Power of goodbye: Madonna split may herald record industry’s death
http://www.gbmnews.com/articles/1674/1/Power-of-goodbye-Madonna-split-may-herald-record-industryas-death/Page1.html
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Published on 10/12/2007
As CD sales continue on a downward trend and online music sales stay relatively small, artists are focusing more on the growing markets of live music, endorsement deals and merchandising.
By Chris Ayres
Madonna is poised to leave her record company of 25 years to sign a $120 million (£60 million) deal with Live Nation, a concert promotion firm, in a move that many may regard as further evidence that the music industry of the last century is officially dead.
Madonna, 49, and listed in Guinness World Records as “the world’s most successful female musician”, still has one final studio album to deliver for Warner Music Group, her old company, which signed her in 1982 for $5,000 per song. When her next album is completed, the self-styled “Material Girl” of the Thatcher-Reagan years who infuriated the Roman Catholic Church with her sexualised religious iconography, is expected to begin a new ten-year deal with Live Nation.
Although it is the largest concert promotion company in the world, it lost $161 million in 2005 and 2006, and barely managed to make $10 million profit from $1 billion revenues in the most recent quarter of this year.
As CD sales continue on a downward trend and online music sales stay relatively small, artists are focusing more on the growing markets of live music, endorsement deals and merchandising.
By Chris Ayres
Madonna is poised to leave her record company of 25 years to sign a $120 million (£60 million) deal with Live Nation, a concert promotion firm, in a move that many may regard as further evidence that the music industry of the last century is officially dead.
Madonna, 49, and listed in Guinness World Records as “the world’s most successful female musician”, still has one final studio album to deliver for Warner Music Group, her old company, which signed her in 1982 for $5,000 per song. When her next album is completed, the self-styled “Material Girl” of the Thatcher-Reagan years who infuriated the Roman Catholic Church with her sexualised religious iconography, is expected to begin a new ten-year deal with Live Nation.
Although it is the largest concert promotion company in the world, it lost $161 million in 2005 and 2006, and barely managed to make $10 million profit from $1 billion revenues in the most recent quarter of this year.
Power of goodbye: Madonna split may herald record industry’s death
As CD sales continue on a downward trend and online music sales stay relatively small, artists are focusing more on the growing markets of live music, endorsement deals and merchandising.
By Chris Ayres
Madonna is poised to leave her record company of 25 years to sign a $120 million (£60 million) deal with Live Nation, a concert promotion firm, in a move that many may regard as further evidence that the music industry of the last century is officially dead.
Madonna, 49, and listed in Guinness World Records as “the world’s most successful female musician”, still has one final studio album to deliver for Warner Music Group, her old company, which signed her in 1982 for $5,000 per song. When her next album is completed, the self-styled “Material Girl” of the Thatcher-Reagan years who infuriated the Roman Catholic Church with her sexualised religious iconography, is expected to begin a new ten-year deal with Live Nation.
Although it is the largest concert promotion company in the world, it lost $161 million in 2005 and 2006, and barely managed to make $10 million profit from $1 billion revenues in the most recent quarter of this year.
The expected deal comes as Madonna’s record sales are falling — despite her concerts attracting huge audiences — and is the latest in a series of moves by big-selling acts to bypass traditional record companies.
Until recently, an artist or a band would sign two deals — one with a record company and another with a touring and merchandise company.
As CD sales continue on a downward trend, however, and online music sales stay relatively small, artists are focusing more on the growing markets of live music, endorsement deals and merchandising. Madonna’s contract with Live Nation is expected to encompass all these elements.
It will have the right to sell three of her studio albums, promote her concert tours, sell her merchandise and license her name, in return for a combination of cash and shares in the company.
According to The Wall Street Journal, which revealed leaked details of the deal yesterday, her package will include an advance of $17.5 million, advance payment for three albums of between $50 million and $60 million, plus a $50 million payment in cash and shares for the concert promotion rights. When Madonna does tour, she will receive 90 per cent of the gross revenues.
Revenues from licensing ventures, such as product endorsements, will be evenly split. The deal is in sharp contrast to the move by Radiohead this week to release its new album, In Rainbows, via its own website, avoiding corporate partnership. The band allowed fans to choose how much they wanted to pay for the album.
It is believed that WMG had tried to join IAC/InterActive Corp — the owner of TicketMaster — to counter Live Nation’s offer to Madonna, but failed to match the deal. Music executives said yesterday that the deal could prove highly risky for Live Nation, which might have to sell 15 million copies of each of her three albums to achieve a return on its investment. It was also not clear how Live Nation, with its limited distribution network, could effectively sell the albums without the joint involvement of a traditional record company.
Madonna, an Italian-American born into a large Catholic family in Michigan, now lives in London and Wiltshire with her husband, Guy Ritchie, the film director. Her recent work has received a mixed reaction from the public, as has her interest in Kabbalah, a Jewish mystical tradition, and her adoption of a Malawian child.
http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/music/article2641527.ece
By Chris Ayres
Madonna is poised to leave her record company of 25 years to sign a $120 million (£60 million) deal with Live Nation, a concert promotion firm, in a move that many may regard as further evidence that the music industry of the last century is officially dead.
Madonna, 49, and listed in Guinness World Records as “the world’s most successful female musician”, still has one final studio album to deliver for Warner Music Group, her old company, which signed her in 1982 for $5,000 per song. When her next album is completed, the self-styled “Material Girl” of the Thatcher-Reagan years who infuriated the Roman Catholic Church with her sexualised religious iconography, is expected to begin a new ten-year deal with Live Nation.
Although it is the largest concert promotion company in the world, it lost $161 million in 2005 and 2006, and barely managed to make $10 million profit from $1 billion revenues in the most recent quarter of this year.
The expected deal comes as Madonna’s record sales are falling — despite her concerts attracting huge audiences — and is the latest in a series of moves by big-selling acts to bypass traditional record companies.
Until recently, an artist or a band would sign two deals — one with a record company and another with a touring and merchandise company.
As CD sales continue on a downward trend, however, and online music sales stay relatively small, artists are focusing more on the growing markets of live music, endorsement deals and merchandising. Madonna’s contract with Live Nation is expected to encompass all these elements.
It will have the right to sell three of her studio albums, promote her concert tours, sell her merchandise and license her name, in return for a combination of cash and shares in the company.
According to The Wall Street Journal, which revealed leaked details of the deal yesterday, her package will include an advance of $17.5 million, advance payment for three albums of between $50 million and $60 million, plus a $50 million payment in cash and shares for the concert promotion rights. When Madonna does tour, she will receive 90 per cent of the gross revenues.
Revenues from licensing ventures, such as product endorsements, will be evenly split. The deal is in sharp contrast to the move by Radiohead this week to release its new album, In Rainbows, via its own website, avoiding corporate partnership. The band allowed fans to choose how much they wanted to pay for the album.
It is believed that WMG had tried to join IAC/InterActive Corp — the owner of TicketMaster — to counter Live Nation’s offer to Madonna, but failed to match the deal. Music executives said yesterday that the deal could prove highly risky for Live Nation, which might have to sell 15 million copies of each of her three albums to achieve a return on its investment. It was also not clear how Live Nation, with its limited distribution network, could effectively sell the albums without the joint involvement of a traditional record company.
Madonna, an Italian-American born into a large Catholic family in Michigan, now lives in London and Wiltshire with her husband, Guy Ritchie, the film director. Her recent work has received a mixed reaction from the public, as has her interest in Kabbalah, a Jewish mystical tradition, and her adoption of a Malawian child.
http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/music/article2641527.ece