How Radiohead on the music industry as a middle-class club: “Make lots of money”
A lot of people think that the music industry has changed so much today that it is barely recognisable. It is often branded as a middle-class club that is inaccessible unless you know the right people and have people opening companies and subsidiaries, implementing various business methods to increase profit and save on tax. However, the fact is that this has always been the case, and we’re just a bit wiser about it now.
“The music business is a bastion of the middle class,” said Ed O’Brien of Radiohead. “You need a bit of money to be able to get the gear together.” And the band had a lot of money. Their albums continued to sell excessively well, and when the cash started rolling in, the band became money-savvy so that rather than putting everything into one big pot, they divided the musicians’ lifestyle into various companies.
The first came in the form of Radiohead Ltd, which was formed in 1993. The band used the company to fund their tours and also invested the profits from touring in the organisation. The accounts reveal just how profitable their gigs were, as after making a loss of £20 in the first year, those that followed saw profits of thousands, hundreds of thousands, and then millions.
Clearly seeing the benefit of having a company handle the band’s finances, Radiohead then set up W.A.S.T.E Products Ltd in 1996. This did the same as their touring company, except they used it to help with merchandise. W.A.S.T.E. grew so much that the band had to set up another company called Sandbag, which made it so that other bands could use their services.
Since then, Radiohead has set up a plethora of different businesses and managed their accounts through them. This means they have a clear eye on their money and can use it to improve their reach and generate more profit. These profits will only be going up, too, as even though the band have been inactive for a while, since the resurgence of LPs, fans everywhere have wanted to own their own copies of OK, Computer, Pablo Honey and Hail to the Thief.
While bands essentially operating as a conglomerate might sound unusual, it shouldn’t come as much of a surprise for Radiohead fans. The band have always been cautious about getting ripped off, not being afraid to leave record labels they weren’t happy with and resisting the technological revolution for as long as they could. They have always set out to ensure they get the best deal possible, and the organisations they run manifest their cautiousness.
In the modern age, this approach to music might work for many artists. Setting up an organisation doesn’t cost much, and with the number of indie musicians on the rise, having subsidiaries for different aspects of their careers might help them manage finances better. It’s clear, though, that Radiohead has always been a profit-driven outfit right from the off, as Thom Yorke himself politely admitted when asked why the band is in the rock’ n roll business: “To make lots of money,” he professed.
