Sunday, April 29, 2012

My Very Own Rock & Roll Swindle! How I Scammed the Music Business in Japan!

Alternative title: "How to use lessons of the Sex Pistols to sell records."

"Hype is always better than reality" - Me

In the early nineties, I ran one of the best-selling independent record labels in Japan. It was called "Samson Records." We were based in Shinjuku, Tokyo and I started the label with a guy from Osaka named Suzuki who owned a radio program recording studio named "Sam." Hence the name of the record label, "Samson Records." 

"Of course you do...."

The company was set up so that I would split 1/2 with Suzuki everything we made. He provided the studios and staff and engineers. I would set up the music and branding and marketing... Later I would be given shares in "Sam" on a stock option (an option that I was never able to exercise). 
The former president of Tower Records Asia, Keith Cahoon, once told me that Samson was the number one selling Indies label in Japan.
This is a brief story about how that label began and how I scammed the Japan music industry.
The beginnings of Samson Label:
We wanted to make a cool indies label that had a policy of very stylish and sophisticated music. J-Wave FM radio station in Tokyo was booming and they had a very chic and stylish image. I wanted to sell music that they would air for us (I also had my own late night show on that station).

I was trying to license music from Europe (mostly France) but was having lots of trouble with conceited artists (what's new?) who wanted huge advances (like $25,000 ~ $50,000)... We didn't have any money to pay advances like that!

It was funny dealing with artists from around the world. If you were interested in music from an American artist and inquired with them, they'd normally say, "OK. Let's have our lawyers get in contact with each other." 

If you were interested in music from a Canadian or Australian artist, they'd normally say, "Great! We'll even pay for our own airfare to come play in Japan!"

If you told a European - or especially a British artist - that you liked their music, they'd take a drag on their cigarette and in a very aloof manner say, "Of course you do."

It was very difficult licensing music from Europeans and Americans. So I decided that we'd make our own stylish music. That first project became known as "Nadege" in Japan and was a smash Indies success that was later sold to a major label. 

Besides problems with licensing foreign artists for Japan, for Indies labels, there was (still are) problems with the music publishers in Japan. Mostly the problems are with the Japanese Society for Rights of Authors, Composers and Publishers (JASRAC).

At that time, JSRAC extorted money, er I mean, "arranged payment" from all small labels by a silly "sticker on album" system. JASRAC used to charge indies labels ¥90 per sticker to be placed on CDs (about $1.10) whether they sell or not - just for manufacture of product. JASRAC would make you buy these little stickers at ¥90 a pop to place on all CDs made. It seemed ridiculous to me.

No, you couldn't just print these on the CDs jackets either. They had to be the actual stickers!

A new label can't afford these types of charges up front. If our Indies label was going to fly, I had to figure a way out of these problems. But how?
Well, as I wrote about the other day in I Was a Teenage Punk Rocker - Why Dedication Beats Fanaticism Any Day! Even for Punk Rock or Success in Any Field!... I had a punk rock band background so I got to thinking.
First off, I went to Korea and made a deal to press CDs over there (I think I was one of the first, if not thee first, to go make a deal like that)... 

We got around massive import duties by having them ship the CDs as "unfinished product" (parts). The Korean manufacturer would ship the boxes, discs, wrappers all separately and then we'd assemble them into finished product by hand in Japan (that was a tough job!) We printed the sleeves, etc. locally in Japan.
Then I knew a half-French / Japanese girl named Vivi. Vivi was a Deejay at Bay-FM (a Chiba Japan FM radio station) and so was I. Vivi was an excellent singer. She also spoke perfect French (well, at least good enough for the Japanese). We put her and the engineer and the producer in the studio and played some music for them and told them to write songs like some examples that I had brought along for them to hear... You know, smooth jazzy lounge music (like Bossa Nova style, Sergio Mendez, etc....) They did a good job writing songs. They went to work on making the music and I would check it out every once in a while and add comments or advice...

Some advice they took; some they didn't. It was okay with me, I figured. If I already knew what 17-year-olds wanted to buy, I would have already been rich! And anyway, I was in charge of sales and marketing and branding anyhow....
In Japan, at that time, if a CD said, "Made in Korea" or "Made in Japan" on the jacket then there were 3 problems: One, JASRAC will demand payment and two, Japanese radio station directors won't play it... Nor would store buyers at places like Tower Records, HMV, Virgin Mega-Stores buy them - that was the third problem... 

This was at the very start of the boom in foreign music stores in Japan and I desperately needed these stores to carry our product... I needed the local radio stations to play the songs... I didn't want to pay JASRAC unless I sold a record....

Malcolm McLaren

So, how to fool all these people? I thought about it for a long time and then it dawned on me like a bolt of lightening! I asked myself, "How would Malcolm McLaren or the Sex Pistols do it?" I soon had my answer. 
I forbade my staff from putting any Japanese writing on the CD at all. None. Zero. Verboten! Then in large letters on the back of the CD backing sleeve, I ordered the designer to write, "Made in France." 
When the JASRAC people saw that they thought, "Oh? Not manufactured in Japan? You don't have to pay publishing royalties!" And, since the sleeves were printed in Japan and parts shipped from Korea, I didn't pay import duties for finished product! (Smirk, smirk!) 

We finally finished the CD, put it all together and started selling it. We offered a really good price to stores for quality product that the stores believed was imported. Even though it looked like an import, we gave the stores excellent product for about half the price of a regular import. We even gave them 100% return rights. The CDs sold like hotcakes!
Soon after, I took some CDs to J-Wave (the big radio station in Tokyo that plays that kind of music) to promote the CD. 

There I met a director named Ishii san. Ishii san was a very arrogant and conceited little piece o' sh*t... er, I mean politically powerful radio director and producer. He was director of what was probably the most famous J-Wave radio program (I can't remember the name). I walked in with the CD to hand to him and he laughed at me (in a very condescending manner) and said, "I already have that CD. I bought it at the store yesterday!" (As if to say, "I'm always way ahead of you Rogers, you are always behind a cool trend setter like me!") 

I saw the CD he was proudly holding in his hand and had a hard time not laughing, but I bowed my head to him and said something like, "Yes. Of course. You are an expert on French pop music. It figures you'd have it first, Ishii san!"
That CD sold well over 20,000 copies in the first month. Considering that we were an Indies label, we made about $10.00 (USD) profit for every album we sold.

Later on we sold all the past released albums for that artist known as "Nadege" to Victor Records for about $600,000 (USD)... Hilarious, huh? We sold to Victor Records a "French pop group" that didn't really exist except that it consisted of one half-French / Japanese girl and two Japanese in studio dorks for over a half million dollars.  

Man, did we have a massive party the night that deal was signed!

I think they released several albums on Victor but never had any more hits... Major labels always have a way of making something cool quite the opposite.
We never were able to repeat the wild success we had with Nadege with other artists but we were able to still have several artist's albums that sold well over 15,000 ~ 20,000 each. 

It was a great time to be running an Indies label in Japan and it was a wonderful memory! It was my very own "Rock and Roll Swindle!"
The music was good, for sure... But the entire concept and selling and marketing was all a scam! It was a lesson that I will never forget: Hype truly is always better than reality!


Andrew Joseph said...

I laughed my ass off reading this. You and I would have been friends if we had met before all of this.
There is always a way around any gov't rule or regulation. It's how big business succeeds. But sometimes, the little guys gets it right, too.
Mike... when you truly become a rich and famous author, help ME get published, too.
Until then - everybody: Never mind the Bollocks! Read Mike Rogers' blog!

diego.a said...

Fantastic post. A bit unusual why you were holding this back for so long but it was worth the wait. Will you write a follow up post on why, "We never were able to repeat the wild success..."?

mikeintokyorogers said...

Guys, I'd like to write the next chapter.... Someday... But can't right now as it might hurt some people who are still struggling in the music business...

dave destroyshesaid said...

Great post Mike.
Love the fact you managed to get through so many loopholes.
My grandad used to say that an expert was someone from the next town with the same qualifications.
Glad to see that syndrome's not limited to Australia!