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Jurij Dobriakov. BMIC ‘07: Lithuanian Music Industry in Prospect


It seems that the years 2006 and 2007 became a turning point for Lithuania’s music industry. First of all, July 2006 saw the establishment of Music Export Lithuania, an institution dedicated to promoting Lithuanian music abroad and facilitating its export. In a short while, Music Export Lithuania could boast several successful projects. Its website www.mxl.lt, which presents Lithuanian artists to potential international consumers in a highly attractive modern format, is online since January 2007. Just a couple of months after its launch, the first compilations from the five-piece CD and DVD sampler series Note Lithuania, presenting selected examples in styles ranging from pop/rock to electronica, were out. Not without the same institution’s considerable effort, the presentation of Lithuanian music industry at the world’s largest music trade fair MIDEM in Cannes (the third one for Lithuania) was much more coordinated and effective (besides, an agreement for a much more comprehensive presentation in 2009 was reached).

 

Lastly, on 24-25 May 2007 Vilnius hosted a very important event that might become a starting point in the newest history of Lithuanian music: the Baltic Music Industry Conference (BMIC), organized by Music Export Lithuania and the British Council. The conference brought together some of the best-known music industry experts from abroad and the representatives of the Baltic States’ music industries: managers, publishers, producers, event promoters and artists themselves. The very fact that Vilnius was chosen as this event’s location suggests that Lithuanian music scene has reached a certain stage in its development that demands a refl ection on current trends and future perspectives.

 

Yet are the industry’s players themselves, not the music market commentators or music export strategists, ready for taking such an objective and critical look at their own business sphere? Talking specifically about BMIC ’07, the Lithuanian participants’ reluctance to actively contribute to the conferences’ sessions makes it difficult to conclude that the majority of them saw the event as relevant to Lithuania’s current situation and potentially useful for Lithuanian music business. The lack of enthusiasm was partially explained by several remarks that Lithuanians made during certain sessions, which could be summarized as follows: Lithuanian music industry is still in a stage where solving short-term problems and taking care of basic needs is more important than setting strategic development goals. In other words, the rhetoric employed by Lithuania’s representatives was radically different than that of their foreign partners. A considerable part of them are still unwilling to reject the familiar mythology of inferiority (consisting of arguments like “the market is too small”, “nobody buys records”, “there are no facilities for live performances”, etc.), while the foreigners tend to speak about innovations, long-term strategies and rational but creative music management methods. In short, while the former identify the problems, the latter seek solutions to them.

 

However, observing Lithuania’s music life of today, which in fact doesn’t lack interesting and original phenomena, makes one feel that this defensive rhetoric doesn’t necessarily coincide with reality, and that Lithuanian artists, publishers and managers are simply accustomed to thinking and talking in such terms. It is possible that BMIC ’07 will serve as a catalyst for change in attitude, inducing Lithuanian music industry players to take an active position instead. Some of them already demonstrated such proactive orientation during the conference, but one cannot be a prophet in one’s own land even in the 21st century. Maybe the lessons taught by foreign colleagues will prove more convincing (if the traditional skeptical attitude toward “Western philosophizing” will be abandoned), especially since most of them were presented as concrete suggestions potentially helpful in making Lithuanian music industry strong, vibrant and lucrative.

 

Will the record companies face the dinosaurs’ fate?

 

There are three basic types of players in the world music industry: the major labels, the independent labels, and self-managed artists and bands (who are also self-published and self-distributed in some cases). What are the likely evolution scenarios for these three? At the conference, it was stated a number of times that the first type virtually has no future, even though its position is still fairly strong at the moment. The giant, infl exible, vertically structured global music corporations are a phenomenon of the late 20th century, unable to adjust properly to the changing trends in culture and business of the new millennium. If these big companies are to escape the fate of dinosaurs, they must evolve into a kind of “big independent labels”, rejecting many of their present functions (like physical manufacturing of records) in favour of concentrating on the creative and administrative functions, outsourcing the rest of the process. Only then will they become responsive to the dynamic processes in the market.

 


Who needs labels in the 21st century: Jaro Slavik (Warner Music

Austria), Toby Brundin (moderator, British Council), Grandmaster

Gareth (Misty's Big Adventure), Erik Nielsen (Marillion)

It must be noted that such major labels practically don’t exist in Lithuania. The international giants like EMI or Warner haven’t entered its market yet, even though they do operate in some other Eastern Europe countries already. Meanwhile, almost all of the local companies are to be classified as independent in terms of scale and principle of operations. Yet there is a paradox: the majority of Lithuanian record labels resemble the majors because of the vertical integration of their operations, since they are what can be called “all-in-one production houses”, taking care of the whole spectrum of related processes–from recording to distribution. For these companies, maximum integration of the music industry’s functions within the operations of one enterprise is a means to cut costs and solve the problem of missing infrastructure, typical of a small market. Yet such integration, while saving financial resources, requires much greater organizational resources and concentration on various routine administrative procedures, and may cause the creative and strategic aspects of the business to be neglected. It is likely that this trend is one of the major causes of the aforementioned phenomenon of concentration on the short-term perspective prevailing in the industry. If this is true, then the practice’s validity for today’s situation should be reevaluated.

 

Another problem hindering the progress of Lithuanian record companies is the lack of professional skills. Almost all of the companies were established by music enthusiasts, musicians, or simply venturous entrepreneurs, not professional music managers or publishing experts. Since complex study programmes in music management are still in their development stage in Lithuania, the music business is largely a field of continuous experiments and trial-and-error search for effective practices, rather than a systematic activity with established principles. Again, this situation hardly leaves any place for coordinated strategic development. Furthermore, it appears to signal that, since the managers and the publishers are not really trained professionals, the artists can do the same activities at least as well, if not better. Thus increasingly many groups chose to take care of their own management themselves, seeking to secure their creative and financial independence, while for some alternative bands it is the only way to get their music out on the market, since risk-averse labels are reluctant to sign them. There are even some bands that establish small self-run labels, like Skamp and their Tabami Records, but the general assumption is that such enterprises are mostly unprofitable. On the other hand, self-managed bands and artist-run labels should be really creative in searching new ways of fundraising and marketing to do without the support of established and more experienced record companies. For example, they might use fan base support for financing the recording of their albums, or explore the possibilities of digital distribution, as it is done in some other countries.

 

What keeps the live music scene alive?

 

One of the conference’s recurrent themes was the declining record sales and the upsurge in the popularity of live music. Even a brief look at the live music scene in Lithuania and its evolution in the recent years reveals that this process is taking place here as well. There is a significant increase in not only the number of live concerts, but also the number of live acts. The sphere of concert promoters is experiencing a similar quantitative and qualitative growth, with some promoters even becoming trendsetters. A good example is Tabami, a live event promotion agency established by members of Skamp, which has become a recognized and respected brand.

 


Fusedmarc (LT) gave absolutely stunning

live performance during the BMIC '07

Unfortunately, the number of adequate concert spaces is not growing so fast. There are quite many small venues (usually cafes and small clubs) that can only accommodate performances for small crowds, and there are several modern entertainment complexes that are suitable for grandiose live appearances by first-rate pop stars. The middle-sized stages appropriate for acts that like to have a close enough contact with their audience, yet have overgrown the pub concert format and have specific technical requirements, are few. On the other hand, one shouldn’t forget that the availability of infrastructure will not automatically make the live music scene interesting and unique.

 

In summertime, the public spaces of Lithuanian cities assume the role of stages for live performances by popular artists, becoming the location for various free events fi nanced by the politicians or business companies. At this point, it is difficult to predict such events’ effect on the quality and growth of the Lithuanian live music scene. So far it seems that the fans are still willing to pay for the favourite artists’ performances in clubs, even if they play free concerts as well. This may be explained by the fact that the atmosphere of ‘proper’ concerts is perceived as fairly different and worth the entrance fee. Besides, it is possible that free public performances may make a band more visible and induce more listeners to go to its paid shows, serving as a ‘free sample’.

 

In Europe, large open-air summer festivals like Poland’s Heineken Open’er or Hungary’s Sziget Festival are a hotbed for live music, featuring both the top international stars and the less known bands. This summer Lithuania had a chance to observe the first attempt at organizing a similar event in its territory. It would be unfair to say that the Be2gether Festival, which took place in Norviliškės on the last weekend of August, was unsuccessful. Yet some commentators stated that the first edition lacked consistency and truly new musical content. Still, one can hope that this start will act as a catalyst for a certain chain reaction, and in a couple of years Lithuania will indeed have an open-air live music festival that will be well-known at least in the region.

 

Digital distribution: an alternative for small market limitations?

 

An underlying assumption of the conference’s session on digital sales was that digital distribution via the Internet and portable multimedia devices is the future of the music business. The global digital sales may equal the now-declining physical record sales by the year 2010. Internet-based digital distribution minimizes the importance of geographical location and physical infrastructure. Even though digital sales cannot fully compensate for the diminishing physical sales yet, it is clear that the music distribution has changed irreversibly, and the new millennium brought new factors infl uencing the bands’ visibility: presence in online communities like MySpace, YouTube and Last.fm, as well as a deal with an independent digital distributor.

 

In Lithuania digital distribution of music is still largely underdeveloped. The culture of buying (not illegally downloading) music online has not developed yet, and the record companies themselves are not yet ready for such a radical transformation. Yet there are good examples that online distribution works, at least for certain music scenes. For instance, the digital versions of the releases of RyRalio Records, a dance music label established by the well-known Lithuanian DJ and promoters team of the same name, are successfully distributed through the majority of popular online DJ stores like Beatport.com for a while already. At the conference, the Lithuanian record companies willing to start digital operations were advised to concentrate their online sales on two or three carefully selected channels–for example, the iTunes store and one or two independent websites like Bleep.com. For very small labels the best practice would be to work with one of the content aggregators like CD Baby, which make it easier to get listed in the online store catalogues and do all the necessary accounting, as well as providing additional promotion tools.

 

According to the statistics, the penetration of mobile devices in Lithuania is higher than 100% and significantly exceeds the availability of Internet access. It is therefore logical that the majority of digital music sales are accounted for by the various musical content-related mobile services. Several aggregators and providers of such content are active in Lithuania. Modern mobile phones, having become portable multifunction and multimedia devices, make possible the distribution of not simply digital tracks, but bundled products that contain additional graphic and moving image files in different formats. Such products can compensate for the loss of a part of the complex experience of music that was typical of the physical distribution era (the design of the sleeve, the liner notes etc.). It seems that the Lithuanian mobile services market is moving in that direction, offering its customers still new services and their combination. The mobile Internet, becoming faster and more widespread, can be a significant positive factor in this process.

 

Digital distribution dictates a new logic of information distribution. Today’s internet is not a sphere of centralized information channels, but rather an unpredictable and constantly evolving universe of independent and personal information tools – weblogs, forums etc. While the distrust of corporate mass media grows, the person-to-person word of mouth and information exchange taking place in the mentioned open platforms become increasingly important. The bands willing to build their visibility and support base in a fast and cheap way can effectively use this situation to their advantage, instead of waiting for the ‘big’ media to notice them. Some music scenes in Lithuania, for instance, the electronic music scene, are already making a fairly effective use of the internet as a marketing tool, while others, it seems, did not fully realize its potential.

 

Making brands sound like music

 

Perfectly aware of the role that music plays in today’s urban life, many well-known brands seek to associate their goods and services with the modern youth culture, where music acts as a symbolic attractor and catalyst for identifi cation and adoption. Today’s consumers are quick to decode the hidden messages and mechanisms employed by the advertising, thus the association of brands and music has to be subtle and imaginative to avoid rejection. For example, using a recognized brand name in the name of a concert hall, an entertainment complex or a festival seems to work well (a prominent example in Lithuania is the multipurpose Siemens Arena).

 

The most popular practice in Lithuania is the distribution of music compilations in the form of prizes together with mass consumption products like light alcoholic and soft drinks. Bomba Records and Monaco Production has engaged in such projects a number of times. There are some more interesting forms of collaboration as well, like club music mixes released by restaurant and urban clothing chains (usually bearing the names of well-known DJs) and impressive dance music events series sponsored by alcoholic drink brands, featuring the top-notch international acts. Other forms of such symbiosis, for instance, licensing songs by popular Lithuanian artists for TV ads of well-known brands on a regular basis, are yet to emerge.

 

Quo vadis

 

Remembering Maslow’s classical hierarchy of needs, it seems that Lithuanian music industry has already transcended the basic level, meaning that its ‘physiological’ survival needs are satisfied, and it is surely developing. Still, it is far from the top of the pyramid, because so many representatives of the music business are focused on very concrete and short-term ‘household problems’. BMIC ’07 can be viewed as successful if the Lithuanian music business elite will direct its look to the long-term development issues and innovative creative strategies after this contact with its foreign partners. It is also extremely important for the local music industry to consolidate and seek common goals in coordination, since that is the only way for it to see the broader context and achieve a more professional level.

 

© Jurij Dobriakov

Lithuanian Music Link No. 15

© Lithuanian Music Information and Publishing Centre, A. Mickevičiaus 29, 08117 Vilnius, ph: +370 5 272 69 86. E-mail your questions / comments to [email protected]
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