Crowdfunding and the democratization of the music market

Introduction

The phenomenon of crowdfunding (D’Amato, 2014; Scott, 2015; Sørensen, 2012) fits into the context of research on popular culture and the cultural production. The context was proposed by researchers of cultural studies and encompasses two key aspects. On one hand, crowdfunding creates new participation models for recipients which fit into the widely discussed subject area of ‘fandom’ (Hills, 2002; Jenkins, 1992; Galuszka, 2015a). On the other hand, it involves artists’ position in the changing model of production, promotion, and distribution. Democratization is crucial to both these aspects. As research in cultural studies shows, this is connected, in the case of fans, to the possibility of using popular culture for the creation of meaning within the ‘semiotic democracy’ (Fiske, 2010). For audience members, this means the ability to give their own meanings to texts and products so that they better serve their needs. This sometimes leads to creation of meanings which are in opposition to the original intentions of media producers. In the case of artists, the problem lies mostly in the transfers that take place in the system of production and work organization. Consequently, it also lies in how artists perceive their own role in relation to their recipients, other artists, and industry. As is the area of popular culture within cultural studies, the area of cultural production, which is exemplified by crowdfunding, should be perceived through both resistance and agency, and at the same time through incorporation and structure. Therefore, we can assume that cultural production in crowdfunding is not a result of folk culture; however, it is also not entirely dictated by capitalistic cultural industries (Storey, 2010: 4–5). Following Bannerman (2013), we suppose that crowdfunding may be a field for constructing certain forms of democratization and contributing to the transformation of the relationships that underlay the organization of the cultural production process. At the same time, however, we think that theses on the democratizing potential of crowdfunding should be supported by empirical analyses. This is of key importance in light of the short history of the analyzed phenomenon and the resulting insufficiency of such analyses.

In this article, we focus on the situation of artists and present issues connected with the new, supposedly ‘democratic’ environment of cultural production that has been created by crowdfunding. This democratization is supposed to result from the reaction to the fans striving for progressively more active participation in the production of texts and the aspirations of artists to have more creative autonomy and be independent from record labels, publishers, or movie studios. This does not necessarily suggest a drive toward the destruction of the cultural production system, but it changes the artists’ position and forces them to redefine their work methods. Thus, it is necessary for artists to develop competences and take over some of the tasks that are usually conducted by labels, such as gathering funds for recording sessions.

All of these factors combined may reshape the hierarchies that currently exist in the cultural production system, especially the division of musicians into celebrities and unknown artists, professionals and amateurs, and mainstream and ‘indie’. Taking that into consideration, this article attempts to answer the question of whether crowdfunding can help democratize cultural production (in the context of our empirical data, which concerns music). In our attempts to answer this question, we will use the model constructed by David Hesmondhalgh (discussed in section ‘What do we mean by democratization?’) broadened with a discussion about the current changes taking place on the music market (section ‘Democratization or precarization?’), as well as data from our empirical research (sections ‘Methodology and the object of study’, ‘The use of crowdfunding by the unskilled and underconfident’, ‘Collaboration and patterns of rewards’, and ‘Crowdfunding as a form of partnership between artists and contributors’).

What do we mean by democratization?

Analyses of the democratizing potential of crowdfunding should be preceded by an explanation of what is understood by ‘the democratization of the musical market’ or, in more general terms, ‘the democratization of the media’. Hesmondhalgh’s (1997) characterization of the democratic media system was based on research by, among others, Benjamin, Brecht, and Negt and Kluge, which indicates a relationship between analyses of the democratization of the media and ‘alternative media activism’ (p. 255; emphasis in original). This similarity, rather than being coincidental, stems from an understanding of the alternative media as representing opinions other than those dominant in the mainstream media and thus as fostering pluralism and democratization. ¹ However, alternative media aim not only to enrich the debate with different viewpoints but also to ensure that their voice results from assumptions they hold about their organization, production of content, and the participation and role of the audience, which are different to the assumptions held by the mainstream media (Bailey et al., 2007). Thus, if we accept the definition whereby the term alternative embraces a ‘range of media projects, interventions and networks that work against, or seek to develop different forms of, the dominant, expected (and broadly accepted) ways of “doing media”’ (Atton, 2004: IX), then crowdfunding can be said to have certain characteristics of alternative media. Nonetheless, it should be emphasized that the term ‘alternative media’ is defined in various ways, with some definitions accentuating their oppositionism and radicalism, as manifested, for example, in the opinion that alternative media represent ‘political and social doctrines that lie outside the defined limits of parliamentary consensus and debate’ (O’Sullivan et al., 1994: 10; emphasis in the original). This understanding of alternative media practically prevents most crowdfunding platforms, which are usually business projects rather than political ones, from being classified as such. Perhaps, it is more appropriate to regard crowdfunding platforms as independent media that exist

on a continuum between mainstream and alternative, operating on a sliding scale between dependence and independence, freedom and control, nonprofit and free market, center and margin: often invoking hybrid arrangements in order to continue to operate in the space between these other media sources. (Bennett, 2015: 11)

This approach suggests that there are many dimensions of independence: in some cases, ‘independent’ equals ‘alternative’, but in other cases, these two terms diverge. ² Similar diversification can be noticed in the case of crowdfunding. For example, D’Amato (2014) compares Produzioni dal Basso – a platform created by ‘people working in self-production and interested in hacking and copyleft’ (p. 141) with Sellaband – a platform founded by, among others, ‘two former Sony/BMG managers’ (p. 141). While both platforms constitute an attempt at organizing the process of cultural production that differs from the model of traditional record labels, the former seems to be closer to ‘alternative’ than the latter. Taking into account the diversity of crowdfunding, ³ we would like to avoid classifying all the platforms as either ‘independent’ or ‘alternative’ but assume that the democratization of media may be contributed to by entities that ‘exist – and produce – new hybrid arrangements that offer genuine – if not absolute – alternatives to the mainstream’ (Bennett, 2015: 9), even if they lack radicalism and do not necessarily define themselves as ‘sites of cultural contestation’ (Atton, 2002: 15).

Regardless of whether the media in question are alternative or independent, a number of key features can be indicated from Hesmondhalgh (1997) that characterize the democratic system of media production. First, he points out ‘participation and access’ as a rule associated with the opening of the production process to groups other than privileged professionals (not only competences matter here but status within a culture, such as gender, as well). Features that in the context of music can be considered democratizing include ‘recording technologies and the means of distribution through the Internet’, which make artists ‘no longer so reliant on the traditional institutions of the music industry to be productive’ (Leyshon, 2014: 151). It is worth noting that in this context, ‘productive’ denotes a greater ease of recording than before. This, as we shall show in the next section, is not tantamount to selling records or the ability to earn a living from music. The second significant feature of the democratic media system is the ‘decentralization’ of cultural production, which allows for the inclusion of areas that were once considered to be peripheral (Hesmondhalgh, 1997). An example of decentralization in the case of the music market may be the increase in the importance of centers that previously were not considered to be centers of the music industry or the popularization (thanks to the Internet and other means) of records by artists from smaller, non-English markets. Experience shows that decentralization, even within a single country, is difficult; resources are concentrated around the central offices of record labels, while ‘bands often relocate in order to be nearer to expertise and to escape the scene that spawned them’ (Hesmondhalgh, 2013b: 123). Empirical research has confirmed these observations, showing that the ‘traditional arrangements from the cultural industries, such as importance of geography, are to a large part reproduced online’ (Verbrood and Van Noord, 2016: 12). Third, collectivism, collaboration, and cooperation between media agents are all important parts of democratization that lead to more equal opportunities to acquire awards and status (Hesmondhalgh, 1997). In the case of the music market, this could mean the elimination of the ‘winner-takes-all’ effect (Towse, 2006), an economic phenomenon whereby a majority of the income from record sales goes to the most popular artists. Consequently, a more democratic record market would be characterized by a greater number of artists that could earn a living from selling their records and also by the development of new forms of cooperation between artists involving the participation of the audience (Galuszka, 2015a; Galuszka and Brzozowska, 2016). This would allow for the exposition of varied and innovative forms of art, and thus have aesthetic consequences (Hesmondhalgh, 1997: 256).

Although Hesmondhalgh (1997, 1999) refers to the example of independent post-punk record labels, we want to adapt the above model for the analysis of cultural production in crowdfunding, as we believe that it will potentially include the abovementioned elements. It is worth noting that when it comes to the democratization of cultural production, the relationship between the artist and the record label is a key issue. This creates two areas of possible controversy – one connected to financial issues and the other to artistic independence (Hesmondhalgh, 1997). Both of these are elaborated on in the discussion of a new ⁴ model of financing through crowdfunding. The model under consideration assumes that the introduction of a potentially more democratic model, created through close contact with fans during production, enables artists to gain independence from record companies. However, the next section quotes opinions about the democratizing potential of each innovation that have been expressed in recent years, which necessitates a more cautious use of the term.

Democratization or precarization?

The power of the largest record labels changed over the second half of the 20th century (Peterson and Berger, 1975). Nonetheless, most large record markets were oligopolistic, and new companies had to expend significant funds in order to enter the market and survive. This resulted primarily from concurrent economic conditions, such as barriers to entry and difficulties with market research. Barriers to entry forced companies to expend a significant amount of resources – understood as both funds and the building of a network of contacts – to promote and distribute their records. Due to difficulties with market research, which translated into a lack of data about the market potential of records to be released (Caves, 2000), companies were forced to distribute the risk over a number of projects by signing contracts with many artists, hoping that one of them would achieve a spectacular success and allow the company to cover the losses generated by less successful projects. The larger the record label, the easier it was to endure a series of failed projects before a successful one occurred.

Despite disadvantageous economic conditions, independent/do-it-yourself record labels, such as the British label Rough Trade, analyzed by Hesmondhalgh (1997) in terms of democratization, or hardcore/punk labels (Gosling, 2004; O’Connor, 2008) have played an important role in the history of popular music. The successfulness of independent projects varied; such labels frequently experienced periods of prosperity only to later fall into financial difficulties and/or begin cooperation with major record labels (Hesmondhalgh, 1999). Cooperation with the potentates would mean a loss of independence and would be regarded by a part of their previous audience as being a ‘sellout’. Consequently, as Bennett (2015) is right to note, ‘funding truly independent media away from either the market or the state makes independent media an inherently precarious enterprise, particularly if a large audience is sought’ (p. 9). Before the age of the Internet, it was even more difficult for musicians not involved with any label to release their records, and such records were released much more rarely than they are today.

Thus, it should come as no surprise that owing to the popularization of the Internet and the MP3 format toward the end of the 1990s, some researchers and commentators began to hope for the democratization of the music market. The phenomenon was to be achieved through the elimination of barriers to entry in the music market: lower costs of recording (thanks to software for recording music at home), the development of online distribution (thanks to P2P networks and online stores with music files), and lower costs of promotion (thanks to social networks such as MySpace and later Facebook). Optimists predicted that the combination of technological and economic factors would contribute to at least a partial equalization of opportunities for less popular artists (the concept of the ‘long tail’ by Anderson, 2008), the financial stabilization of independent artists (the concept of ‘1000 true fans’ by Kelly, 2008), and the inclusion of the audience in creative activities (the concept of ‘participatory culture’ by Jenkins, 2006).

While it cannot be denied that some of the optimists’ predictions have come true (see Anderson, 2014), the benefits of digitalization are distributed unevenly, and thus it is difficult to conclude that an unquestionable democratization of the music market has taken place. Very popular touring artists (Meier, 2015) and large corporations such as Apple or Google that entered the recording distribution market were among those who enjoyed the benefits of the ongoing processes (Hesmondhalgh and Meier, 2015). The increased availability of various musical offerings has also benefited the audience or, more precisely, those members of the audience who actively search for various records. The portion of the audience who is less interested in exploring musical niches still form a market supplied by major record labels, which maintain ‘crucial control over the marketing and promotion that will largely determine what music most consumers get to hear and know about’ (Hesmondhalgh, 2013a: 344). In turn, less popular or debuting artists experienced a phenomenon that Hracs et al. (2013) termed the ‘dilemma of democratization’: while it is easier to release one’s records, since the ease applies to all artists, the supply of music increases, and with it, competition. As a result, an increasing number of artists compete over the same (or, in some cases, lesser) funds that the consumers are willing to spend on music, and over the increasingly dispersed attention of the audience. In this situation, breaking through the noise requires funds for investment into promotion, most of which is in possession of the strongest players, that is, the largest record labels. This, on one hand, results in stricter competition on the part of artists over contracts with record labels and, on the other, forces most debuting artists to finance their ambitions from their own funds; as Meier (2015) notes, this ‘contributes to the prevalence of un- or under-compensated musical labor’ (p. 408). It is worth adding that the imbalance of power also applies to distribution: records can only be directly delivered to digital stores and subscription services by major record labels. The remaining labels and unsigned artists must hire music aggregators as intermediaries, which produces additional costs (Galuszka, 2015b). Consequently, overcoming the prevalent imbalance of power on the music market is almost impossible without funds that could be invested in the creation, promotion, and distribution of records. Thus, crowdfunding may appear as an alternative source of such funds and a phenomenon that could display a democratizing potential. The following sections of this article use empirical data to present the potential issues with this line of reasoning.

Methodology and the object of study

The analysis presented in the remaining part of this article is based on 30 in-depth interviews conducted with artists (musicians) who crowdfunded their projects on MegaTotal, the Polish-based crowdfunding platform. MegaTotal, which started in 2007, is the oldest crowdfunding platform operating in Poland. As of 30 April 2014, artists registered with the platform have managed to attract funds for the recording of 105 albums, the publication of one book, the organization of one live event, and the production of two music videos. Up until January 2012, MegaTotal concentrated solely on music-related projects, and despite its later opening up to other types of projects, it can still be considered to be above all a music-oriented platform. Thus, in order to contextualize the conducted research, a short overview of the Polish record market is necessary. In 2014, records amounting to USD79 million in value were sold, of which 18% were sold as digital copies and 71% were sold as physical copies (International Federation of the Phonographic Industry (IFPI), 2015: 81). These sales ranked the Polish market as 22nd globally. As with other European countries, major record labels control over 50% of the market (although no exact data are available, some sources estimate this share at 65%), while the remaining part of the market is shared by over 200 independent labels (Galuszka and Wyrzykowska, 2016). The records released by the latter part are in direct competition to those released by MegaTotal. As shown in the later part of this article, MegaTotal does not carry out all tasks traditionally attributed to independent labels; rather, its engagement in the promotion and distribution of records focuses primarily on the Internet.

It is important to note that communication between artists and contributors on MegaTotal is carried out using both the tools available on the platform’s website as well as other social networking sites such as MySpace or Facebook. Taking into account the use of communication tools, MegaTotal’s history can be divided in two parts. Until January 2012 project initiators communicated with contributors mainly via shoutbox, the forum, and mailing, which were embedded in the platform’s website. In January 2012, MegaTotal removed some of the communication tools from its website, advising project initiators to contact contributors via Facebook and other social networking sites.

What distinguishes MegaTotal from some other popular platforms, such as Kickstarter, is that it employs elements of the so-called ‘equity model’. This means that contributors who adopt a certain strategy and are lucky enough to support successful projects can count on making some profit. A full explanation of this mechanism is available in (Galuszka and Brzozowska, 2015; Galuszka and Bystrov, 2014a, 2014b). The study shows that in the case of MegaTotal, ‘the motivation of individuals involved in crowdfunding musical projects is complex. The dominant motivation is a willingness to help artists, but the investment motive also plays a role’. In other words, even though MegaTotal differs to a certain extent from Kickstarter when it comes to the method of accumulation of funds, a majority of its contributors are driven by fandom or a general interest in music rather than purely financial motivations. Since the empirical material upon which this article is based was gathered from artists (project initiators), the interviews focused on their relationships with fans (contributors) rather than the financial aspects of the process of crowdfunding (for this type of analysis, see Galuszka and Bystrov, 2014a, 2014b).

A total of 30 in-depth interviews, lasting on average 60 minutes, were conducted between June 2013 and September 2014 (see Appendix 1 ⁵ ). The interviews were transcribed (approximately 500 pages of transcripts containing over 252,000 words), coded, and analyzed. The interviewees were artists/musicians engaged in fundraising on MegaTotal, who in most cases succeeded in gathering enough funds to release at least one record (single, extended play (EP), or album). Almost all interviews were conducted with emerging artists with little or no history on the record market and varying amounts of live experience. They represented various music genres, with rock being the most numerous category. All but one respondent had concentrated on developing their careers in Poland.

The use of crowdfunding by the unskilled and underconfident

On one hand, crowdfunding enables the ‘unskilled and underconfident’ (Hesmondhalgh, 1997) and artists from outside the largest metropolitan centers to record albums despite record companies’ lack of interest in them. One of the respondents describes his surprise at the fact that someone liked the demo recordings that were presented on MegaTotal. He mentions that he observed the progress of the project with ‘disbelief, because the recordings were of poor quality […] that was gratifying for us at the time, that something was happening’ (Ag). As the band did not have sufficient funds to finance the recording themselves, a successful crowdfunding campaign was crucial to the creation of the album: ‘the money […] surely gave us a chance to record in a professional studio […] we wouldn’t have recorded it otherwise’ (Ag). On the other hand, the words of the same respondent show that the final results of such an enterprise can be disappointing:

It was the first time we recorded, we had no experience, there was no really good equipment […] We surely had no such thing as a producer. Such a person sits there and says ‘Okay, play this another way, play this like that’ and gives advice. (Ag)

These words show that the funds gathered by the band were not sufficient to pay for a producer’s service. There was a sound engineer in the studio, but he did not fulfill the creative tasks of a producer. Undoubtedly, the best solution would be to acquire a larger amount of money, but the band did not want to assume an overly ambitious target for the campaign for fear of being unable to reach it (which would mean returning the funds to the contributors and starting the campaign anew).

The theme of the presence of ‘people from the music business’ can also be noticed in the words of other respondents. They show that for artists who release albums on MegaTotal, the recording industry is a point of reference. In most cases, they (the artist and the ‘crowd’ supporting them) do not see themselves as forces working against the music establishment. In fact, it is quite the opposite – the views of industry representatives matter to artists, and the artists actively seek out their opinions. Here is one of the responses that confirm this:

For us, the album sounded well, because we were hyped: ‘cool, we’re releasing’, but in the opinion from the people in the business, more experienced after all, it didn’t sound well, so […] we had to do remixes. It was a like an additional expense, but eventually the record sounds practically ninety-five percent the way I wanted it to. (At)

Mentions of unsatisfactory quality of recordings due to the musicians’ lack of experience in a recording studio appeared in some of the other responses. The pattern was similar: first, the artists recorded their music, then they were confronted with the opinions of ‘people from the industry’, and after that they made attempts to improve their recordings with the help of those people. The resulting unexpected costs inhibited the realization of the budget that was set at the outset of the crowdfunding campaign.

Hesmondhalgh (1997) writes that the ‘professional world of mainstream media production places a premium on technical finish and excludes unskilled and the underconfident’ (p. 256). Thus, the release of albums thanks to crowdfunding platforms by artists who could be called ‘unskilled and underconfident’ could be considered a sign of democratization. The issue with this line of reasoning is that MegaTotal’s input into the appearance of such artists on the music market is not a result of any cohesive ideological proposition aimed at introducing greater diversity to the musical scene. Respondents who voiced their preference for a ‘do-it-yourself’ approach represented the individual stance of artists who used the platform not because they were looking for independence but because things happened just to turn out that way. For example, when the respondents spoke of a reluctance to participate in talent shows, this did not result from a conviction that the programs were ‘commercialized’, but from the fact that playing such a show did not benefit the band (although, obviously, there are exceptions, such as respondents who refused to perform on television because the producers of the show required them to use playback). In other words, most of the respondents use crowdfunding because they have no other way to release their recordings, not because they oppose the rules of the mainstream music business. Most of the respondents treat crowdfunding as one of many steps to a future career in cooperation with traditional record labels. Taking this approach into consideration, it is difficult to expect ‘aesthetic consequences’ (Hesmondhalgh, 1997) (that the products of crowdfunding are radically different from those of the mainstream music industry) from crowdfunding when it is conducted in this way.

Collaboration and patterns of rewards

In Hesmondhalgh’s (1997) model, ‘collaboration and co-operation amongst media workers’ should be reflected ‘in more equal patterns of rewards and status for participants’ (p. 256). Therefore, another factor that should be taken into account when analyzing the potential impact of crowdfunding is the possibility of enhancing the cooperation between the artists themselves. Democratization interpreted in this way not only allows for the inclusion of fan participation but also undermines the traditional division of musical artists into celebrities and (insignificant) lesser known artists or professional and amateur creators.

The answers provided by our respondents confirm that crowdfunding may be an effective tool for enhancing ‘the collaboration and co-operation amongst media workers’; however, it does not immediately lead to ‘more equal patterns of rewards and status for participants’ (Hesmondhalgh, 1997: 256). A number of respondents declared that they made interesting contacts with other artists on MegaTotal. Many such contacts simply ended up as conversations, but a few turned into artistic collaborations and led to joint concerts and even to the successful release of an album (also crowdfunded on MegaTotal). One of the respondents, a participant of such a collaboration, describes the MegaTotal user community in the following way:

Most of the contributors were artists themselves. A huge majority were people who had their own projects and it worked like a peer support group. (Ay)

Another respondent explains that an advantage of the artists’ community on MegaTotal is that by listening to an artist’s recording on the platform, it is easy to evaluate what they represent, and the tools available at the platform facilitate contact:

I decided that I want my songs to be remixed by people. And MegaTotal once again turned out to be a kickass place, because […] I sent messages to a few people who liked my music […] and four of them answered. (Aę)

Of course, any social networking site devoted to music could serve a similar purpose. However, it should be noted that in the case of crowdfunding platforms, there is the additional factor of gathering funds for recordings, which could result in the creation of a ‘peer support group’ (working by the rule, ‘I support your project, you support mine’) as mentioned by the respondent. Nevertheless, it is difficult to precisely assess the potential of this phenomenon on the basis of the empirical data from the study.

As mentioned before, cooperation between artists on MegaTotal did not fully lead to ‘more equal patterns of rewards and status for participants’ (Hesmondhalgh, 1997: 256). The analysis of the rewards and status of the participants in the case of MegaTotal is complex due to the difficulties of outlining the criteria for the measurement of the ‘patterns of rewards and status’. In the case of the traditional music market, the status of artists can be compared in a number of ways; however, the criterion of record sales is the most popular method (as Manfred Mann said, ‘The more people buy a record, the more successful it is – not only commercially but artistically’ (Frith, 1978: 202)). In the case of MegaTotal, this criterion is harder to use as the records released by the platform have not had high sales. Naturally, other criteria may be adopted: the time needed to gather the target budget, the popularity of a given artist in the discussion on the platform’s forum and shoutbox, and so on. These factors are democratic to some extent; they mostly depend on the effort of artists and fans in the promotion of the project during the fund-collecting phase. The problem is that the significance of these factors is relatively small compared to more successful sales which, as mentioned before, have not been achieved by any of the artists.

Crowdfunding as a form of partnership between artists and contributors

From the point of view of democratization, the most crucial proposal of MegaTotal was probably that there should be a common interest between project initiators and contributors that reached further than artist–fan relationships. The significance of the promotional engagement of the fans is described by Nancy Baym (2013), who comments on the phenomenon of illegal file sharing on the Internet:

[…] entrepreneurs have taken to heart that if their music doesn’t spread, it may as well be dead. The logic goes like this: We are small and have minimal budgets. There are few mainstream venues that will promote our music, so few people will have the opportunity to hear it through mass media. The more people who hear it, the larger the audience will become.

Henry Jenkins et al. (2013) comments on this by indicating the synergy melding the interests of small labels and unknown artists who want to be noticed, but have small budgets and cannot afford advertising, and, on the other hand, fans who want to make listening a community activity incorporating music into their own web identities:

In embracing spreadability, these artists are sacrificing some ability to shape and control the routes by which their music reaches the public. In return, their songs circulate among audiences they would never have come into contact before. (p. 235)

In theory, the situation looks no different from the perspective of the discussed phenomenon of crowdfunding. It is moving away from the promotion model based on ‘capturing the attention’ of consumers in favor of the user grassroots agency. The latter are not only a source of complete financing, but also it is through their activity on the platform and clear interest in the project through grassroots intermediaries that they play a role in promoting it.

In the case of MegaTotal, until January 2012 the abovementioned common interest of project initiators and contributors reached beyond the artist–fan relationship as contributors were receiving a share of the profits from the recordings after the recordings were released on the market. ⁶ The profits were proportional to contributors’ initial input to the project. This model assumed that a common interest, partially financial and partially resulting from fans’ motivations, would translate into the contributors’ involvement in the promotion of released records. However, the respondents’ replies reveal that the promotional involvement of MegaTotal users is not a sufficient substitute for the traditional methods of promotion.

The first problem that some of the respondents encountered was the fact that the relationships they established with contributors during the fundraising phase were too weak to result in a strong promotional impulse after the release of the record. The main reason for this is, it seems, the rather long period of time between the end of the fund-collecting phase and the release of the record. If the artist does not maintain a relationship with the contributors during that period, the fans may not feel obliged to participate in the promotion of the record after its release. In some cases, the artists’ relationships with the contributors dissolve almost completely. Consequently, the contributors not only refuse to take part in promotion but also do not contact the artist to voice their opinions about the final shape of the record. A disappointed respondent described this situation in the following way:

I expected that, you know, they’d start sending messages and at least say that they had expected something better, or that it’s cool. Like, you know, one sentence ‘nice, nice, I like it’. Or for example, ‘oh, this song is awesome’. (As)

It is difficult to generalize based on this individual case, as it could have been influenced by many factors (e.g. the artist’s lack of activity on the platform during the recording period) which may not have been present in other projects. However, it is worth noting that contributors’ lack of promotional involvement following the release of a record which was completed thanks to their financial input means that the promise of profits from sales does not motivate them enough to become active promoters.

The other problem that emerged was that even when the contributors and fans took part in the promotion of an artist’s recordings, it did not have a significant impact on the artist’s popularity. This may be caused by the fact that most of the artists who collected funds through MegaTotal were at an early point in their careers. Taking into account the fact that a debut artist needs extensive promotional funds, it is hard to expect the promotional activities of contributors to be enough to build an artist’s popularity at such a crucial stage in their career. These activities would surely be a helpful supplement to a label’s marketing actions, but MegaTotal, unlike a traditional record company, did not offer full promotional support to artists. Some of the respondents claimed that this was the reason for their disappointment in crowdfunding, while others knew that they could not expect the same things from MegaTotal that they could from a large record company:

I’m not sure at all if MegaTotal helped me with some marketing. They were working […] at their own portal […] they published information and supported us, and we were in contact, but at a wider scale they, well, at least I can’t recall, that they for example helped with something, with some organizational matter, concerts, or some interview somewhere or larger articles somewhere at other portals – I don’t remember anything like that. (Ak)

From the point of view of the discussion on democratization, the relatively weak promotional activities of MegaTotal are a key issue. The bold proposal of the platform’s founders that 50% of profits from record sales should be distributed to the artists and 50% should be distributed to the contributors left no share of profits for the platform. In effect, MegaTotal had no direct financial motivation to invest additional funds in the marketing of released records. Naturally, artists’ success benefited the platform’s popularity and drew the attention of new project initiators and contributors. However, this did not encourage investment in the promotion of certain albums in the same way that directly receiving a share of the profits would. We could therefore assume that the main advantage of the system proposed by MegaTotal, allowing fans to profit from the sales of records, was also a factor that limited the popularity of the released recordings. The assumption that fans’ promotional activities would work according to the proposals of Baym and Jenkins was not, in this case, correct, and the activity of fans was not sufficient for artists to achieve recognition on the national music market.

The problems presented in this article may be perceived in one more way. This is especially true when we take into account the case of an artist ⁷ who collected funds to release an album on MegaTotal but decided not to sign a contract with the platform after being offered a contract by a major record company. When analyzing this case, we may assume that artists who collect funds through crowdfunding platforms are observed by the representatives of traditional record companies. When such an artist has potential for commercial success, they are ‘pulled out’ from the crowdfunding platform by a record label. If this is indeed the case, then we can assume that if the most promising artists, from a business point of view, leave MegaTotal for traditional record companies, then the remaining artists have a low commercial potential, according to the recording industry. If this group really has lower chances of commercial success, then it becomes even more difficult to depend solely on fans’ promotional support. In conclusion, the democratizing potential of crowdfunding is limited by competition from traditional record labels which have the necessary budget and know-how. In other words, the crowdfunding platform experiences what independent labels have experienced for decades: when competing for artists, it is hard to win in direct competition with the largest record companies.

Conclusion

Despite its rising popularity, crowdfunding still remains a relatively new form of financing creative products, hence the uncertainties concerning its evaluation and the interpretation of the actions of the parties involved. The dissimilarity between crowdfunding and the traditional methods of financing the production of cultural goods suggests the potentially democratic character of the former, which allows it to be situated, from the perspective of media studies, closer to the interpretative areas of independent media and associated with the democratization of the media. However, it is worth pointing out that the institutional and economic conditions before the popularization of the Internet presented independent and alternative media with challenges different to those faced by crowdfunding platforms and the artists who use them. For instance, post-punk rock labels described by Hesmondhalgh (1997) treated democratization in ideological categories, that is, as a challenge to the mainstream media. In their case, this caused a range of internal contradictions related to the boundaries of artistic autonomy, the pursuit of profit, and the necessity of creating alternative stars. Some of these contradictions do not apply to MegaTotal: the developers of the platform have no direct influence on whose album they release (this is decided by users’ contributions), and the lack of a direct relationship between the income of the platform and album sales guards against the temptation to interfere in the final form of the releases (the artists enjoy full artistic freedom within their budgets). Due to the economic conditions for cultural production in the 1980s, the independent labels of the post-punk era had no such freedom. At the same time, however, the statement can be made that the effect of economic factors has raised the operational costs of these labels, which has translated into an ideological placement of the fight for the democratization of the music industry. MegaTotal has created a potentially democratic system for the participation of artists and their fans in profits from record sales that simultaneously does not make it its policy to challenge major record labels.

As a result, the ideological placement of crowdfunding in the area of independent and alternative media and, consequently, its clear association with ‘the democratization of the media’ raises certain doubts, as confirmed by our empirical research. Taking into account, on one hand, the political attitude and underlining of radicalism on the part of some independent and alternative media and, on the other, the character of the production process under the new model, it should be stated that crowdfunding presents itself as an ambiguous phenomenon. First and foremost, crowdfunding displays no elements of the radicalism that is associated with the pursuit of independence; on the contrary, artists who take advantage of crowdfunding underline their connection to the existing production system and their willingness to participate in the main circulation of cultural goods. Thus, crowdfunding appears as a ‘hybrid’ solution that to a certain extent fills the gaps in the dominant system but is not clearly identified with the political attitude of some independent and alternative media, ⁸ which, it should be emphasized, do not constitute an absolute alternative to it. At the same time, it is worth remembering that crowdfunding belongs to a wider landscape of changes introduced into the market of cultural goods by digitalization and the development of online forms of cooperation, creation, and sharing of content, as manifested in the term ‘spreadable media’ (Jenkins et al., 2013) that in principle includes meanings related to widely defined democratization. However, the development of these forms is accompanied by the numerous spectacular successes of crowdfunding campaigns that engage, in one manner or another, major media companies (Scott, 2015). This puts the ‘independent’ potential of the new model in question (even under the assumption that the model, rather than fully oppositionist, is hybrid in character) or raises concerns about its risk of being ‘taken over’ by the dominant system. Questions arise about the actual potential of transformations in the organization of the production of cultural goods, as well as to whom and to what extent are the benefits of the technological innovations that form the foundation of crowdfunding directed. Answering these questions could be the goal of future research on crowdfunding.