When people talk about this perfect storm moment for the business, consolidation of the business, consolidation of radio, all the elements, the Internet, what do you think? It's a great phrase, is it a reality?
Yeah I believe it is. I think that, again, my opinion, is record labels will become sort of -- I mean they are to some extent venture capitalists, in the way that they invest in a piece of talent. But they only have the rights to derive income from the record sales.
I believe that the future's going to be if a record company invests in breaking in artists -- which a record company does spend time, energy, effort, marketing, promotion, distribution, sales, and numerous other ways to help break an artist -- they're going to want a piece of the publishing, the merchandising, the touring. I mean some of that has started on some level, and that's how it used to be years ago. But I think record companies are going to go that way again.
Or die, yeah. I mean I don't think they're going to die in the relative future, and the relative future is the next five or 10 years. Again, it's really complicated, and it's way beyond the scope of what I can say at this moment. But brick and mortar retail sells 99 or 98 percent of all records sold. It's really hard to, quote "overnight" have the people that sell 99 percent of your product go out of business. That doesn't happen overnight. But it happens over time with the Internet, and the sophistication, the technology growing. You know, that's how it works.
Let's just talk a little bit about Velvet Revolver. Who, what, why, where, when, how?
Basically I had been Slash's lawyer, and my law firm represented Scott Weiland. So I had pre-existing relationships with both. I hadn't seen Slash in several years and I ran into him at Tower Records, when he and Robert Evans were doing a record signing for the soundtrack album to "Kid Stays In The Picture."
And we talked, and he said, "I'm looking for a singer, we're looking for management." And I always thought that, you know, if several of the guys from Guns N' Roses, the biggest band in the world for a period of time, got back together, and they found their quote, "new singer," it could be amazing. It could be unbelievably huge.
So we started working with them March of last year. I think they hooked up with Scott Weiland in May. And, you know, the future is their oyster to a large extent. I mean it's incredible the ride we've taken in less than a year. Between putting together a soundtrack -- they did the theme song, the untitled song, for "The Hulk", the Universal motion picture. We also did a song for "The Italian Job," all as an unsigned artist, which first and foremost is extremely rare to have an unsigned artist do -- contribute major songs to major motion pictures.
What does it mean, "unsigned artist?"
Meaning they didn't have a record deal at the time. They weren't signed to anybody. We'd been approached by record labels in Europe, record labels in Asia, we were exploring the possibility of talking to Apple, we were exploring the Internet. At the time there was a lot of interest in the band, and we were exploring a number of different distribution avenues to see what we wanted to do.
In the end, June 19, 2003, the band played sort of an unannounced gig the day before the release of the motion picture "The Hulk." And at that time a number of record label came down, and the buzz started to heat up, and several labels made offers. We ended up going with Clive Davis at BMG and RCA.
Did Clive say something wonderful, or was it that it was Clive? What happened?
Well Clive is a legend. What can you say? I mean there are no rules for originality, and he's an original. He's sort of done everything in the music business and still stands the test of time. So there was a lot of competition, great labels, I think the guys felt that, you know, Clive Davis is this interested and he's the head of the label. You know, it's a hard thing to say no. Plus the deal was unbelievably fantastic. But all the deals were competitive and all the people were great, it's just Clive has an edge because he's Clive.
What of the deal can you tell us?
Nothing. It's a short-term deal with a lot of royalties and at the end the guys own their masters. That's positive.
I could say once upon a time there was Guns N' Roses and Stone Temple Pilots, they operated under the old world, the old rules, the old universe. Then there's a kind of big bang moment, something happens in the business, and now this is a template for something new.
Yeah, again, we all at times, you know, have wishful thinking. We all think this could be huge, and knock on wood it will be. But I don't like to speculate because many times I've speculated on how big something's going to be and it was just the antithesis of that.
In this instance though, you do have a group that collectively, the guys have sold 70 million albums around the world. Guns N' Roses, at the time, was too big for stadiums in Europe and in South America. They played speedways. Scott Weiland is a complete and utter rock star. Scott Weiland is a genius and in his own right his own band sold 20-25 million albums. You combine these two people, the record is fantastic…
The global marketing excitement for this band is fantastic. The other interesting thing about this, although they are a new band, they are the type of artist that could sell out venues that are larger than what a typical new band can start. You know, they could probably sell out 3,000-seat venues across the United States, just on who they are without even hearing the music.
So when you have these kind of intangible, extra-added bonuses, you never know what you're going to get. It could be lightning in a bottle, like I said before. …
Tell me about Duff and about Matt.
Duff McKagen, bass player Guns N' Roses, bass player Velvet Revolver. Matt Sorum, drummer for The Cult, left The Cult I believe in 1990, joined Guns N' Roses from '91 to '97. Just, you know, brilliant guys, fantastic writers, worked with Slash -- again the chemistry between Slash, Duff, and Matt is something you can't manufacture. They've played together -- Duff and Slash in particular have played together for 15 years. And, like I said, their small shows were arenas. Their big shows were speedways. So when you play together and, you know, Matt played with them as well, for about six or seven of those years. So you can't manufacture that kind of chemistry.
The other interesting thing about this is Dave Kushner, the other guitar player, and Scott, all five of them write. A lot of bands you'll get just one or two people in the band that really contribute. Sometimes three. Here, everybody contributes, everybody writes. Everybody brings in ideas. Everybody brings in comments, suggestions. They're smart, they've been around the block. They've seen it from the highest levels there are. And they're great writers.
What's new in the world of the release of this record now? …
Well the thing that they face most of all is, again, really when Stone Temple Pilots first or second record came out, I think it was '92, '94, '95, and Guns N' Roses I think released in '87 and then in '90 or '91 -- the Internet, for all intents and purposes, didn't exist. I mean, it's a whole different marketing strategy, a whole different concept. There's instantaneous, immediate global access to a musical composition when it's put on the Internet. Is that good, is that bad? It depends.
One of the things that we're doing, or I should say RCA is doing, is what's called "spoofing" some of the tracks. They put the tracks on the Internet and they see how many people are actually searching for these tracks. I think we had over 350,000 people searching for Velvet Revolver songs. For new, unsigned artists that are just coming out, I mean again, there's a lot of awareness here. But that's fantastic, that tells us a lot. It tells us there is awareness. It tells us people are excited. You know, they're anxious to hear the songs. Things like that.
You can use that, with a lot of other marketing tools, in really sort of defining what you may mean out there. So the Internet is the biggest thing. …
Alright, so two questions: How do you keep everybody from stealing this? … And then what happens. How do you make money?
Well, again, we're selling records. And typically, kids that are downloading songs also like to buy the CD. They like to have the artwork. There's also some surprises we're going to have, possibly in a marketing campaign, with the CD that basically enhances your desire to buy the CD. But most of the kids, even though they may download, also a lot of them are buying now, you know, songs, through Apple iTunes and other companies, but they'll still be buying.
We always hear about the additional merchandising aspects, the posters, the tour, the everything else, that's that where the real [money] is anyway. Is that going to be the case for Velvet Revolver?
Again, you have to look at certain type of artist. I'll start with the general and then I'll talk specifically about Velvet Revolver. But a lot of artists, depending on who you are, you may never go out on the road. You may never have a band and may just do what's called "track dates." That means you don't really tour, you don't play larger venues, and you don't make the kind of money one can make as a touring artist.
Rock bands traditionally have probably made their biggest money, if they're a major rock band, from touring. Why? Because you get paid every single night. And nothing that's, per say, recoupable. Under a record deal you get paid semi-annually, and most if not all of the money that the record label spends is recoupable.
That means they take their cut first.
Well the record company advances the artist a certain amount of money. And then they get to recoup that advance prior to the record company paying the artist their royalty.
So years could go by before you made any money.
Or never. Or right away. Meaning, there are many artists that weren't successful, that never recoup, and there are artists that were given millions and millions dollars and may sell 3 or 4 million albums, and didn't recoup. If you're a major artist, you recoup. …
What will you be looking for on the release of Velvet Revolver? How will you know, what temperature do you take, what's the thermometer you stick in the bird to know the thing's done?
… Eighty to probably 85 percent of all records, quote, "fail." Again, what's failure? I don't know what failure means. I have my own definition. Not recouping on the first album, is that a failure? Maybe not if you recoup on the second or the third, you become successful. Getting dropped, or failing to hit a gold record, is that a failure? I don't know, but a majority of the records that are released don't recoup. And a minority of the artists do pay for all the other things.
In this instance though, again, there's some intangible sensation that you feel, and everybody around it feels, about an artist or a group of these kind of guys. They're great guys, they're extremely talented, they're visionaries in their genre. People like them, people want to see them succeed, and they have an unbelievable record. And at the end of the day, it's all in the music. It all comes down to music. The gatekeepers of the music are the radio program directors. If they love it, it gets on the radio.
It's still all about the kids. If the kids want to request it, it gets played more and more. The more it gets played, the more people buy. The more people buy, the more records they sell. The more records they sell, shazam, you're a rock star. You know? It's not, you know, Euclidian geometry, but it definitely can work. And with these guys, you feel that undertow. They made an amazing record. And our radio department already told us they've been playing the single for a lot of people, and they're feeling really good about it. It's much better than not feeling good about it. …
I have an impression that two of the guys, at least the two we met, are really involved in every step of this as well. Is that rare?
Again, it is and it isn't.
But I heard them talking about how much it costs to be in the studio and watching every penny and every nickel.
Well, they've made records for millions and millions of dollars in the past. This record was made for much, much less. They're brilliant musicians, they do a lot of pre-production, they rehearse, they know what they want. And if you think about great records, classic records that have stood the test of time, not only is there a great producer, but the artists are just involved in the production as the producer and the mixer. And they were involved every step of the way. Great mixer, great producer involved in this.
Like they said, they hired a guy named Josh Abraham, young, young producer, great. They co-produced it with him. And you hear their signature, you hear something that's really contemporary but yet sort of harkens back to these melodic sounds that both bands were known for.
And yeah, they were involved. They're involved in every aspect. They're involved in planning the video, the artwork, the touring element. They meet with us regularly, we talk to them everyday. They're not 23 years old. And, again, not to say that 23 year olds shouldn't be involved either, a lot of them are. But it just depends on who you're dealing with. Some people want to be involved in everything, some people don't want to be involved in anything except, "Where do I play?" These guys want to be involved in everything and they can play. …