Interviewer: What do you mean when you say they don't have anything to protect? I think that's an interesting phrase.

Andy Allen: Well, you know, the industry has been floundering really trying to figure out what to do with kind of unlimited burning and sharing, and as a result it's changed the economics of the business. The business was always – the big business was always built on you'd put 8 or 10 things out, and most of them would fail, but you'd have one record, and that one record – and I'll use my example of Island. Island was able to exist and be this creative home for everything from Anthrax, to Grace Jones, to U2, to, you know -

Interviewer: Tom Waite -

Andy Allen: Eric B & Rakim, because of U2. And frankly it wouldn't have worked if it hadn't been for U2, because U2 would come along every 2 or 3 years and put out a record. We'd sell, you know, 5 or 6 million copies domestically and, at that time, another 6 or 7 million internationally, and that funded everything else.

Interviewer: Right.

Andy Allen: Now that was an independent that was incredibly efficient at doing what it does and very focused and could spend a lot of time on an act like Tom Waite, but a major label isn't able to focus quite as much, and the economics for them really is dependent on that one big record supporting everything else. Well if you're one big record is selling 40 or 50% less than it used to means that the economic model doesn't work anymore, and that's what's really been struggling. So what you see now in the big business is mergers, downsizing, you know, a re-examination of really the whole thing, mostly driven by lack of sales -

Interviewer: Um-hum.

Andy Allen: And everybody has probably an idea as, you know, where their lack of sales are coming from.

Interviewer: You mentioned Bright Eyes, and it's been something – I tried to sign him many years back now, and ended up speaking to, I think, Rob at Saddle Creek, or whatever the fellas name is, and quickly realized I didn't want to sign this guy. They're doing everything they need to do. They don't need my help -

Andy Allen: Yeah, yeah.

Interviewer: At all. And, yet, some of the things that you just said about Island seem to be kind of similar to what they're doing with Saddle Creek.

Andy Allen: Yeah.

Interviewer: That Bright Eyes allows them to release an awful lot of other kind of records that don't sell what Bright Eyes does, do it on their own terms, the fact that they can put out two records – different records through your system at the same time. I can't imagine that happening, either on a major label, or through a major distribution system.

Andy Allen: Well, it wouldn't happen, because the A&R guy would say, "Hey, you know what? You've got too much material. You gotta make one great record." Or, "There's not a radio hit here." Mostly it's college play or webcasting, or, you know, any of that kind of thing, but you're certainly not seeing a Bright Eyes video on MTV every ten minutes, nor are you seeing it on your – or hearing it on your Top 40 or FM station.

Interviewer: He's getting a lot of press.

Andy Allen: It's a tremendous press and amazing word of mouth, and justifiably so, because it's some important stuff, but it wouldn't happen in a major system because the experts would have probably said, "This is probably not a good idea. You know, you're splitting your audience. They have to make a decision. They're confused. There's too much material, there's no hits." That doesn't happen in an indie system, because there's nobody to say no.

Interviewer: Well, there are people to say no. You've chosen not to say no. There are certainly distributors out there – I know many of them that are indie distributors, who have said, "Don't give us two records right now," and I don't. I'm certainly not gonna mention names, but the fact that you said, "You gave them the freedom to do that." Did it give you any pause, or at this point do they kind of say – you kind of just give them the room they need?

Andy Allen: Well, I'll tell you what gave me pause. I thought that, that was the major battle, but then what we found out is that Connor, who's the driving force between Bright Eyes, also decided that he didn't want to have to put barcodes on his CD's. Barcodes are the little UPC codes, you know, the little things that when you go up to the register they scan em, and that's what triggers the sale.
Interviewer: That's a good phone call to get.

Andy Allen: He had decided that it destroyed his art, so he didn't want to have barcodes on his CD's, which would have made the records unretailable. So that was a challenge.

Andy Allen: Well, we didn't put barcodes on em. We actually – you know, they have those little, what they call top spine things -

Interviewer: Unbelievable.

Andy Allen: That little sticky shit -

Interviewer: Thing you can't get off right?

Andy Allen: Yeah, the stuff that you have to -

Interviewer: You can say -

Andy Allen: Cut.

Interviewer: Shit.

Andy Allen: Yeah, okay. You have to cut em, you know, or peel em off, or whatever it is. We got away with doing that and, again, the experts would say probably that you can't get away with just doing that, because so much of distribution and the handling of CD's happens at high speeds. That CD's shoot down these things at, like, 5 CD's a second, and the barcode readers have to read em, and then they go off into these little things, and that's how they get out to distribution, and that how they go to the stores. But somehow it worked, and I don't know of anybody that's complained yet.

Interviewer: Well, and Connor, I said, doesn't get away with it. I'm sure there are some artist who might have tried suggest that to you and you told them, "Perhaps we need to keep a barcode on it."

Andy Allen: Well, we came up with some other solutions, so if it didn't work, maybe one of em would have, but that was a little more difficult than the two CD's.
Interviewer: And it keeps with your mission statement. We talk a lot about missions and values in this program. Your mission statement is give indie labels a distribution system. It merges the clout and convenience of a major with a marketing sensibilities of an independent. Can you elaborate on that a bit?

Andy Allen: Well, I'll start with the first part. The first part is, ten years ago when ADA was created, if you were an independent label, in order to achieve national distribution you had to go and make a deal with a distributor that was usually regional. Meaning that there was somebody that handled the Northeast, there was somebody that handled the Southeast, there was somebody that handled the West Coast. They were all separate companies, and you had to ship em records, you had to get paid by each one individually. There were no systems that told you how many they got, how many sold, what was happening. It was really – you had to kind of paste it together. So when this group of independent, or national independent distributors (of which ADA is one) I guess there's probably five now, it was for the first time an indie label could have true national distribution.

Three of these big indie distributors are actually fake indies, including ADA. If ADA is owned by the Warner Music Group; 95% by the Warner Music Group and 5% by Sub Pop. RED is owned by Sony entirely, and Caroline is owned by Virgin, which is an EMI company, so there's a couple of true indies, but most of the big indies are actually affiliated, or actually owned by the majors. Why is that important and why is that bad? Well, it's important because it gives us abilities to have scalability, which a true indie would have difficult times doing. It gives you some security in collecting money. It means that we get paid first, as opposed to last, which most indies get paid, and it provides security for the label. Meaning that if we're collecting their money they're gonna get paid from us, which means they're gonna be able to pay their artists.

A true indie, if a big company goes bankrupt, is not likely to get paid, which means the label doesn't get paid, which means the artist doesn't get paid. That's the good part of being affiliated with a major.

The bad part is some of the things that we talked about. Lots of obstacles, too much of, "We don't do that here. We haven't done it that way, so we're not gonna start doing it for you." Any of that stuff that goes with being in the business for 25 or 30 years, 20 or 30 of those years it working wonderfully successfully -
Interviewer: Um-hum.

Andy Allen: Certainly this last 5 or 6 years it's -

Interviewer: Not so well.

Andy Allen: It's been a model that's been under attack.

Interviewer: Right.

Andy Allen: So that's the good and the bad. Right now I'd have to say that we're in a wonderful position. You asked, "What's not to protect?" Well, if you're Warner Brothers, for example, you've got 25 or 30 years worth of copyrights that now basically everybody is, you know, making ten copies for their friends, or, you know, being shared openly on the Internet on a worldwide basis, not even just a domestic problem, but a worldwide problem. That's how you make money, is these copyrights, so if you can't get paid on those copyrights how do you run your business?

Interviewer: Sure.

Andy Allen: From an indie label standpoint it's, like, "Hey, you know, if 50,000 people want my music I think that's wonderful." They're not quite as concerned about, "How do I get paid," and all the rest of it, cause they're still in a position where they're trying to find an audience. Once you have an audience you try to protect that audience. You have the indies that look at everything that's happening now. Is it the equally or leveling of the playing field, or opportunity to get to where the big guys are, and the big guy is trying to protect their position. And it's not that much different, even from a retailer standpoint, you know. So, you know, you got little stores in the shadow of a Best Buy or a Tower, how do they all co-exist? Same thing.
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