David Letterman launches record label
David Letterman waves during a taping of the "Late Show with David Letterman" in New York.
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Tess Vigeland: The music industry has struggled for years to figure out what its next business model is. iTunes went a long way toward solving that whole downloading problem. But when it comes to introducing new musical acts, television's been playing a big role.
The CW network made music a hallmark of many of its programs, especially teen soaps like "Dawson's Creek" and now, "Gossip Girl." And then there's that small outlier on Fox called "American Idol." Now David Letterman is taking it a step further, teaming up with Capitol Records to start a record label.
Marketplace's Alisa Roth reports.
ALISA ROTH: David Letterman is not out to redefine the recording industry.
Tom Keaney is spokesman for Worldwide Pants, Letterman's production company. He says this is just a little side project.
TOM Keaney: There's no grand plan here, but we have a history of making investments to help develop entertainment and entertainers that we like. And every once in awhile, like with "Everybody Loves Raymond," we end up with something successful.
David Letterman obviously doesn't need a record label to make money, or a name for himself.
Russ Crupnick is an entertainment industry analyst at NPD. He says it's an entirely different story for an up-and-coming artist.
RUSS CRUPNICK: The likelihood of a band to be able to walk into the offices of a company like Capitol and getting signed these days and getting tour support and getting all the investment that's needed are very, very slim these days.
He says getting an endorsement from Letterman could really make a difference.
David Herrera is a professor at Belmont University. He teaches classes on the music business there. He says TV can launch music careers, just look at "American Idol." But there, the artists are doing more than just singing on TV.
DAVID HERRERA: You have a whole back story and a whole season of getting to know an artist personally, so you kind of know who they are, and their story, their family, and how they got there, so you buy their product.
And he says even there, they usually fade away after a year or two.
For now, Worldwide Pants is working with three artists. The first album, from a band called Runner Runner, is due out in late summer.
In New York, I'm Alisa Roth for Marketplace.