The Strategy

[pilferk]

thanks for that breakdown pilferk...I've always wondered what it would look like

No problem.

I'm looking at the breakdown and trying to get a feel for what would be different for GH. ?Here's what my "vibe" is:

 ? ?$0.17 Musicians? unions (fixed)
 ? ?$0.80 Packaging/manufacturing (Given it was a digipak, you can probably take packaging and cut .10 off)
 ? ?$0.82 Publishing royalties (fixed)
 ? ?$0.80 Retail profit (fixed)
 ? ?$0.90 Distribution (fixed)
 ? ?$1.60 Artists? royalties (relatively fixed but given the number of covers...it might drop a bit..say .20)
 ? ?$1.70 Label profit (well, it will increase by whatever we remove from the list)
 ? ?$2.40 Marketing/promotion (reduced by 25%)
 ? ?$2.91 Label overhead (Halved)
 ? ?$3.89 Retail overhead (Fixed)

So, what I come out with as a guesstimate is you can add approx .60 + 1.45 + .10 + .20 to the retail profit of 1.70. ?That brings the profit to almost 4.05 using a pretty logical and conservative estimation (feel free to poke holes and I'll adjust accordingly) for GH.

If that's even close, on US sales alone, you're talking 14 million.

Edit: Adjusted Marketing to be not halved but reduced by 25%.

[pilferk]

As other people have said... when Appetite was released, they had nothing to prove. ?It wasn't potentially the label's biggest release of the year, and it certainly didn't cost them as much.

All of which has nothing to do with whether the strategy worked, or would work, this time.

And CD is likely NOT being pegged, by the Universal brass, as their biggest release of the year.  It's an unknown quantity, to them, I'll bet.

As for "costing as much"..I think we've given a pretty good indication over the past few threads that Universal has likely recouped a good portion of the "cost" of CD already.  It looks like it can only really MAKE money for them.

[Neemo]

that is crazy so if AFD went 15 times platinum, lies 5 times, uyi 1 & 2 7 times each, tsi once, live era gold and GH 3 time platinum it looks like all those guys are fucking rich

[pasnow]

? ? ?$0.80 Packaging/manufacturing (Given it was a digipak, you can probably take packaging and cut .10 off)
 ? ? ?$1.60 Artists? royalties (relatively fixed but given the number of covers...it might drop a bit..say .20)
 ? ? ? ?$2.40 Marketing/promotion (Halved)
 ? ?$2.91 Label overhead (Halved)

Thanks for researching and posting Pilferk, but I'll have to disagree with a few "adjustments" you made. Mostly the Artists Royalties. Granted the covers may not need to goto GnR, but they do need to goto who owns the rights to the original (Bob Dylan & Paul McCartney), so really you shouldn't decrease that, possibly it will increase for borrowing the song.

Second Label overhead , they have employees and staff's salaries to pay, and they need to generate revenue to pay them. This would be included in Label Overhead. Don't think that it'll be halved just because it's a GH

Third, I think halving Mrkt'g/Promo may be a bit drastic. Because it has no NEW songs on it and no supporting tour, I would think it may need to be promoted heavier (ads in Magazines, in store promotions, etc). Even if a GH is less, I don't think it's 50% less. Just my oopinion.

Well, the last isn't a huge deal, only $.20 but I'm not sure what you meant by a "digipak" (I never bought the album, never needed to)

[AxlReznor]

A digipack is a cardboard case, as opposed to the clear plastic ones.

[Voodoochild]

Actually, I saw some GH TV ads here in Brasil (wich is REALLY rare and I remember there was nothing like this with Live Era). So, I think they did some promotion...

[AxlReznor]

Actually, I saw some GH TV ads here in Brasil (wich is REALLY rare and I remember there was nothing like this with Live Era). So, I think they did some promotion...

There were a couple of TV ads here, too.  And some full page magazine ads.

[T_Roxie]

A digipack is a cardboard case, as opposed to the clear plastic ones.

I've seen both digipak and standard packaging for GH...bit odd.

[sootn]

all it takes is one killer single...  then CD will take off.

we have no idea what they have up there sleeve.

All the songs we have heard most are good but not like killer. Im sure they got like 2-3 badass unreal songs. time will tell I guess.

im just sick of waiting... sick of all the bs on the forums its so old.


GNR and Management are assholes!

[pilferk]

Thanks for researching and posting Pilferk, but I'll have to disagree with a few "adjustments" you made. Mostly the Artists Royalties. Granted the covers may not need to goto GnR, but they do need to goto who owns the rights to the original (Bob Dylan & Paul McCartney), so really you shouldn't decrease that, possibly it will increase for borrowing the song.

Second Label overhead , they have employees and staff's salaries to pay, and they need to generate revenue to pay them. This would be included in Label Overhead. Don't think that it'll be halved just because it's a GH

Third, I think halving Mrkt'g/Promo may be a bit drastic. Because it has no NEW songs on it and no supporting tour, I would think it may need to be promoted heavier (ads in Magazines, in store promotions, etc). Even if a GH is less, I don't think it's 50% less. Just my oopinion.

Well, the last isn't a huge deal, only $.20 but I'm not sure what you meant by a "digipak" (I never bought the album, never needed to)

Artist royalties are fixed on cover versions, rather than variable for first publication, according to US law and RIAA regulations (the statutory royalty rate...and it's about .10 for a 5 min song per unit). And there is no negotiation with the original songwriter, so long as you don't change anything about the original composition, due to compulsory licensing laws.? All they have to do is notify the original songwriter that they're using their work and provide quaterly royalty statements.? ??I'm not sure if that pertains to the GnR/Universal tunes, because of contract issues, etc, etc, on their own GH album. ?But, for sure, using another artists song IS less expensive than new, first run material (which is what this break down covers). ?.20 is actually relatively conservative given the number of covers.

Label overhead would decrease drastically because, on first run material, you're covering overhead during production of the album as well. ?That includes A&R stuff, some band expenses, as well as the executive side of things, AND production costs (mixing, mastering, etc). ?For a GH album you're covering a lot less of that over a much shorter period of time. ?I think half is a good estimate, though it may be less than that, even.

I'll agree the marketing and promotion figure might be a bit drastic. ?But I will say compared to a new album from an established artist...there was a LOT less promotion for GH. ?But I'll give you, maybe not HALF as much. ?I'd be willing to change that to a 25% cut.

On the digipak, it's a soft cardboard flimsy sleeve thing.....much less expensive to produce. ?I think .20 a piece is pretty close to the difference.

[pilferk]

all it takes is one killer single...? then CD will take off.

we have no idea what they have up there sleeve.

All the songs we have heard most are good but not like killer. Im sure they got like 2-3 badass unreal songs. time will tell I guess.

im just sick of waiting... sick of all the bs on the forums its so old.


GNR and Management are assholes!

I think "Better" is absolutley killer, and "IRS" is almost killer, but I'll agree, when looking at the sum total, the majority are not.  They're just very good.

[randomconcepts]

You guys wanna know the strategy... It's actually pretty simple ready, here we go: October 1, 2006 Management, Universal and GN'R got together and put 13 Tuesdays in a hat... (mind you this is hush, hush...) anyway, they randomly selected one and that is the release date then they burned the hat and all the Tuesdays slips and nobody really knows which one it was... Some say that as a joke Izzy came to the meeting and tossed in a Dec. 23, 2008 date. Which made everyone laugh but, they thought wait a minute we could do that... yeah that would work. For those that are i dunno... how to put this ignorant, slow... i dunno... it's a joke... What does it matter... we got like 10 Tuesdays... I am gonna go to live at BestBuy so I'll see you guys later... I have enough food for two and a half months... and will have plenty of electronics to play with... you can find me either in  the video games or television areas tonight later...

[Eazy E]

It seems to me that the fans on this board created the whole "no promotion" strategy and then ripped it to shreads. ?What gives everyone the idea that there won't be any promotion? ?Merck commented on announcing a release date... but that's a seperate issue.

[pilferk]

You guys wanna know the strategy... It's actually pretty simple ready, here we go: October 1, 2006 Management, Universal and GN'R got together and put 13 Tuesdays in a hat... (mind you this is hush, hush...) anyway, they randomly selected one and that is the release date then they burned the hat and all the Tuesdays slips and nobody really knows which one it was... Some say that as a joke Izzy came to the meeting and tossed in a Dec. 23, 2008 date. Which made everyone laugh but, they thought wait a minute we could do that... yeah that would work. For those that are i dunno... how to put this ignorant, slow... i dunno... it's a joke... What does it matter... we got like 10 Tuesdays... I am gonna go to live at BestBuy so I'll see you guys later... I have enough food for two and a half months... and will have plenty of electronics to play with... you can find me either in? the video games or television areas tonight later...

Just keep clear on the 17th and 19th of November.  Those PS3 and WII customers might be brutal if they think you're trying to score one of their consoles.

[randomconcepts]

I now... I am gonna set up "An Alliance"... I will point to people and start fights cause I really don't even care about getting those... those will be a few days of fun... I will just insite a riot maybe... lol... those day I am even gonna wear a nintendo shirt and PS hat... and have those dumb mario wristbands...

"An Alliance" refers to The Office... love that show...

[pilferk]

I now... I am gonna set up "An Alliance"... I will point to people and start fights cause I really don't even care about getting those... those will be a few days of fun... I will just insite a riot maybe... lol... those day I am even gonna wear a nintendo shirt and PS hat... and have those dumb mario wristbands...

"An Alliance" refers to The Office... love that show...

Ever seen Governor Arnold's (aka The Terminator's) little gem "Jingle all the Way", with the god awful "Young Anakin" Jake Lloyd?

"He's GOT TWO!!!!"

(Riot ensues).

I'll be there on the 19th for my Wii.  (And that comment, right there, is exactly why Nintendo picked the worst name in history for this console....so wrong...)

[randomconcepts]

Yeah I loved that line... lol... I used to work overnights as a manager at a Wal-Mart... me and my friend Tim were laughing when I said that once... haha. Should be a good day... Looking for people to join "The Alliance" I plan on having a meeting around 7 EST in the Soundtracks Aisle... I will be there at 5...

[pilferk]

Yeah I loved that line... lol... I used to work overnights as a manager at a Wal-Mart... me and my friend Tim were laughing when I said that once... haha. Should be a good day... Looking for people to join "The Alliance" I plan on having a meeting around 7 EST in the Soundtracks Aisle... I will be there at 5...

Well, if you're anywhere near Connecticut.....just name the best buy!

[randomconcepts]

LOL... fuck it I'll catch the next plain... to Conn. you call the city and store... on my way I'll visit WWE Headquarters... sounds kinda like a fun trip... I'll just have to stay with you til after the New Years... it will be like National Lampoon's Conn. Vacation...