Weekly Wire
Austin Chronicle Vertical Integration

By Michael Bertin

OCTOBER 13, 1997:  It started with one man who wanted to put albums from his own label into the store where he worked. A mere eight years later, his is a business in which sales have grown by 4,000% and several million units are moved annually. Better yet, it's a business that works with hundreds of artists and thousands of retailers. And now they are in Austin. The business is Dallas-based Crystal Clear Sound and the man is its owner Sam Paulos, who says he's been trying to open shop here in Austin for a while. To hear him tell the story of how Crystal Clear came to open a satellite facility here in town a couple of months back, though, sounds a little more like one of those Slacker re-run segments MTV recently started airing than the fulfillment of a lifelong ambition. "Well I've been meaning to do it for a couple of years, but I got distracted," says Paulos. "I'd thought about doing the Austin thing for a while, but essentially just didn't have the time or didn't take care of it."

That's unfortunate, because the "Live Music Capital of the World" could use more places like Crystal Clear, a sort of one-stop shopping mart for bands wanting to put out their own release. At the Dallas facilities one can literally walk in with nothing but songs and instruments and leave with full CDs and cassettes ready to be shipped to retail. This probably won't happen that same day, but you get the gist of it; there's a recording studio, mastering facilities, and an art department. When all that's done, Crystal Clear can put your music on cassette or CD, shrink-wrap it, and send it to Blockbuster or Best Buy.

The Austin operation of Crystal Clear is a bit more modest, capable of doing tape duplication runs of up to 250 and small CD runs of up to about 25 or so (everything beyond that can be sent to Dallas through the local office), but it's a similar operation. Still, why open a branch in Austin if that's all you can do?

"This office is trying to be support -- obviously in sales -- but graphics and art is our biggest area of support that we are trying to provide people," according to Matt Wiedemann, manager of the new Austin office. Art may not seem that important, but the truth is that it's essential to professional-quality finished product. You don't go to the store and buy a plastic disc. You go to the store and a buy a plastic disc in a handy jewel or cardboard box with pretty pictures on it.

Since getting artwork done involves a lot of back and forth between the musicians and the graphic designers, having one place were both parties can collaborate is convenient. With musicians and bands being able to sign off on final color proofs -- on-paper examples of what the final tray cards (those things inside the back cover of the jewel box) and inserts (those things inside the front cover of the jewel box) will look like -- rather than having to either physically go back and forth between Austin and Dallas or ship stuff back and forth from Austin to Dallas, the margin of error is greatly reduced.


Tape duplication at Sound Recorders

photograph by Todd V. Wolfson


For Danny Gillespie of Cold Spring Records, whose roster includes country singer Chris Wall and hick rockers Reckless Kelly, Crystal Clear's local operation "made a big difference" in getting things done without a hitch. "Everybody's got their own view of what the colors should be," says Gillespie. "I've had stuff done where I've looked at the proofs on screen, where the color was supposed to be corrected, and then had it printed out with real funky colors. [This operation] made us more comfortable. You're not sitting there sweating for three weeks wondering how your art is going to come out."

That kind of convenience may be an extra, but it's not a luxury. Artwork is often a band's only chance of catching a buyer's eye, especially for a band self-releasing an album or releasing it through an indie label with limited marketing resources. In fact, graphics matter so much that Paulos figured they were one of the best reasons to enter the Austin market.

"Actually looking at the numbers, it surprised me how little business we're doing [with Austin-based acts]," says Paulos, "and I think that was one issue -- that there really wasn't anyone in Austin to usher a customer through the process, show them what the graphics were going to be like, show them what the volume mastering needs to be like, all that kind of stuff. They had to do that by phone instead, and I think that was somewhat of a deterrent."

So, with all of its size and services Crystal Clear is the 2,000-pound gorilla poised to pound the competition into a hapless pulp. The local yokels must be terrified by the behemoth from up the interstate coming into town, right? Wrong. When asked point blank if he's nervous about Crystal Clear's setting up shop in town, Basil Thomas, the head honcho at Austin's Sound Recorders fires back without hesitation, "Definitely not."

Save for some vertical integration -- a studio on the upstream end and distribution on the downstream side -- Austin's Sound Recorders does what Dallas' Crystal Clear does. But whereas Crystal Clear just got to town, Sound Recorders has been here for 25 years and Thomas figures that kind of local history is itself a valuable commodity. "One thing that we have is that we've been doing this stuff for a long time here in Austin," says Thomas. "I think there are a lot of people we've done business with here that will continue to come see us."

Like all good stories, ours of the new beast on the block and its fearless adversary has a twist to it. Wiedemann, the manager of Crystal Clear's Austin operation, used to work for Thomas over at Sound Recorders, a job he recently left to work for Paulos. It's a situation that has made for polarization between the two entities beyond what might be expected from a healthy business competition.

What Wiedemann did, however, has an impact on both operations beyond just a personnel change. Cold Spring's Gillespie actually did Chris Wall's first album with Wiedemann when he was at Sound Recorders. And that's why Gillespie is now taking his business to Crystal Clear. "Matt was great there [at Sound Recorders] and that was part of the reason that we were happy to deal with him when he moved over to Crystal Clear," says Gillespie.

Thomas, for his part, doesn't appear to be dwelling on or pouting over the defection. As he claims, "I'm not interested in making this a negative thing toward Matt. He did what he has to do and now I've got to do what I have to do." And what is that? Compete.

The thing is, despite what your ears tell you, CDs and cassettes are pretty homogenous products. For a batch of 1,000 CDs, both places are charging figures within $10 of each other; Sound Recorders lists 1,000 discs at $1,280 while Crystal Clear will manufacture that same number for $1,290. Midwest Records, another Dallas operation, lists 1,000 CDs at $1,290 as well. The prices are almost identical because the manufacturing process is the manufacturing process is the manufacturing process.



Tape Duplication at
Crystal Clear Sound
photograph by Todd V. Wolfson

And what exactly is that process? Say you're in a band and you want to make an album. First, you write some songs and record them. After you're done recording them, you get your master, which is a gold CDR (a recordable CD) with all of your digital info on it, to the manufacturer. That CDR gets mirrored onto a piece of glass (cleverly called the glass master). From that, a metal stamper gets made, and it's from that stamper that your CDs are manufactured. A liquid plastic is poured into a mold in which that piece literally "stamps" the rapidly hardening plastic. You've now got a disc encoded with ones and zeroes, the bit information your CD player's laser reads. You couldn't play this disc, though.

If you put that piece o' plastic into your disc player at this point, the laser would fire straight through the sucker. Compact discs are silver for a reason. That silver coating is there to reflect the laser so that the encoded info on the CD can be read by your machine. After the silver coating, another protective coating is put on. After that, artwork can be silk screened onto the disc itself.

It's still not done, though. Again, you don't go to the store and buy plastic discs. You go to the store and buy plastic discs in handy jewel or cardboard boxes (and here's the important part) with pretty pictures on them. This is one of the areas where one-stops like Crystal Clear and Sound Recorders can compete -- artwork, design, and production services and costs. Well, actually it's probably more just "costs" than "services" as both Crystal Clear and Sound Records have all of the necessary facilities on site to handle any artwork job at any stage of development; technically, Crystal Clear doesn't do the film on site, but the printers they use are literally feet away in the adjoining building.

Beyond that, if for your given job you still don't find much price differentiation, then it's largely a question of where you want your money to go. Neither of the two big guns actually uses its own manufacturing facility, because neither has its own manufacturing facility, as such a facility requires a few million dollars in start-up costs for capital equipment. Each entity contracts with a manufacturer.

Sound Recorders does its manufacturing through Sony in Terra Haute, Indiana; the rest of the process, putting the artwork in the jewel box and shrink-wrapping it, is done in town. Crystal Clear uses a company called Disctronics in Plano for the entire process. If you're making tapes, the whole process is a little different. Both places can do small duplicating orders in-house, but for manufacturing of large orders (where the tape is cut to length and inserted into an empty cassette shell), Sound Recorders does those on site while Crystal Clear sends those orders to Dallas.

There are a handful of other service considerations. Sound Recorders will master your stuff, Crystal Clear won't (not in Austin, anyway; they will in Dallas). Crystal Clear will burn small orders of CDs, where a machine literally burns the information onto a recordable CD one CD at a time ("one-offs"), Sound Recorders won't. Etc., etc.

In terms of quality, both companies have good reputations. Even though Gillespie jumped ship and took his Cold Spring business to Crystal Clear, he says he has "no real complaints with Sound Recorders." Jeff Cole at Doolittle Records was one of the first to use the then-brand-new local Crystal Clear offices to do artwork on the Slobberbone EP, and he was "extremely pleased with the printing." In fact, about the only complaints lobbied at either organization were by people claiming to have some qualms with Crystal Clear's distribution -- getting stuff into stores -- but distribution has little to do with manufacturing or developing and printing artwork.

In the end -- and beneath all of the differences -- it all boils down to this: An established company has opened up an office in town. Big deal, right? Even if you're a musician, all these details and distinctions most likely bore the heck out of you. You probably don't care where your money goes geographically, or whether you have to walk across the street to look at the film for your artwork or not. These might not be great concerns of yours.

It could be that all you care about is getting your CD or cassette made, having it look good, and most importantly, getting it done as cost effectively as possible. Well, if I were a musician in town, and I had just finished recording and mastering an album and was looking to get it put on disc or tape, I'd think that the Thomases'/Sound Recorders' claim that they "will not lose a job on price" probably runs up against similar claims by a former employee at Crystal Clear. That being the case, I'd be all wet with excitement. n Crystal Clear Sound, 404-A Baylor Street, Austin, TX 78703, 512/320-0696; Sound Recorders, 4031 Guadalupe, Austin, TX 78751, 512/454-8324


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