Today many music pieces and movie clips are distributed in digital form, and consumption methods of these content are shifting to streaming from downloading. However, I think that these trends usually go back and forth like a pendulum, that is, even if people are rather enthusiastic about all things digital now, their interest may swing back to analog in different forms a few years later.
In Japan, phonograph-needle maker Nagaoka shut down their business in 1990, which symbolized the end of analog sound sources in the Japanese music industry, but I was surprised to see a TV program which was recently aired on Japanese public broadcaster NHK, showing a vinyl pressing plant receiving a large number of pressing orders from music studios and labels, which far exceeds the factory’s production capacity. This unexpected demand is caused by artists or music lovers, who have been attracted by the beauty of vinyl record packages and the quality of reproducing sounds in a wider sound range than digital sound sources.
Japanese startup Tokyo Digital Music Syndicates (TDMS for short) recently launched a platform called Qrates, where anyone can upload their music pieces and launch a crowdfunding campaign for producing vinyl records. Once the targeted volume of orders is pledged, one may ask the platform to produce vinyls and packages, collect payments from and deliver the outcomes to ordering customers (campaign backers).
When the iTunes music store was introduced for the first time, sound flies were typically distributed in a quite low bit rate so it was not good enough to be amplified at discotheques due to sound distortion. DJs carry heavy vinyl records even now in the digital age because it would be a holdover from those days. Ahead of other companies, TDMS introduced a music distribution service called Wasabeat back in 2007, which has offered high-quality sound sources for club DJs. The company has been hearing many opinions from music artists since then.
TDMS has also been receiving voices from artists that they want to produce vinyl records. However, there’s only one active record pressing factory in Japan, which requires a minimum quantity of 300 pieces and forced to set a retail price as high as 1,500 to 2,000 yen (about $12 to $17) to break even.
Yong-Bo Bae, CEO of TDMS, explained,
If we were to sell record products to consumers worldwide, eventually music artists cannot profit because at least two or three intermediary companies will be needed for global distribution. Therefore, we wanted a structure that enables artists to produce and sell vinyl records even for a smaller lot but at a lower risk.
To turn his ideal into reality, Bae partnered with a long-established record pressing factory in the Czech Republic, and made the Qrate platform available both in Japanese and English so that it can accept orders from artists as well music labels from all around the world. While a minimum order quantity starting at 100 pieces, the platform supports record label and package designing in addition to offering a crowdfunding function to lower the production risk by receiving pre-orders from fans.
We know that crowdfunding projects for producing vinyl records are becoming more vibrant on Kickstarter or Indiegogo. However, there has been no crowdfunding site focused on producing vinyl records. We are perhaps the first of this kind in the world.
The Qrate platform allows campaign owners to not only create a page for their campaign but also provide a variety of helpful functions for them, such as calculating the break-even point for the campaign, offering bonus music tracks for pre-ordered users or engaging fans via online interactions. According to Bae, he has received many inquiries exploring potential business partnerships from not only indie music artists but also major record labels.
Basic features on Qrates are available for free. But if your crowdfunding campaign is pledged on the platform, one will be charged 15% for the sales as a commission excluding manufacturing cost. Otherwise, one will only be charged 10% for the sales as a commission if one does not intend to produce vinyl records via the platform. With additional payments, one can use a sound mastering service that optimizes the sound pieces to analog recording. One’s vinyl records will be pressed and delivered to all backers within two months after securing the crowdfunding campaign.
For further development of the Qrates platform, TDMS has fundraised an undisclosed sum from IMJ Investment Partners, Xing (Karaoke machine company / a subsidiary of Japanese sewing-machine and printer manufacturer Brother), and Tokyo-based investment firm PE&HR.
Translated by Taijiro Takeda
Edited by Masaru Ikeda & “Tex” Pomeroy