Chance the Rapper
“I’m pre-currency, post-language, anti-label/
Pro-famous, I’m broadway Joe Namath” – Chancellor Bennett
Chance the Rapper is arguably the world’s first successful independent music artist.
In the music industry, “independence” is a term that has recently been in flux. Chance, however, functionally fits every meaning of it; he has not signed with a record label or a major corporation in order to distribute or finance his music.
Record labels have a strong role in the song development process. They are in charge of production, distribution, marketing, and contributing tools for creative development to the artist.
In this way, labels take up very large percentages of revenue generated by released music albums. To some degree it is justified, as the labels serve as a “one-in-all” musical production house from the gestation of a song to its final sales. In addition, only 10% of all albums released generate profits that outweigh the costs, and labels rely on the revenue generated by thatose 10% to finance the remaining 90%.
However, it is not uncommon to see the artist only receive 14% of royalties on album sales, which is further reduced by production expenses and the “reserve against return” clause. The reserve-against-return policy essentially grants labels the right to withhold some of the royalties given to the artist in anticipation of copies of the music being returned. This is based on the idea that the royalty artists earn is forfeited when a CD is returned. Practices like these epitomize the label industry, where corporations often think of creative ways to reduce royalty expenses handed out to artists. They deduct royalty expenses for digital downloads (which require no no cost of production), promotional records given to radio station, and the 5-10% of records given for free to retailers to incentivize further buying, amongst other things.
Chance the Rapper comes at a time where the Internet has become the de facto means of music distribution. Labels may have been necessary from the 1960’s to the 1980’s where physical CDs were needed to listen to music, and production costs for wide distribution would have been very high. However, the necessity of labels is an open question: Technological development means that a large percentage of the population has quick and easy access to music with functionally no cost.
It also does not help that labels were caught in a price-fixing scheme in order to raise profit margins. There were five major labels in the industry: BMG, Warner, Universal, Sony, and EMI not too long ago. Sony and BMG merged in early on March 4th, 2004, which has resulted in the labels being known as “The Big 4.” The Big 5 labels that consolidated through the 80s to the 21st century were caught raising their prices between 1999 and 2001. The average price of a CD rose from $13.04 to $14.19, a staggering 7.2%, adding to the growing level of label distrust among artists and consumers.
We are in the era of BitTorrent and LimeWire (though now defunct), and alternative music downloading websites. With the entire world finding ways to download music without actually purchasing it, Chance the Rapper thinks that selling music is an outdated concept. Portable music for Chance serves the function of allowing him to connect with his listeners. Distributing his music for free allows him to reach a broader audience and establish a rapport with his fan base. His revenue generation comes from merchandise sales and live-show attendance.
Chance the Rapper is part of a broader trend of democratizing music. He has achieved worldwide stardom without relying on the distributive capacities of labels, instead using just his SoundCloud account and word-of-mouth. But more than that, Chance the Rapper does not sell his music at all. You can go online and stream Chance for free right now.
Yet it is important to note that the music industry is not faltering. Artist sales have dramatically increased in the last few years from merchandise and live performances. Artists have been making more from their music, and consumers have been paying less – it is the ideal, economically efficient scenario. The only agents in the industry hurting are the music labels.
This sort of business model can only work for artists already experiencing massive success. Chance’s popularity has skyrocketed since he released his 10 Day mixtape four years ago. Technological progress has also modified the very standards of success: music streams have started counting towards US Charts rankings since 2014. 1500 streams are treated as the equivalent of 10 track sales, or 1 album sale to Billboard. Chance’s Coloring Book became the first streaming-only album to reach the Billboard Top 200.
As such, Chance truly marks the downfall of the label industry. It is important to note that he is not the first independent music artist. There has been a smattering of artists who have attempted to independently sell music, (i.e. Radiohead, Arctic Monkeys, etc.) but all of them had label backing behind them in some form in distribution, promotion or financing production costs. Chance is the culmination of the rise of the Internet & social media, growing anti-label sentiment from artists and consumers about pricing structures, an increased desire for musical flexibility, and a shift in the paradigm for what constitutes musical success.
Yet Chance the Rapper is not just a trend; his story is unique and fascinating. He released his first mixtape after serving a suspension from school. He spent months writing, working, and building a network in order to fill his hunger to have music “out there”. Chance works to fight gun violence in his hometown West Chatham, gives speeches about combating racial injustice, and has given a lecture at Harvard’s HipHop Archive & Research Institute.
Chance’s unprecedented economic success has made him a national phenomenon in the independent music space. Chance is viewed by many as is the next rapper to take the throne, but regardless of that, Chance’s success has revolutionized the way we think about the music industry.