SonicBids’ Value Proposition

I really just wanted to respond to Mr. Panay’s disingenuous and self-serving comments post at Digital Music News, http://digitalmusicnews.com/stories/040611festival  but the comments are closed. (gee, and just when things looked like they were about to get interesting)  No doubt Panos Panay is a man of great personal charm, able to bend fledgling bloggers to his will with a mere prime rib dinner and perhaps a ride in his Ferrari, but his own words are what damn him, imo. Here’s the blog comment I refer to, in its entirety, with MY comments in brackets:

Comment By: Panos Panay
Friday, April 08, 2011

Hi There,

This is Panos, founder of Sonicbids. I’ve been following the comments and I think much of what I have to say has already been captured in comments made by Dave Cool and others.

In many ways this whole subject is moot, as right now 65% of all gigs on Sonicbids carry no submission fees. By June, this number will be 90%. [Well, it’s 65% moot then, and according to Panos, will soon be 90% moot, but if you happen to look up the word “moot”, you’ll learn that it really doesn’t work by percentages; an issue is either relevant or not,  but I’m willing to let you, the reader, decide]  But, I will also say that we are keeping some premium listings fee based, because I’ve s een these fees work and create opportunities for emerging music that without them would have never been possible. [This is the first misrepresentation of fact; submission fees don’t create opportunities for bands and musicians; never did, not once.] If you care, read further. If you’re fixed in your opinion, then don’t waste your time reading my rather long-winded response. [Panos doesn’t want you to read this;  you might twig to what’s really going on, if you do]

We at Sonicbids did not invent submission fees. They existed long before I launched the company 10 years ago. [This may be true, strictly speaking, but not to any great extent, and particularly not for the vast majority of successful and good-paying festivals that a young indie band would want to associate with] Do I feel that it’s worth it for an artist to pay $25 or whatever to be considered for SXSW or CMJ? Of course I do.  [and why not? Panos splits the take with the promoters! This creates a confliict of interest and incentives for promoters to get a bit lax about little things like closing submissions when all festival slots have been filled or even for a few months or years after the festival date has passed; after all, it’s free money, for which the concert promoter need do nothing, not even look at the submissions if she doesn’t wanna.] And as an unabashed believer in free market dynamics,  [ a free market is one in which Panos is free to keep your money, and can dynamically turn around and use it against you]  I will tell you that if it was not worth it, then countless managers and agents and artists would not be applying to perform at these conferences every year — and benefitting from showcasing at them for over 25 years now. [Has Sonicbids been around for twenty-five years? No? even if it had, would twenty five years of injustice be justifiable based on longevity? And about those droves of managers, agents and artists, the smart ones, the reputable ones run, screaming from this smelly deal, because there is no upside to playing a show where you have no leverage; if you had leverage, the festivals would come to you, and you’d need SonicBids for what?] Is emerging music better off because SXSW, CMJ and other similar festivals exist? You bet.  [Maybe emerging music IS better off, but only because some crappy bands realize they’re being screwed and quit the business. Here’s a dirty little open secret: nobody gets “discovered” at CMJ or SXSW anymore, if they ever did; it’s just a big party for the music industry that was already subsidized by the music press, the clubs, the fans and the major labels-now, they wanna fleece the indie bands, too.] Could they take place if they did not charge these fees? I doubt it. [This is the big “pants-on-fire” moment; it betrays either a fundamental misunderstanding of the basic economics of concert promotion, OR that Panos is pulling a fast one, because any festival that requires submission fees from its artists to stay in business is a losing proposition; in other words, completely economically infeasible. (the exception would be co-op festivals organized and promoted by the bands themselves, which is a much better idea than SonicBids, in my opinion) Concerts are supposed to get their money from fans and sponsors.  When they don’t, they die.]

As far as other non-conference promoters that charge fees, when a band is still developing and young and untried, nearly all the financial risk lies with the promoter that books them as in many cases there is no guarantee that they will recoup their cost of the evening/event from the crowds that a young, emerging band will bring. I would go further and say that in most cases, these bookings are almost always at a loss as most events sell tickets not based on the emerging bands they book but by booking the same old, same old headliners. It’s changing but we’re not there yet. [Another whopper; ethical promoters assume these risks, laying off the cost of building future business (promoting lesser-known acts) against the larger drawing headliners; they don’t need to be subsidized by starving baby bands if they know their business. I guess Panos maybe has a point, in that many of today’s promoters don’t, but do you really want your band and your brand associated with such losers?]

Historically, this unknown has made many promoters risk averse – or even downright hostile — to booking new music (join in on any of the calls that we have every day to festivals around the planet if you want to get a flavor of the objections to indie music). Why take a risk on a new artist when one represented by a label or an agent comes with a known draw that at least covers some or most of their costs?  [This is true, and it’s why it’s so much better to self-promote and build your fanbase and attract a great manager with negotiating skills and some clout, because until you can put butts in seats, there’s nothing you have that a festival wants, which means you will be on the wrong end of any deal you make, Panos or no] (By the way, keep in mind that most clubs and most festivals are labors of love and largely unprofitable. I personally don’t know many promoters that live the good life.)  [It’s amazing this guy can see anything for all the smoke from those burning pants; most clubs and most festivals make money, or they go out of business;  Panos ain’t doin’ so bad hisself, though I think he may have sold the Ferrari.]

Small submission fees, earned by promoters, take some of that risk-aversion away.  [And small submission fees of as little as $25, using Panos’ figure, when multiplied by five thousand or so submissions would amount to$125,000. Boy, howdy, that’d rent a lot of Porta-Potties.] And many times WE will assume all the risk (Sonicbids) by sponsoring events and guaranteeing them revenue – often at a huge loss. Last year, we spent over $3 million to create these opportunities out there. And yes, it takes THAT much money to change the attitudes of people towards booking emerging music. And you know what? It’s working. We are on a track to DOUBLE the amount of gigs that are getting booked on Sonicbids from 80,000 to 160,000 this year. [Whoah, wait, did he say the promoters earned the submission fees? What goods or services did they provide in exchange, and most particularly, what did the bands that weren’t selected get for their money? It surprises me not in the least that SonicBids shelled out $3M plus to put bands on bills where they had literally no business, and where did the money come from? The loser bands.]
I wish I could tell you that the 30,000 people going to Bonnaroo in June are going there to see the 10 bands that are getting booked using Sonicbids but that’s not the case. But, we insisted that the bands get paid $1,000 each, we are giving ALL fees to charity (designated by the Bonnaroo guys) and we are paying to sponsor the event as well. All in the name of promoting emerging music. [There you have it, Panos would’ve kept SB’s share of the fees, but Bonaroo’s organizers objected. Effectively, this amounts to SonicBids paying to have its name associated with Bonnaroo’s vaunted brand. Personally,  I’m not averse to risk, but I am averse to the idea of buying legitimacy; I work in the advertising business, so I believe I know it when I see it.]

I am not going to go on and on about these fees (as I mentioned, we are moving to having over 90% of the gig listings to be non-fee based). I will tell you that they have enabled investments and created opportunities ranging from tours, to festival gigs, to channels on airlines, and slots in TV shows, all of which showcase new music, and would not have been there without them.  [Again, submission fees never created any of these opportunities; never, not once, and here’s why;  without the bands that don’t have to pay to play, there is no gig,  period.]

Lastly, if you don’t like paying submission fees to conferences and festivals, there are other avenues out there. But arguably, all require an investment one way or another. If you want to build any business, be it a music career or a company you have to be willing to take risks and invest money and time and energy. I’m not going to lead you on to believe that there’s any other way. [This is 100% true, but it’s my personal opinion that there are far better ways to spend $72/year than on SonicBids; for starters, you could build your own website, where you have control of your content and mailing list or organize your own festival. As a bonus, you get to keep the skills you’ll learn and the fans you earn.]

Trust me, I know first hand. I started Sonicbids by raking up $30,000 in credit card debt that took me 4 years to pay off and $50,000 of my personal savings, which was all the money I had in the bank (and nearly completely depleted). No one ever guaranteed me that all the energy and money that I would be investing would ever amount to anything. And unlike most online businesses, I did not start with a nice cool $1 million in VC money or whatever. I took a huge personal risk because of my belief and love and passion for emerging music. [Wink-wink; we’re supposed to believe he did all that for love, with no expectaion of reward. Also, you gotta love the Freudian slip; the guy is all about “raking” in the cash, not racking up the credit card debt]

I’m glad it did it. Because nearly 350,000 gigs that have been booked since I started this site almost exactly 10 years ago and we think we’ll add another 160,000 this year. [See that? He took credit for twenty-five years of showcases and in the same post, twice admits he’s been in business ten years. I think this sums up the kinda guy Panos is, but if not, try dividing the total number of SonicBids accounts by that 80,000 gigs per year figure.]

Rock on.

Panos

P.S. Wanna comment directly to me? Go to my blog. I listen.

Here is Dave Cool’s blog post RE SonicBids: http://davecool.ca/2010/03/the-dirty-word-at-folk-alliance-2010-sonicbids/ in which he admits Panos bought him dinner and is a swell guy.

So Here is Panos Panay’s value propositon: Pay me $72 dollars a year, plus submission fees for what a dozen other websites do better and for free, and I’ll use your money to lobby to exclude non-SonicBids members from as many major festivals as I can. Does this seem like a good deal to you? If so, feel free to join the gold rush, but remember what happened to the Forty-Niners; nearly all of them got broke, except the prostitutes and the guys that sold the pickaxes.

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