Thursday, January 25, 2018

Recorded Versus Live | Lefsetz Letter

Maybe we’ve got it all wrong. Maybe the record isn’t the advertisement for the live show, but the live show is the advertisement for the record!

Think about this. It’s only been a hundred years or so that we’ve had recorded music. But prior to that, for millennia, music triumphed.

And it wasn’t until the late sixties when the album format burgeoned that there became so much money in recordings. Which ultimately went through the roof with CDs and the rocket ship of MTV. Suddenly, we were living in a monoculture and everybody was paying a high price for a plastic disc with only one good song.

And then the whole thing crashed. Credit the internet, credit Napster, and ever since everyone in the food chain has been complaining we just haven’t made the revenue on recordings we once did.

But live business has gone through the roof.


Because of a culture change, because of a societal change, so much of what we consume became commodities, we all had the same items, which were relatively cheap, we were looking for something to separate ourselves from the pack, to stand out, and to communicate with others.

Ergo the live experience.

We haven’t analyzed this, only basked in its payoff.

We think festivals are about headliners when the truth is they’re gatherings of the masses akin to Woodstock. It’s where you go to commune with others, in a world where you’re often at home, in front of a screen.

And we’ve hit peak festival and many will survive, but not all.

And the idea of going out to the local bar to hear music is anathema. Who wants to hear that much bad stuff, especially when you can be titillated at home.

We’ve got endless cash to go see superstars in concert. But how do you become a superstar?

Traditionally you make recordings, assemble enough of them where you can go on the road and repeat them.

But it didn’t used to be this way. It used to be you went to the show to see the act explore, to hear something different, unique. Prior to the MTV era when the public expected a production akin to the video.

And now…

The biggest act in the world is “Hamilton.”

Its Soundscan number is almost equal to Taylor Swift’s. Furthermore, it’s got multiple companies on the road. It’s basking in bucks. Why?

Because of its story, because of its uniqueness.

You can listen to the music at home, but it’s nothing like being there. This isn’t just songs, it’s story, you’re caught up in it, you can never get enough, assuming you can get tickets, you go again and again and again. WHY AREN’T WE MAKING MORE OF THIS?

Instead we’re focused on hitmakers du jour, propped up by producers and topliners, music made by committee, and one educated Puerto Rican American is inspired by a biography and comes up with a musical by his lonesome which is staged in collaboration with others and all we can do is marvel at his genius, deservedly so. This is the magic that created classic rock, which blew up the business, and it’s right in front of our very face!

This is not so different from the Trans-Siberian Orchestra, touring every year to boffo at the b.o. The recordings are secondary.

We’ve figured out online monetization of recorded music, streaming won, yet we haven’t analyzed the underlying product. While record companies are investing in tech startups, they are not investing in music, in creativity. Do you really think “Hamilton” can be the only one?

P.S. Phish gets its fans to come back multiple nights with surprise content. You feel if you don’t go, you’re missing out. Sure, it’s all ultimately videoed and up on YouTube, but still you need to be there, to see what happens next.

P.P.S. Jazz and blues and even rock were built upon improvisation. Playing the hits note for note is passe. We need to train the audience to come to hear something new. It’s not about the new track that sends you to the bathroom, but EXPLORATION! Believe me, no one went to the bathroom when Eric Clapton stretched out in Cream.

P.P.P.S. Record companies should be CONTENT companies. And the goal of their business should be to own rights which rain revenue in the future, and they’re all not in recordings. Instead of having songwriting camps to create hits, they need to nurture talent to stretch out and do something new. Not only create musicals, but productions… Never forget that Genesis built a loyal audience on production, the hits came MUCH later. And Peter Gabriel hasn’t had a hit in eons but he continues to sell out when he tours because his audience expects something DIFFERENT, not only production, but reworkings of legendary songs, with new players and instrumentation.

P.P.P.P.S. The recordings are just the beginning. Hearing them rendered note for note live is actually a lame experience. What can you add to make one plus one equal three?

P.P.P.P.P.S. Story is king. It’s what created the album concept, it’s what’s making TV the prime creative outlet today. Why not inject story in music?

This is an almost two year old article and the numbers have only gotten better:

“‘Hamilton’ Inc.: The Path to a Billion-Dollar Broadway Show”


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