Thursday, February 11, 2010

An Open Letter to Tommy Silverman - February 11, 2010

An Open Letter to Tommy Silverman:

Hi Tom: Thank you for your gracious letter. As I had originally suspected we are almost on the same page. I was in High School when "Rock Around The Clock" started the avalanche that propelled Elvis to the big top and established rock & roll as a permanent part of popular culture.

I made my first money selling music in 1957 and have been doing it ever since. I cannot remember a time when I did not manage at least one band. Over my fifty plus years in the postmodern record business I have been fortunate to serve many artists great and small.

Today I manage a baby band called The Reflectacles, so my interest in the new music industry paradigm is not casual or merely academic. I have a real job to do building a business around this six piece Americana folk rock band that formed out of my classroom at Loyola Marymount University.

Seven years ago when I was teaching personal management at Musicians Institute a student asked me, "How would you build an act today when the music is free?" I must admit that for the first time in my life I did not have an immediate answer to a question. The Holodigm is the continuing answer to that question. After due consideration, my students and I embarked on an extensive analysis of the problem. When I joined the faculty at LMU we continued the research and development of a new music industry paradigm.

Now, six years and more than 2000 students later, we believe we have perfected a working model that the industry will follow, knowingly, or not. It is organic and based primarily on the historical trajectory and a clear vision of the future. More importantly, it deals with the broadest range of participants. The millions of bands registered on They all deserve a chance to compete.

The concept is presented as the first interactive, audio-visual, online text book and addresses the fact that a kid would rather watch a movie than read a book. It is a training, mentoring and coaching system for musicians and entrepreneurs that addresses every aspect of the ancient alchemy of turning music into gold. It functions on a simple mathematical formula: One Artist + One Manager = One enterprise.

The manager is the CEO of the artists company and he owns an equal share of the enterprise. Fifty/fifty partnerships a la Elvis and The Colonel for solo artists and an equal share with bands. He cannot be fired because his contracts ran out or somebody will do it for less. He is an equity owner of the business he helps build and can only be bought out at the fair market value of his shares.

All are exclusive employees of the corporation or LLC. Record producers can also be invited to join as partners since their skills will always be needed. We invited recording legend Eric E.T. Thorngren to be a full partner in The Reflectacles Music Co. ensuring that we will make world class records from day one. Everybody works for free until there are dividends to declare.

This form of partnership will ensure that everyone on the board of directors has an incentive to make the business successful. Each member has a role beyond the stage. In the case of The Reflectacles, each man is either an officer of the company or a vice president of a division. They apply the business skills they acquired in the classroom to their real life career pursuits.

How many CEOs get to indoctrinate their employees for sixteen weeks, three hours a week? Not many. But Holodigm Artists get that training before they start the arduous climb to artistic and financial success. Thy do not run blindly, lost in the fog of showbiz. Their goals are clearly defined and supported by a game plan that can be conducted at a livable pace, under their direct control.

The Holodigm is their sanctuary and provides continuous career direction as each enterprise grows. We hold no equity interest in the activities or entities produced by "Academy" and "Society" members. When appropriate, we may invite partnerships with promising talent through our professional division Holodigm Media. The business that is built will belong to those who build it.

Our staff of coaches and consultants is being implemented at this time and will provide a constant source of seasoned professional advice to our members online. Additional services and products provided below market price will facilitate production and marketing activities ensuring a faster rise to profitability. Individual successes and failures will be shared among the membership through The Holodigm Forums, Blogs, Social Network and Chat Rooms. The members, pursuing the same goals, each get to benefit from the other's learning experience. There is no template to follow; it is a real-time live experiment.

With a clear focus on the two primary activities of recording and performing, combined with effective Internet marketing, the team can build and operate its own business. The mystical fuel of "talent" drives the engine and combined with other "star" factors, like, great songs, charisma, sex appeal, hero worship, authenticity, passion and desire, they can build a fan base.

Nepotism, personal wealth, sponsorship, talent TV and personal relationships can enhance and accelerate the process. However, these are stairway to heaven possibilities that will not exist in most cases. Generally speaking, The bands and managers will have to do the work themselves.

Traditionally, investors want something for the risk they take. And that is only fair. However, during my fifty plus years in the music industry I have never seen a record company make a fair deal with an artist. And, I have never seen private investment pay off for the artist or the investor.

The money will want a permanent piece of the company. Unless they contribute something else to the artist's enterprise this will become inequitable eventually. In an industry where only ten percent of the artists will survive there won't be much venture capital available.

The Holodigm concept concentrates the artists and managers on the job of building a viable live act, in local and regional markets, around which products can be developed and sold. It focuses on do-it-yourself systems, mechanics and protocols. And, it forces the players to run their enterprise as a business without giving away equity to third party service providers.

Artists who wait for investors will be doomed to fail. Those who take action on their dreams will create their own destiny and they will reap the reward. They will own their masters and publishing and the most talented will build a permanent annuity to support them in their old age.
I totally understand the pressure you were under the day we met. I am a long time observer of your significant accomplishments and hold you in the highest regard. The work you do in support of the continued growth and development of our business is significant and necessary. In time the labels will let go of the old paradigm and embrace digital download distribution for their catalogs. And, they may even be able to buy up a few new acts as they emerge. But, it will never be the same.

The music industry is thousands of years old and will not expire under the weight of digimodernization. The record business is just over a hundred years old and will surrender to the digital sword. In the transition the business of recording will fall to the hands in which it belongs, the men and women who create music.

New artists will no longer be imposed by record company moguls or A&R producers of the month. They will be discovered, nurtured and revered from the fan base up. The information super highway is the arena and the Internet is the rocket.

I hope you will visit and consider that perhaps the new paradigm exists and only has to be implemented. This concept evolved from an historical observation of the effect of new technologies on the record business pre Napster; and, on my personal experience directing careers as an agent and personal manager in the postmodern era.

The invitation to speak to my class still stands.

Pax et Amo. Hartmann

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