Marvster Posted November 29, 2001 Share Posted November 29, 2001 Don't know whether any of you heard about this, but the repercussions aren't pretty. Thought this article said it all.... Marv * * * * * Death Valley BLUE ROCK'IT RECORDS owner Patrick Ford thought his band's new album, A Tribute to Paul Butterfield, would be just the financial crescendo his label needed to survive the recently slow economic tempo. His distributor ordered an encouragingly large number of copies, and the CD soon became one of the top sellers for his small Bay Area blues label. But now Ford doesn't expect to see a cent from the album's sales. In fact, he's already lost nearly $50,000 in an ordeal that will cost musicians and independent labels all over the country more money than their small budgets can afford. "We're backpedaling to try to figure out how to keep the company going," says Ford, a drummer with Robben Ford and the Ford Blues Band. "The market is already not so good right now, so to take this kind of punch is really hard." The punch was delivered by Blue Rock'it's distribution company, Distribution North America, when its parent company, Valley Media, filed for Chapter 11 bankruptcy Nov. 20. After a failed merger with the Alliance Entertainment Corp., megacorporation Valley Media began negotiating a last-ditch rescue with lenders Nov. 15. The next day the company laid off nearly 200 employees. Representatives did not return phone calls last week. "This is major news," says Uli Elser, general manager for local label Alternative Tentacles Records. "It's really, really scary. How can a company like that go out of business?" While Valley Media deals in many realms of mainstream media, DNA acts as a distributor for independent labels all over the country. Since these small labels essentially lend their CDs to DNA, they don't see any cash until the records sell at retail outlets. With the bankruptcy factor, DNA's inventory falls into the bank's hands, and the labels can no longer profit from the sales of their own albums. More.... http://www.sfbg.com/AandE/36/09/musa09.html Link to comment Share on other sites More sharing options...
Philip OKeefe Posted November 29, 2001 Share Posted November 29, 2001 That's really too bad... A label I used to work for went through almost the exact same thing. Blonde Vinyl (the label) ended up going belly up when the distribution company (Spectra) went bankrupt. Blonde Vinyl's owner, Mike Knott, made everything right in terms of artist's mechanical royalties out of his own pocket before he closed up. But they (Spectra) really messed him over, and a lesser man would have just closed up the label and told the bands that they were out of luck... Phil O'Keefe Sound Sanctuary Recording Riverside CA http://www.ssrstudio.com pokeefe777@ssrstudio.com Link to comment Share on other sites More sharing options...
soapbox Posted November 29, 2001 Share Posted November 29, 2001 Wow! Tough times... My condolences. Enthusiasm powers the world. Craig Anderton's Archiving Article Link to comment Share on other sites More sharing options...
kudyba Posted November 29, 2001 Share Posted November 29, 2001 What's strange is these guys fulfill SO many stores and web sites including K-Mart, CDNow, Amazon, The Orchard (ok that's kind of a joke) and many others. Keep an eye on Derek from CD Baby...he's got something brewing...in fact CD Baby will be the official CD site for MP3.com...that will be announced within the next week or so... Link to comment Share on other sites More sharing options...
D. Gauss Posted November 29, 2001 Share Posted November 29, 2001 i sell three times as many cd's on cd baby as i do on amazon. when my first cd came out several years ago, it was the other way around. go derek! -d. gauss Link to comment Share on other sites More sharing options...
Marvster Posted November 29, 2001 Author Share Posted November 29, 2001 Couldn't agree more about Derek. He's a rare breed: Has the best of intentions, is a marketing genuis, and is a genuinely nice guy. Marv Link to comment Share on other sites More sharing options...
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