December 8th, 2005

Indie Bands Jump on Brand Wagon; Today's Artists See Commercialization as Savvy, Not Selling Out

By Margaret Webb Pressler
Washington Post

Bob Mould is best known for his 1980s punk band Husker Du. Now 45, the guitarist and vocalist sells his new music primarily by touring and through his Web site. But it’s a grind.

So Mould was thrilled when he was contacted recently by the music supervisor for the hit Fox show “The OC,” who wanted to use a recording from Mould’s most recent album in an upcoming episode.

The producers paid “in the low five figures,” Mould said, to play his song “Circles” on the show multiple times, making it exactly the kind of deal that Mould, and artists like him, are looking for now.

Corporate executives are increasingly looking for new sounds to help create an image for a brand, whether it’s a product, a store or a show. It could be music from an emerging artist, or something old and hip, such as Husker Du, but whatever it is, it is likely to be cheaper than the high price of licensing a hit song from a major record label.

The result is that corporate music buyers are changing the economics of being an independent musician. The once-standard dream of a record deal and radio play is giving way to the reality of restaurants, retailers and automakers scouring the industry for little-known music that can lend mood and edge to marketing campaigns.

“New artists have realized that the big labels really are not doing the job anymore, and if [the artists] can just get their music out, people will stumble onto it and then the buzz starts,” Mould said, speaking on a cell phone from a San Francisco coffee shop while on tour. “As an artist, you’ve gotta look for ways to make money.”

Don Rose, acting president of the American Association of Independent Music, said licensing represents “a growing and significant portion of any indie label’s revenue portfolio.” Selling music to advertisers used to be taboo among many sellout-conscious artists, but today “these commercial branding opportunities are being viewed much more positively,” he said.

While there is no comprehensive data to show how much money such artists are making from licensing, Rose said it can be seen in any small music label’s revenue stream. A good example would be ESL Music, which is based in Adams Morgan and gets nearly 40 percent of its revenue from licensing deals, up from almost nothing a few years ago, according to Phil Hawken, director of licensing for ESL.

ESL was founded by local musicians Eric Hilton and Rob Garza because they did not want to sign their group, Thievery Corporation, to a record label. As the business grew, the duo hired Hawken and moved the company to a large Adams Morgan rowhouse renovated with sound studios and entertaining spaces. Hawken finds plenty of takers for Thievery Corporation’s wide-ranging, internationally inspired electronic sound, along with the music of other groups the label has signed.

ESL music has been on television shows “Sex and the City” and “The West Wing” and in retail chains such as Starbucks and Banana Republic and used for the marketing campaigns of major consumer businesses. Even Caesars Palace in Las Vegas plays some ESL music.

International bands are cashing in, too. Last year, Australian garage band Jet got worldwide exposure when Apple Computer Inc. featured one of the band’s songs on an iPod television commercial. So did Italian music artist Nicola Conte with a Kmart commercial for Joe Boxer showing a young man dancing in his skivvies. Likewise with under-the-radar British band Dirty Vegas and its dance song, “Days Go By,” featured in a Mitsubishi commercial. Legendary British punk band the Clash was paid $50,000 to have its anthemic “London Calling” used in a Jaguar commercial.

In Hollywood, most major television shows have music supervisors who do nothing but search for that arresting 12 seconds of music they can license for a particular scene—for a good price. And companies such as PlayNetwork, SoundExchange, DMX and Gray V license and assemble music, much of it from independent artists and labels, to be played in retail stores, hotels and restaurants. Together, it is pouring millions of dollars in licensing fees into the pockets of individual artists and small labels.

“I can’t tell you how many times I hear, ‘I want things playing that no one’s ever heard before,’ “ said Lori Hon, founder of Gray V. “The indies are much easier to deal with, and they have great stuff.”

This trolling for new sounds is making it easier for artists to earn a living off their music, industry experts say, and is encouraging more hopeful musicians to give it a shot.

Kidgusto, an aspiring global grooves musician from Silver Spring, said most artists understand that the goal is getting their music out any way they can. Kidgusto licensed one of his songs to American University earlier this year to use for a Flash presentation on its Web site. He would not discuss terms of the deal but said the proceeds have helped support his musicmaking since he was laid off from his tech support job at a law firm in April. He has also been liberally licensing his eclectic music to bigger record labels for other musicians to use in their remixes.

The financial benefits of these smaller deals have been eye-opening, and Kidgusto is eager to sell his work for commercials, to retailers to play in stores, to television shows or, even better, to film producers.

“Definitely, that’s the jackpot right there—to get it on multiple movies,” Kidgusto said, dreaming of the kind of deal that might well go into six figures. “Licensing deals are the way to go now.”

With the explosion of music downloading online, artists are already looking past the radio and MTV for a chance at success, which comes at 99 cents per download. But while online music waits for consumers to find it, corporate buyers take a musician’s song and expose it to a wide audience filled with desirable consumers.

Retailers have often played background music, but often it was whatever the store manager brought in from home. Today, retailers want tailored music mixes to enhance the “brand experience.”

A teenager browsing in Hot Topic, a 650-store punk clothing chain, for example, is treated to a well-honed list of songs from around the world chosen because of their likely appeal to that chain’s audience. Much of the music is from new or tiny producers, found by Hot Topic executives or PlayNetwork, the chain’s music service. A shopper in the store can find out what music is playing from an electronic box that lists the artist and song.

For musicians, that can be desperately needed exposure to a target audience.

“Here you are talking to artists, or little labels, who are looking for opportunities,” said Jeff Heiman, senior director of licensing and label relations for PlayNetwork. “With radio the way it is, with playlists as tight as they are, with nobody wanting to promote some independent artists, these guys are looking for any and all opportunities.”

How much an artist gets paid for licensing depends on how much a song gets played. A musician might get a few dollars or a few thousand dollars every month, Heiman said. But the exposure can lead to more album sales and more touring gigs.

“Oh, gosh, does it give you credibility,” said LeRoy Bell, a Seattle-based acoustic performer who formed a relationship with PlayNetwork and whose tracks have since been played extensively in Starbucks and other retail chains. Two years ago, Bell was struggling to get his self-produced CD off the ground, but now he is touring with legendary bluesman B.B. King. He credits that success, in large part, to the exposure that began through retail channels.

Bell said someone will hear his music in a store, look it up online and then may see that he is coming to town on tour. That person might go with a few friends, who might all buy his CD after the show. “It really does work that way,” Bell said.

In his cluttered, third-floor office overlooking Rock Creek Park, with Mojito the cat trolling underfoot, Hawken of ESL Music rattles off some of the biggest deals he has landed, such as one with Jaguar last year. The automaker hired ESL to create eight promotional CDs, including a mix of ESL’s own artists, such as Thievery Corporation and Ursula 1000, to put in the glove compartment of new X-Type cars. It was just shy of a six-figure deal, Hawken said, and made a big impact on the company—in many ways.

“That was a flat fee, and it was a huge deal,” Hawken said. “We’re getting paid to promote our music. . . . It’s kind of flipping the old model on its head.”

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