I've been discounted!

Subject: I've been discounted!
From: Suffet
Date: 28 Nov 09 - 11:41 AM

Greetings:

I have no idea who they are, but a website called Lala.com is selling my newly released digital album Old Fashioned Folksinger for $2.50 less than the official price on CD Baby. Furthermore, they are selling MP3 downloads of the individual tracks for just 89¢ rather than the CD Baby and iTunes price of 99¢ each.

How can they do this? I'm not really sure, but I do know that when I signed up with CD Baby I said it was OK to sell my album and single tracks from it through their Internet partners. Up until now, these secondary outlets were either charging the same as CD Baby or even charging more. Lala is the first one I have seen that charges less. So you can pay the full $9.99 for Old Fashioned Folksinger or you buy it from Lala for just $7.49. Here's a clickable link.

As far as I'm concerned, even at its full price Old Fashioned Folksinger is a bargain. You get 20 of my best songs; some have been remixed and all have been remastered. Many of the songs feature vocal and/or instrumental accompaniment from such artists as Robin Greenstein, Ray Korona, Joel Landy, Chris Lang, Heather Lev, Anne Price, Gina Tlamsa, and he late Eric Levine. Some are traditional folk songs and others are songs I wrote myself in traditional style. I dare anybody to figure out which are which.

But this bargain basement website took me completely by surprise. Furthermore, Lala.com has somehow positioned itself to become the top hit when you search my name on Google.

Has anyone had any experience with Lala.com or with outlets like them? Will this work to my advantage, or will it devalue my own product? Should I be concerned? I can always tell CD Baby that I no longer wish to participate in their Internet partners program, but should I? Any advice would be most welcome.

Thanks.

--- Steve Suffet

Subject: RE: I've been discounted!
From: Dan Schatz
Date: 28 Nov 09 - 11:46 AM

I always figured that the discounted CDs of mine I've seen out on the market are promo CDs from radio stations that decided not to hold onto them, or changed their program format, or what have you.

Dan

Subject: RE: I've been discounted!
From: Susan of DT
Date: 28 Nov 09 - 01:32 PM

"Used" copies of two of the four volumes of the new edition of Bronson appeared on Amazon the day it was printed - for $20 MORE than the new price.

Subject: RE: I've been discounted!
From: open mike
Date: 28 Nov 09 - 01:44 PM

i hope you get the full amount due to you from each sale..
i have seen lala showing up in search engines lately..
only quite recently...apparently they have a way of
being listed by search engines at the top of the list..

here is their web site http://www.lala.com/
and here is a review..which includes ratings by customers
many of whom say it has poor customer service or support.

http://reviews.cnet.com/music-services/lala-com/4505-9240_7-31841184.html

apparently it started as an internet c.d. swap place.

Subject: RE: I've been discounted!
From: kendall
Date: 28 Nov 09 - 01:56 PM

Some web sites are selling my book for three to five time what it originally sold for.What do I get? NOTHING.

Subject: RE: I've been discounted!
From: open mike
Date: 28 Nov 09 - 02:15 PM

i went to the lala web site and it took a long tome to load
i closed it for fear it was somehow searching my computer
for music on it...that is one thing they say they do..

hopefully not without the computer owner's permission..
sounds suspicious.

this may be one thing the Performer's Royalties organizations
can deal with...

there has been quite an uproar recently about royalties,
and small radio stations and places that play music
(i even heard of a beauty shop being told they could
not play a radio for their customers unless they paid
a fee/fine)

but mostly the record labels get the proceeds,
not the artists directly, esp. if they are small
independant musicians. Damn the middleman!

Subject: RE: I've been discounted!
From: Suffet
Date: 28 Nov 09 - 03:14 PM

Greetings again:

I checked with CD Baby and this is what I found out. When I submitted Old Fashioned Folksinger for digital distribution I approved the option for distribution through their digital partners, of which Lala is one. I could have unchecked individual partners, or I could have rejected this option entirely, but I didn't. The digital partners can set their own discounts, but CD Baby still gets $4 per album sold. I therefore get $2.50 less when someone purchases it from Lala than from CD Baby itself.

I can edit my choices and tell CD Baby that I no longer want to sell through Lala, but for the time being I am going to keep things the way they are. For all I know, Lala's discount will lead to greater sales, and that could mean more net income for me. Since this is a digital album rather than a physical CD, there is no cost to replace depleted stock. In the end I could come out way ahead, but that remains to be seen.

Is anyone else who has had experience with Lala?

--- Steve

Subject: RE: I've been discounted!
From: SharonA
Date: 28 Nov 09 - 04:12 PM

No, but this situation certainly does stink, if CD Baby is not alerting the artists to the possibility that his/her music could be discounted by their internet partners -- CD Baby should make that clear on their sign-up page or on a separate page that comes up before the artist clicks "OK". Thanks for the heads-up, Steve.

Subject: RE: I've been discounted!
From: John on the Sunset Coast
Date: 28 Nov 09 - 04:21 PM

That Sucks! It's damn near theft. It's like when I was working my sales manager would make a special deal, and make it up by cutting my commission rate.

Subject: RE: I've been discounted!
From: Suffet
Date: 28 Nov 09 - 04:41 PM

Greetings again:

CD Baby does make it clear, once you find it. So be careful. When you sign onto distribution through CD Baby's digital partners, you have several options. The one I selected was "Everything that pays," mean CD Baby will not give the music to sites that distribute it for free. They will, however, give it to sites that sell at a discount. This is what that option says:

As long as it pays, you'll take it. There are always new forms of income for your music in the digital world, and we'll make sure it is sent to partners that use innovative models. This option includes paid streams, as well as services that may pay less than more traditional sites for downloads. Option D is great for exposure, and will ensure that your music is delivered to a vast majority of our digital partners! [Emphasis added.]

There are 20 different such partners. Lala is only one of them and it's left to the artist to look each one up and find out what its policies and practices are. So musician beware!

As I wrote above, I just may come out ahead if this leads to increased sales. I'm willing to take the chance with a digital album since I incur no expense in replenishing inventory. However, I would never do this with a physical CD.

--- Steve

Subject: RE: I've been discounted!
From: SharonA
Date: 28 Nov 09 - 04:47 PM

Whoops; I meant to delete the "s" from "artists" and type the phrase "...alerting the artist to the possibility that his/her music..." Sorry!

Subject: RE: I've been discounted!
From: GUEST,Lox
Date: 28 Nov 09 - 04:54 PM

Check with your publisher that they are doing it legally. If not you may be able to stop it happening.

Subject: RE: I've been discounted!
From: EBarnacle
Date: 28 Nov 09 - 04:58 PM

This situation reminds me of something that happened to a friend who owned a bar in a disreputable section of Newark, NJ.

One day he walked in and saw a rack of potato chips on the bar. They had not been there when he left. He asked his partner how they got there and was told:

"I bought them so we could have something extra to sell."
"How much did you pay for them?"
"Fifty cents a bag. The rack was thrown in."
"How much will we sell them for?"
"Fifty cents."
"How will we make a profit?"
"We'll make it on volume."

There is a limited market for any album, especially a folk album. If you sell a bunch at a discount and make x sales, that means that you will make x times the discount less than you would have otherwise.

Get out of LaLa.

Subject: RE: I've been discounted!
From: Suffet
Date: 28 Nov 09 - 05:53 PM

EBarnacle advises, "Get out of LaLa.

That is always an option, although there is probably some lead time required after I notify CD Baby. The problem is that I don't know what the policies and practices of the 19 digital partners are. I could opt out of all of them, or I could spend time investigating each of them and then deciding which to stay with and which to drop. For the time being, however, I will take a wait and see approach.

--- Steve

Subject: RE: I've been discounted!
From: SharonA
Date: 01 Dec 09 - 06:37 PM

Steve, I took a look at this page: http://members.cdbaby.com/HowCDBabyWorks/pricing.aspx

It's CD Baby's description of its pricing and rates. What it says under "Distribution Pricing" makes me shudder... and makes me think that your assumptions about what you'll receive from a sale are 'wayyyyyyy off...

First of all, that "$4 per album sold" applies only to physical CD's -- the discs in the jewel cases -- not to digital albums.

For a download sale on cdbaby.com you set your own selling price per track and per album, and CD Baby keeps 25% of the purchase price (minimum 29 cents). You net 75% of the sale.

For "digital distribution sales through [CD Baby's] partner companies", things get tricky. CD Baby pays you 91% of net income... AFTER the partner company takes its cut. In other words, you get 91% of what CD Baby gets paid by its partner for the sale, NOT 91% of the actual sale price that the partner offers.

The blurb on the page says in part: "What we're paid by partners varies... and contractually we are not allowed to disclose those amounts to anyone who is not yet a CD Baby customer. Depending on what level service you sign up for with CD Baby, some partners may pay less per song, and streaming clips pay much less -- but we still pay you 91% of all download and streaming revenue."

Now, I'm not sure what they mean by a "CD Baby customer" -- I'm guessing they mean you, not the buyer of the merchandise. If I'm right, then CD Baby should be giving you access to information that will tell you how much Lala pays CD Baby for anything of yours that Lala sells. Check into it!!!!!

When pondering exactly what it is that you signed up for, the phrase "pig in a poke" comes to mind.......

Subject: RE: I've been discounted!
From: Suffet
Date: 01 Dec 09 - 11:49 PM

Sharon,

Thanks for looking into this. I'm completely sloppy when it comes to the business aspects of music. That's because I don't have to depend upon music to make a living, thanks to my New York City pension plus Social Security. Every once in a while CD Baby sends me a check, and I consider it gravy.

Somewhere down the line I can tell CD Baby that I'm opting out of Lala and/or their other 19 digital partners, but first I should find out what each partner pays. That would be the smart thing to do, but right now I'd rather not invest the time and effort. Maybe, as I have previously speculated, discounts by digital partners will result in enough additional sales that I will come out ahead. That remains to be seen.

As you so aptly observed, we are dealing with a pig in a poke.

--- Steve

Subject: RE: I've been discounted!
From: GUEST,Kevin at CD Baby
Date: 03 Dec 09 - 01:07 PM

Steve,

I hope I can clear up a few things for you.

First off, there are a number of different digital download store business models out there. Take Rhapsody, Napster, and EMusic for instance. We've been working with them for years and they are all completely different from the a traditional download store like iTunes. EMusic actually pays out on average less than 40¢ per track per download.

The reason we work with these companies is because the majority of our artists expect us to. With that being said, we are completely understanding when an artist does not want to have their music listed in a certain digital service. We do our best to give the info upfront about how each company works (And as mentioned you are more than welcome to exclude these companies), but the challenge is not overwhelming artists with details a mile long for each company. Some artist just want their music everywhere possible. Other artists are very particular. For the particular artist, it's important that they do a little more homework.

I think LaLa is a perfect example. While you're concerned about people getting a download for 10¢ less, other artists are ecstatic that Google is putting their music right on top when people search terms that relate to their music. It's getting their music in front of a broader audience. Believe it or not, people used to have the same suspicions about iTunes when we first started working with them. Now, having your music in the iTunes store is a must.

Finally, it's important to take a look at the user experience (For the music fan) before discrediting a service. LaLa is doing some very cool things that music fans are excited about. Couple that with their new deal with Google, and LaLa could quickly be "the place to be" for digital music retail. If you ever have any questions about a company, feel free to ask! You can reach us by email at [e-mail] or talk to a real person at 1-800-BUY-MYCD

Subject: RE: I've been discounted!
From: Suffet
Date: 03 Dec 09 - 09:39 PM

Kevin,

Thanks for the clarification. While I am concerned I am nevertheless happy to take a wait and see position. Maybe the discounts offered by your digital partners will lead to a sufficient increase in sales, in which case I will come out ahead.

Kindest regards,
Steve