photo by Michael Hicks
In early November, Taylor Swift will become a free agent. The looming question is whether she will “Begin Again” with her existing label, take her talents to a new label – or go it alone.
Scott Borchetta, the founder and CEO of Big Machine Records, famously signed Swift when she was 15 years old. At the time, she and the label were both untested quantities. Rolling Stone characterized Big Machine as “more of an idea than a company when [Swift and her parents] signed.” The star and the label rose to prominence together. For many people, Swift effectively is Big Machine, though the label has expanded its roster to include other established acts including Reba McEntire and Cheap Trick. Still, Swift has been Big Machine’s biggest artist by far for years.
But Taylor Swift’s career and the music industry both look very different today than they did when her self-titled debut album arrived in 2006. Variety reported that Swift’s representatives have opened conversations with the major label groups, as well as holding discussions about the possibility of staying with Big Machine.
These days Swift is a “big machine” all on her own. It makes me wonder why she needs to sign a new contract with Big Machine, or any major label, at all.
Any deal Swift would accept will presumably include control of her new masters. And while Big Machine could sweeten the pot by offering the masters of her first five albums, I strongly doubt the label would take this step. A person with knowledge of the business told Variety that 80 percent of Big Machine’s revenue is derived from those albums today. In a streaming-dominant world, giving up those masters might be too big a loss to take, even if keeping them means forgoing the chance to profit on Swift’s future work.
Big Machine may also be betting that Swift has plateaued. Swift’s most recent album, “Reputation,” sold significantly fewer copies than its predecessor, “1989.” The label may feel that it will do better to hold on to the masters for the five albums it has than to give them up just to stay in the Taylor Swift business.
But the fact that Swift sold over 1 million copies of an album in the first week of its release in 2017, as streaming continues to become the dominant mode of music consumption, is still remarkable. “Reputation” was the best-selling album of the year in the United States, and sold 4.5 million copies worldwide. It is little wonder that major labels are still eager to sign a star of Swift’s caliber. And this is before we even mention her touring revenue. Pollstar reported that the first 18 dates on her most recent tour sold out, and Swift reportedly grosses between $5 million and $9 million per concert. Despite initial skepticism over the variable pricing model Swift introduced for the “Reputation” tour, committed fans proved they were still willing to show up in large numbers.
The “360” style contract was not yet widespread when Swift signed with Big Machine, but now a label would almost certainly try to negotiate to enjoy a slice of that concert revenue. Labels today are much more likely to want to insert themselves into every part of an artist’s revenue stream, from merchandise to endorsement deals, as album sales are no longer the dominant moneymaker they once were. Nor are 360 deals limited to unknown artists; Jay Z famously signed a 360 deal with Live Nation in 2008, though in 2017 he renegotiated the terms to cover touring only. While Swift almost certainly has the power to limit the label’s reach into her revenue stream, such limits would be the exception rather than the rule. Even Swift would have to give up some level of control to secure a label’s backing.
While an unknown artist may benefit from the exposure a label can offer, it’s tough to see what a superstar like Swift would truly get out of such a deal. Swift has demonstrated that she has no real need for label’s help with publicity. Today’s music industry focuses much more on fan experience than album sales. As David Turner wrote for “Real Life” magazine, “…music fans aren’t paying for the opportunity to access music — most listeners take access for granted — but instead to integrate it meaningfully into their lives.”
Swift arguably acted ahead of the curve in this sense. Even as she became a superstar, she regularly interacted with fans who tagged her on Instagram and other social media platforms, creating an aura of approachability while maintaining control of her public persona. And she has long been known for unusually warm and personal interactions with her most devoted fans, from curating a playlist for one who was navigating a breakup to inviting another to her home and baking cookies with her. Even in the midst of a social media blackout preceding the release of “Reputation,” Swift continued to “like” posts her fans made on Tumblr, giving them a sense of exclusive access and connection.
Swift is also used to a certain level of artistic autonomy. Variety reported that her in-house team already handles “most of the duties a label would,” including overseeing an album’s development, publicity, album cover design and most of Swift’s music videos. It does not seem far-fetched to imagine she could hire additional staff to cover any gaps.
One of the few compelling reasons that remain for an artist to join a label is to take advantage of the company’s artist development resources. But Swift is an accomplished performer and songwriter, one of the most famous pop musicians in the world. She already has a team she trusts, a huge amount of name recognition, and established channels for interacting with her fans. There is no credible way to argue she needs a label to hold her hand for any of it.
The one thing a label contract could offer her, in theory, is a guaranteed payday. Music industry insiders told Variety that Swift could secure as much as $20 million per album in upcoming negotiations. If Swift is worried that her fans may eventually desert her, the comfort of such a contract may outweigh the potential for greater earnings and the reality of giving up some level of control.
But I would be surprised if Swift approached the deal this way. Even if Swift is concerned that her popularity is waning – which I don’t think the evidence suggests she is – going independent is still in her best interest. She will continue to maintain a large number of dedicated superfans who, as producer and artist Ryan Leslie pointed out years ago, are the true backbone of a successful musician’s career. And clearly the major labels that are salivating at the thought of her becoming a free agent are an indication that industry experts are not concerned with Swift’s future ability to sell music or tickets. The lucrative nature of the deals she is offered should be their own signal that going it alone is not only viable, but preferable.
For artists without a proven track record, deciding whether to go solo or let a label put their fingerprints on all parts of their artistic life is a difficult choice. Artists who aren’t household names will need to weigh the pros and cons carefully. But for someone like Swift, today’s music label offers little that she cannot do better and more lucratively with her own team. The only question that remains is whether Swift is willing to step forward and demonstrate what truly independent music superstardom can look like.