New site SellaBand hopes fans will cough up cash before an album’s even made

Here’s a bit of a creative conundrum for you – how do you fund the production of an album? Get the label to pay for it as an advance on royalties? Find some investors who believe in you and your music? Mortgage the house and foot the bill yourself?

For Chuck D, Flavor Flav and da boyz of Public Enemy, the answer may be “ask the fans to pay for the album up front.”

It’s all part of the music investment site SellaBand’s incentive to have fans of certain groups donate cash in exchange for a number of exclusive perks. For the Public Enemy project, prospectively their eleventh album would be paid for by online donations from their fan base. They hope to raise a startling quarter-million dollars, twenty-five bucks at a time.

The system is set up so that the more you contribute, the more you gain. Here’s the donation level breakdown, as provided by online site TechDirt:

* 1 Part ($25) = "Believer" Level Incentive: Exclusive, numbered CD in Digipak
* 4 Parts ($100) = "Hype" Level Incentive: "Believer" Level, plus the opportunity to buy 2nd CD at 50% off, & Name in booklet
* 10 Parts ($250) = "Rebel" Level Incentive: All of Above plus Exclusive Limited Edition Public Enemy T Shirt
* 20 Parts ($500) = "Posse" Level Incentive: All of Above plus Autographed Copy of CD signed by Chuck D
* 40 Parts ($1,000) = "Terrordome" Level Incentive: All of Above plus Unlimited backstage pass for 3 years [Limited to 50]
* 200 Parts ($5,000) = "Bring The Noise" Level Incentive: All of Above plus Executive Producer Credit on Album [Limited to 15]
* 400 Parts ($10,000) = "PE Number One" Level Incentive: All of Above plus Studio Visit during recording session [Limited to 5]

Report to industry insists on less business, more music.

If you’ve got a spare $500 lying about, and you want to hear how one leading research firm thinks the music industry should remake itself, by all means purchase and download Music Product Manifesto: The Product Features That Will Save Recorded Music, by Mark Mulligan.

Mulligan points out several issues he thinks are critical to the continued relevance of the music industry, among them the de-emphasis of the “business” part of the music business, and a greater focus on the consumer/listener.

The report suggests that each music listener has a “right” to things like “unique music experiences,” file sharing, mash-ups, and more. The point, the report insists, is to remake the music business model in a way that will win over apathetic listeners and file-sharers, and will still make money for the creators by allowing the public to share in the creative process, by offering “excitement and uniqueness.”

Label to control ads

The New York Times is reporting that mega-label Warner Music Group has reached an end to the nine-month negotiations with popular web destination YouTube in a deal that will finally return the label’s videos to the channel.

Warner’s videos were pulled from the Google, Inc.-owned website last December when talks between the two companies halted over how the label would control advertising and revenue from the site. The agreement marks the fourth and final major label that YouTube has gathered into the site, along with four major music publishers.

The way now seems clear for YouTube to continue to dominate the online video world, a share that ComScore reports as holding up to forty percent of all online video.

The terms of the agreement were not disclosed, but it is believed that Warner wanted a larger share of revenue from advertising dollars, and more control over which advertisers would appear alongside the label’s videos.

The site stated that they expect the formerly removed videos to be reinstated by the end of 2009.

Largest US interactive music producer launches major online entertainment mall

Big Mama Digital Entertainment, Inc. (BMDE), parent company of Chartbuster Karaoke, the nation’s largest producer of interactive music, has gone live with a major new online initiative. Chartbusterkaraoke.com lifted the veil on an interactive music site that for the first time offers fully-licensed digital downloads of their vast library of tracks, in an array of platform-agnostic formats unencumbered by digital rights management.

Worldwide, the karaoke industry represented $987 million in gross revenues in 2007. BMDE enjoys approximately an 80% share of the US market in the segment.

Key to BMDE’s strategy is the release of digital interactive music downloads, but a broad spectrum of music goods will be sold alongside those tracks, including CDs, DVDs, videos, and concert tickets. The company has partnered with Alliance PFL, LLC for the fulfillment of hard goods and with Vivid Seats, LTD, for event tickets.

BMDE’s exclusive access to their own catalog allows them to enter the online retailing space with an industry-leading product. Correlated products fulfilled by their partners will be presented to users alongside search results, boosting revenues while giving users a more complete music experience.

Unlike the vast majority of other online music sites struggling to generate revenue, BMDE’s offering is firmly grounded in the popularity and exclusivity of their own catalog, and delivering it in both physical and digital formats. Coupled with the ability to deliver virtually any music-related product, the company is well-positioned to take full advantage of both primary and secondary revenue streams.

BMDE has given top priority toward streaming content to reflect a clear shift in market dynamics, playability of their tracks on any platform, including mobile devices, and leveraging their marketing activity on major social networks. 

The company will offer to its affiliates and partners the capability of including the same functionality from within their own click-and-mortar or online retailing spaces, through skinning techniques of the affiliates’ sites or through the inclusion of web programming modules.