Figuring that the quickest route to a slacker's heart is through his stereo, AOL and New Line Television's content site, The Hub - which launched Monday on the Web - will debut the new record label Hub Music, says general manager Jonathan Sacks. Targeted at the same young, urban (and 3-million-strong) audience that traffics the site, Sacks says Hub Music will push the digital distribution of music by promoting new bands through the recently debuted digital download capability on the site.
"If BMG is the size of Apple, we're the size of a fruit fly," says Sacks, "but we're very committed to music, and we want to play in every area of the music industry." Sacks adds that the label will encapsulate the Hub attitude: "edgy and not full of crap."
Initially, the Hub expects to release repackaged compilations based on properties from the site, including Carmin Electra's Tarot To Go ("music for a lucky day," as Sacks describes it). As part of the A&R development, the company has already been listening to bands for two months, but Sacks admits that "we haven't fallen in love yet, but ... word is out in the indie rock community." With a 36-person staff, the Hub's biggest single division is now the 10-person music section.
The Hub has already surmounted one major hurdle by securing distribution through Tower Records. In the deal, Tower will distribute only the prepackaged CDs, allowing the Hub to send singles over the Net.
The Hub is certainly not the first to exploit the juncture between technology and music. Online music news and retailer N2K has run its own label, N2K Encoded Music, with some 15 bands, for more than a year. In addition, their "e_mod" system utilizes the same Liquid Audio technology that the Hub uses for its download of the "Duran Duran" single currently available at the site. While N2K may be "losing a bundle" on their label, it's a wise move to shortcut around traditional labels if they want to push new delivery systems that threaten them, says Jupiter analyst Patrick Keane.
According to N2K spokesman Chris Hensely, the real attraction for starting a label is reduced cost of promotion online. Bulletin boards, chats, and online single releases can build a significant fan base before the album even hits the stores, Hensely says. "It costs US$300,000 to $500,000 to take a new band to the market traditionally," says Hensely. "How many times can you take a hit like that?"
