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MUSICULTURE
The Music Industry Bible, Version 8
Donald Passman’s All
You Need to Know About
the Music Industry
by PHILIP EHRENSAFT
When a book announcing that it
tells you all you need to know
about the music industry
comes out in an eighth edition,
it has passed a Darwinian test.
As a young music industry lawyer in Los Angeles,
Donald S. Passman observed a shared
characteristic of brain surgeons and musicians:
“.... each one is capable of performing his craft
brilliantly, and generating huge sums of money.
Without the need for any financial skills. In
most businesses, before you can start earning
big bucks, you have to be pretty well schooled
in how the business works ...But in entertainment,
as in surgery, you can soar to the top
without any business expertise.”
That lack of expertise often leads to a lot of
woe. So Passman started teaching a course at
the University of Southern California about
what makes the music industry tick, aimed at
musicians as well as other music professionals.
For musicians, the message was: most of
you should not manage your own career, but
you better get a solid handle on how the music
business works in order to monitor whether
your manager, booking agent, and lawyer are
doing a good job.
In 1991, Passman turned his course notes
into a book, All You Need to Know About the
Music Business. It took off, as did Passman’s
rise to the pinnacle of music
law. Part and parcel of his
rise is an evolution of music
lawyers’ roles beyond the
usual legal functions, to an
integrative role as dealmakers
in an increasingly
complex and fragmented
music sector. Passman’s
deal making has involved
the likes of Janet Jackson,
Quincy Jones, Tina Turner,
and R.E.M.
Passman has a rare talent
for transforming technical
issues into a clear,
entertaining prose. After
advising musicians on
how to choose and monitor
their team of supporting
advisors, he proceeds
to the intricacies of record deals, songwriting
and music publishing, group issues and touring,
merchandising, and motion picture music.
Any Canadian musician doing business in
the world’s largest single music market will be
well served by Passman’s book. Chapters like
those on choosing advisors are equally applicable
in Canada. Others require supplemental
reading for the specifics of Canadian law and
practices, but the reader will know what to
look for.
Passman’s clients indicate the focus of All
You Need to Know: the popular music, including
film music, that generates the lion’s share
of music industry revenue, whether it’s the big
buck acts in New York, L.A. and Nashville, or
aspiring indie bands in outlying regions.
Classical music gets a scant four-page chapter
in Passman’s 480-page book, treated as a
mostly poor-cousin special
case of the music
industry. When
Passman discusses
musicians’ clout, or lack
thereof, in negotiating
recording contracts, he
refers to a starting artist
as a musician who does
not have a recording that
has sold at least 100,000
copies in the USA.
In contrast, typical
classical music sales are
“... in the 5,000 to 10,000
range worldwide.... In
fact, a “big seller” classical
album is 50,000
worldwide.” Passman
doesn’t pull punches on
why “classical” classic
music recording deals are now so rare: “Their
economics suck. Classical records are very
expensive to make and have limited sales
potential.” Even if you’re a major-name classical
artist and can get recording contracts, the
terms for the artist’s cut are typically modest
compared to pop music.
Readers of La Scena are all too aware of this
bleak situation. So why read a book that focuses
on the nuts and bolts of popular music businesses?
One reason is that these big-dollar genres
set the economic parameters for the music
sector as whole, including classical music. The
special February 16, 2013, issue of the “Wall
Street Journal of the pop music industry,”
Billboard, is devoted to The Power 100 in the
sector. Number one on the list is the chairman
of Universal Music Group, Lucian Grange.
Grange maintains that “The data shows and
has proved that the enjoyment, the pleasure,
the use, the interest in music has never been
higher. That’s why we’re confident.... We’re
monetizing things that we’ve not monetized
before, and they’re coming elsewhere in the
balance sheet.” The classical music sector
would do well to monitor whether new strategies
created by people like Grange can also
bolster the balance sheet for art music.
In particular, classical music has a great
deal to learn from popular music’s pioneering
use of social media to reshape the music sector.
Social networking is front and center in
Passman’s music business bible. But the shoe
can also be on the other foot – witness the brilliant
harnessing of You Tube by the young violinist
Lindsey Stirling to launch her international
career, as profiled in the March 2, 2013,
issue of Billboard.
Passman’s own analysis also suggests that
many classical musicians may have superior
lifetime net income flows, compared to many
pop musicians with much higher gross
incomes. Most pop musicians have relatively
short careers. Not as short as football players,
but most will not emulate the aging Rolling
Stones in filling stadiums. An important part
of the work of pros like Passman is getting pop
musicians to plan ahead and save for the future.
In contrast, classical musicians can typically
continue their career in their 70’s and
beyond. Pop musicians in their prime are also
paying a larger proportional share of their big
gross incomes for commissions to personal
managers, booking agents, business managers,
lawyers, and big touring expenditures
for their band plus tons of electronic equipment
and the staff to manage it.
So classical tortoises may outrun pop music
hares.
LSM
AVRIL/MAI 2013 APRIL/MAY 39