From the course: An Insider's Guide to Today's Music Biz: 7 Record Labels

What labels do

- I get emails all the time from young folks who want to start a record label and they want my advice on how to do that. And while I love the enthusiasm of it all, I often wonder if they really know what it is that labels do. So if you're one of those folks who are looking to start a record label and want some advice, let's start with what do labels do? The very first thing labels do is identify talent. If you're gonna be a record label, you're gonna need to release music, and that means you'll need to sign some artists to make that music. Seems simple enough, but if you want to be a successful label, you'll need to sign artists that actually sell records, that's how you'll pay the bills. Secondly, labels make records, that's what they do. Once that artist is signed to the label, the label will work with them to produce the best possible recordings they can. They'll do that by helping the artist find the right producer, engineers, songwriters, recording studios, anything it takes to make a great record. And of course, they will pay the cost of making those records, that's an important point. So they make records and pay. Once that record is made, the record company will manufacture, distribute, and sell that music, so that's the third thing they do. Manufacture, distribute and sell. That music will be reproduced in all kinds of different formats, from CD to vinyl to digital downloads, streams, what have you. It will be distributed in physical formats, at brick-and-mortar retailers as well as in digital format. All the digital outlets like iTunes and streaming services like Spotify. And they'll need to do it on a global basis, and that is no easy task, as every country and every digital retailer have their own unique customs and processes, so that's what the label will take care of. And once you've got all that done, they'll need to get the money, so they'll need some muscle to get paid. Getting the records made and in the stores is one thing. Getting folks to hear them and buy them is quite another. That will require marketing and promotion. A label provides that marketing and promotion. You'll need photos for media, videos for YouTube, advertising, online and offline, touring to bring customers to the music and the artist, licensing opportunities, massive airplay on radio, the web, in video games, and anywhere else people hear music. And that is gonna cost some real money, folks, and the labels are the ones that pay. And that brings us to the last thing that labels do. The labels pay for it all. If it all works out, great, the labels makes some money. But if it doesn't, they're gonna lose a lot of money. Still want to start a record label?

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