Donald Passman’s seventh edition of his book “All You Need to Know About the Music Business” is available in bookstores today.

Along with the material from the previous editions – the music industry structure, building a team, understanding copyright and publishing, and literally everything else you need to know about the music business – this new edition adds the latest developments from the rapidly changing music business, including:

* The new 360 model of record deals, wherein record companies share in nonrecord revenue

* The Copyright Royalty Board’s latest decisions regarding online transmissions

* The developing customs on new technologies such as streaming on demand, ringtones, and digital downloads

* Updates on recording and publishing deals, as well as film music

I don’t know what else to say about this book that hasn’t already been said. If you’re even thinking about pursuing music as more than just a hobby, you need this book. If you only get one book about the music business, this is the book to get.

Rather than writing a review, I think it suffices to list the thesaurus entries for “definitive.” This book is: absolute, authoritative, clear-cut, complete, conclusive, exhaustive, precise, and reliable.

I saw Mike Masnick post this on TechDirt a few days ago but only got around to reading it this morning. This is a paper written by Bas Grasmayer as part of the research for his thesis on the future of music distribution. Bas analyses 5 musical releases that used new business models; Radiohead’s ‘In Rainbows‘, Nine Inch Nails’ ‘Ghosts I-IV‘, Groove Armada’s ‘Drop The Tough‘, Danger Mouse and Sparklehorse’s ‘Dark Night of the Soul‘ and Mos Def’s ‘The Ecstatic‘.

Click here to read.

After analysing each one he draws the following conclusions:

What does NOT work (well)

• Not going all the way. Fans love free music and so do people that are not familiar with the artist’s work, but if you’re going to give something away then really give it away. If you don’t, you won’t get the attention you were hoping and might even disappoint some fans instead of connecting with them.

• Creating unnecessary mediums instead of utilizing existing ones. While the Bacardi B-Live Share application looked cool (now offline), it was completely unnecessary. Instead of creating a digital dashboard with meaningless graphics, it could have been executed in a much simpler fashion by utilizing existing social networks or filesharing websites. IF you’re going to set up such a thing, then at least make it interactive, social (in terms of enabling users to interact with each other) and add value (with videos or a game for instance). You could even use it to sell other products of the band or artist.

• Expecting people to pay for what they can get for free. People might pay, but most will pick whatever way is most convenient. Usually, this is by remaining seated at your computer and by avoiding complicated online payment procedures. Sure, people should use legal ways to buy music, but the reality is that people go for convenience.

What does work (well)

• Giving fans a reason to buy. Instead of expecting people to pay for something which they can, perhaps more easily, get for free, create added value. This is what Nine Inch Nails, Mos Def and Danger Mouse and Sparklehorse all did very well. Instead of expecting people to pay for the music, they all created something besides the music which people would be more willing to pay for.

• Freemium. By offering something for free, one connects with fans and they will spread the word about you (as long as what you’re offering has value). Once attention has been garnered, and perhaps sympathy has been won, you can offer a premium product. This is how Radiohead and Nine Inch Nails have been successful with forementioned albums. First you give something for free, then you market your premium; freemium.

• Understanding that the package IS the product. This goes for all of the cases, except for Groove Armada. In the case of Danger Mouse and Sparklehorse as well as Mos Def, the package was actually the reason to buy the product. In the case of Radiohead and Nine Inch Nails, they marketed the package as premiums, perhaps understanding that it’s hard to make money if you have to compete with free, meaning music downloads.

• Buzz. By generating buzz, you can turn people just turned on to your product into fans. These fans can then later be marketed to when trying to sell premium packages (or subscriptions for example). Even if they don’t buy, having them talking about your brand or product increases the buzz. This works best if they can give others free samples (free music) to see for themselves how great the brand or product is.

• Co-branding. By co-branding, the two brands can both benefit of each others’ resources and skills. In the case of Groove Armada and Bacardi, the latter benefits mostly from Groove Armada’s image and the ability to promote themselves on all Groove Armada-related products, this includes live performances. Groove Armada on the other hand, benefits from the resources Bacardi has, for instance to set up the website and network for the distribution of the music, as well as their marketing capacities. Both are connected to different audiences and by working together, they can promote each other to their respective audiences, perhaps new ones.

This was a great read and I love the conclusion. I highly recommend you read the entire paper, it’s only 20-odd pages, check it out here.

Image by Gary Simmons.

GrindEFX has been running for just over 3 months now, and I’ve noticed that we haven’t talked much at all about books you should have in your collection. So here is the first installment of our book recommendation series.

Don Passman’s “All You Need to Know About the Music Business” is arguably the most well-known and praised book on the music business. Now in its 6th edition, the book has been universally regarded as the definitive, essential guide to the music industry for over 15 years.

In the book Donald Passman, who is considered one of the best entertainment lawyers in the U.S. with clientele such as Janet Jackson, Quincy Jones, R.E.M., and Tina Turner, covers everything from copyright and publishing to songwriter deals and how to pick a manager. I’m not going to write a review per se because there are a thousand and one of them out there written by people more qualified than myself, here are some you may recognise:

“Should be required reading for anyone planning or enduring a career in the biz.”– Rolling Stone

“Any creative person who’s considering working in the music business should read this book.”– Jimmy Iovine, chairman, Interscope Geffen A&M Records

“I highly recommend this book to anyone with an interest in the music business.”– David Geffen

“I’ve spent ten years trying to get Don to open up like this to me. Never has he been so eloquent, so patient, or so thorough. It cost me a fortune to get these diamonds from Don: Now you can have them. For your own. At a fraction of the cost.”– Tom Waits

“This man is so knowledgeable that it’s difficult negotiating with him. The book is terrific and a must-read if you want to know how the music business works.”– Joe Smith, former president and CEO, Capitol Records/EMI Music, Inc.

“I almost hesitate to recommend Don’s book — it gives away more inside information than it should.”– Mo Ostin, chairman of the board, DreamWorks Records

“An entertaining and professionally written primer on the music business.”– Michael Eisner, former CEO, the Walt Disney Company

“I highly recommend Don’s book to anyone who has ever been interested in the music business. His experience and insight into the inner workings of the music world make this an indispensable work.”– Quincy Jones

“If I’d had this book when I started, I’d be ten times richer and would have saved a fortune in legal fees.” –Ed Bicknell, manager, Dire Straits

Michael Eisner Chairman and CEO, Walt Disney Company An entertaining and professionally written primer on the music business. –Review

I really can’t stress how much of a “must have” this book is for anyone starting out in the music business. I’ve read it at least 5 times over past few years and still refer to it for information, even if your knowledge on the music biz is quite advanced, you’ll still get something out of this book. I remember when I was first starting out in music I just couldn’t get my head around publishing, no matter how much I read about it or had it explained to me, I just didn’t get it, when I read this book Passman made it seem so simple and I instantly got it. He breaks everything down in an easy-to-understand way and provides insightful analagies and comparisons.

If you only buy one book on the music business, make it this one.

Buy All You Need to Know About the Music Business from Amazon.com for the special price of $19.80.