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Dependent reopen in summer/fall 2009

I have decided to reopen Dependent and start again. This will include the release of some physical CD’s, starting in late summer 2009.  I am well aware that...

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The End of an Era

This text originally appeared in the Dependence Vol. 2 CD booklet.

In Summer 2007, Dependent Records will close its doors for good. After we release the currently planned albums from Mind.In.A.Box, Rotersand, AutoAggression and Fractured, along with another Septic compilation, the label will cease to be active. And to put a nasty rumor to rest: we're not broke. But after a long period of frustration, we've decided this is what we must do.

The following pages will explain why.

First, we should mention that this essay is directed less at those who will are reading it - those vanishing few who still believe that music is worth paying for - than for those who are not.

This is not about money, and it never was. It's about being encouraged to continue to release music. Anyone who wants to start a halfway professional label without ending up at the unemployment office a few months later must inevitably come to terms with some financial realities, such as determining how much money and advertising can be put into any given project and when to reign in the budget. (There are always a few wiseguys who will tell you that fiscal responsibility and the idealism of an independent label are incompatible notions. Let's just say those people have clearly never tried to run a record label.) I think we've done pretty well in the last seven years; we haven't squandered loads of money and we've released some pretty good records. But money was always tight, and in the future it's only going to get tighter, because even if we were to continue to produce quality CDs, the rate with which they will be purchased legally will continue to decline. Each album released would represent an ever-increasing financial risk.


Chances of success decreased radically by illegal downloads: Dependent Act Seabound

The Russian pirate site Mp3xx.ru (name changed by editor) provides an instructive example. Not only does this portal provide free downloads of every album in the electro scene, it allows users to see how many times individual labels' releases have been downloaded. While worldwide sales of Seabound's "Double-Crosser" hovered around 2500 copies after the first two or three weeks of its release, the same album was downloaded from Mp3xx.ru over 5000 times in just seven days. And this is via just one of dozens of pirate networks like Kazaa, Bit Torrent, Morpheus, Shareazade, etc. Illegal downloads of Dependent albums outnumber legal purchase by a factor of three or even five to one.


Ironically enough, Dependence II also appeared on download platforms hours after it was initially released.

A popular claim often seen on Internet fora maintains that the P2P culture weakens the majors and bolsters the independent labels. This is, we can assure you, 100% bullshit. Even if there are listeners who download first and buy later, they are clearly in the dwindling minority. The same could be said of those who patronize legal download alternatives like iTunes, Musicload, and Grenzwellen. Many people seem to believe that music on the Internet is "free", because it is readily available to everyone. But "freedom" isn't about everyone doing whatever they want; it's about having the ability - and responsibility - to make your own decisions. When everyone does whatever they want, the result generally isn't freedom, but anarchy.

It makes no difference to us whether we sell records in the form of physical CDs or as digital downloads, but the production and distribution of music is an expensive proposition regardless of whether or not physical product is involved. We have to service DJs and magazines, help our artists with recording and design costs, provide tour support, and connect artists with agents and concert promoters. This all costs money, but these activities are not our primary concern. Our primary concern is to find and polish a few select gems, drawn from a vast wasteland of often atrocious music, that we believe stand above the rest and are deserving of a wider audience. We spend months - sometimes up to a year - working with our artists, helping them to fine-tune and polish their releases to be as fully realized as possible. This type of coaching can turn an above-average demo into a fantastic debut which is a more diverse, professional product than the original recordings. At the end of the day, it is the audience who benefits from all of these finishing touches, inasmuch as they result in better music. So if someone tries to tell you that record labels have become redundant in the age of the Internet, rest assured that they have no idea what they're talking about, as most of them clearly have no clue what kind of work goes into producing a record. If you're still not convinced, we suggest you spend a few hours looking for decent demos on MySpace to disabuse yourself of the notion that good music grows on trees, and to see for yourself how finding and developing new artists constitutes the lion's share of a record label's activities - not pressing CDs, which accounts for only around 5% of our workload. Our primary mission is to make the best music possible and to ensure it stands out from the rest.

In this day and age, record labels deal less with CDs than with the "rights" to an artist's recordings. Whether these be realized in the form of CDs, vinyl, MiniDiscs or MP3s is immaterial. What is important is that the commercial exchange of these rights becomes exceedingly difficult when the materials are simultaneously available for free on the Internet - or in any event, when a few million morons seem to believe that to be the case. Incidentally, we are far from the only label suffering as a result.


Pride and Fall are also affected by the download problem. They offered to translate the Dependence II text into Norwegian

It is actually the job of the (German) federal government to insure that musicians and record labels have a platform on which to operate. That platform is known as intellectual property law. Intellectual property law dictates that the owner of the intellectual property - in this case, the musicians who write and record the music, as well as the record labels who release and administer it - has the exclusive right to decide what they want to do with it. They can give a song away for free on the Internet, they can press it on compact disc and store it forever in their basement - that's their decision. With the advent of CD burners, P2P networks, and sites like Mp3xx.ru, the intellectual property law has lost much of its practical power, and the law is in need of considerable revision. Mp3xx.ru has been around for over two years, and its right to existence cannot be legislated from Germany. The Russian webmasters could give a damn if some German indie label is giving up the ghost; their site is financed through advertising, couple with the fact that the goods they are providing are stolen, enables them to make a reasonably good living. After multiple attempts, the federal government has so far failed to modify the 30 year old intellectual property law to insure that it offers those working in today's music industry a reasonable way to make a living. If the law provided even a glimmer of hope that the situation for labels and musicians would improve, then we would keep on fighting. But the outlook for the next few years is bleak.

In the end, we are not closing our doors because of the existence of pirate websites, but because there are simply too many people who enjoy our bands and their songs who do not wish to pay for them, despite the fact that we reduced the sale price of our albums considerably two years ago. Consider this example: if 60% of the audience at a concert gained entry with forged tickets, the promoter, the band, the concert agency, and the venue would all be broke in a matter of weeks. We have lived for years now with the reality that much of our music is stolen, not purchased, and we have frankly had enough of it. A label releases music so that the public may pass judgment on it, but the label also expects to be compensated for its efforts based on the public's reception to the material. It's easy to become bitter when you notice that you're being made a fool of by the majority of your listeners. We do not lack good new bands, or passion for music, but rather the motivation to release CDs given the current market conditions. The same goes for many of our artists, who can only stand by, shaking their heads in disbelief, as they watch the music into which they have invested months or years of their lives being ripped and copied for free; as a result, many artists are ceasing to release new albums. Perhaps our decision and this essay will help to convince the public that the Internet, MySpace, Bit Torrent, and Mp3xx.ru cannot truly replace the quality control services provided by a record label. Rarely do truly brilliant bands simply spring forth from the earth fully formed, just as one tends to not find Chanel suits at a flea market.

 

We would like to extend our thanks and apologies to all of our artists, most of whom are already aware of our decision, as well to everyone who has spent their hard-earned money on our releases instead of simply downloading them or burning them from friends. We respect you all the more because we know you could have more easily taken the low road. If it's any comfort, know that without your support, we likely would have come to this decision much earlier, and the positive feeback was a continuing motivation. Thank you all so much! We hope we can count on your support for these last few months. If you have comments, feedback, suggestions, or opinions, please joins us in our online forum at www.dependent.de. Please feel free to distribute this statement further, as there are still bands and labels who have not yet lost their motivation and are fighting to remain active.

I would like to extend my personal apology to all the people who have worked with and for Dependent over the years, especially Heike, Ela, Lothar, Ned, Thorsten and of course Brigitta; to our excellent distributor Alive, our label manager Jochen, and all of their staff; to Luke and Alfred; to idealists like Claudia Schöne, Stefan Brunner, Ecki Stieg; and to everyone for whom music means as much as it does to us. Keep looking, and respect the music.

Stefan Herwig, December 2006

Translated from the German by J. Ned Kirby

 

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The Truth About The Record Industry, Part One

The Truth About The Record Industry, Part One
by Stefan Herwig (Dependent)

Translated from the German by Ned Kirby

The Dependent offices: gigantic, luxurious, elegant. Stefan Herwig (label president, in his early thirties), dressed in a checkered Italian designer suit, is sitting at his marble desk, which is bare except for his feet.

Ela comes through the door, red dreadlocks swinging. She is carrying a large envelope bearing the word "URGENT".

Ela: "Stefan, the VNV Nation master arrived today, five weeks after the agreed-upon deadline. Should we send it off to the pressing plant posthaste?"

Stefan (setting down his champagne glass): "No, just put it in my 'to-do' pile. I spent half an hour throwing away fanmail, I'm exhausted. The more the bastards whine, the later they'll get their record."

Ela (rolling her eyes): "You're right, and you haven't driven the Cabrio in ages. Go ahead and take the rest of the day off, it's nearly 2:30. Besides, we haven't had a vacation in nearly two weeks. Fans..." (She shakes her head, drops the envelope in a giant grey box with countless others, and leaves.)

The telephone rings.

Stefan (annoyed): "Not again, that's the second call in as many hours." (lifts receiever)

"Who's this? Why hello, Mr. Distributor Man! What's that you say, all our CDs are sold out? The next check from the distributor is only half a million? What do you mean, we can't sell any more CDs if we don't repress them? Fine, fine, tell the stores they'll get their CDs, but in no case should they sell them for less than $18.99. We've gotta bleed the consumer for every penny, the company swimming pool isn't going to finance itself. VNV Nation master? No, it still hasn't arrived. Release date is next week? Whatever, it'll sell like hotcakes whenever it comes out. Besides, I'm not a bloody magician. The new release date is..."

(swivels his chair around to face a giant wall calender, covered in crossed-out notes and red Xs, closes his eyes, and lets his finger fall on a random day)

"...October 13th!"

"That's a Sunday?" (repeats above)

"OK, then June 6th it is. Of course the fans can wait, Christmas comes but once a year. I'm done for the day, got to get in a bit of golf yet."

(hangs up)

He calls into the adjoining room:

"Heike, i'm heading out. Pick two or three of the groupies out front, the ones with the best hair, and tell them the chaffeur will be by to pick them up in a few minutes. Put anything else on hold until Monday. I'm not available to speak to anyone, least of all any of our artists."

------------------------------

Or so most people imagine the daily routine at a record label. The truth is, however, rather different:

"Industry sales volume falls by 12.6%"

"Music industry in a deepening crisis...record labels project July and September losses of over 20% in comparison to the previous year."

"Record labels declare war on CD burning"

"Germans won't pay for CD downloads...only a quarter of those asked said they would accept a per-song fee."

All quotes taken from articles in the industry journal "Musikwoche" ("Music Week"), 2001.

There is no doubt that the entire music industry finds itself in the midst of a crisis, probably the worst crisis of its existence. As a result of illegal copies of music CDs and downloads of MP3 files via semi-legal and illegal filesharing services such as Napster, Audiogalaxy and Gnutella, sales volumes are falling through the floor. This crisis affects every branch of the music industry: dance, hip-hop, mainstream, alternative, and of course the independents like Dependent, Bloodline and Out Of Line. This article seeks to concern itself with the effects of this illegal duplication on the independent market, and to reply to some of the more common justifications for illegal duplication. Perhaps in learning more about the internal workings of the music industry, you might find your attitude towards record labels changing.

1. "Record labels? They're just in it for the money!"

Yes and no. At least at the time they're first formed, most labels are founded with idealism and a love of music at heart. You're getting the chance to introduce the music you know and love to a gigantic audience, help the artists become successful, and maybe even make a living for yourself. Not bad, eh? But anyone who forms such a company is immediately confronted with a world that has nothing whatsoever to do with music: business registration forms, reserve returns, quarterly sales reports, lawyers, advance notice of value added tax...and this financial aspect of the business is part of the day to day lives of the artists as well as the labels.

No man can live on bread alone, and anyone who runs his or her own labels knows that without paying close attention to your income, you soon find yourself in a position of being unable to pay your artists or yourself, at which point your hopes and dreams come to an untimely end - accompanied by some rather unpleasant side effects such as trials, garnishment of wages, and insurance claims. So it's all about the money?

Again, the answer is both yes and no. It's one thing if you are trying to change the nature of the music you release, and to force the artists to change the nature of their music, purely for financial gain. This is common practice at many record labels, where A&R and product managers aren't valued for the quality of their releases, but merely for their sales figures. For this very reason, more and more consumers are seeking out independent labels, who are more likely to release interesting and novel types of music, although this practice has changed a great deal in light of the current situation.

2. "CDs are just too expensive."

Here I am of two minds, one personal and one professional. Yes, every CD currently being sold for more than 15,00 Euro/DM 30,00 (about US$13.00) is in my mind too expensive. Most customers know that the manufacture of a CD costs about fifty cents, so why should they pay upwards of 17-18 Euro (US$15.00) a CD?

From a professional standpoint, however, it can also be said that it is extremely difficult for a record label to alter the price of a CD. To understand why, you must first know how the manufacturing cost of a record is calculated, because it is considerably more complicated than simply adding up the cost of the materials. Let's follow the life of a CD from manufacturing plant to the store:

  • For a "naked" CD, production costs currently rest somewhere inbetween 35 and 50 cents irregardless of playing time, so manufacturing costs for CD singles are almost exactly the same as for full length albums. Next comes packaging: the so-called "jewelbox" costs only a few cents, but the booklet and inlay cards can cost up to 40 or 50 cents depending on their size. Specialty packaging such as digipaks are even more expensive, but let's assume on average packaging costs are about 50 cents an album, so we're talking about 1 Euro (US$0.90) a CD.
  • Every legally manufactured CD is also subject to GEMA fees*, which at some point later are distributed to the "originator" (usually the musician). These usually amount to around 1,00 Euro, so now we're up to 2,00 Euro (US$1.75).

*[Translator's note: the information with regard to GEMA (Gesellschaft für Musikalische Aufführungs- und mechanische Vervielfältigungsrechte, or Society for Musical Performance and Mechanical Reproduction Rights) does not entirely hold true in the United States. In the US, performing rights societies like ASCAP and BMI aren't allowed to distribute mechanical royalties. In most other parts of the world, government agencies like the GEMA, SACEM in France, STEMRA in Holland, etc. handle distribution of both performance and mechnical monies.]

  • Artists are generally reimbursed for their work, somewhere between 1-2 Euro (US$0.85-$1.75), although independents can usually pay more than major labels, who by dint of their massive size have correspondingly massive operating costs. On average, a well-established band can expect a royalty rate of about 1,75 Euro (US$1.50, again usually less for major-label acts and frequently more in the United States for independent bands), so we're up to a cost of about 3,75 Euro (US$3.20).
  • Now you're faced with the business of getting the finished product from the pressing plant to the stores, which is where distributors come in to the picture. At least, this is the case with independent labels, as the majors usually own their own distribution networks, or more clearly expressed, they are the distribution networks...our distributor is SPV in Hannover, where some 80 people work to insure that our releases are available more or less everywhere in the country. VNV Nation's new album "Futureperfect", for example, was on the shelves in some 1200 record stores throughout Germany on the day of its release. The logistics of insuring this kind of distribution have their price, but they benefit the consumer in that it makes it easy to find a given release wherever you may be (depending, naturally, on the popularity of the band in question).
  • The distributor sells CDs to the stores at a cost of about 10 Euro (US$8.75) of which about 7 Euro (US$6.00) kicks back to the label, so the distributor earns about 3 Euro (US$2.50) per CD for dealing with the physical distribution, sale and bookkeeping. This means that a distributor can only survive by distributing several labels, much in the same way that a record label signs multiple bands. SPV's roster currently consists of about 25 labels.
  • So for about 10 Euro (US$8.75), a CD ends up in a record store. The store ends up selling the thing for between 15 and 17 Euro (US$13-15.00), but that includes 16% VAT* as well, so the store ends up netting around 3 to 5 Euro (US$2.50-$4.50) per CD sold. From this the store needs to pay its employees, rent and sundry associated costs, which have risen drastically in recent years.

*[Translator's note: VAT (Value Added Tax) is a tax present in most European countries that is applied to the base cost of almost any good or service you can imagine. It's almost, but not quite, entirely unlike sales tax. While sales tax in the United States is usually considerably less, the principle is the same.]

Those of you who have followed along can do the math: the record label has to make 3,25 Euro (US$2.75) per CD stretch to cover the costs of advertising, free promotional copies, rent, supplies and employees. If a record does poorly, the distributor, stores and artist all make a little bit, but the label, who has financed the entire operation from the beginning, can be faced with the prospect of losing money on a release. So the label is the only member of our little tea party who carries any substantial risk.

So to those who would still maintain that CDs in general are too expensive, I would ask for suggestions as to where the record labels should try and cut costs, keeping in mind that most CDs with reasonable distribution can be in stores within 48 hours upon reorder. The consumer has become so used to this luxury that it has become more or less an expectation.

The price of CDs is still often compared to the price of vinyl records, the implication being that record labels are basically making a mint off of CD sales. What is not so commonly noticed is that, since their introduction in 1981, the price of CDs has remained extremely stable, compared to the cost of living or the price of gas or the movies, to name a few items hit heavy by inflation in recent years. The cost of concert tickets and merchandise has exploded as well. Yet the only criticisms are levelled at the cost of a product whose price has remained stable for years and in particular the record labels, despite the fact that the price increases that have occured have been driven mainly by retail stores.

Also of note is the fact that the arguement that CDs are too expensive seems to have conincided with the introduction of the CD burner, which presents a nearly free alternative to the legal acquisition of CDs. One might conclude that the "CDs are too expensive" argument is being raised by the consumer in a bid to simply save as much money as possible.

The real question needs to be: is a good CD really worth 15 (or even 20) Euro? Think about your personal CD collection and your favorite albums, and about how much they are really worth to you. Naturally, not every single CD is of the same quality - there are hundreds of mediocre releases on the market. And while I too have countless times taken a chance on an album and come home with a lemon, I've also had some wonderful surprises...

(to be continued...)

 

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The Truth About The Record Industry, Part The Second

The Truth About The Record Industry, Part The Second
By Stefan Herwig (Dependent)

Translated from the German by Ned Kirby

Today: "It burns!" or: "Never buy a CD again!"

It's been a fairly long time since the first installment of this series was posted. But those who read Part I carefully know that we only work 2 hours a day, preferring to spend our time at one of the reknowned golf courses of Gelsenkirchen or cruising the ample highways and byways of the Ruhrgebiet, assuming we can detach ourselves from the seductive arms of the label groupies. All the while our artists are drudging away in damp cellars, like slaves in a galley, turning out promising new records for the industry, with its purely commerce-oriented release strategy, to exploit for millions.

Nonetheless, the occasional dark cloud will now and again appear on our horizons. Just last week at the news kiosk, the new issue of "PC World" grinned at me with the headline "Never buy a CD again!"; for months now, magazines like "CHIPs", "PC-Praxis", and "PC Shopping" have run helpful articles like "How To Crack Every Copy Protection Scheme", so that I might finally be able to make 1-to-1 copies of my entire CD collection for the car (and nothing else, of course...) How selfless of them, to protect you from the likes of us, robbers fleecing the public through inflated CD prices (see Part 1), unacceptable copy protection schemes and on the whole poor quality music.

But "Never buy a CD again"? Isn't that just a bit far-fetched? No, the sub-headlines inform us, because it is now possible to download all music absolutely free(!) from the Internet. The only costs invovled: a high-end PC with an integrated CD burner (which, following Moore's Law, will need to be upgraded at least once every three years). And a DSL connection for less than 40,00 € a month. And a 1,000 pack spindle of blank CDs for 125,99 €. And a clean conscience. And finally, the free time to sort through the 46,000,000 titles currently available through the most popular file sharing services, never mind the time to separate the wheat from the chaff.

What are record labels good for in this day and age, anyways? After all, music is free, a fact well known to hobby musicians the world over. And with just a few clicks on audiogalaxy.com, every halfway talented bedroom musician from anywhere around the globe can achieve worldwide fame. I could tell you about a thousand such bands who achieved recognition this way, if only I knew of any. Oh, yes, and there are dozens of concert agencies happy to book world tours for these artists gratis. "As seen on MTV" is a thing of the past. These days, it's bands supporting their new tracks "As heard on Audiogalaxy and Napster" out on the road with elaborate stage shows, paid for by...the "PC World".

No, Mr. Herwig hasn't completely lost it just yet.

Mr. Herwig would just like to perhaps mention the fact that most record labels actually have something to do with the success of their artists and their music. Talented or not, artists have a tendancy to make certain, almost obligatory errors: A given vocal take should be re-done. Certain tracks are receiving too much airplay, or a single isn't club-ready enough, etc. Maybe the live show isn't terribly creative, or the setlist is poorly structured. Stagewear laughable. Album cover ugly. Interviews dull.

I can already hear some of you crying "commerce!" once again. However, it's not that cut and dried. Suggestions and comments that improve the quality of the artist's ouput can only be beneficial to all parties involved. Somtimes, record labels will knowingly withhold or conceal the artist's output from the fans - for which the fans often have something to be thankful for, and the artist as well. This role that labels play often results in a higher-quality end product: better music.

There are also record labels who send out hundreds of free promotional CDs to DJs all over the country, an exercise that costs the equivalent of a small vacation per release. Many DJs show their thanks for these free advance copies by making them available to the world at large via p2p networks, which might explain why fewer and fewer record labels are providing DJs with advance copies these days...

The ads in Orkus, Zillo, and Sonic Seducer - the ones you look for to find out which hot new acts you can download off Audiogalaxy - cost money too. It may come as something of a to our independently wealthy friends that so-called "indie" magazines would also like to make a living, but it's the irrevocable truth. I don't think "PC World" is in the business of paying for this advertising, either.

Then there are the mastering studios, who can take questionable recordings and deliver the CD-quality results once praised by music lovers; but seeing as how we're all satisfied with MP3s these days, sound quality seems to have taken a back seat, so we can spare ourselves this expense as well.

When you see the extensive full-page interviews with our newcomer Dismantled in the July/August issues of Sonic, Orkus and Zillo, that's because we've made sure that all the important editors and reviewers had advance copies back in May. And not just in Germany, the same goes for France, Sweden, England and so on. And that's just the beginning: behind almost every interview, every concert, every video there's a record label providing financial support, promotion or advice.

What would actually happen, if we "Never buy another CD", as our well-respected German computer journal so altruistically recommends, if the trends of the last several years spread throughout the world? Record stores would stop carrying any kind of back catalogue, i.e. everything that doesn't fall under the category of "new". You want to find a copy of Suicide Commando's "Construct/Destruct" at your local Tower? Wrong! Skinny Puppy "Cleanse Fold & Manipulate"? Dream on! :Wumpscut: "Bunkertor 7"? Surely you jest! Well, it's not quite that bad, you could always order it from IsoTank or Metropolis, but it's easier - not to mention cheaper - to just grab 'em from Audiogalaxy for free. Gotta use the DSL for something, it's not exactly cheap...

But then what? If there are no labels who take a chance on new bands, no tour support, no club promotion, no magazines, no ads, no videos, no interviews, just half-baked demo MP3s on Audiogalaxy - some 2.8 billion by the year 2008?

Music just doesn't seem like it would be much fun. Fast forward to M'era Luna 2009, where the same bands of ten years prior are still wandering about, albiet with a few more grey hairs. Headliners: L'ame Immortelle, Apoptygma Berzek and Front Line Assembly (guaranteed with "real Bill Leeb!"), topped off by the Sisters of Mercy, who will be presenting tracks from their upcoming studio record, due out in 2013.

Is this what we really want? Is it true that no one would notice if all the record labels fell off the face of the earth tomorrow? Everyone burns, and everyone saves, so long as you don't mind sacrificing the music of tomorrow.

Last but not least: I'm listening to an amzing album from this really cool band called...well, you haven't heard of them, but it's this super-dark, minimal trance/industrial/electro record. Really fresh and original. You should totally check it out. They're on Audiogalaxy, but haven't been signed yet. Starts with "I". Happy hunting...

Stefan

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The Truth About The Record Industry, Part III

The Truth About The Record Industry, Part III
by Stefan Herwig (Dependent)

Translated from the German by Ned Kirby<

"Are We Evil? Yes, We Are!"

This phrase once adorned a T-shirt we had printed up back in the days of our old EBM label OffBeat. A little background: we had acquired a reputation among certain insiders in the record industry as "evil", or at the very least aggressive, as the label had managed to sign a large number of hot new artists in a remarkably short period of time (similar to the story of Metropolis Records in the United States). This was taken to be somewhat unholy by certain other bands and labels at the time. As far as the kids were concerned, though, OffBeat was still a pretty cool label, that had managed to bring out a lot of good albums by exciting new bands (haujobb., Mentallo & The Fixer, Individual Totem and many more).

These days, the situation is just the opposite: Dependent has a good rep with our colleagues in the industry, since we rarely sign up artists that other labels are after, but the listeners lump us in with the rest of the music industry. As a member of this much-maligned industry, I sometimes feel as though I'm perceived as some kind of leper by music consumers: half Ferrari-driving mogul, half artistic bloodsucker with Big Brother-esque designs on world domination; a mix of Dieter Bohlen (for those not familiar, he's sort of a German version of Simon Cowell on Germany's popular American Idol-knockoff Deutschland sucht den Superstar) and a member of the Bush administrations Security Council, tempered only slightly with a sprinkling of musical trendyness, but nevertheless quite clearly mentally deranged.

This image manifests itself nearly every time I read reports about the state of the industry, for example on heise.de (an online forum for underoccupied, dateless, highly intelligent but unemployed computer administrators). Recently, similar essays have appeared in the taz ("die Tageszeitung", a German newsmagazine), the Süddeutschen Zeitung (a popular German newspaper), and in the Spiegel Online (Spiegel is perhaps the largest newsmagazine in Germany, similar to Newsweek or Time, although probably a tick less pandering). The picture of my industry that is presented therein is pretty accurate, when you think about it. After all, we only got into this business to sleep with hot groupies and impress our friends with our sports cars and relationships with trendy artists, all the while raking in oodles of cash. (A certain affinity for music is also occasionally part of the profile.)

And now this: the taz has branded our branch of the entertainment industry as collectively "demented", because the music industry appears unable to stem the tide of ever-shrinking profit margins due to massive reductions in CD sales. (You can imagine a typical scene down at the unemployment office: "Herr Müller, this IQ test puts your IQ at 91. As a result, we are unable to offer you your first choice as record store owner; I think the best we can do is senior A&R over at Roadrunner. Be thankful; you could have bombed the test worse than Herr Laufer, who with an IQ of 84 is fit only for CEO of Universal Music.")

Dementia notwithstanding, the music industry still has designs on world domination, and it is for precisely this reason that we are fighting to make it illegal for individuals to make private copies and force consumers into a worldwide Digital Rights Management system. The Bundesregierung we've already taken care of, of course; Brigitte Zypries, German Minister of Justice, calls us twice a month to give her blessing to the latest version of the copyright law. For the most part we just brush it off with a lapidary "still too lackadasical". We don't have money for new bands or pricey promo videos, but of course plenty of cash to pay off politicans so as to insure that the copyright laws stay the way we want them. Incidentally, the 9/11 attacks were really designed to take out a napster.com server housed in the South Tower. Why were both towers attacked, you ask? As it turns out, one of the planes was being piloted by a less than gifted member of Warner Music Afghanistan's promotions department, who with an IQ of just 73 had a difficult time with a compass and as a result managed to guide his charge into the 84th floor of one of the Twin Towers. But hey - in an industry where a success rate of 10-20% is the norm, 1 out of 2 ain't bad.

OK, back to reality for a minute here: as a result of its efforts to stem the tide of illegal filesharing, the music industry (of which we are a part) is on the outs with just about everyone. Why am I bringing all this up?

Ignoring for a moment the fact that no one who has worked for an independent label has ever seen anything resembling real money, there are one or two other things that separate us from Dieter Bohlen and the US Security Council:

  • We don't believe that there exist any weapons of mass destruction in Iraq beyond those that the Americans brought in with them;
  • In spite of my status as an affiliate of this brainless industry, I have managed to write this essay all on my own, without the help of a ghostwriter, and as such any characterization of our label as demented should be made only after taking my authorial skills (or lack thereof) into account;
  • We have nothing against the reproduction of our music for personal use.

 

(pause)

 

Hold the phone. Did we just say that we don't have anything against individuals copying our music for personal use? And we work in the (evil, demented, greedy) music industry? What's going on here?

First things first. On the basis of my previous essays on the subject of piracy, a lot of people have decided that our opinions are 100% the same as those of the RIAA and IFPI (International Federation of the Phonographic Industry). And because, in 2000, we released the copy-protectedf VNV Nation single Genesis.1, a lot of listeners now assume that all our releases are copy-protected (which, in some circles, constitutes an immediate license - nay, duty - to burn and distribute them).

If these people would actually take a minute to think before they opened their mouths, they might realize that "Genesis.1" was our one and only foray into copy protection. This in spite the fact that the technology has been available now for a number of years. We're not alone in this: most indie labels, and even some majors, have made the decision to eschew copy protection schema. Think about it: in the face of large returns due to CD burning and the threat of bankruptcy (no joke!), a not insignificant number of labels - both large and small have made an arbitrary decision not to copyprotect their releases.

In our case, we were disappointed with the restrictions the copy protection placed on the means with which one could play back the VNV Nation CD. The integrated MP3 player didn't function under Windows NT or MacOS; the pressing plant failed to mention that all copy protected CDs must be marked as such, and that this service costs an extra 20 cents per disc; and the copy protection was laughably simple to crack. Keep in mind that the idea behind copy protection isn't simply to stop consumers from burning copies of a CD: all it takes is one person to leak a track to the Net, and it is instantly available worldwide. Last but not least, it is impossible to continue to ignore the computer as a professional means of audio storage. The cat is out of the bag. This doesn't change the fact, however, that a pro stereo system is simpler to operate than a computer interface, has an aesthetic edge over a PC, and offers sound quality CONSIDERABLY superior to that of a 128 of 196kps MP3.

Before you all go auction off your CD collections on eBay, take a minute to reflect on all of this. The IFPI and majors are basically right. Widespread copying, burning and downloading is harming the music, the artists, and the labels - and we are the ones, at the end of the day, who finance the entire operation. The IFPI is completely justified in its stance to prosecute uploaders, intensify copyright law, and combat misappropriation of music.

We understand where the music consumers are coming from. But we also understand the viewpoint of the majors and the music industry organizations. What might a compromise look like? A compromise between keeping music as a valuable commodity for which you have to plunk down your hard-earned cash - and the interests of consumers, who want to continue copying and trying out music on their own terms, not those dictacted by some prohibitively restrictive copyright law?

The reforms to the copyright law and the growing number of copy protection measures effect consumers in really only one central way, and that is the principle of "fair use" of music. In my opinion, and in the opinion of all of our artists, there is nothing reprehensible about making copies of our releases to play in your car, on your MiniDisc player, or even on your computer (did I already mention that music sounds extra-crappy when played back on most computer systems?). But if youre going to disseminate our music, you need to be sure to follow a few simple rules, so as to not become just another statistic that the "evil" recording industry can use to enact more and more restrictions:

We have to live from the sale of music, just like our artists. If you want to recommend our music to friends or acquaintences, then by all means pass it on - but just one or two particularly good tracks on a mixtape (or mix CD, or mix MD or whatever it is you prefer), not entire albums. If you get a mix disc from a friend and find that you really like the new material from Dismantled or Seabound or whoever, then go out and buy it, rather than celebrating the fact that you have yet another crappy-looking CD-R to add to your collection. If you download tracks from the Net, check out just one or two, and give them a chance to grow on you. If you decide you don't like them, then delete them, rather than amassing gigs and gigs of material on your hard disk that you will NEVER listen to again.

If you find out that your friend is borrowing your CDs just so that he or she can make copies without having the slightest intention of ever buying them, tell them to go to hell. And when they tell you that they don't have any money to buy new discs, ask them where they get the money for their broadband connection (did I already mention that MP3s sound terrible?) And if a friend gives you the entire new VNV Nation album as a gift, throw it in the trash in front of them (in this case, not on account of it being VNV Nation, but because giving away entire albums is just plain rude).

If your local DJs music collection consist only of CD-Rs of downloaded tracks that he or she has burned, you should call them out as a cheapskate or worse, and do whatever you can to discredit them in front of their friends.

I know that there are tons of folks out there who use the p2p networks as a means of informing themselves about music that they then later purchase, but there are at least as many leeches who simply greedily suck down free songs and who see music not as one of the precious few things that infuses this life with vision and emotion, but simply as a soundtrack to their pathetic lives stuck in front of a computer screen.

These are the people the IFPI are suing. It is as a result of their behavior that labels drop bands, let go of employees, and start using copy protection schemes. If this trend continues unabated, illegal file-sharers will be the reason why, in a few years, you'll only be able to listen to music on your computer with a corresponding license. You, the fans, will be the ones who have to pay for the greed and arrogance of these inconsiderate thieves. But I don't hear anyone complaining about these people - the ones the IFPI is suing and attempting to stymie with half-baked copy protection schema.

I know that this outlook is idealistic, blue-eyed, hopelessly irrational and absolutely impossible to regulate. Seems awfully similar to the product by which we earn a living: music.

I look forwards to reading your reactions to this article in our Forum.

Stefan Herwig

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