August 2, 2010 Echo Republic Announces "Music Stock Market"
Web-based site Echo Republic lets you invest in artists, purchase 10 cent music, and stream your music anywhere.
Santa Monica, California, July 20th, 2010 – Echo Republic, the worlds first joint music stock market and sales company, opened to the public on June 20th. Part music sharing, part e-commerce, Echo Republic strives to return the power of the music industry to its two most important members: the artists and their fans. “We’re not a company. We’re a movement.” says founder Patrick McConlogue of the California start-up.
A movement that will quickly attract attention for its legal music downloads at a price point even the most penny-pinching college student can handle: 10 cents a song. What’s more, Echo Republic’s firm belief that purchased music belongs to the buyer means every download is iPod™ compatible and accessible through the company’s cloud based music library, Echo Encore.
But a revolution in the music industry requires more than just quality music at aggressive prices. Enter “Elements,” an innovative service that enables fans to share in the financial success of their favorite artists {a feature available exclusively through Echo Republic}. For every song purchased on the company’s website, the artist receives 50% of the revenue while 20% is retained for service fees, leaving 30% of revenue unclaimed. This portion is divided equally among Echo Republic customers known as Element Owners, registered users who have purchased one or more of the 100 Elements assigned to each Echo Republic artist. “Essentially, we’ve created an online music stock market, a way to reward the people responsible for the artist’s success: the fans,” explains McConlogue.
The company is a young group of Californian college students who love music and have a great idea to share that passion. Echo Republic is not the end game, it’s a launch pad for unrealized talent and artists ready to break out.
Press Questions: Patrick McConlogue, Tel.: +1.858.382.3043
Reader Comments (6)
So the artist gets 5 cents a song? Which, if it's a band, may have to be split 4 ways (or more).
If the record was professionally produced, the producer needs their cut. What about the band manager? I'm assuming there's no record company in this case.
Of course, all the recording costs have to come out of that first.
The songwriter might be lucky to get 1 cent out of it ... so a dollar maybe, for every 100 songs sold.
Wow ... if they sold 10,000 though ... they'd make $100!
Much better than streaming then.
Let's all share in the artists "success" !
####### PERSONAL LETTER FROM A FOUNDER OF ECHO REPUBLIC ########
Dear Catherine, (and readers!)
My name is Patrick and I am a founder of EchoRepublic.com. Your concerns were brought to my attention and I wanted to personally talk about some of the ideas you have kindly brought to the table. First, I want to thank you for taking the time to learn more about our service and I also want to thank MusicThinkTank.com for listing our article on their website.
EchoRepublic.com does not revolves not around price points and numbers, we try to focus on the relationships that artists develop with their fans. I know this sounds odd, but in fact even the 2 cent "service" charge we take from sales is only to cover the cost of credit card fees. In essence, we offer song sales for our artists without profit.
You raise an important question in the amount of money that an artists can receive once the costs of production have been accounted for and this is something that I really want to address. As an artist myself, I know that the biggest part of being an indie artist is getting your name out there. And often song sales themselves are not the focus, yes money is good, but its the love of music that actually drives the talented artists. You could even argue that if money is the focus, the band doesn't go very far.
However, we do need to look at numbers. Commonly a new artist has two options; offer their music for free or sell it on iTunes for $0.99 cents. This is an enormous jump for fans to make, and often only increases illegal behavior. However, if an artist offers music for free there is no "value" associated with the song. People don't care about free things, like air or sunlight. Once someone pays for something, even if it's 10 cents, you remember what you bought. I bet you remember last time you bought lemonade on the street corner for 25 cents, but can you remember the last drinking fountain you drank out of? The point is, free things don't last in our minds, and things that cost, do.
Echo Republic offers a unique way for artists to impact their fans, while not forcing them to purchase music for an entire dollar. In essence, it's not about sales in this case, it is about syndication.
Does that mean artists can't profit on Echo Republic? They can. That is where our "investment" method kicks in with Elements. The ability for fans to invest in their favorite indie artists I would argue is our coolest feature. Echo Republic is NOT the end game, this is a launch pad for talent, and we let the fans decide and invest in that talent. Currently, artists can list themselves for free on the market and receive 100 shares, this value will increase as more songs are sold.
Once again Catherine, thank you so much for taking the time to comment on our site. I would love to have a chat over the phone with you 209-202 ECHO (ext 3) if you have any other questions.
Also, If you are an artist, we would love to see you on Echo Republic.
Best Regards,
Patrick
#########
....so how is it a "Stock Market," though? I don't get that part. It's not even an exchange! Making fans into affiliates or JV partners is not a stock market. Am I being too technical? Is "stock market" just a short-hand metaphor for elevator pitches?
It seems to me that, at most, by giving registered users back end income, you're only selling one single stock: Echo Republic. More importantly, none of the "market-making" mechanisms of an actual stock market exist in your system.
Right?
I love that we are getting a conversation on here and we are able to hear these concerns.
I will personally be checking this website over the next couple of weeks to answer questions.
So Justin, let's talk about the stock market and it's structure; great question.
Echo Republic is built on a complex code structure that has hundreds of thousands of lines of code. This system allows people to purchase sections of profit of account holding artists. BY NO MEANS are we the stock market or participating in the NYSE. Naturally with a brand new concept it's hard to explain it to the public, currently Echo Republic operates very closely to a stock market, but these shares are not publicly traded. We have coined the term Music Stock Market because you can purchase shares of our artists.
I hope that explanation helps clear up the definition and I also want to extend the same invitation as I did to the previous writer to contact me. And thank for taking the time to learn and to comment.
Best regards,
Patrick
Question, being I've worked on Wall Street for 8 years, do you have SEC clearance? It appears you are offering fans like myself to share in the profit or loss in an artists. Therefore, you are offering securities correct?
Do you think traditional record companies will file suit once this catches on?
Dont spend it all in once place.