On Monday, August 4, Derek Sivers sold CD Baby to the parent company of Disc Makers, a leading CD manufacturer headquartered in New Jersey. Sivers, the semi-legendary, occasionally controversial founder of successful Portland-based independent music retailer and digital distributor CD Baby, announced on his personal website what his company's employees had learned earlier that day—that CD Baby had new owners. Explaining his decision, Sivers cited his personal and professional history with and admiration for Disc Makers, his own managerial inadequacies, and his desire to move on and concentrate on developing a set of new services for independent musicians.
His tone was upbeat and forward-looking, and, in an attempt to preempt the inevitable wave of concern and criticism, he was quick to add, "The CD Baby staff, location, name, and everything else will stay the same, but I think you'll start to notice more attention given to improvements that help you sell more music."
When thinking about which people and institutions make up our local music community, we tend to focus on the relatively glamorous entities: bands and venues. However, just as critical to the health of our sonic ecosystem are the local businesses like CD Baby that not only provide services that facilitate music-making—instrument repair, disc duplication, printing, publicity, distribution—but also provide day jobs and living wages (often to musicians), pay Oregon taxes, and provide sponsorship funding for community arts projects and events. Given Disc Makers' status as an out-of-town corporate company (an East Coast, private equity group owns the controlling interest) in the same industry as local businesses like CDForge and Cravedog, hometown speculation rapidly commenced as to what practical changes we might see at CD Baby, in spite of Sivers' assurances.
To get their take, I spoke with some CD Baby employees, who generally seemed optimistic about their new situation and the interactions they've had thus far with the new owners. Additionally, Disc Makers President Tony van Veen answered some questions I sent addressing how his company's acquisition of CD Baby will affect Portland:
MERCURY: Will the brick-and-mortar part of CD Baby remain here in town, along with the jobs it provides?
TONY VAN VEEN: There are absolutely no plans to move CD Baby anywhere else.
How autonomous from or integrated with Disc Makers will CD Baby be?
It will be significantly autonomous. CD Baby will be run by the existing team, and will make decisions that are right for CD Baby. Disc Makers will not force CD Baby clients to buy CDs from Disc Makers, nor will it force its CD manufacturing customers to distribute with CD Baby. I will offer some high-level strategic oversight, but the team on the ground will be driving the business.
How do you plan to develop CD Baby's or Disc Makers' relationship with Portland?
I think CD Baby should be more involved with local events in Portland. While the company is a fixture in Portland, I believe we should have a higher profile locally than we do have. One thing we've been discussing with the staff is organizing an open house for musicians at CD Baby and having some bands play on the loading dock. We just have to figure out how to do this without any client CDs "walking out" of the warehouse.
Will Disc Makers be moving any of its operations to Portland?
Haven't decided. We may open a sales office now that we already have a presence here.