TuneCore vs. CD Baby for digital distribution

Hip hop giants Public Enemy will release their next album via digital distributor TuneCore, according to a story in yesterday's New York Times.

As a musician who's recorded a lot of CDs with unsigned bands, I'm a longtime fan of CD Baby, which provides an online store for selling physical CDs, as well as digital distribution through iTunes and other online services. How do the services compare for digital distribution?

CD Baby charges a one-time $35 fee for each album you want to sell through them (digital or physical), and takes a 9% cut of each download. TuneCore charges about the same amount up-front (although it will vary depending on how many songs are on an album and how many stores you want to sell your music through), and charges an additional $20 per album per year. But they never take a cut of any sales.

If you're a relative unknown with a local fanbase and minimal tours, you might sell 100 tracks in a year. From each of those downloads, you'll probably earn about $0.60 of the $0.99 that most sites, including iTunes, charge. Sixty bucks. CD Baby takes 9%, leaving you with $54. TuneCore's always going to be better in that first year, as they let you keep the full $60.

But in the 2nd year, you'll pay TuneCore $20 per album regardless of whether it sells or not. Or you'll pay CD Baby 9% of your gross from digital sales. Assuming the $0.60 per download is accurate, the breakeven point is 370 downloads: that is, you will have to sell more than 370 downloads to do better with TuneCore than with CD Baby. For a name like Public Enemy, that's a no-brainer. For other unsigned bands--depends on whether you tour, whether your MySpace friends actually translate into paying customers, and so on.

If you're signed with a label, they've probably already covered digital distribution for you, and the contract says what the contract says.

[PeterTuneCore]

More on TuneCore

Hey Matt, thanks for the kind words! Let me fill in some of the blanks on
TuneCore:

The actual amount we pay when a song sells on iTunes it $0.70 for the U.S.
store, of which the artist sees 100%, just as you said.

We're also proud to include ISRC codes and UPC codes at no extra charge, if
the artist/band doesn't already have them, which is a real boon to unsigned
or new people. Those codes are theirs for life, and can even be used on
physical products--we never reuse them, even if the person leaves TuneCore.

Also, that $19.98 per year isn't mandatory: if someone's had their music up a
year and decides they don't want to pay the annual maintenance/storage fee,
we'll take it down, no questions asked, no charge. I don't want your readers
to feel they'd be locked into anything, we're non-exclusive and cancel-any-
time.

There are a lot of other factors folks might want to consider when shopping
for a digital distributor: frequency of payments (TuneCore is 24/7), the
accounting process (I admit I'm REALLY proud of ours, which is astoundingly
thorough and transparent, even down to letting folks export a spreadsheet-
ready accounting), and customer service.

I'm really glad folks on the c|net boards are offering information about digital
retailers. The more people know, the better informed their decisions.

If you or your readers have any questions, feel free to drop me a line or post
here--we scope out blogs all the time, it's a great way to learn how to
improve our business.

Thanks!

--Peter
[e-mail]

[leeman10]

For £25 www.dittomusic.com provide you with over 50 sites, and not just the US based ones.
Also online accounting, a fixed release date, 4 week turnaround and you can become eligible for the UK charts.
They cover a total of 700 worldwide stores and take 0% commission on sales.
They have had 7 UK top 40 singles, all with unsigned artists.
A better service for UK artists

[kevincdbaby]

Like Peter stated above, the payouts are actually higher than mentioned in the article. After CD Baby's cut, the artist get 64¢ per a 99¢ download through iTunes.

There are a couple options that CD Baby offers that seem to work better for the average indie artist. Our service is a flat fee of $35 per album. No annual fees or hidden charge for each store (Including all the different versions of iTunes). CD Baby will get you to far more digital outlets for that flat fee, but probably the best feature of our digital program, is that you can sell downloads on cdbaby.com.

For downloads directly through CD Baby, the artist gets to set the price, so they can charge far more than 99¢ per track which has been a huge boost to the indie music community. For those downloads, artists keep 91¢ on the dollar. No one even comes close to that kind of return.

Don't forget, we also sell your CDs worldwide! CD sales are still going strong for the indie artist, especially in international markets that artists in America tend to overlook!

Feel free to contact CD Baby with any questions at [e-mail]

Thanks,

Kevin Breuner

CD Baby

[Gjonz]

i have a growing disappointment with Cd baby. This company has been good over the years but recently has really dropped the ball. I as well as other musicians i know signed to Cd baby are having issues getting e-mails answered which used to be answered immediately. I had to send an e-mail 3 times over the course of 2 weeks until it got answered and yes i had the right e-mail address. i have one i sent just 2 weeks ago which has not been answered and i have sent it twice already. it is concerning how to get some songs uploaded and registered because the functions that they have on their site which allow this are not functioning properly. we want to get this music posted NOW and are considering Tunecore due to these delays. We understand that there is a rehaul with the site but emails still need to be answered and functions on the site fixed so people can still sell their music.

[klokfire]

Thanks for sharing.
This week I'm discussing US aggregators (ie Tunecore and CD Baby) with fellow Danish musicians. And we wonder if your companies see to that copyright and royalties are paid. In Denmark we have KODA/NBC , organisations that take care of these things for composers and writers.
How does it work if we Tunecore or CD Baby?

Joe Klok, Singer/songwriter

[klokfire]

...if we choose Tunecore or CD Baby.

[chunkiv1]

WaTunes is a social media distribution service that enables artists, groups, and record labels to sell music, music videos, and audiobooks through leading online entertainment retailers, including iTunes,ShockHound, and eMusic. Artists and labels can sell unlimited music and earn 100% of their profits ? ALL FOR FREE!

[rspeck]

Another important service to compare is Nimbit.com. They offer everything CD Baby and Tunecore offer and they have a single content management capability that allows a single artist or small label to change information in one place and have that content distributed to all web distributors as well as the artist site. Also, they take zero from online sales through web distributors (iTunes, Rhapsody, etc). We are using it as their NimbitSkin product allowed us to create a nice seamless store within our artist site.