Bandcamp Just Got Acquired by a Video Game Behemoth
Indie musicians have grown to trust and rely on Bandcamp—but what happens now?
I guess I shouldn’t be surprised that the most beloved music platform for indie artists just got swallowed up by a video game company. Music is increasingly integrated into other business models—that’s the new reality. But it’s worrying to see indie music becoming potentially less independent.
In case you missed the news, Bandcamp has been acquired by Epic Games, a huge video game business run out of Cary, North Carolina. The company’s flagship product is Fortnite.
I’m no expert on gaming, but I’m told that you survive in Fortnite by enduring an endless stream of toxic events, fighting off zombie-like creatures and other hostile parties, and meanwhile mustering enough resources to avoid imminent death and destruction.
So, at first glance, it has some similarities with the music business.
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But I’m still apprehensive, despite promises from Epic Games that Bandcamp will be allowed to operate on a standalone basis. I don’t have much confidence in those kinds of commitments, which look good on a press release but typically aren’t legally binding.
This is a big deal—if only because Bandcamp has emerged as one of the few trusted and supportive platforms for music distribution. The company pays almost 90% of music revenues to artists. That’s a sharp contrast with streaming platforms, such as Spotify, where artists receive a fraction of a penny per stream.
Bandcamp is a positive force in the music business for other reasons. It has helped many indie artists take advantage of the vinyl album revival—currently the most profitable and fastest growing segment of the recording business. Bandcamp also provides more album information, superior graphics, better links (to artist websites, etc.), and other frills not found on the leading streaming platforms.
The bottom line: Bandcamp appears to care about musicians, and has built a business that empowers and supports them. That earns my praise, especially because there are few other power players in music with such solid values.
There’s no reason that needs to disappear with a new owner. But I can’t help noticing some ominous signs.
“Our musical culture deserves to be more than just another game.”
I have often been critical of the large companies (Google, Apple, etc.) that now control the music business. But let me make clear, I have no objection to them being large. The real problem is that they have higher priorities than music. Apple would give away music for free if it could sell more devices. Google actually does give away music for free (via YouTube) in order to sell advertising. Spotify is more of a pure music company, but its recent investments in podcasting show that it also has higher priorities than the success of recording artists.
All signs indicate that music is getting turned into what businesses call a ‘loss leader’. In this kind of environment, music isn’t expected to make much money, because these tech titans can earn far more by selling related products and services. And that might work for CEOs and other technocrats in Silicon Valley. But what happens if you’re a musician, and you need to make a living while the companies you rely on don’t care much about the profitability of your vocation?
Of course, no tech CEO will publicly declare that songs aren’t important. But just look at how little they have invested in improving their music platforms over the last decade. Everything about these interfaces is subpar—graphics, search capabilities, audio quality, recording details, etc. And year after year passes with little improvement.
There are a few exceptions, but the overall picture is unambiguous. The key decision-makers in the music world no longer have the same goals and ambitions as musicians and their fans. That’s why Bandcamp’s independence was so important. Artists felt they were part of an organization sharing their interests and worldview.
Bandcamp is now part of a video game company. If its new owners have to choose between improving the music ecosystem or creating a better zombie-killing experience for gamers, which will it choose. I hope it doesn’t come down to that, but the lessons of mergers and acquisitions are clear.
When I was a younger man, I used to handle negotiations on business acquisitions. I’ve lost count, but I probably did 30 or 40 multimillion dollar deals over the years. In more than a few instances, the acquiring company destroyed the business it bought. Not immediately, but it happened sooner or later. They didn’t do it out of malice or contempt. They often had the best intentions. But when forced to choose, they did what was best for the parent company, not the acquired business.
The chance of failure increases dramatically when the acquired company is in a different industry. Just look at the acquisition track record of AT&T or Sears or Xerox or Kodak for examples of how these disasters happen. It has even impacted the music business. RCA was once a dominant record label with a flourishing consumer entertainment business too—but it started making crazy acquisitions, buying up frozen food companies on the notion that TV dinners weren’t much different than TVs. They eventually self-destructed, but a lot of musicians got hurt along the way.
So I can’t look on this Bandcamp deal without anxiety. It wouldn’t be so risky if we had other companies in the recording industry that were reliable and artist-friendly. There aren’t many, and Bandcamp is one we can’t afford to lose. I’m certainly not hostile to Fortnite, but our musical culture deserves to be more than just another game.
Update (3/5/22): One reader asked for more detail on the larger ownership structure in the industry. So I took a stab at sketching out the relationships—which establish the context for the Bandcamp acquisition. I believe these numbers are correct, but if anyone has more up-to-date information, let me know.