The Nature of the Deal

My sister’s oldest daughter is a successful music writer here in Los Angeles. She got to ride around on Rihanna’s 777 plane last year, goes to all of the big music events and festivals and gets opportunities to hang with the big stars on occasion. She wrote a review of the solo Neil Young concert the other day and posted a note on her FB page. That’s how I hear about it. Who knew that Neil was doing a nationwide tour by himself? You can read her article at the Hollywood Reporter website.

I actually secured a couple of tickets for the show this evening…a sort of self-funded post birthday present. You’ll be able to read my review tomorrow. The kind of performance that Neil is doing this evening would make a perfect high-resolution 3D Blu-ray disc. I’m sure they’re recording all of the shows but I doubt they’re doing it with fidelity in mind. We’ll see what becomes of it. For those of you who have heard my recording of John Gorka singing “Italian Girls”, you know what’s possible with the right motivation and techniques. Just imagine a solo Neil Young concert recorded that way!

As I was reading the review by Emily Zemler in the Hollywood Reporter, I noticed a link to another article about the Pono KS campaign entitled, “SXSW: Neil Young Introduces Ponos to the World — While Its CEO Raises Some Eyebrows“. The “raises some eyebrows” made this a definite read.

After the normal Neil speech about getting back to the “soul of music” and the magic of 192 kHz/24-bit PCM, a member of the audience asked CEO John Hamm, “What’s your cut?” To which he responded, “It surprises most people that everyone who buys music from the record labels pays exactly the same amount.” This was the moment that things fell apart and the Q&A session abruptly stopped, according to the HR piece.

As someone that has spoken to the major labels and has actually seen the deals that are offered to high-resolution music download sites (including the upcoming project in October), I can tell you that John Hamm was exactly right when he responded.

Apple’s iTunes set the “distribution” percentage at 30%. When I get a monthly statement from iTunes, Apple keeps 30% of every dollar. By way of comparison, when I sell a Blu-ray disc through Amazon, the distributor and Amazon keep 55%…a much steeper cut.

It’s kind of like Tesla selling their cars directly to consumers (except in New Jersey and a couple of other states, which require you to purchase cars through dealerships). The people making the records or cars always do better selling directly. That’s why I encourage my customers to purchase from AIX Records and iTrax…I become the retailer and get to keep more of the money.

In fact, iTrax pays our affiliate labels between 70-80% of every dollar. The distribution percentage seems reasonable to me…and I think Apple and iTunes are pretty much in line. The labels and artists are getting a much better deal from them than they are from Spotify and Pandora.

But when John Hamm says that “everyone who buys music from the record labels pays exactly the same amount”, he’s right. The major labels have licensing departments and they are making deals with HDtracks, SuperHiRez, HighResAudio and Ponomusic at exactly the same amounts. I’m sure some of the advances and guarantees are different but they control the cost of the content. How much Pono or HDtracks puts on top of those amounts is up to them. But there is tremendous pressure to keep the money flowing back to the labels because the deals mandate a certain minimum guarantee. That’s part of why I can’t go there.

How many “high-resolution audio” download sights can the business sustain…especially if 90% of the content being offered isn’t high-resolution but merely transfers of CDs or third generation analog tapes? That’s why iTrax will offer limited content but all of it at reference quality personally verified and approved by myself.


Mark Waldrep, aka Dr. AIX, has been producing and engineering music for over 40 years. He learned electronics as a teenager from his HAM radio father while learning to play the guitar. Mark received the first doctorate in music composition from UCLA in 1986 for a "binaural" electronic music composition. Other advanced degrees include an MS in computer science, an MFA/MA in music, BM in music and a BA in art. As an engineer and producer, Mark has worked on projects for the Rolling Stones, 311, Tool, KISS, Blink 182, Blues Traveler, Britney Spears, the San Francisco Symphony, The Dover Quartet, Willie Nelson, Paul Williams, The Allman Brothers, Bad Company and many more. Dr. Waldrep has been an innovator when it comes to multimedia and music. He created the first enhanced CDs in the 90s, the first DVD-Videos released in the U.S., the first web-connected DVD, the first DVD-Audio title, the first music Blu-ray disc and the first 3D Music Album. Additionally, he launched the first High Definition Music Download site in 2007 called A frequency speaker at audio events, author of numerous articles, Dr. Waldrep is currently writing a book on the production and reproduction of high-end music called, "High-End Audio: A Practical Guide to Production and Playback". The book should be completed in the fall of 2013.

12 thoughts on “The Nature of the Deal

  • April 1, 2014 at 11:52 am

    To play music from iTrax on my stereo with my Mac Book Pro as the source, what music playing program do I need?

    • April 1, 2014 at 12:57 pm

      You can use iTunes on your laptop. Just set the Audio/Midi Setup to 96 kHz/24-bits. You’ll be able to experience full high-resolution in stereo. You can also use Amarra, Audirvana and others.

  • April 1, 2014 at 1:06 pm

    The only problem I have is you do not have any music I listen to , which is a shame as I am all for what you are doing.

    • April 1, 2014 at 1:19 pm

      I can appreciate that our artists are the biggest stars but we do have music across a very wide spectrum…from fusion (Carl Verheyen), blues (Steve Pierson) to country, jazz and Latin.

      • April 1, 2014 at 1:57 pm

        Thanks for the reply . Some artists that I listen to are
        Amos Lee
        Beth Rowley
        Logan Vath
        David Ramirez
        Keith Greeninger
        Eric Bibb
        Gregory Alan Isakov
        Hope waits
        The Pines
        And a few others
        But these people do not use you for recording , which is a shame

        • April 2, 2014 at 9:45 am

          I only know a couple of the artists on your list. I’ll have to do some investigating. Thanks

  • April 3, 2014 at 6:43 am

    >>especially if 90% of the content being offered isn’t high-resolution but merely transfers of CDs or third generation analog tapes<<

    So, if a download is based on a transfer from a non-high-resolution source (e.g., analog tape – regardless of generation) is there ever a reason to warrant paying for a download file with resolution greater than, say, 44.1/16bit?

    • April 3, 2014 at 4:23 pm

      There might be some benefit from going up a notch or two. If I get the analog masters from the labels, I will transfer things at 192 kHz/24-bits although I believe that 96 kHz would be ideal.

      • April 5, 2014 at 5:57 am

        So, here we go. Just read a review of Mile Davis’ Kind of Blue in The Absolute Sound magazine (April 2014, p. 156). In addition to a few CD versions, the reviewer also critiqued three hi-res downloads: (1) 96/24 from, (2) 192/24 also from, and (3) 192/24 from

        The reviewer concluded that the 96/24 was good but, slightly less pleasing than one of the CDs. And, that it wasn’t until he listened to the 192/24 versions that he was hearing something really special. He gave the edge to the SuperHiRez download commenting that “the instruments cross an invisible threshold; they simply sound right “.

        Well. If you read the description of the digital transfer process on the HDTracks and SuperHiRez sites, it’s pretty clear that they’re working off the same 192/24 transfer, which used the original analog session reels and was remastered by Mark Wilder and Steve Berkowtiz.

        So, how in the world could the reviewer pick a clear winner from what would appear to be the exact same 192/24 transfer? And, how could the 192/24 version of a 1959 analog tape be so clearly superior to the 96/24 version – especially when they’re based on that same transfer? Am I missing something here? Or, are the download sites just looking to score a few more dollars from their more gullible customers? And what does that say about the hearing abilities over at The Absolute Sound?


        (BTW, I have the 96/24 download. The work done to archive, preserve, and remaster the original tapes is excellent and so is the download. It’s the 192/24 version(s) and review that mystify me.)

        • April 5, 2014 at 6:46 am

          I’d have to investigate a little, but I had heard that Chesky (HDtracks) did a new transfer of the analog master using the Plangent Process…which is a really interesting strategy for optimizing speed stabilization AND removing scape flutter. I don’t believe that SuperHiRez did the same thing. There is a possibility that the 96 and 192 would sound different depending on whether they were transferred at the same time or somehow remastered differently. There is no high frequency information in the 192 kHz version that isn’t in the 96 kHz. This is all about reselling the same old stuff one more time.

          I can’t comment on the TAS writers…this is their business and they have a motivation to keep the audiophile world interesting. I can say that there is a LOT of misinformation and snake oil in the audiophile world.

          • April 5, 2014 at 10:51 am

            What leads me to believe that both sites are offering the same transfer is that they both describe their downloads as having come from the following process, as quoted from SuperHiRez:

            “The three, 3-track, half-inch tapes from the original 1959 recording sessions are in good condition, but tapes of their age were not made for the success and spread of the music of Kind of Blue, and repeated usage, Berkowitz explains. Thus, the imperative to be as precise as possible to replicate fully the magic that is Kind of Blue.

            The archiving was done at 192kHz/24 bits, played from a modified Ampex ATR 104, and hard-wired to HDCD Model 2’s directly patched to a Lynx 2 sound card.

            An upside to working from the archive files was the ability to chase the original fader moves done during the mix in 1959, Mark Wilder, of Battery Studios, the engineer working on the project says. “We constantly compared to an early pressing – mono and stereo – and worked bar by bar to duplicate the level moves on the three tracks to match as well as possible.

            Each channel was converted to analog and passed through a GML mixer, bussed to stereo or mono – depending on the release format – and converted once again to 192Kc/24 bits. At the GML, we inserted processing where needed.”

            HDTracks offers *exactly* the same verbiage on their site – for both the 192k and 96k downloads. (They also have a very nice video of Berkowitz and Wilder talking about the process.) So, I’m guessing that both sites are offering the same transfer unless there’s some other tweaking that gets done outside the process described above?

            Anyway, I have no issue with two sites offering the same download; a little competition is a good thing. I was reacting more to the notion that the review in TAS, claimed a big difference between the 192k and 96k versions – which makes no sense given the provenance of the downloads – and that one site’s 192k version was markedly better than the other’s – which makes no sense if they are in fact the same transfer.


          • April 6, 2014 at 5:39 am

            There could not have been a great difference.

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