Todd Smith has been a musician, a record producer and most recently, the owner of a record label, the now-defunct Louisville-based Label X. He says Label X did everything right – solid artists with fans, radio play, coveted television spots – but none of that translated into sustainable record sales.
“After the digital revolution and file sharing and everything, consumers began to think of recorded music as a free commodity. You saw record sales in free-fall. The revenue model that the recorded music industry was built on, for all intents and purposes, eroded,” says Smith.
When he closed up shop in 2008, Smith was left wondering if it was still possible to make a living in the music business, when even legal file downloads result in such a small fraction of what a record sale used to generate.
“The music industry of today is virtually unrecognizable from the one we grew up with,” says Smith. “I had to take a very cold hard look at that landscape and come to the conclusion that it’s really never going to be the same and we have to do something different.”
Now the Louisville entrepreneur has launched Gyroskope, a digital platform aimed at helping artists sell content like music videos, concert footage and interviews directly to fans. Smith thinks savvy music fans, who understand the financial realities their favorite musicians face, will pay for exclusive content they can’t get for free on YouTube or elsewhere.
“I think there is a consciousness on the part of the fan these days that this is not a self-replenishing stream, that if I don’t feed it, it will dry up,” he says.
Content providers (called “producers”) pay Gyroskope a fixed monthly fee, set their own prices and keep 100 percent of every sale. Purchases are added to a member's “collection,” and producers can contact members who have collected their work, which adds another opportunity for artists to build relationships with their fans.
Videos stream from the cloud, and are available online and through mobile apps. The service isn’t limited to musicians – filmmakers, comedians and even yoga instructors are setting up shop. Smith says the ideal producer for Gyroskope already has an active fan base.
“Gyroskope’s not going to build your audience for you,” says Smith. “Gyroskope is going to allow you to build a transactional relationship with your fan base directly without going through a middleman like a record company or a gatekeeper like an iTunes. It’s going to allow you to sell directly to your fans.”
Gyroskope hosts several dozen producers so far. Musicians include Bonnie “Prince” Billy, whose recent concert in Chicago’s Millennium Park is available for purchase. Members can watch a brief preview of each song for free and buy the whole show for $10. Casual listeners might take a pass, but a devoted fan who missed the live act could add the concert to his collection.
Smith says Gyroskope isn’t intended to replace services like YouTube, where videos are free and a viral hit can create a career out of thin air. He says his company creates a new revenue stream for artists online, where most consumers expect music to be free.
“Could Gyroskope hope to advance the flag of the enlightened consumer to help support and patronize the artist they love? Yeah,” he says. “Hopefully, we can gain some of that ground back. There’s always going to be piracy, there’s always going to be free stuff. We think we can carve out a space where this model works.”