BC Business
Jonathan Simkin, 604 Records | BCBusinessWant a hit record? Call Jonathan Simkin, maybe.
A runaway hit by Carly Rae Jepsen leads a local record producer to muse on the fall of the “bigs.” If previous decades were the halcyon days of the record business, declining sales in the last 10 years suggest the current situation is a much-needed correction.
If previous decades were the halcyon days of the record business, declining sales in the last 10 years suggest the current situation is a much-needed correction.
Despite the international success of “Call Me Maybe,” Mission native Carly Rae Jepsen’s smash pop hit that reached number one on the Billboard Hot 100 and topped the charts in 16 countries, 604 Records Inc. president Jonathan Simkin says all is not harmonious in the industry. “It’s a horrible time. People don’t buy records,” he quips, adding that it’s an especially bad time for major labels.
604 Records, the upstart Vancouver label Simkin co-owns with Nickelback frontman Chad Kroeger, has achieved success with a star roster that includes Jepsen, rockers Marianas Trench and Delta-based band Theory of a Deadman. But Simkin cites financial irresponsibility among the “bigs” during the industry’s peak years for current industry woes. “Here’s the problem for major labels: like an independent, they’re dealing with the challenge that people don’t buy that many records anymore, but unlike most indies they have giant infrastructures they built up during the boom years of CD sales.”
It’s still possible to make money in the record business, Simkin claims, but only by having reasonable overhead. “This was an industry that was proud of how [financially] unreasonable it was, and thrived on excess to the point of it almost being cliché, with the limos, first-class hotels and overspending on everything,” he says.
The occasional runaway success to the contrary, there is still no set formula for what becomes a hit record. “The business was always sort of a crap shoot. Even in the so-called ‘good old days’ most things didn’t work. The difference was that when things did work, it paid for all the stuff that didn’t.”
He cites Matthew Good’s Beautiful Midnight, which debuted at number one on the Canadian Albums Chart and went on to sell upwards of 400,000 copies. That kind of a windfall could absorb “a Miller Stain Limit and all those kinds of bands that didn’t sell,” says Simkin.
In 2011, after a steady decline in the previous seven years, sales of complete albums rose marginally, with Adele’s 21 and Michael Bublé’s Christmas leading the way. And when sales soar and an artist has mega-success, ancillary revenue opportunities come fast and furious.
Jepsen, Simkin says, has been asked to play the half-time show at football games; marketers want to use her lyrics on T-shirts; producers want to use her song on their shows; requests come in by the hundreds for “Call Me Maybe” to be part of compilation CDs; and is Jepsen available to tour Switzerland?
“But Carly’s unusual. That’s, like, the biggest song of the year internationally.” (In fact, Billboard named it 2012’s Song of the Summer on its annual list.)
Even a big hit, however, “doesn’t quite cover your nut anymore,” says Simkin, which 604’s strategy reflects. “As long as you keep it to a reasonable financial level and show fiscal responsibility, you can still do okay in this business.”
It’s a business model that he feels is necessary for survival. “The money is being poured back into the company, back into the bands, back into signing more bands and being able to keep this going,” he says. Read: not on limos, Cristal and the biggest suite at the Four Seasons.
With up-and-coming local artists By Starlight and Fighting For Ithaca among its latest roster signings, 604 is optimistic about the future of independent record labels. “I hate to say it, but I don’t see how major labels survive at this point. They just don’t make sense anymore.”