Only one venue, the Harmony Bar in Madison, Wisconsin had not cancelled her performance. When asked about the show, staff could only comment that the owner was in Mexico and unavailable but told local press, “there’s no doubt in my mind he’ll cancel this,” per the Hollywood Reporter. Shocked’s volunteer publicist also walked off the job. Shocked has said she plans to show up to her schedule show in Los Angeles despite the cancellation and talk about gay bashing in L.A. mayoral race. The owner of the club she was to perform at, McCabe’s in Santa Monica, has stated she is not welcome in any way.

            Controversy over beliefs and comments to the press are no strangers to popular music. The biggest example is of course The Beatles in 1966 when John Lennon as quoted as saying the Beatles were bigger than Jesus. This sparked controversy from Christians all over the world but most notably in the United States. However, only one show was cancelled from the band’s 1966 US tour in Memphis and then was worked out so they performed anyway. There was an incident when a firecracker was thrown at the band in Memphis but no other issues. It’s rare that an artist’s comments end up with a whole tour being scrapped. I don’t think there has been another incident where is occurred. This incident shows the fine line of being an artist and not going over the line. It also wasn’t that Shocked expressed her views in song but in a blunt rant to the audience. I applaud the venue for shutting down the show and issuing refunds and other venues for cancelling her shows. While there should be room for free speech, spewing hate has no place in the music industry.

Sunday, March 10, 2013

Getting Beyond The Next Day


            In a recent blog post entitled “If You Can’t Sing…” music industry veteran Bob Lefsetz weighs in on why people still send him demos and if that’s still the right idea, especially if they’re not outstanding, different, or radical. The problem he sees is publicity for bands is on its way out and is not the way to be discovered in the music industry in his eyes. He points out the example of the New York Times. Reviewers don’t make fans anymore, he says, because the Internet has turned us into clusters of fans by linking us. Most people don’t want to hear what an independent observer’s thoughts. That wasn’t always the case. “If you weren’t reviewed in the newspaper, it’s like your gig didn’t happen.” He then turns his attention to the new David Bowie record The Next Day. He says that if radio and MTV were still around to play the record, then it would be called a hit. Now, he just makes a record for fans. Those were the gatekeepers and allowed really spectacular music to make through. The difference today is music is everywhere so the mediocrity is not going to cut it.

            Another interesting look at the new David Bowie album comes from Steve Schneider at Orlando Weekly entitled “Watch that, man: Reading too much into Bowie.” In the article, Schneider states that Bowie’s explosion onto the scene with his first new album in 10 years, throws away all current industry conventions by not having the traditional social media build-up that most record releases have these days. The problem Schneider sees with that is he feels most will read into it that you don’t need that promotion to sell albums, as The Next Day will probably have great sales even without much promotion. An issue with that is not many artists are David Bowie and this album’s tactics aren’t going to work for most artists.

            What Schneider’s article misses is that this isn’t even Bowie’s creation. He is not the first artist to mysteriously drop an album. The major example of that is Radiohead, who famously released InRainbows just 9 days after announcing it on their own blog. The album was their first studio album in 5 years. The beauty of digital distribution is fans can get product now and since initial album sales are mostly fans anyway, that way artists can get most of their sales as soon as possible. Promotion is less needed with established artists because as Lefsetz pointed out, we are already clumped together as fans. Bowie fans will talk to other Bowie fans about whether the album is good or they will preview it on iTunes. They won’t buy it because MTV played the video or it had the most spins on their local rock station, which has probably been converted to another genre anyway. While this method does work for established artists, I don’t think new artists will try and do surprise releases like David Bowie. They will probably continue to follow traditional promotional methods as much as possible. A great example is Mumford and Sons, whose album Sigh No More was released to no fanfare in 2009 but by 2011 had become one of America’s biggest selling albums. This is what Lefsetz means in his post when the content is great, it will get noticed far more than any promotion or marketing tricks.

Here's a cut from David Bowie's new album to play you out: