CD Baby - History

History

CD Baby began with its founder, Derek Sivers in Woodstock, New York. Sivers was a musician who created the website to sell his own music. As a hobby, he also began to sell the CDs of local bands and friends. He chose to make CD Baby a "utopian" online store for independent musicians. To do this, Sivers followed principles based on his personal preferences:

• The musician will be paid every week
• The musician will get the full name and address of everyone who purchases their music (unless they opt out)
• The musician will never be removed from the system for not selling enough

In addition, Sivers made sure to listen to every CD he sold (currently several people are employed to do this). The operation was run mainly in Sivers' bedroom.

Sivers, eventually hired John Steup as his vice president and first employee. In an interview, Sivers recalls saying to Steup: "This thing might get huge one day. I mean, we might have 100 artists here."

Steadily, CD Baby grew as more artists wanted to sell their music through the website. Sivers and his employees always dealt with the artists directly.

Beginning around 1999, Sivers oversaw expansions of his roster with such collaborations as the one with Oasis Disc Manufacturing President Micah Solomon, where Sivers partnered with Oasis Disc Manufacturing to distribute the complete Oasis artist roster at the CD Baby store (an arrangement still valid currently).

CD Baby was somewhat inspired by a website named Songs.com founded by Paul Schatzkin, Tom Kimmel, and Michael Camp. Songs.com, though not having the nonexclusive policy CD Baby does, was also a website that sold primarily independent music. However, ten months after Songs.com was sold to Gaylord Entertainment for $3-million, Gaylord folded all its digital initiatives, including Songs.com. Schatzkin would then send an email to members of Songs.com, recommending CD Baby. Schatzkin was also the instigator of CD Baby's toll-free phone line, "1-800-BUY-MY-CD."

Sivers never accepted money to advertise a CD more than any other CD and didn't negotiate with investors or display advertisements. Currently, there are one hundred or so employees of CD Baby whose work ranges from warehouse work to programming to business development to customer service to listening to CDs.

Although the majority of artists who use CD Baby are North American, about thirty percent of orders for CD Baby are overseas.

In 2003, Sivers won a World Technology Award for Entertainment.

In 2004, CD Baby began offering a digital distribution service. By opting in to their digital distribution service, artists can authorize CD Baby to act on their behalf to submit music for digital sale to online retailers such as Apple's iTunes, Emusic, RealNetworks' Rhapsody, Napster, Amazon MP3, MusicMatch, Didiom, and MusicNet among others. Songs on CD Baby are now also available on Spotify.

In August 2008 it was announced that Disc Makers, a CD and DVD manufacturer, bought CD Baby (and Host Baby) for 22 million dollars following a 7-year partnership between the two companies, according to Sivers.