I recently contributed to a kickstarter for The Dollyrots. I got an early digital copy of the new album -- which is great and you should buy it! -- and also got the little care package they sent out including a signed poster of all of the contributors and a few similar things. This extra stuff is adorable, and made the whole process feel very personal.
Apparently they only had around 500 contributors, but that was enough to pay for the album, which is awesome, and kind of surprising -- that's not exactly a large number of people! Even for a small band, that's only the attendance of two or three shows. It looks like about half of their total came from small-ticket items rather than things like "buy my old guitar".
When it came time to make our first music video, Internet Killed The Video Star we aimed high. We wrote the story out ourselves and found a great director... The video included nearly 50 crazy looking zombies, tons of special effects and multiple shooting locations. We even hand-made an arsenal of cardboard weapons - The best part was, we managed to do it all for less than most bands spend on catering at their video shoots.The zombie video has over a million views on YouTube now, but back when it only had a few thousand, MTV came calling! They said they loved what we had done and asked if our label had submitted it to them. When we told them we weren't signed, they were amazed and probably even more excited to help out. They played the video in its entirety a number of times and featured us for a whole week [...]
By the time we were ready to make the video for The Future, we were signed to the label and assumed we'd get a healthy production budget so we decided to go even bigger than we had for Internet Killed The Video Star... We wrote a script calling for even more elaborate special effects, crashing a time traveling Delorean into a Porsche, tons of costumes and actors, plus massive explosions. We had our sights set for an epic video and when we submitted it to the label, they said, "No... It's too dark and violent and besides, it'll be way too expensive..."
We were shocked, but, defiant and determined, we decided to make the video anyway, on our own dime.
Of course the next step was a conversation between the two of us that started with "if we're a signed band, why are we having to choose between paying our rent or making a music video?" and ended with "the breakup call" with the label...
As far as I can tell, record labels are useless at this point. They loan money, write a press release or two, and handle the mechanics of getting the MP3s into Amazon and Apple. There are cheaper ways to get those services than giving someone else so much control.
Smaller labels used to provide an editorial role, in that you could sort of expect that if someone was released on a particular label, it would have a particular sound, but even that is pretty rare these days. For example: last year, Niki and the Dove were scheduled to play a date in San Francisco that was cancelled, but I managed to see them at SXSW at around the same time. I asked them after that show why the SF date had been cancelled, since obviously they were already in the country, and they told me that halfway through their (short) tour their label -- Sub-Pop -- had told them, basically, "You guys are too small and not popular enough so we're pulling the plug in the middle of your tour and canceling the remaining dates."
There certainly still exist small labels that have this kind of editorial theme -- Kitsuné comes to mind -- but there really aren't very many, and I strongly suspect that most of them aren't actually functional businesses, but are more along the lines of, a one-person operation that is more like a very expensive labor-of-love that is funded by savings and/or a day-job. (I have a certain amount of experience with this dynamic.)
At this point, I think what label a band is on is usually about as interesting as which plant pressed their CDs, or which ISP hosts their web site.
Back when I still used CDs I used to try to support bands by buying their CDs at the show, because often they get a bigger cut of that sale that way (though sometimes not, as the label basically makes them buy their own CDs at so close to face value that it makes no difference). Even when they get a good margin on the CDs, they almost certainly still make more profit on t-shirts.
Paying for the music ahead of time via something like Kickstarter just seems like a much more sensible way to go about it, especially if you already know that it's a band you love and that you'd have bought the next album sight unseen. It's almost a "subscription" model.
It's also nice to be paying for the thing you actually care about -- "I'm paying for you guys to make a new album" -- instead of the weird proxy situation that other merch puts you in. When you think about it, it's kind of nuts that often the way you can best support a musician is by letting them re-sell to you a piece of clothing that they commissioned and sourced from someone else.