October 23rd, 2012 post to techdirt, Mike Masnick explains how a confirmed DIY activist like Trent Reznor can still make a deal with Columbia Records (part of Sony Music) for his new band, How To Destroy Angels.
Although some observers have criticized the founder of Nine Inch Nails and Oscar winner (The Social Network best original score) for making a deal ("crawling back to the machine"?) with big media, Trent Reznor hasn't given up on using the DIY model for niche projects.
It's just that the power of Sony Music to reach a mass audience using Old World marketing techniques is still unsurpassed.
Trent Reznor's dilemma? If he makes a deal with Sony to market his new project, he knows that the revenue stream will have many deductions before he sees any profit - and some fans may question whether he's being a hypocrite for doing business with a big media company.
Weighing these considerations, the ability of Sony to market the hell out of a new band v. the power to control and maximize the profits should the project hit, Trent Reznor opted for a (very favorable, see below) deal with Sony: "The top priority wasn't to make money. It was to try to reach the most amount of people, and try to reach the most amount of people effectively, that doesn't feel like it's coming completely from my backyard. Because I don't want this project, ultimately, to just be dismissed as "side project"."
Reznor's manager, Jim Guerinot, explained to Mike Masnick that the How To Destroy Angels deal with Sony has one key difference from the typical record deal: "[Trent was] able to license it and continue to own his masters... and, really, that's the most relevant thing about the deal... The toughest thing is when an artist takes an advance, pays back the advance, and doesn't own his masters. That's always been -- and I've argued this with my friends who run major labels -- that is the single greatest difficulty and why so many artists don't trust labels."
So Trent Reznor owns the master recordings (which means he will have more say in how the recordings are used in subsequent derivative works - like ads and movies) and Sony has an incentive to market the recordings made by How To Destroy Angels in ways (e.g., billboards, ads in magazines and on radio and TV around the world) that even the richest rock star would find too expensive.
Indie filmmakers can learn from Trent Reznor.
The distribution models are changing - and instead of signing away all rights - some savvy artists (those with negotiating power and knowledge of the business) are retaining ownership while only licensing relevant rights to the big media companies.
The goal in the New World is to find distribution that allows your partners to profit from success (even if your partner is a huge conglomerate) - without stripping the artists of future revenue.
The lesson? If the opportunity arises, there's no shame in using Sony's deep pockets and marketing strength to make your content pervasive - just don't give away more than you have to.