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Ditto Blog

iTunes Got Quick and The Industry Changed!

I have been working in digital distribution for several years and remember when we as a company would send our music to iTunes and they would take 3 weeks for them to process a release and get it live. So iTunes would have your release on the 1st of March and it would probably be ready for sale by the 1st of April. This long processing time lead to Pre-Release campaigns on other stores such as 7Digital being very popular, why do nothing in the month you have to wait when you could be clocking up pre-sales to increase the likelihood of charting!? 


Then iTunes, probably concerned about missing out on sales introduced Pre-Release (kind of… :S – the release has to be 4+ tracks and can only be bought as a bundle) in January 2010. This then changed the model that was popular with our Independent artists. Pre-Release campaigns were added to iTunes, however this would still take around 3 weeks of a wait but with SMS pre-releases and 7Digital etc this was fine.


Then iTunes Got Quick!

So, June 2010 iTunes update their system allowing releases that get sent to iTunes to be processed and become live on store within hours. So how did this affect our market? We noticed that our clients were pretty keen on this. Forget pre-release campaigns and marketing – ‘I want my release on iTunes now! Now? Yes right now.’


This topic of instant release has been discussed over the last few months, even on the Sky One show ‘Must Be The Music’ releases where going live that night, X-Factor did the same thing and our clients followed suit, get it up there now and hope that you start making money. But how did this affect the model?


Something very interesting happened. One of our artists recorded a cover version of ‘Turn My Swag On’ done in the style of Keri Hilton – you may have remembered it from Cher Lloyd’s audition on X-Factor. Our artist Alexa Goddard knew this would be a hit, recorded it and sent it to us, and within 24 hours it was live. So that was the only copy available and it sold 10s of thousands. What else? We have seen tons of our artists making great incomes from cover and karaoke versions, i.e. Adele’s new single gets played on the radio on a Sunday, they record on Monday release on Tuesday and as Adele still has 6 weeks of Radio promo before release date where they are instantly making money from someone’s compositions, legal and without issue – well, here in the UK anyway.


So has this opened up new possibilities within the industry? Take for example cover bands, wedding band etc, all earn a decent living from performing other peoples music. Because they can now record and release the same week or even before major label artists they can now take advantage of this potential money, because distribution is now so quick.


This is probably really irritating Universal, Sony etc as effectively Independent artist and labels are taking money out of their pockets and earning off all the work they have invested in their recording artists composition and marketing. So how will they counteract this? Well take for example Jessie J’s ‘Price Tag’ released on US radio of the 25th of Jan 2011 and released very soon after for digital download in the UK on the 30th of Jan 2011. Was this to beat the cover/karaoke version? Was this because of her success with previous release ‘Do It Like A Dude’ that Island thought they would not need a big radio campaign for it to be a success (which proved to be true), maybe they thought if they didn’t release quickly she may fizzle out, who knows. It still must be irritating for Island that when you search ‘Price Tag’ in iTunes the first thing that comes up is a cover version by Covers Records – sucks to me you!


So this may become the norm for majors, or it may simply become an option of releases styles, but what else could the Major label industry do? Put pressure on the PRS and music publishers to change copyright laws, maybe. In the US you can’t simply release a cover version you have to get clearance from companies such as Limelight, where you pay an upfront fee depending on how many units you will manufacture or estimate to sell for digital. This money then gets passed onto the original copyright holder but it takes time – delaying how quickly you can release these versions, where as in the UK PRS take the 8% and pass it to the label so you can freely release all you want – could this change??


So do Major labels scrap 6 week radio campaigns and just release straight away? Could this then change the model of radio playlists? Will the legal policy on cover versions change to something similar like they have in the US where you need to purchase clearance prior to release? I don’t know but look how one discussion from iTunes can have a butterfly effect on a whole industry; I mean it’s one store? Fair enough BPI quoted iTunes to be 34% of the entire record industry in 2010 but it goes to show the effects it has on this business – what if they ever stopped working?!


- Jay Kerr

Vice President