The "Virtual" Record Label

The interweb has spawned the latest trend in record labels, the "virtual" label. As reported on Hits, Echo Label, home to Feeder and The Stands and part of The Chrysalis Group, is going to start a "virtual" label in the US. Echo will develop and cultivate new band signings and depending on how things are going, send them up the food chain to the bigger parent labels when the time is right. ADA will distribute the label in the U.S, with Warner waiting in the wings. The concept, which is already quite the reality with many indie labels, will see many label functions outsourced to outside companies. It's a good, cost-efficient, flexible way to run a small label and concentrate on artist development. Do employees get virtual vacation days and salaries?

The two-tiered structure is quite popular these days. So popular, in fact, that it's even got its own Fast Company-styled corporate lingo term: "upstreaming." Warner Music Group has ADA to work on projects. Universal will start Fontana to act as its indie distributor. Sony uses RED as its minor league. EMI has the ability to bring up some Caroline artists if and when they take off.

Look for Volume One of NOW! That's What I Call Upstreaming in stores soon.

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The "Virtual" Record Label