All Sales Vinyl

So when Michael Galinsky called me about insound.com, a site he touted as the coming "premier underground culture site," it was not hard to contain my enthusiasm. Galinsky, though, is not your average shill. The bassist for the late, indefatigably indie band Sleepyhead, Galinsky is also a photographer and filmmaker of some note. His 1995 Half-Cocked, made with wife and partner Suki Stetson Hawley, was a critically acclaimed and remarkably right-on story about a bunch of kids who steal a band's equipment and then are forced to tour to avoid being caught. Galinsky and Hawley's recent Radiation is also about the darker side of indie life; it focuses on a corrupt manager who takes his hapless charges' tour support money and buys speed, which he then sells throughout their tour of Spain. The films include performances by Come, Stereolab and Will Oldham, as well as members of June of 44 and Ruby Falls.

Still, I was skeptical when I met with Galinsky, now head of content development for Insound, at their well-appointed loft on Wooster St. What I found may be the best-kept secret on the Internet.

Depending on your perspective, Insound either has great potential for presenting indie culture to a much broader audience, or it's going to strip-mine what's left of the underground. A really content-rich site, insound.com contains a "Zine Stand" that has reviews and features from 50 unusually worthwhile zines like Badaboom Gramophone, Caught In Flux, Chickfactor and Puncture. Another 40 will be added shortly. The rapidly expanding video library just added eight rarely seen visual efforts by the seminal Fall, a self-shot performance by New Zealand's Clean and all those Touch and Go, Merge and Matador videos those labels continue to make even though they never get shown. There are also the inevitable online chats, which this week (Nov. 4) guests emo giants Promise Ring.

Free MP3 downloads include the twee pop of K Records' Crabs and the unjustifiably obscure dronecore of Japancakes. The site offers 300,000 titles, with an "Annex" selling 3000 (soon to be increased to 10,000) difficult-to-find 7- and 12-inch records, as well as self-produced and mini-label CDs.

The financial svengali of Insound is Christian Anthony, director of operations, a twentysomething who prior to founding the company worked for J.P. Morgan in both municipal and corporate finance. His punk rock credentials are also undoubtedly enhanced by the fact that he also serves as copresident of the Brown Club of New York. In an office where jeans and rumpled t-shirts are almost required, the well-groomed Anthony exudes the type of self-confidence that says that if anybody can put a potentially subversive subculture on a sound financial footing, he can. He points out that Insound's employees never actually touch a CD; like their competition, they work with a large one-stop distributor, Alliance, who sends the ordered product directly to the consumer.

Anthony concedes that from an e-commerce perspective most of what Insound does is not unique. Given a little Web architecture and a fax machine, he says, "If you look at the retail space, anyone can sell 300,000 records." What differentiates his company's revenue stream from the competition is that annex/indie product, plus the skill at niche-marketing via the content-loaded site. Pointing out that 70 percent of Insound's demographic is under 28 years old?and that since the kids have gone back to school, visitors to the site have increased to more than 10,000 a day?he chides the competition and explains why he believes that Insound will be around long after most other sites have spent themselves dry or been bought off by the leviathans.

"If you look at Amazon, at the end of the day they have over 11 million users in their database. They own the demographic, and they are going to monetize that in any way they want. It's the Wal-Mart model?you sell as much product as you can at the lowest margins to the most number of people, and at the end of the day you are probably going to survive on the basis of sheer volume.

"In the middle you have CDNow, who three years ago aspired to be everything to every music fan, but now, when the Amazons get in, CDNow has no reason to be. Then at the other end of the spectrum you have Insound, who say that we're going to ignore 80 percent of the market but do good by the other 20 percent of the market."

He may be overly sanguine as to the size of the market for indie rock and experimental music; still, the Internet will decisively prove or disprove over the next five years whether the masses will actually buy "the good stuff" if it's mass-marketed to them online. And unlike the regular catalog, which has a 10-15 percent profit margin, the way-underground stuff carried by the Annex has a margin of a whopping 40-50 percent.

"You sit in a meeting with a bunch of capitalists and they want to know, how is your technology?" Anthony quips. "Do you have the highest quality digital downloads? And our answer is that 30 percent of our sales are 7-inch and 12-inch vinyl records."

Having founded Insound on what he calls "angel money" from friends and family, Anthony predicts that it will be in the black by 2001. He isn't only depending on singles to do the job. He plans to make the company a distributor in its own right. Pointing to the boxes and shelves of product for the Annex that are stored at Wooster St., he says, "I bet that 80 percent of our revenue comes from 10,000 products. What we should do is buy those products ourselves and eliminate the distributor. But we will also keep our relationship with Alliance, so if you want an old Rolling Stones CD you don't have to leave the site."

Anthony sees content licensing as another future revenue stream, and predicts that larger sites will want to license the Zine Stand, the videos and the chats. "When it comes to underground content, we're doing the larger sites' work for them." He is also confident that now that Insound is beginning to be able to show numbers, advertisers won't be far behind. "Insound can deliver the underground community to a bigger audience. AT&T and Levi's will love us." But then he adds, "There are issues on our side of brand credibility and whether we would want to do that."

Anthony explains that "We are a music-driven site, but one that recognizes that tastes in music fuel tastes in film, literature and art."

That's where Galinsky comes in. He originally contacted Insound with photos of indie bands, which they agreed to put on the site. He has since introduced the company to the world of independent film. Insound is now partnered with the New York Underground Film Festival. "We will try and sell the films they show now directly to consumers," Galinsky says. "Filmmakers will see immediate benefits, instead of having to maintain this hope that someday they'll get distribution."

Galinsky talks about hooking up with small presses and beginning to have text and downloads as part of the site as well. And, not surprisingly, Insound has just founded its own music label, tiger style, with a roster of five as yet undisclosed bands. It has already been pressing its own CDs as part of a tour-support series, a novel idea Galinsky brought with him to the company. The notion is to back bands on the road with monthly releases of EPs; pressed in small batches of 1000, the company keeps 500 to sell online and gives the remainder to the band. Participating bands have ranged from the avant-rock June of 44 to the Christian-influenced Soul Junk and Danielson Family and the post-rock Spaceheads.