New beat drives music business in Detroit
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Crain's Music Issue: A report on the state of the music industry in Detroit.
Photo: Kenny Corbin
Businesses in metro Detroit forced to adapt in an industry that has changed forever ...
Seems like we've heard that one before, in automotive, health care and even banking.
Now, Crain's tells the tale for music -- an industry that in many ways put Detroit on a global map.
This special report on Detroit's evolving music industry shows how music-related businesses are adapting. It's a look at potential for growth, as old businesses look at new business models.
And this report is a debut of greater coverage an industry that other cities -- Austin and Seattle -- have used as a big part of the local economy. As writer and professor Richard Florida points out on M9, cities that are open to new sounds are often open to new technologies and businesses.
"Motown, Mitch Ryder and the Detroit Wheels, the MC5, Iggy Pop and the Stooges, Bob Seger, Kid Rock, Eminem, the White Stripes, electronic music pioneers -- they define Detroit in the popular imagination as much as do cars and the Motor City," Florida said. "Music is your window to the world."
Yet this region has a vibrant patchwork of music-oriented businesses. And they're finding new revenue streams -- merchandise and ticket sales -- to make up for dollars that once came from the sale of CDs and vinyl. Artists now think like entrepreneurs. Crowd-funding has become a way for performers to raise money from fans.
Detroit's music scene can be a bigger part of the local economy. Nashville uses music as the backbone of a growing economy, and it doesn't have the history Detroit has.
A great example of the evolving music businesses is Mack Avenue Records. This Detroit-based company is replacing sales-oriented revenue with merchandising revenue. And it's trying to harness the social media outlets rather than purely compete.
Pandora and Spotify are the kind of services that take the place of CD sales. But, said Mack President Denny Stillwell, they're still playing Mack songs.
"There continues to be a broad range of opportunities to expose music even as our industry pulls itself out of one of the worst periods in its history," he said. "One of our challenges is to be in the best position to take advantage of those opportunities."
And maybe the next chapter is the region taking advantage of opportunities, as well.