Hello, Berklee online.
Hello.
We've been waiting on you.
I'm John Kellogg, I'm the assistant Chair of Music Business Management
Department here at Berklee.
And I want to welcome you to Berklee Onsite.
Are you having a pretty good time so far?
Good.
Let's see.
Do I have so many of you from so many different places?
You know?
I want to talk about, first about a song made years ago, of a great R&B
artist named Bobby Byrd.
He recorded a song that was penned by the great James Brown.
And the title of that song was Saying It And Doing It is Two Different Things.
Saying it and doing it is two different things.
Now, I like that song.
I like it so much that I'm going to sample it.
I'm going to remix it.
I'm going to give it my own spin.
And I say that having it and making it are two different things.
Having it and making it are two different things.
Do you know the word "it" is often used to indicate
someone had special talent or special ability to connect with an audience,
particularly in the entertainment industry?
There's a lot of ministers, pastors, and even motivational speakers,
that can convincingly state that everyone has it.
Everyone has that special something in them
that nobody else has that they should share with the world.
But discovering your it is a process that everybody has
to undertake in their own unique way.
My quest to discover my it started when I
did a concert when I was 11 or 12 years old by a group called The Miracles.
At that time, Smokey Robinson was the lead singer.
And I remember sitting in the audience seeing the groups up there,
great syncopated choreography, ice suits, great harmonies,
great soulful singing, the audience going, wow, making people feel good.
And I said to myself, "I want to do that."
But it wasn't until a few years later, when
I was in high school, that I discovered my it.
I was managing a group of underclassmen, I was a junior.
Four guys, vocal group.
The name of the group was The Illusions.
And they were trying to learn a song by the internationally known Motown act,
The Temptations.
Wow.
I remember seeing The Temptations at a small club in my hometown of Cleveland,
Ohio called Leo's Casino.
And usually when they would appear, they had an opening act
by the name The O'Jays.
And at this time, the O'Jays was just a reasonable act,
they didn't have any national prominence or significance.
And I knew that they were internationally
known because they lived right around the corner
from me in the inner city of Cleveland, Ohio.
As a matter of fact, we used to go and sit
on the steps of their uncle's house, where they were staying.
And we'd hear them sing a capella, they sounded just like a record.
It was unbelievable.
In the old days, they used to perform with The Temptations
and they used to build that show as the battle of the groups,
the O'Jays versus The Temptations.
And always the O'Jays used to battle them tooth and nail,
almost to the point that I felt that if the O'Jays didn't make it in the music
industry, I wasn't even going to try to get into because the industry had
to be too crooked if a group with that level of talent couldn't make it.
So The Illusions were trying to learn the song I Could Never Love Another.
The song has a great opening lead that was
sung by the lead singer of The Temptations, David Ruffin, at the time.
Now, David Ruffin has an extremely unique talent.
He has a five-octave range.
And in the first verse of this song, on one word, he flips up an octave.
It was outstanding.
So everybody in the room tried to hit that like him, nobody could it.
And it got to the point that I eventually went up to the band,
and I said, wait a minute.
That's not how you do you This is how you do it.
And I hit the mic.
All of the guys stopped.
They stepped back and looked at each other.
And then one of them stepped up to me and said, John,
we didn't know you could sing like that.
You can manage the band, you've got to be in the group.
So I felt, well, maybe I have something that I can pursue.
Maybe I have this it to connect with an audience with my voice.
But discovering your it doesn't mean that you are going to
or may even want to make it.
And if you decide that you want to make it,
you have to determine what is making it to you.
Well, I tell you what I decided right at that time.
Wow, if I had this it, I want to make it, and making it to me
is to perform in a national recording group.
That would really be making it.
So I knew I had it.
And that I wanted to make it.
But what I didn't know at that time is that having it and making it
are two different things.
You know?
I think that a lot of these reality shows,
talent competition, American Idol, Voice, America's Got Talent,
kind of distort the meaning of what it takes to make it.
Many of these, great, many talents get on that program,
and think that once I get on national TV in front
of six or seven million people, I've got it made, I've made it.
I won't have to work another day in my life.
All I have to do is play, you know, my instrument or my voice,
and I'll have it made.
Well there can't be anything further from the truth.
What a lot of people don't understand is that it takes time to make it.
And these contestants will soon be very frustrated
and find out that they had it, and they had the opportunity to make it.
And I say that if you have it, you can make it.
But not without the impenetrable power of working it.
And for the next few minutes, I want to talk about the impenetrable power
of working it.
If you go on YouTube today, put it in the search box,
Carrie Underwood's first audition, television audition for American Idol.
It will pull up a video clip, an attractive young lady,
very plainly dressed, here down in a very simple style,
singing a great song, I Can't Make You Up.
She did a clearly phenomenal job.
The judges could have ride through to Hollywood.
She went on to win that season, that's 2004.
And after winning the competition, she went on a 25 or 26 city tour of arenas.
15,000, 20,000 people with all of the American Idol
top 10 winners or contestants.
15,000 or 20,000 people.
Now, after she finished that tour, she had a decision to make.
She could've decided to go back to her home state of Oklahoma
and maybe just sing at church every weekend, do a couple of gigs.
Or she could choose to be an international superstar.
And I started to see after that American Idol tour
that Carrie Underwood was working anywhere and everywhere she could.
She was working at state fairs in front of 10,000 to 15,000 people.
county fairs, three to five thousand people.
Even country music roll houses, 500 to 1,000 people.
She was working four or five nights a week.
You know that great author Malcolm Gladwell in his book The Outliers
says that you have to invest 15,000 hours to become
a master in your field of pursuit.
15,000 hours to become a master in your field, any field, of pursuit.
You can also go onto YouTube channel, and you
can search for Carrie Underwood's performance
on the very last American Idol program, which happened last year.
I urge you to do that after this presentation
and you're going to see the difference.
She performed immaculately dressed, great production,
style out of this world, all those 15,000 hours, all came to a head
on this performance.
You saw how she knew exactly what to do, when to do it,
how to touch an audience, like she had learned on the road,
the kind of moves to make to touch that person in that 18,000-seat arena way
in the back.
She killed it.
But more importantly, she was introduced by Ryan Seacrest like this.
Now we have an iconic singer currently on a worldwide tour.
Carrie Underwood had it, she wanted to make it,
but she couldn't have done it without the impenetrable power of working it.
So how many people have taken my Introduction to Music Business course?
Anybody in here?
Yeah, you have.
OK.
So I'll be brief.
You've heard this in the videos.
Started with the allusions in high school,
went to college, worked with two bands, The Decade,
which was a dynamic group of five singers and five band members.
Most of whom did not want to make it in the music industry,
they were upper-class men.
And after they graduated, both me and my guitar player roommate
put together a band that wanted to make it
in the music industry, The New Decade.
And we worked and worked.
We worked college campuses, we worked parties,
we worked nightclubs, eventually getting to the point where we became
a staple on the chitlin' circuit.
Chitlin' circuit is a string of nightclubs and theaters
where black entertainers play, and cut their teeth, so
to speak, during that day and age.
And when we were in these various cities,
there would be other bands at other clubs.
And when we had off nights we'd go check them out.
When they had off nights, they'd come and check us out.
We networked.
Networking is a part of working it.
We met managers and agents, and other band members.
So when I decided to move to New York after a number of years,
the first call I made was to the leader of one
of those groups, Larry Blackmon of the group Cameo,
who had just released their first single, a disco song,
about a year earlier, and were finally at the point
that they were recording an album.
And on the same day I got to New York, after working years and years,
I was in the studio recording with a group
that had a national recording contract.
And I will never forget the day that the band was all together in a tight van
and we were traveling to Philadelphia to do a promotional gig.
And we crossed the Ben Franklin Bridge from New Jersey into Philadelphia,
and the R&B station played the current hit single.
This was the first time we ever heard the song when we were all together.
And of course, the bus erupted.
I remember once they said wait into the second song
after that, just kind of put my head back on the seat,
thought about the nine years it took for me to get to that point.
One of the best benefits you're getting by going to Berklee
is to benefit of other Berklee students and the late Berklee alumni.
I remember going to a concert, my first year here,
the Heavy Rotation CD release party.
Heavy Rotation is our student-run label.
And they had an annual CD release party where all of the artists on the CD
performed live in the Berklee Performance Center.
And I went to the show that year, unknowing what to expect.
But I saw a--
I met a young performer, his name was Kevin Ross.
And he was a songwriting major, wrote up great R&B songs.
Had a very unique performing style, engaging.
And after the show, I remember seeing him in the lobby
and I stopped him and I said, young man, I think you've really got something,
come and see me.
And he came into my office a couple of days later.
And I said, you really got something, you need to continue to work,
I think you're really gonna do it.
And he said, Mr. Kellogg, yeah, I'm going to do it, one of these days,
I'm going to have a number one record on the billboard charts.
That was making it for Kevin Ross.
I watched him as he finished his studies here for the next year and a half.
He continued to work, he performed on television shows,
he performed at clubs, even the famous Paradise Rock Club, which is historic.
And after he graduated, he moved to Atlanta
and started working with a very established urban music producer.
And he continued to write and work with the producer,
got a couple of placements, one on the big urban artist, TI, rap artist.
But he continued to work trying to get that number one record.
Graduated in 2008, it wasn't until 2014 that he got a contract
and released his first EP on Motown Records.
Wow.
That enabled him to open up for tours for Maxwell and for Neil.
He was getting experience in front of a large audiences.
Still no chart record.
He even got a television commercial, a Glade commercial.
You might have seen it during Christmas of 2014,
a young man in a nice camel coat singing a song about glade candles.
Great national promotion for him and exposure for him.
Still no hit record.
Then I was reading USA Today last year in September.
And each Friday they have music charts.
And I was-- I look at them every Friday, and I was very surprised
to open it up and see on the adult urban contemporary charts,
a record by Kevin Ross was number 10.
Long Song Away.
I was thrilled.
I said, congratulations to him and to Motown.
I watched it over the next several months,
and it's slowly moved up to top 10, to number eight, to number six.
Then, when I was out in LA for the Grammys just this past February,
I noticed that it was number four on the charts.
And I went to see this A&R person in Motown
and congratulated him on a great job.
They did won in the supporting category
Kevin even admitted when he was here a couple of years
ago that it was a time doing this process that he
had to work at a fast food restaurant just to make ends meet.
Because he was that determined.
And he had a person--
I asked, and a person said, you think this record
is going to go to number one?
He said, yeah, I think it will be there in a couple of weeks.
Now, to be frank with you, I really didn't believe it
because Bruno Mars 24K Magic was number one, and that's a great record.
I thought it would hold on for a number of weeks.
Well, it wasn't two weeks afterward.
But within three to five weeks afterward, I went on the billboard site
to the Hot Adult Urban Contemporary Songs chart,
Kevin Ross had his number one record.
Kevin Ross had, he worked it, and he made it.
Sometimes you get to a point that you will find that you
might have it in more than one area.
I read an article in the Wall Street Journal
last year that said that the typical person a day
would have six to seven careers in their life time.
Six to seven careers in your life time.
So some of you, I've noticed in students that I teach online,
are in the military.
What a great thing, serving our country.
Many of you might have gone into the military thinking, man,
if I could just become sergeant.
That'd be making it, to me.
Right?
And you might have achieved that goal.
You might have worked in a warehouse distribution center, started off
as a stock person, but you wanted that manager's position.
You worked at it and you got there.
You achieved that goal.
You can start at an accounting firm as a public accountant,
and eventually wanted to be a certified public accountant.
And you achieved that goal.
But all the time in the back of your mind you were thinking,
wow, I sure would like to make it in the music business.
And that could be one of the reasons why you enrolled here at Berklee Online.
I'm sure many other people that you tell that dream to might say, are you crazy?
You finally made it to that position?
Why in the world do you want to do something different?
I often get asked why did you leave Cameo
after working all those years to get in that position?
And I always tell people, you know?
A funny thing happened to me while I was making it with the group Cameo.
I remember even when I was with the group
The New Decade working on the road, I started reading articles
about lawyers practicing a new type of law called entertainment law.
This is in the middle of the 70s.
Brand new profession.
And it kind of stuck in my mind, particularly
after I read an article with Dionne Warwick, who was a big star in the 70s,
said, you know?
If I had to do it over again, I'd go to law school.
So even before I moved to New York and work with Cameo,
I applied to my hometown, I'm from Cleveland, Ohio, Law
School, Case Western Reserve.
And after a couple of months of being on the road with Cameo,
I recognized that I would never be able to fulfill
both my creative or my financial goals within that group.
So when I got notice that I was admitted to Case Western Reserve Law School,
I immediately left New York and went back to Cleveland
to work in the steel mills a few months before I started law school.
That was tough.
You know?
I left the week that Cameo--
we had played a number of small auditoriums and college campuses,
and small nightclubs.
But the week I left, they were going to open for Natalie Cole in the Superdome.
Oh, my goodness.
What a gig I missed, right?
So I went back to Cleveland and it was there, Case Western Reserve Law School,
that I learned the three A's.
The three A's.
Affirm what you want to do, affirm what you want to do.
The first few weeks of law school, all of the fresh--
the first year students gathered in the hallways and out on the quad.
Inevitably, you get around to the conversation of what kind of law
you want to practice.
Some people would say, well, I'm going to be a corporate lawyer.
Others would say, I want to help people and the defenseless,
I want to be a criminal defense lawyer.
Or I'm going to be a divorce lawyer.
John, what are you going to do?
Well, I'm going to be an entertainment lawyer.
Mind you this is the 1970s, brand new profession, in Cleveland, Ohio,
not hardly an entertainment center of the universe.
So I can tell many of them walked away saying, yeah, good luck with that, guy.
You know?
So not only did I affirm throughout my law school career
that I was going to be an entertainment lawyer, in spite
of some very strange looks.
And I also took action, that's the second big in.
Action, take action.
I knew that to be an effective entertainment
lawyer I needed to take his many business
courses as possible because at this time the field was so new it didn't even
have entertainment courses They didn't even have a copyright law
course at that time.
So I took some very difficult business courses that a lot of students
thought I was crazy to take.
Why are you taking that course?
I said, don't worry about it, I've got it covered.
And I remember walking on the campus after I graduated,
and I was preparing for the BAR exam.
And I saw a student who was a year behind me saw me across the quads,
and, John!
He ran up to me.
He said, John, John, are you still wanting to be an entertainment lawyer?
I said, yeah, that's why I came here.
He said, well, look, I just met the lead singer
of the O'Jays, Eddy Levert's nephew.
And Eddie is sending him to Cleveland State University
to become an accountant.
And I think they might be looking for a legal counterpart.
Why don't you-- here's his number, contact him.
Would that have happened if I had not affirmed that I
wanted to be an entertainment lawyer?
I don't know.
As a result of that contact, I met that young man,
we've been the best of friends, as well as
business associates for over 35 years.
And as a result of that connection, I was
able to represent my childhood idols, Rock and Roll Hall of Fame inductees,
the O'Jays, Gerald LeVert, the late Gerald
LeVert, one of the greatest R&B singers, songwriters, and performers ever.
And his supergroup, LSG.
In other words, as a result of affirming what I was going do, taking action,
I was able to achieve my goal of becoming an entertainment lawyer.
There's another Berklee alum I want to tell you about,
that went through the same kind of process.
His name is Nils Gums.
Nils Gums wanted to come to Berklee.
That was making it to him.
To come to Berklee College of Music.
And he did, he made it.
Well, he got very interested in the music business
major, became a music business major.
And while he was here, even though he just wanted to come to Berklee,
possibly to be a star musician, he recognized, wait a minute,
maybe I have it in another area, I think I can advocate well for people,
I think I could really represent talent well.
And after we graduated, he moved to California.
And he started representing Berklee alums.
The first alumn he represented was Dawaun Parker.
And he became a big producer with Dr. Dres' label, Aftermath and Interscope
records.
The next clan he picked up were also Berklee alumns.
A duo, Amy Heidemann and Nick Noonan, collectively known as the group Karmin.
Those of you who are studying music business online,
the great thing about Berklee and the Berklee education process
is that we really try to train students to be innovative,
and to be on the cutting-edge of the music business.
And that's what Nils Gums did.
He took those thoughts and he really started
to see the disruption that was happening in the music industry,
and how the internet was taking over, and how this new YouTube channel
partnership that was happening at the turn of the last decade
was very important for promoting artists.
So he worked with Karmin over two years with the thought in mind.
And Karmin had the thought in mind that making it was a major label deal.
And of course, Nils wanted to be a major music manager, that was his goal.
So he came up with a great strategy, an innovative strategy.
He told Karmin, look, this is what I want
you to do, I want you every week to record a video cover of a top 10
hot 100 billboard song, every week.
And they did that.
And during the second year of doing that, things started to catch on.
And after a while, over an eight-month period,
they had accumulated 190 million views, as well as 88,000 YouTube channel
subscribers.
Not only that, but Amy's very interesting interpretation
of Busta Rhymes rap on the song Look At Me Now by Chris Brown
was so entertaining, that it accumulated two or three million views
in just a couple of days.
So much so that Ellen DeGeneres called and said,
I want you on the show next week.
And they did.
And after that, there was a bidding war between major labels to sign them.
And they did sign them.
Not only that, but shortly after being signed,
Karmin became the very first group without an album
to appear on Saturday Night Live.
They had achieved their goal.
They had it, they made it, but not without the impenetrable power
of working it.
I also get asked many times, well, John, why in the world
did you leave a successful law practice in the 90s, the golden age of recorded
music, when album CDs were selling in the millions,
advances were in the millions, why did you leave
that to get involved in education?
And I say, once again, well, a funny thing
happened to me while I was making it as an entertainment lawyer.
I started to see production companies and producers who
were driving the business of the 90s.
Particularly in the hip hop area and urban area.
And I noticed that even some of the most successful ones
didn't have a clue as to what was going on with their contracts
or their accounting statements.
They didn't know how the money was made.
And I said, I've been given the unique opportunity
of acquiring this knowledge by representing the clients I
had the opportunity to represent.
And I said, I'm going to put together a series of workshops
to try to train these young production companies on it.
So that's exactly what I did.
I put together a workshop called Take Care of your Production Company's
Business.
And I had a workshop in my hometown of Cleveland,
I also had one in Detroit, Michigan.
And I invited a bankruptcy judge from Detroit, federal court,
who was noted because he had terminated recording
artists' agreements in bankruptcy, and he was one of the few attorneys who--
not attorneys, but judges who actually did that in bankruptcy court.
His name was Ryan Reynolds Graves.
And I'll always remember that when I introduced him
for his hour-long session doing this all-day workshop,
I noticed that he was an adjunct professor at Wayne State University Law
School.
And I'm telling you, as I sat there and saw how for a whole hour he was able
to just totally enthrall the audience and hold our attention as he weaves
stories of the bankruptcy court, entertainment law,
the lives of musicians, , and, how this law affects everyone.
And by the end of his presentation, I felt
just like I felt when I went to the Miracles concert
when I was 11 or 12 years old.
I said, I want to do that.
So I knew I had to prepare for that, as well.
I knew in order to teach at a college level, you at least have to write.
Writing a book is important.
I'd written a number of articles, so I ended up
writing a book, Take Care of the Music Business,
the Legal and Business Aspects you Need to Know to Grow in the Music Industry.
I also started to accept any and every speaking engagement I could.
Workshops, panels, I went on a 26-city book tour, speaking in bookstores.
And then, finally, in 2002 I was reading the Billboard Magazine,
as I encourage all of you to do, and I saw an ad that said,
University of Colorado in Denver is looking for an assistant professor
of music business.
Well, the first thing I thought was, I didn't even
know that they had music business programs on the undergraduate level,
I was surprised.
I thought that I would probably have to teach copyright law, entertainment
law at a law school.
I thought it was the only opportunity I had to teach.
And the second thing I thought was, Denver, Colorado?
It's not a music capital by any stretch of the imagination at that time.
I applied for the job and I was accepted for the job.
And from my very first day of teaching, I would tell all of my students,
as I'm going to tell you, you are the future leaders
of the entertainment industry.
And remember how I said I thought it was strange that they had a music business
program in Denver, Colorado because it wasn't a music capital?
Well, shortly after I started teaching there,
I had the opportunity to teach future leaders of the entertainment industry.
Isaac Slade, Ben Wysocki, who are members and founders
of the group The Fray, kind of put Denver on the map.
And over and over again, I've seen the students
from not only university of Colorado at Denver,
but as well as the students here, Berklee, do the same thing.
Four years later, I saw an ad in Billboard, Berklee College of Music
looking for an assistant chair of the music business management department.
And that's why I'm here before you today, folks.
So no matter where you are in your career,
this might be your first choice, you might just now
be working on your Professional Studies degree,
this is your first action step toward achieving your goal of making it
in the music business.
It could be your second or third career.
I've had four.
I've been a singer, I've been an entertainment lawyer,
I've been an author, I've been chairman and professor,
I don't know how many more I've got to go,
but I'm going to keep on striving as long as I can.
But it's important to recognize that the Berklee system that you're ran
is going to put you in the position to make it happen
it was another student, Berklee student, whose goal after he
got here as a freshman was to develop a YouTube channel.
He wanted to be a YouTube star.
His name was Charlie Puth.
He started putting up quirky videos every couple of days.
And he finally did a video with Emily Luthor, cover of Someone Like You.
And he wanted to be a YouTube star.
That video went viral.
I remember being in my office on a--
I believe it was a Tuesday, and there was a knock at my door.
A young lady walked in, it was Emily Luthor, I didn't know her at that time.
She said, mister Kellogg, mister Kellogg, I was told to see you.
I said, OK, have a seat, what's up?
She said, my partner and I put together a couple video of Someone Like You,
and we put it online on the YouTube channel on Sunday,
and we entered into the Perez Hilton Cover Contest the same day,
and it's got two million views over a couple of days!
I said, wow, Ellen's going to call.
She looked puzzled.
She said, Ellen?
Ellen who?
I said, Ellen DeGeneres's is going to call you.
She said, yeah, right.
Thank you, mister Kellogg.
I said, well, come back and let me know how it works out.
The very next day.
[KNOCKING] Mister Kellogg, mister Kellogg,
you're not going to believe this, we won the Perez Hilton Cover Contest
and Ellen called!
Me I said, I told you she was going to call you.
Karmin did the same thing a year earlier.
They went on the show, eventually got a contract with Ellen's company,
didn't quite work out.
But Charlie Puth was determined.
He wanted to be a YouTube star, he had made it,
yet he decided he wanted to do something else.
He wanted to get his college degree, he didn't have to make that decision.
And he said, I want to get my degree in production.
I want to be a great producer and songwriter, too.
So instead of leaving school, he stayed in school for two or three more years.
And eventually graduated.
Second goal reached.
Then he went to work in production.
I believe he got a publishing deal and continued to work.
You know the end of the story.
See You Again was the biggest record of 2015 with Whiz Khalifa.
So my point to you folks don't think that this is so far from you.
It's very close.
Very, very close.
Take it from a kid from the inner city of Cleveland, Ohio.
My god, certainly not a recording capital of the world.
You can do it.
You can do it.
But just remember, if you have it, you can make it,
but not without the impenetrable power of working it.
Thank you.
Thank you, folks.
So let's talk about some of the developments that are going on
in 2017 in the music industry.
Anybody have any questions?
Comments?
Yes?
Affirm what you want to do, take action--
The third is achieve.
Affirm, action, and achieve.
Great.
Anybody else?
Yes?
Tell us what are the three P's, in case they haven't read your book,
The three P's.
Powerful product, proper perspective, and professional attitude.
Powerful product, proper perspective-- and powerful product
doesn't have to be-- when I say product, it doesn't just have to be a CD,
it could be a great song, it could be a live performance,
you know, even if that's a service, still, you
can look at it from a product standpoint, as well.
That's very important for you to--
it's becoming so important in today's music industry.
If you go to any arena show today, powerful product
isn't just going to be the songs, it isn't just
going to be the entertainers coming out and singing.
You know, like I said, I used to go to clubs and see The Temptations
and the O'Jays on the stage about this size and about this high,
with microphones and the band in the back,
and the choreography and everything else had
to be the entertainment that really made you lock in.
Today it's completely different, which gets us
into talking about-- thank you for giving me this segue into what's
happening in 2017.
You look at the arena shows, think beyond.
A lot of my students say they want to start record labels
and I tell them look I think beyond it folks
think about starting an entertainment company.
Because now, music is invariably paired with video in some form or fashion.
So when you go to a major arena show now,
you aren't just going to see the singers.
You are going to see that great art form choreography that
was really made famous back in the R&B days with groups like The Temptations.
They are going to have dancers, but you're also
going to have lighting effects that are tremendous,
you're going to have some form of video.
When I went to the Grammys just this past time,
you might have seen it on television, Katy Perry's performance was amazing.
And I don't know how she did it.
I don't know how she did it, but there were times
that she disappeared behind what looked like a screen,
but there was no screen there.
It was one of the most fantastic production jobs I've ever seen.
And all of the major acts now are trying to outdo each other
by putting together not just the music to entertain,
but the entire production.
It's like a Broadway play to some extent.
So powerful product on the live in is that great show
proper perspective is understanding where you are in the business
and not losing yourself in the business, as so many artists do.
Well do I mean by that?
And in my book, I talk about artists think
they get a million dollar advance, a million dollar contract,
they think that they are rich.
When, if it's a million dollar contract, it
could be for four albums, and each album is $250,000 each, the advance.
But out of that $250,000, they have to pay all of the cost of recording.
And then, what's left over, Uncle Sam comes in and takes a piece of that.
So, many times, people get a little bent out of shape.
They really think they're stars, they have a lot of money to burn,
and they don't.
So it's important for you to understand and have the proper perspective.
And the last is professional attitude.
Make sure you treat everybody the same.
You meet the same people going up that you'd be going down.
That receptionist today, the person that opened the door for you, that person
in the mail room, could be the head of the label one day.
So treat everybody the same.
The three P's.
Powerful product, proper perspective, and professional attitude.
Thank you from listening you also have any questions for them
all right let's talk about some of these issues.
Wow.
Here's the thing that I've really been noting that I think important.
You remember how I was talking about now it's about entertainment companies
and not just recorded music?
That's true in a number of different areas, particularly in the video area.
Those of you who are interested, those of you who score films,
want to do scores for films, television shows.
What an opportunity the industry has provided now
that the streaming services, Hulu, Netflix, Amazon have come in.
There are so many new content providers.
So the film and TV companies are going to be expanding,
and are expanding to a very great degree.
The fees of actors and other talents, even the writers,
they just renegotiated in a new contract.
They are starting to go up.
It's going to create a great opportunity.
And you need to think broadly.
Once again, think about the visual aspect, as well as the recording
aspect.
And hopefully, that will have an effect even on the music industry,
as far as how much money it is going to be made.
So there's great opportunities there.
The growth of subscription service apple Spotify.
All of the various subscription services are really growing.
I just read an article that it's over 100 million.
It just exceeded the subscribers of Netflix.
Here's the disturbing thing to me.
I remember a few years ago there was one commentator in the music industry
that says that when we hit that 100 million mark,
the whole game will change.
And these tips of a penny that creators are being paid
will increase to the point that it's going to be phenomenal for them.
And they predicted, this person did, that it would happen in 2017.
I didn't think it would get there that quickly.
I wasn't sure.
But it has.
We're there.
Has the revenue for content creators increased?
No.
But there it-- well, it has, I shouldn't say no.
It certainly has.
But there is still a way to go.
And it's important for you to be involved.
As I tell everyone, join lobbying efforts
like NARAS, the National Academy of Recording Arts and Sciences.
That's the Grammy organization.
Because they have lobbying efforts to make sure that we insist in work,
even if we have to pass laws to make sure
their creators are getting paid more.
Now, I say they aren't, but they are.
Creators are being paid more.
I have a client that is in a niche market artist,
and told me that he was paid $60,000 from Sound Exchange.
And this is why I know those of you who take my course, I insist upon you,
register in your recordings with Sound Exchange.
There is money for you.
And any non-interactive streaming that's done, you are going to be paid.
They're just-- and you're going to be paid on a monthly basis.
So I see at least as far as the interactive streaming and sound
exchange, the royalties are increasing currently.
The landscape is starting to change with these subscription services.
Spotify is getting ready to have not an initial public offering,
they're thinking about having a direct listing on the New York Stock Exchange
sometime this year.
And they've entered into deals with Warner Music Group, where--
not Warner Music Group, Universal Music Group,
where the label will be able to window the new artist albums,
and only have them streamed on the paid service
for a period of time, maybe a week or two.
And I think that you are going to see a difference, and we as creators of music
have to make the difference, as far as creators
receiving a fair share of the revenue.
The good news is that this market is exploding.
Spotify has over 50 million subscribers.
I think they said that Apple has over 20 million subscribers.
How many people in here have a paid music subscription?
Pay yourself, good.
So I think that the prospects for the future are very bright.
But not without you being involved, each of us
being involved to make sure things are going to happen.
Sales-to-streaming just changed over this past year.
The beginning of this year was the first time many of the labels
found that the streaming revenue alone exceeded 50% of their revenue.
Phenomenal growth.
So it's to the point now-- now, I'm not saying not to make CDs,
because those of you who have taken my course also
know that I tell you to get out there and work,
perform live, sell your CDs because you can make money
at this point still doing that.
It's still a very important part of the process.
But streaming is starting to grow significantly.
And I think that that's an excellent thing.
Now, here's something that, as you notice if you take in the introduction
to music business course, one of the current issues I talked about
in the course is net neutrality.
Unfortunately, since the new administration has been in,
it appears that net neutrality, and what I
mean by that is that's where the internet service providers have
to allow all of the content for whatever the price
you pay to come through and be given at a certain level and a certain amount
of bandwidth.
If they eliminate these net neutrality laws,
then they're going to be able to restrict certain content.
It might be slower, which could kind of discourage people from possibly
looking at certain streams.
And it's really going to put people in a position
that, if you don't have the money to afford the broad bandwidth,
it could be-- this is the argument the opponents of the current administration
are making, it's going to eliminate some of the opportunities for people
to have their products and services exposed.
So this is a big issue.
And I also say that the music business is made up
of law, business practices, and politics.
And that's why it's important for you to be active in politics
because the politicians can change the laws.
And you can have an effect on that, and that's why it's very important for us
to become actively involved.
What do you guys think about 360 degree deals?
Anybody?
I feel like it benefits you if you're a bigger artist.
How do you feel about them?
I beg your pardon?
I feel like it benefits people if you're a bigger artist in a sense because you
got more money to go around.
OK.
He says he thinks it benefits you if you are a bigger artist.
360 degree deals, of course, are when record companies sign--
it's not just record companies, but primarily record companies, that
will sign an artist to a deal where they don't just participate
in the revenue generated from their sale and use of their recordings,
but they also benefit by way of participating
in a percentage of your earnings from live performance, sponsorships,
endorsements, possibly publishing.
And most labels are kind of insisting upon that.
And I haven't been able to get a read, I've
been trying to get a read on how successful this
is for record companies.
I have seen live performance revenue breakout sheets and closing
statements, where you see that the artists that have to pay the percentage
are paying a percentage of the net live performance money to the record labels.
So I know that they are making money.
And here's the good thing.
And a lot of people rail on major labels, I used to do it too.
I used to rail against major labels and say how crooked they were
and how unfair their business practices were, until I saw
a marketing plan for one of my clients.
And I saw the amount of money that the record company
was investing that wasn't recoupable from the artist's royalties.
And it's billions of dollars.
And it made me appreciate the value of a major record label.
Here's the good thing.
Major labels now are really starting to focus on being very active in that 360
degree space.
They're going to have sponsorship in endorsements, and promotional deals,
and people that--
some of the labels even have management arms
that assist in coordinating things for live performance.
So when there was a time where labels were many times
just passive participants and just taking a percentage for just creating
the hype about you, and not really working to make endorsement movie deals
happen for you on the other end.
I understand the concept of 360 degree deals.
I mean, you have a company that's saying that, I'm taking you, unknown artist,
and I'm going to invest in you and use all of my resources to make you
a huge star.
Now, once you become that you star you're going to get calls to act,
to be in toothpaste commercials, right?
Samsung sponsorship deals, would that have happened
without this initial investment?
Pretty good argument.
So I think the good thing is that the labels now are
focusing on those 360 degree aspects.
And I think it's creating some great opportunities for those of you
who want to get jobs in record labels, as well.
Don't think that major record labels are going away.
They're going to be around.
There's only three, but they're going to be around.
And lastly, before I open it up for questions, is that I see a trend now.
Some of you who took my course know that there's
an interview by Richard Blackstone who worked with BMG Rights
Management, where they did deals where they didn't take any ownership
interest in the recording, which is a big issue with artists, and should be.
But they primarily just provided management of their rights.
Well, a lot of companies are doing that as we enter into the digital space.
And of course, I'm sure many of you saw Chance the Rapper
last year, how he got a $500,000 payment from Apple, just for a two-week window,
I believe it was, for his video to be seeing exclusively,
his album to be streamed exclusively on that service.
You have companies now that are just recognizing
that when people come with complete products, recordings that
are ready to release, they can still make money
if they affiliate with a number of various artists,
placing those recordings through digital services
and taking a percentage rather than an ownership interest.
There's a company called Empire Distribution
that did a great job with that, with a couple of artists.
One of whom was another Berklee alum.
An artist named Major, who had a major record.
As a matter of fact, Kevin Ross was battling with--
one Berklee alum was battling with another Berklee alum, Major,
in the Top 10 on the Adult Urban Contemporary charts.
Major's song and recording was released through Empire Distribution,
who initially just released it digitally and placed it
with all of the streaming services.
And it went very well.
Now, he was signed to a production company,
but that production company owns that recording.
And Empire is taking a percentage, I don't know if it's 15%, 20%, or 25%.
But I see and I think that you're going to have a number of artists.
I just read yesterday that Anderson Pack,
I don't know how many of you are familiar with Anderson's music.
Tremendous artist.
But he has that kind of deal with Sony Red, which
is the independent arm of Sony Music.
And I'm seeing a lot of artists that are moving in that direction.
I think that's a very positive sign.
It's always good for artists to own their own recordings.
Because you have to weigh, you have to weigh it,
don't think that it's terrible to go with the interest.
If you have a company who's going to put millions of dollars
behind promoting you, and you want to be an international music star,
then it might be something that you might want to consider.
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