I wrote this around the time of the end of Merck in the interest of explaining a little bit about Merck and the state of electronic music/IDM that you all may not have known before. I hope that you all can understand better the industry side of why we have decided to end the label, and what is going on behind the scenes with a lot of record labels. There are still a fair amount of personal reasons on top of these that have caused us to decide to move on to something else, but at the end of the day you run a record label to sell music, so thats #1 priority.
Merck Records does make money, I’ve paid out over $40,000 in cash to artists since the label started, as well as providing artists with hundreds of copies of releases to sell and give away.
We released 12 cds and 12 vinyls for each calender year 2003 and 2004, the same as much bigger labels than us were doing. For 2005 we decided to slow it down to roughly half that and do 6 cds and 10 vinyls to make things a little easier on us. We did roughly the same for 2006, our final year.
Before 2004 most all of our releases were pressed in quantities of 1000 and most are still in print. In 2004 we started to get better distribution and began pressing 2000 of most new cds and ALL of those cds are still in print (though we have sold more than 1000 of some of them).
Based on those figures you can understand that the income from running a small record label is not large enough to support personal housing, food, etc., much less a label office and staff expenses. On top of that I drive a crappy car and have crappy insurance, so if i break my leg, somebody’s album isn’t coming out.
Around %50 of our releases were sold in Japan, so the size of the scene you think the U.S./Europe has, divide that in half, the US is only buying 100-250 copies of our cds at most, same for Europe. The rest are going to Japan. The Japanese have the highest per square foot real estate costs, but yet they are the ones buying the most physical copies of music releases (vinyl on top of that!). So the big secret you all don’t know, is that without Japan, a lot of the indie labels you know and love, would be a lot worse off or not exist. So thank Japan for helping keep a lot of the music you love, coming out. There’s a reason every Warp album comes out in Japan 3 weeks before the rest of the world and has a bonus track on it.
In recent times, the European music market, that was the birthplace and incubator of a lot of electronic music, has taken a decent sized downturn and a lot of distributors are focusing more on pushing a lot of copies of one release or focusing only on more profitable genres, instead of actually doing the job of a distributor, which is to supply a lot of copies of a lot of releases.
MP3’s have definitely had a good and bad effect on the label, of course they help to spread our music around to people who haven’t heard it before. The problem comes when people use it as a substitute for a real copy of the cd or a legitimate mp3 purchase. As Machinedrum said in a recent interview and as I’ve experienced personally multiple times, we meet many people who swear Merck is one of their favorite labels and they love all our stuff, then when asked what cds/vinyls they own, they either own NOTHING or only a couple releases. Thats not support, and although we appreciate their enthusiasm, they are not the kind of fans that breed a healthy scene. Take this
excerpt below that was actually said in an IRC chat channel as a perfect example:
<instlr> guys does anyone has these or some of these albums: http://www.m3rck.net/hiphop.txt ?
<HomX> new merck out -> Blamstrain_-_Blamstrain_Remixed_(Merck)-CD-2005
<HomX> instlr, i have the tribe called quest albums on that list
<HomX> i’d be interested in getting all the other classics.. some of which i have on TAPE.. baha
<instlr> i did a quick listen to that blamstrain, didnt sound super hot tbh
<HomX> no? man i love it, sometimes you need to listen to an album a 2nd time to really feel it, or you just
weren’t in the right mood for it
<instlr> yeah thats true, ill give it some more time
<HomX> the merck album i’m totally immersed in at the moment is -> MD-Appelsap-2000
<instlr> ym2……… Kkowboy! or is that track on the other md?
<todo> kkowboy is on between gaps i think, thats one with the face on it
<instlr> yeah thats the one, i love that album
<todo> i like the half the battle remix cd a ton, that ones great
<HomX> totally, i honestly adore every single merck release ever put out
<todo> yea they do some pretty wicked shit overall
<instlr> ym2, thats why i wanted to download that list with their influences
<todo> do you own any of the cds? they do some real quality printing
<HomX> the only merck cd i own is the new blamstrain
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Thanks for reading this, and supporting Merck over the years….the true fans who are buying music, going out to shows, and telling their friends about good music….are keeping this going.
I kind of came late to the M3rck scene (circa 2004?) and unfortunately was unable to buy a few choice things in the discography–believe me, I wanted to!!! ; )
M3rck was truthfully the *first* indie label I stumbled across (mainly because I followed MD over from the demoscene). Before M3rck, I was just as guilty with music as any other mp3 leecher (my tastes were just as bad too!). Since then, I’ve done some growing up and I’ve learned to highly appreciate what these artists give to the community. From their dedication to the kick-ass sounds, I am more than happy to give them my money.
I think its important to realize that the problem does exist and that there’s no justification for it. I *still* grab an album from time to time from a p2p client. There’s no excuse for it, but I also have been buying A LOT of albums/eps from various indie labels that I would have never even thought of doing before M3rck showed me the way.
Thanks again for all the great sounds! I just wish I could only support you more!
Thanks for posting. I initially heard about Merck by being sent Machine Drum’s Half the Battle 12″ through Audiogalaxy in 2002, so P2P certainly has its benefits in terms of getting your music out there (as you said). But it’s certainly abused when people do find the music through file sharing, and then just keep the mp3’s and don’t buy the physical copy. I won’t say what the mix is of legit/non-legit file-sharers, but I’m probably in the minority of those that use Soulseek heavily, yet still buy over 50 releases a year. I use Soulseek to sample the gobs of new music coming out every week, and go out and buy the ones I really like, because I know artists can’t continue to afford releasing music if no one buys it. Buying music these days is less about the physical copy and more about the vote of confidence for the artist/label that released it.
That said, didn’t Merck have a huge problem with vinyl distribution as well? I’m no DJ so I always just bought the CD’s, but it seemed like the vinyl versions of releases came out way later and only had about half the tracks off the CD. And with indie labels and particularly the electronic scene, if DJ’s aren’t playing your stuff, it’s kind of hard to create the type of buzz needed to sell more than the 250-500 copies you guys probably averaged. Even disregarding DJ’s, the type of fan that would be into Merck is more likely to be the purist that listens on vinyl instead of CD/MP3’s anyway, so it always seemed to me like Merck was potentially alienating its audience by being so anti-vinyl. I know when I talked to people about Merck, their response wasn’t very positive, and it didn’t seem to be because of the music so much as the lack of vinyl support. I have no idea what vinyl costs were back then vs. CD’s, so there could be a ton of justifiable reasons for the delayed “samplers” you released, but I do think it hurt the label.
I certainly have noticed the trend of labels going toward the more “boutique” style you mention, focusing on just a few key records a year and really working on building hype for them. Warp started doing that, I want to say, a couple years ago, and it’s amazing how long they’ll go without a release now. But they all get reviewed well by Pitchfork et al so I guess they know what they’re doing.
Well, the vinyl thing is a rather elaborate answer. So Let me just start by saying my main point is that the market is/was just not there, and without that market it boils down to money, so let me start with the $$ issues first. Both cds and vinyl cost about $2-3 each in cost to make (depends on how elaborate your packaging is). But you can sell a cd for $7-8 wholesale, but vinyl only goes for $3.50-4.00 wholesale. You can of course skimp on production costs and end up with a vinyl that costs slightly less than $2 to make (see: merck MR, and SA first version), but you get a 1 color label, a thin record, a blank jacket and probably not the best sounding vinyl. Very quickly I realized i wanted to make something nice, so our records cost more on the $3 end of costs to produce (full color labels, thicker records, shrinkwrap, and a generic, but yet high end printing job jacket).
So lets say you make 1000 12″ records, costing $2800 to make (2.80 each), you turn around and sell them for $3.75, netting yourself $3750. So that means your break even point is about %75 of sales (2800 / 3750). Thus you have to sell 750 copies before you’ve just recouped your manufacturing costs. Now on top of that, take out another chunk for copies you give to the artist, friends, djs, or records that stores/distros don’t pay you. And on top of that its a standard rule that you don’t get paid by your outlets until 60+ days after shipping them the records. You can see very quickly why labels pop up, do 3 vinyl releases, and disappear silently forever. THUS why I started Merck by releasing several CDs to build a following, and some turnover in money coming back in, before venturing into the vinyl market. And also why the vinyl schedule always seemed to be lagged behind the CD releases. I started this label with my life savings, ran it out of my garage, I couldn’t exactly just drop a half dozen vinyl releases and catch up.
I would have LOVED to press every drop of music we released, onto vinyl, and release it along with the cd. I started off in IDM music buying vinyl, and I own over 1000 vinyls myself. But with the $$ factors you see above, and the market factors im going to mention below, it was just not feasible to follow that Warp type model, for Merck. On several occasions we pressed vinyl releases before the CDs were made (or without an accompanying cd at all), and of course it had better sales than a typical sampler vinyl, but it was nothing close to anything persuading me that vinyl was the route to go to make the label more successful. Its always been a format thats slowly dying out, and becomes less appealing with each new generation, especially since “DJing” lost its cool (see: the turnout to the last few DMC competitions). Nonetheless, I would pick my favorite tracks from an album and press the 12″ samplers to try and give the DJ’s and vinyl fetishses something as best we could, but quite frankly if we pressed 2xLP’s of our first dozen cds, along with the cds, We would never have gotten into double digits of our catalog, and i would be broke and have a whole lot of useless records in my garage.
Also, I mentioned the skewing of Japanese fans towards the market share of purchasers of our music in the post. As far as formats, vinyl is even more skewed towards Japan, they bought a majority of our vinyl editions, with europe buying more than the US, though that generally was never very much due to the abundance of this type of music in Europe, as well as the shipping costs from here to there. Nonetheless Japan probably bought %66 or more of any vinyl edition we did. Vinyl was very popular in Tokyo in the early 2000’s, it was like a fashion trend to be seen walking around with a bag of records, but of course that is long gone and since then I would say that probably 80% of the stores selling back then in the heyday, are no longer around.
As far as the market, I don’t know a lot of people who buy vinyl, and then go out and buy a cd if they dug the vinyl, nor do i really know a lot of clubs or places that had anyone playing our stuff, or stuff like our stuff, regularly that would cause people to hear it, and then go purchase a copy. I definitely know a fair amount of people who buy vinyl only, but the ultimate issue is really that the market has NEVER been big enough to support large scale vinyl production of this kinda music. You can get away with it if you have Warp’s budget and history, but not many else have had much luck, and even Warp got out of that game.
Also when you press vinyls in editions of under 1000, your cost per item goes up excessively because there are so many setup costs associated with vinyl to begin with. Thus a 500-700 edition record, once you sell them all, you can only really hope to break even on your costs. Thats why in vinyl its very important to be selling numbers well above 1000 editions. Which is what Warp, and a lot of hiphop type material is able to do. But for more obscure IDM stuff, theres just no way to make it a profitable enterprise. We ended up pressing some 600 edition records at the end, as a straight up pro-bono exercise for the fans who are into it. Its sad to say, but neither me nor the artists really made any money on about the last 2-3 years of Merck vinyl releases.
As far as mp3’s, i’m definitely not judging people outright based on that, its really between you and god per say. I’ve been downloading and sharing them (with responsible people) since the earliest days of it. I have used ftps, napster, soulseek and oink, and i found tons of good music through them. A lot of my collection is still original 128 stuff with no ID3’s. But then again I also own over 1000 cds and 1000 vinyls, and have a large wantlist of stuff i’ll buy on sight (at reasonable prices). And I’ve been known to come back from japan with 50+ pounds of records (yeah, they have a lot of awesome used stuff over there). The point is just the new generation of fans that don’t understand the economics of things I guess, or would rather spend their money on fashion or $9 drinks. Ultimately I don’t see any clear solution how to change that.
Correct me if I’m wrong, but the problem seems to be more complicated than simply downloading. With the mass amounts of information flooding people via the Internet, I think one big factor is choice. People have a greater choice than ever before, and with that, there isn’t an ability to sale en masse without huge marketing or hype via the media.
I thank the Internet for the chance to buy the 5 or 6 Merck CDs I own, but it is just one of THOUSANDS of labels that have my interest. It seems that there is tons of interesting music coming out, but the competition is fiercer than ever to get people’s 10 seconds of attention.
It’s most definitely a consumer’s market at this point, which makes it hard to justify setting up or to continue a label…
Just my two cents.
Yeah, now is definitely the best time for the music consumer ever. But what boggles my mind is with 2-3 billion people in the 1st world, how can it be so hard to sell a couple thousand cds of what is admittedly fairly unique music?
First off, I want to say a HUGE thanks to you Gabe, as well as to the artists who have put out music on your label. As you may or may not know, I came in to the Merck game very late, and not to pat myself on the back, but after hearing of the label’s closing, I stocked up on releases like a madman. Honestly, I don’t get it–the lack of sales here in America. People will pay ten dollars to go see some godawful forgettable movie or a crap meal, yet can’t shell out a lousy fifteen bucks a month for a cd? For me, even though the music was top priority, it was always the physicality and ownership–the whole package. I remember in highschool how i’d save up my lunch money and later hit the mall and go to the local Camelot or NRM to pick up something from Wax Trax or Nettwerk. Yeah, I know it’s showing my age, but I guess growing up in a time before MP3s sort of forced me to really appreciate that certain physicality, and really get into stuff line liner notes and art work, and whatnot. And speaking of art work, Merck, and many electronic music labels really DO have some of the finest work and packaging, etc. out there. To me, the art was almost just as important as the music it accompanied. So, I think this also show just how much we value art in this nation. Anyhow, there was a time I considered stocking up on lots of gear and making and selling electronic music on a serious level, but I remember Chris Graves (aka Colingib) who runs the micro label, Kracfive, saying how electronic music is a thankless endeavor. So, I give tons of credit to guys like Travis Stewart and Joe Misra and Richard Bailey, etc., who have continued to put out excellent music, despite the financial downside, over the past several years and have, personally, provided me with endless hours of listening pleasure. Seriously, there’s an evergrowing heap of horrible garbage music taking over this planet and I don’t know what I’d do without labels like Merck. It’s not like I make a ton of money myself, so all I’ve got to say is c’mon folks, show some love, get the priorities right and support this music–it’s not to late for the love of Pete!
Definitely needs no explanation. I’ve got 7 Cd’s in my room, a bunch more in my car, and ALWAYS a sticker on my bumper (i’m rationing them out for future cars). You’re contribution to music is nothing less than completely awesome.
Damn, i feel so stupid now
Living in Brazil and being underage makes things really hard, even so i bought some merck stuff and try to save money for other indie labels records (brazil’s currency is shit, exchange rate rape me, and i can’t work for being underage, so, yeah) but i’m afraid that’s not enough.
dammit life sucks, i wish i could be helpfull for the music that i love so much.
Sorry Gabe, and thanks for sharing this, i promise that when i get my 1st job, my 1st payment will be entirely in albums!
Bit of an off topic question - but for how long will the legitiimate mp3 versions be availble for now merck is winding down? it would be awful to think of the music actually dying officially, but leeched copies going around for years afterwards. something that surprised me about the sending orbs label is the lack of any sort of legit MP3 versions of albums that are now OOP - virtually forcing people to leech it - not even giving the artist a chance to make an income from it - i’d like the think the digitial download store of merck would go on indefinately?
also - if another label wanted to do a repressing of a merck release - is that something thats fairly straightforward, or is there a lot of legal baggage attached? does that give you the opportunity for future income of stuff if say a japanese based label wants to repress some merck stuff.
just interests me, cause im looking at setting up a label myself at somepoint in my life - but have no idea where to really find out whats what…
i only became aware of US IDM scene a couple of years back, but somehow the closure of merck was a real eye-opener to me. whereas in the past i had always thought “i’ve got years to get around to buying this” when i had considered real purchases, the closure of my favourite label was like a wake up call - i now buy pretty much all my IDM, after previewing it on oink / waffles etc. and dont leave a time delay incase stuff goes OOP or the label closes. I just wish id had those eyes open before the closure of merck was annouced, otherwise i wouldnt have left it till right at the end to buy up the catalogue :S
This kind of attitude saddens me and I see it all around me. I
know people who haven’t bought a single record in years because it’s ‘widely’ available on the net. Don’t get me wrong, I download a lot of music too but I always buy what I like.
Merck Records always fascinated me and I was amazed that there only were 1000 copies of each release (in the beginning). Even more because I know a fair amount of people who like the label. They all seem to be satisfied with having them as digits on their PC/mp3 player….
Gabe, I’d like to take this opportunity to thank you once again for all the amazing tunes you helped to spread into the world!
I wish you all the best and I hope this blog will help me to find cool releases on my musical journey.
Cheers,
Robin
I was guilty of dl’ing merck music, then I got a pair of mk5’s and an sl-dz1200, and bought up as much merck hardcopies as I could find. put merck stickers on all my hardware, even met malcom kipe at some shows in ATX. he gave me cd copies of his music, and I returned the favor by buying Lit on vinyl. Now that I’ve relocated to Montreal, best believe I’m going to drop those obscure merck cuts on unsuspecting virgin ears.
Ben: Awesome, much appreciate. I gurantee you’ll get some people coming up to the booth asking what it is.
Robin: Yeah, Music is really at some kinda Moral Crossroards (yeah, that sounds corny as fuck). and Yeah, we always pushed the releases as limited, but they were limited by Demand, not Supply.
Risch: The legit versions of Merck single artist albums on digital download sites such as Itunes, Rhapsody, Emusic, Napster, etc. Will remain up there indefinitely at this point. We have no plans to take them down, though the rights status of some of the music may change down the road, and I can’t say what will happen to it after that, but for now the stuff will surely be available Digitally for the next several years at least. As far as compilations, they never were, and never will be available digitally. So buy up those physical copies. Almost all of the ones we have done are still in print, and I have no problem with someone having MP3s of a cd like Squadron that is long OOP and not available digitally.
As far as other labels licensing our releases, its a fairly simple process, we just have to agree to terms for them to do it, and generally the label needs to make accounting statements and payments down the road.
Vinicius Trentin: Thats awesome man! I’ve never been south of Nicaragua, but I’m glad to hear people are hearing our stuff down in Brazil. And i definitely understand the plight you are in. The US has fucked so many countries around the world monetarily that I understand that it can be near impossible and impractical to be buying our releases physically. Not sure really what a solution to that would be, but I definitely understand where you are coming from.
Gabe, do you have any suggestions for some slick jazzy downtempo? I have Miasmah, getting aphilas on vinyl soon (along with some blockhead), Fehlmann’s “Lowflow” (that was a bitch to get on vinyl), lots of ninja tune stuff, and various merck comps i.e. dosage, and mergerz and acq. I plan to hit the Montreal lounge scene with a mix of downtempo/trip-hop, and hip-hop instrumentals.
Off the bat ill drop the merck stuff that fits that category that you didnt mention. Malcom Kipe and 40winks are about as jazzy downtempo as merck gets (and aphilas too). Deceptikon is also downtempo, but not so jazzy. i also suggest stuff by Quantic and Bonobo (they release on Tru Thoughts and Ntune). Also Mowax has alot of great stuff along those lines, but you really gotta dig through their catalog to find the stuff thats quality(I can’t think of names offhand). Some other names to check out: Aim, Nightmares on Wax, Red Snapper (some of it), Comfort Fit, Jay-Dees instrumental stuff. Herbaliser, Climber, and of course Luke Vibert/Wagonchrist stuff (Tally Ho is such a great album).
thanks. I’m listening to sound puzzle as I type, I definitely need to get it on vinyl. I have Malcom Kipe’s stuff, N on W is always good. DILLLAA!!… man.. what I wouldn’t do (within reason) for Vintage on vinyl. thanks again for the suggestions, I’m also looking to integrate the funk with the groove and boom-bap, with a dash of the glitchy/synthy experimentalism. I suspect my Deru and Deceptikon records will fit in nicely for the latter elements.
Ben, Debut “Transitions (2007)” of dutch producer Arts the Beatdocter sold out within six days in Japan. Check out the track “Decreasing Daylight” at http://www.myspace.com/artsthebeatdoctor
whoa…that’s the shit! I wanted something to mix with aphilas-type stuff, and this definitely fits the bill. good lookin’ out, and thanks.
apan has definitely show the most support for Us and i think its good to acknowledge that.
Not only that but it is also a great place to visit, play music at and meet heads.
Cheers
Some more good instrumental hip-hop/downtempo stuff some jazzy some not :
-Anomaly - The Long Road
-Climber (was already mentioned, very good.)
-EKP - Things you already know…
-Express Rising (if you can find any of it)
-Purple Penguin
-Silent Poets (some stuff, they are really all over the map, but have some truely great music)
-Beneath Autumn Sky
-Ill Padre
-Ciencia Fixion
-DJ Reezm
-Plan B (super cool dude in seattle, good tunes and nice percussion)
-sixtoo (of course)
-
and basically anything on the labels bully,heardrums, memphix.
shoot, i had a whole long response to some of the topics brought up in the post.
but it didnt like my security code, hehe.
remember to copy and paste !
to sum it up briefly this time :
i think you can look at the entire dj scene here in the US and find an answer for why merck’s vinyl sales lacked here.everyone is a dj, nobody “needs” vinyl anymore etc. there are too many cases to be made.
i personally spend 250 $ a month on vinyl not including shipping.the exchange rate is killing me !
personally i see a bright future for vinyl, there are good ideas being throw around. like when you buy a piece of vinyl, there will be a code etched in the runout that you can enter at a specific site to download hi-bit mp3’s of those tunes.the label charges a few extra dollars and alot of people are happy, the vinyl dj’s are happy the serato dj’s are happy.
and if you have noticed, alot of the bigger bands in the uk are releasing 7 incher singles…and selling well.it is still cooler to play vinyl even if it is casually in your room.
gabe your postings in this topic where very interesting.
and i have to say i have all but a few merck vinyl releases, and would not part with any of them !
thanks, Gabe, for the instrumentally ill ep. I’ve also special ordered Climber’s Downtown Loop LP
and thank you Casey, for the suggestions. I got Express Rising “time and time again” 7″, and Jeux de Ficelles on vinyl (!)
Many thanks for this informative post, Gabe. I agree with most everything said, and learned some stuff in the process. I recently started a label that I have been trying to get off the ground for over five years. I swore I would keep it strictly vinyl, but in the end, I was forced to debut with a compilation CD. Despite having actually sold all 100 copies in three weeks time, entirely by myself, it’s a ton of work. It’s a full-time job. On top of my other full-time job. The end result is most definitely rewarding when you sell out of a release and manage to pay all of the artists their share, but any sane person has to ask themselves how long they can continue on for. Most good (small) labels don’t do it for the money, and at first that seems ok. But then after you invest so much time and energy (and $$$), one has to ask themself if it’s worth it to keep breaking even, or in my case, making a nice enough profit to pay 10 artists a little bit of dough, only to leave the person running the label, who is doing all of the real physical labor, empty-handed. It’s a sad situation, but I must commend all the labels that are keeping on, and those with balls enough to at least give it a try. Regardless of others opinions, I truly think that .mp3/Beatport/Serato Scratch are the prime suspects in the demise of vinyl culture, along with a dwindling economy and the rising costs of fuel (since vinyl is petroleum based). I can only imagine what things will be like in 10 years or so. I’m just trying to enjoy what’s left, while we still have it…
Peace