Out of this Spark

A record label in Toronto Ontario Canada

The Trouble with FACTOR Redux

Posted on | April 2, 2013 | 5 Comments

If you haven’t had a chance to read Slagging Off’s ‘The Trouble with FACTOR‘ article you really should. You also should check out the rest of the blog’s entries.

It really has hit the nail on the head on what is wrong with the music industry and FACTOR in particular.

I (Stuart Duncan, proprietor of OOTS) have wanted to write a similar article for generations but sadly have never had the time. I alluded to a lot of my issues with the music industry in Canada, in an article I wrote in 2009 about the Polaris prize, which brings up a lot of the same points.

OOTS as a label has received support from FACTOR in the past. Once for a Forest City Lovers video, another time for promo of Snowblink’s Long Live, and a few times to support sending me to Pop Montreal. All totaled this money may have been about $10-15k, really a drop in the bucket when you compare it to the amounts received by the other labels mentioned in Slagging Off’s post. The bands have also occasionally received support to go to music festivals, but again the numbers are pretty small, typically just barely covering the costs of gas to drive to Montreal or Austin.

As a label we have had a lot of success, we have released 11 albums, most of which have been well regarded by press and fans. We / the bands have had busy showcases at most of the major music festivals. There have been countless beautifully shot videos and incredible shows across Canada, the States and Europe. But long time fans of OOTS have probably noticed that as of late we have been much quieter as a label. We still exist and are still committed to putting out music, but the torrent of music that we used to put out has slowed somewhat.

Frankly OOTS as a label has hit a bit of a financial wall and the biggest reason for that is FACTOR.

People buy less music nowadays, particularly physical copies of music be it CDs or Vinyl. Every record label, big or small, is competing for an increasingly smaller and smaller amount of music sales. As outlined by ‘The Trouble with FACTOR’ the vast majority of FACTOR money goes to larger labels, this has essentially created a two-tiered music industry in this country. Labels like ours cannot compete with labels that have the vast majority of their operations subsidized by FACTOR and other granting bodies. Our records, that we struggle to cobble together $15k to put out, have to compete with 10 albums that each have a budget of $50-200k all supported by FACTOR, Starmaker or Industry Canada.

Labels like ours also struggle to attract and keep artists on our labels, because so many musicians flock to where the money is available. I don’t really blame the artists as they are struggling aswell, and more money can mean more opportunities. But operating OOTS sometimes really felt like a farm system for those bigger labels, those labels that are indie labels in name only, and it was always pretty frustrating to do the work and take the risks building up grassroots support for a band and have them leave for one of 3-4 grant subsidized labels.

The most frustrating part of the affects of FACTOR has been that it really has made it impossible to sustainably operate a small record label in this country. I am lucky that I have a pretty ok paying regular job that has been able to help support OOTS activities over the years, but it is shitty to think that next Constellation Records, Mint or Three Gut won’t be able to get off the ground because they can’t compete with FACTOR supported labels and no funding is offered to them to help get them to that stage.

I think small labels have and always will create the most interesting music. They are the most directly connected to their audiences and they are always the first to know what is innovative and exciting.

The solutions to fixing the problems with FACTOR are really easy and have been known for generations. People have been talking about the problems with FACTOR since before I started OOTS, but unfortunately too many of the people that make the decisions at FACTOR have a big stake in maintaining the status quo, and I doubt change will ever occur. It seems every year someone from the industry has told me that FACTOR is going to change for the better this year, and every year the changes are small and inconsequential.

Despite all my pessimism about the music industry, I do think there is a need for arts granting bodies in this country, and really hope something like FACTOR manages to turn itself around. It probably too late for OOTS, but I really hope that in the future some passionate music lover with an entrepreneurial spirit can still find a space in Canada’s music industry.

NOTE : Since I posted this, I have received some notes that some of the historical suggestions about fixing factor have been addressed in this round of funding. Unfortunately like a lot of labels of my size, people had given up on FACTOR a bit, and don’t pay close enough attention to it anymore. Without having a chance to look closer at the details of it, some of it could seem positive. It is unfortunate however that small label folks are not being informed about said changes. Being insular has always been a criticism of FACTOR and they have always needed to do a better job of reaching out beyond the bubble of a certain tier of Toronto based record labels. That being said, please ensure you check www.factor.ca to check to see if a program can apply to you or for the latest on the programming.

But for you the reader here are a few common suggestions for fixing the problems created by FACTOR :

- introduce tiered levels of support for labels based upon sales. A label like OOTS will never get to 5000 copies sold of one album to reach the cut off levels for support, but we pretty consistently sold 1000-2500 copies of most of our albums. Introduce smaller levels of consistent funding for smaller enterprise, kind of like Direct Board lite.

- cut off factor funding once a band or label has reached a certain level of sales or income. This would open up the FACTOR budget to more new projects.

- get rid of direct board approvals completely, make more money available for individual projects and allow people to qualify based on cumulative previous sales.

- get rid of FACTOR completely. Frankly it would better for small labels like ours not to have FACTOR exist it all, then have it exist in its current form. It would level the playing field (to a certain degree, all those previous FACTOR supported labels would have a bit of a market dominance) and make it so labels like ours wouldn’t be drowned out by heavily promo’d FACTOR supported releases.


  • RPP

    Have you read the new FACTOR program guidelines for 2013? Many of the things you wish for at the end of your article are already happening.

  • http://twitter.com/blackskyline Simon Becker-Sadava

    I was almost on board with you until your very last point: Get rid of FACTOR completely.

    If the objective is to be competitive with other labels, you’re doing it for the wrong reasons and you’re providing a horrid service to the bands you represent. All of these indie labels that get excessive amounts of funding started out as indie labels smaller than yours (Dine Alone w/ Alexisonfire, Arts & Crafts w/ Broken Social Scene, Nettwerk w/ Sarah McLachlan). The objective shouldn’t be to compete with other labels but to help your bands grow and, at the same time, grow with your bands. It’s a very natural process that involves growth based on realistic expectations.

    As for Direct Board Approval, that’s a grey area to me. I understand why labels get it (they’ve got a track record of working with bands to bring them to the next level where they’d be qualified for the grant) but it certainly is a dilemma when you’ve tied up a bunch of the available funding with established labels before anyone has gotten a chance to submit an application.

    The point you’ve missed is that the grants given to these established bands go towards helping more people than just the bands. Everyone from the people working at the venues to the music video crew benefits from that grant. Supporting the arts means you’re supporting the economy in a million different ways. It’s the reason government funded organizations such as FACTOR continue to exist.

    Either way, best of luck.

    • outofthisspark

      Thanks for the comment.

      The only thing I would like to point is that in a couple of those label examples the folks that founded those labels had a history of working at major labels already and already the insider connections to the music industry to certain degree. Not to discount what they accomplished, but those connections do help.

      Also in the case of most of the labels they were lucky enough to catch the tail end of the era of people still buying records. 7-10 year ago, an ‘indie’ release could sell 5000 copies but every year that number has become harder and harder to obtain. So if you happened to be a label that started from scratch with no industry connections in the last 5 years, the numbers were unattainable. That is why to a certain degree, direct board support is mostly the domain of labels that started 8-10 year ago. There are exceptions to that, but it is still overwhelming the case.

      And unfortunately very few bands on the label have gotten support from Factor at least on major level, they might get $1000 every couple years to go to a festival but haven’t been able to get access to the larger amounts that can help record and promote in a meaningful way.

      They have done well in jury programs such as OAC or Canada Council, but just like labels there is a very large segment of Canadian artists that also don’t get access to FACTOR. So for them if FACTOR didn’t exist it wouldn’t really impact them in any real way.

      But that being said I don’t want FACTOR to not exist, I want it to better.

  • David.

    I too run a Canadian Label and have been incredibly happy with FACTOR. I manage and publish artists of all different levels. Some of which do not qualify for FACTOR and many of which do.

    My company has likely received somewhere in the $100,000 range of FACTOR funding over the past 3 or 4 years.

    One thing that I find consistent in these articles, is that the authors may not have as much knowledge of FACTOR as they believe they do.

    I had a very hard time getting funding in the beginning, but then I signed up to be on the jury (like anyone else can) and began to see why I wasnt getting funded. It really does come down to a few things

    One of which is the quality of the band. There is a reason why FACTOR funds bands of a certain quality (judged by peers) and dont fund others. Its the same reason why a company has to be in business for 3 years before obtaining any funding.

    The reason is that FACTOR is in the business of funding the MUSIC INDUSTRY. Not funding people who want to be in the music industry.

    One of their desires, is to help Canadian bands reach international platforms. But I can plainly state, that many of the bands that submit to FACTOR are certainly not at the level for anyone to be investing in yet, and when they reach the level where they are ready – They will be very lucky to have access to FACTOR at that time.

    Also – I am well connected in the Canadian Music Industry and have seen an enormous range of people obtain funding. It is absolutely not locked into people that all live within 16km from the FACTOR office like noted in the other blog.

    However, I would also like to state, that Toronto is still very much the main hub of the industry in Canada, so it does make sense why so many labels (including my own) are in the vicinity of the office.

    I find it odd that FACTOR is being slightly blamed for putting around 18 million dollars a year into supporting the arts. 18 MILLION DOLLARS A YEAR.

    When I was not getting funded by FACTOR and all my applications were being turned down, I became more educated, found out what I was missing, talked with people at the office to find out how to create a stronger application, filed all the proper paperwork and put in the time.

    I would highly recommend that the rest of you do the same.

  • Demi

    Your post is spot on. The reality is that a group of well-connected players – managers, agents, label reps – et al are part of the circle-jerk that is called funding in Canada’s music industry.
    And, the essential nature of how things operate in this country will not be changed by some tweaking of the process at FACTOR. It’s about people, and ways of doing business, that are entrenched.
    So, all your suggestions for improving things are valid and worthy – including the truth that getting rid of FACTOR would benefit the majority of people. It’s nice to say the system can be fixed, but, it won’t happen, so, blow it up and start over.