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THE PENNSYLVANIA STATE UNIVERSITY SCHREYER HONORS COLLEGE DEPARTMENT OF FILM-VIDEO AND MEDIA STUDIES MUSIC INDUSTRY DEMOCRATIZATION: BRITISH INDEPENDENT RECORD LABELS IN 2012 MELINDA KARTH SPRING 2013 A thesis submitted in partial fulfillment of the requirements for baccalaureate degrees in Media Studies and Psychology with honors in Media Studies Reviewed and approved* by the following: C. Michael Elavsky Assistant Professor of Media Studies Thesis Supervisor Dr. Susan Strohm Senior Lecturer of Advertising Honors Adviser * Signatures are on file in the Schreyer Honors College. i ABSTRACT In response to music industry concentration, British independent record labels in the 1980s successfully, though briefly, established an autonomous network that allowed for them to produce and distribute music without major record company assistance. In addition to gaining access to the commercial market, these entrepreneurs also strived to achieve something more profound: music industry democratization. Ultimately, it was believed that such ‘democratization’ could be achieved by diminishing major record company control over the market, introducing new sounds and voices to the public, and defending the rights of creative workers. Thus, by developing their own sets of practices and ideologies, these independents worked to protect the business and creation of music. Nonetheless, while their attempts were initially successful, the independent infrastructure has since struggled to maintain autonomy in an increasingly concentrated music market. This pattern of struggle, though, has recently shifted, as independents have begun to achieve notable success in the commercial market, causing many to claim that music industry democratization has finally been realized. This generalization, however, dilutes the meaning of ‘democratization’ to nothing more than commercial market access, thus ignoring other issues, such as the rights of creative labor. Therefore, in response to this generalization, this thesis intends to examine the actual practices of independent labels in 2012 to consider if the pursuit for industry democratization is still being strived for. To accomplish this, studies on independent artists and record labels will be conducted, as well as examinations on external influencers that affect the independent sector, such as government policy. Ultimately, the goal of this project is to gain a better understanding of the practices, motivations, and struggles of British independent record labels in 2012 in order to evaluate their contributions to the British music sector. ii TABLE OF CONTENTS Introduction ................................................................................................................... .1 Chapter 1 Development of the British Independent Music Infrastructure......................... .5 Political economy and deregulation .......................................................................... 5 Artist exploitation.................................................................................................... 12 Development of the U.S. American independent music sector .................................... 14 Development of the British independent music sector................................................ 18 Chapter 2 British Independent Music Post-2000............................................................ 28 Revitalizing the British independent music sector...................................................... 29 Popularizing independent artists through NME.......................................................... 31 The ‘indie’ aesthetic and the illusion of independence................................................ 35 Democratizing the music industry with The Arctic Monkeys...................................... 39 The development of a ‘tiered’ independent music sector: Breaking ranks .................... 44 The decline of British indie in the 2000s ................................................................... 46 Independent labels post-indie popularity 2012: A case study of Cooking Vinyl ........... 47 Cooking Vinyl: Budget marketing..................................................................... 49 Cooking Vinyl: Record contracts....................................................................... 52 Cooking Vinyl: Song ownership rights .............................................................. 57 Cooking Vinyl: Artist autonomy ....................................................................... 58 Cooking Vinyl: Icebreaker and funding ............................................................. 61 Chapter 3 Current Obstacles for Independents in the Digital Era ................................... 67 Physical distribution ................................................................................................ 69 Online distribution................................................................................................... 73 Online distribution: Piracy, government intervention, and copyright control......... 74 Online distribution: Negotiating power through licensing ................................... 81 Online distribution: Streaming and Spotify ........................................................ 82 Marketing ............................................................................................................... 77 New revenue streams............................................................................................... 90 New revenue streams: 360 contracts.................................................................. 91 New revenue (and marketing) streams: Vevo..................................................... 93 U.K. government funding for SMEs ......................................................................... 97 U.K. government funding for SMEs: The Enterprise Finance Guarantee.............. 100 Music industry democratization: A global perspective ............................................... 103 Conclusion..................................................................................................................... 108 REFERENCES....................................................................................................... 120 1 Introduction Though considered a form of entertainment, music has repeatedly demonstrated that it can also serve as a space for public commentary. For example, it is not unusual to observe music artists criticizing social wealth divides, job unemployment, and the commodification of culture. However, despite this defiance, music often ends up circulating through the system of capitalism, rather than actually challenging it. In other words, politicized music can play a role in furthering the exploitation of creative culture and labor while also appearing to oppose it. Nonetheless, a few instances where creative workers have effectively confronted corruption and social injustices are worth noting, one such example being the British independent music sector. In sum, during the early 1980s British entrepreneurs were able to effectively, though briefly, challenge music industry concentration by establishing an independent music sector that worked autonomously from the corporate sector. More specifically, this infrastructure was created to challenge major record companies’ exploitation of creative labor by providing artists with creative autonomy, fair working conditions, and job opportunities. Ultimately, all of this was ‘achieved’ through the independent business network they had established. Moreover, beyond this physical network, independents also developed a collective ideology that promoted collaboration, egalitarianism, and creative freedom, but rejected commercialism, competition, and the status-quo. Nonetheless, while this infrastructure was initially effective, it eventually imploded at the end of the 1980s, as independents struggled to maintain a system of collectivism and equality in an increasingly neoliberal market. Thus, as a result of 2 pressures to conform to the competitive market, some independents began to adopt conventional business practices, such as tiered salary programs, so that they could grow their companies. Consequently, the collective independent ideology that had previously existed in the 1980s splintered, as some independents became oriented towards competition and individualism, while others remained more socialist. In other words, the independent sector became divided along lines of power, wealth, and market influence, thus shifting its original goal of democratizing creative businesses. Throughout the 1990s, Britain’s independent music infrastructure continued to move further away from its original purpose of creating alternative opportunities for creative laborers. In fact, it became common for independent record labels to form close partnerships with large music corporations. In other words, many independent record labels began to work closely with the businesses they had once resisted. As a result, a true and effective independent network failed to transpire in the 1990s, as more and more labels were absorbed into the corporate sector. This trend, however, appeared to stall in the early 2000s, as some British independent record labels became commercially popular, despite operating outside of the corporate sector. Ultimately, this was considered very unusual because media conglomerates have dominated the production and distribution of music for decades, therefore making it difficult for independents to work autonomously. Thus, because of this unusualness,