by T.M. Wolf

“I’ll Sell it Out the Trunk and Make a Mil’”

Hip-hop, as any number of industry executives, gaudy videos, and endlessly self-referential rhymes will tell testify, is big business. And yet, even with its fabled rise “from ashy to classy” – leapfrogging from ghettos to rural hamlets and back again, from New York to Los Angeles, Atlanta to Houston, and all points in between – hip-hop has retained its status as Public Enemy #1: the subject of endless crusades, tirades, crackdowns, and lockdowns. Just ask DJ Drama and DJ Cannon, two prominent Atlanta-based DJs and radio personalities who spent the evening of January 16 this year cooling in sheriff’s custody on racketeering charges. The early-morning SWAT raid on their Gangsta Grillz mixtape operation – the culmination of an investigation supported by the Recording Industry Association of America – did more than confirm the high stakes involved in hip-hop’s newest, most dynamic addition, the informal mixtape economy: it solidified hip-hop’s long-running status as America’s most policed art form.

By now, the fine details of the Drama-Cannon incident have been well documented (see Samantha Shapiro’s “Hip-Hop Outlaw (Industry Version)”, New York Times Magazine, 18 February 2007). While many questions have been asked (who’s to blame? what laws were broken? how much money’s at stake? who called the cops?), the two most important haven’t: How did the industry get to this point? and What does it all really mean? The answers to these questions are about as straightforward as a Teflon-clad county sheriff clambering through your recording studio’s back window. The mixtape is part of a much larger story that intertwines policing, graffiti, resistance, globalization, “informal” economies… and, of course, rapping.

In this and a set of follow-up essays, I’ll pull the various different threads apart, and peer closely at the historically tense relationship between hip-hop and law enforcement regimes, mixtape metaphors, and the political potential (and actuality) of mixtapes. For now, though, some words on what mixtapes are, why we should look at them from an economic, rather than just a legal, point of view, and a theory about why they’ve become such a formidable industry. As it turns out, even iced-out rappers with 60-inch plasma screens you can view from a side angle and cribs so big you can get lost (like the Bermuda triangle) aren’t much different from the uninsured moonlighter in New York City or the scrap-metal-salvager in Mumbai. As they can all tell you, obtaining, maintaining, or regaining a livelihood in today’s world frequently requires stepping outside the bounds of the normal, formal workplace. To greater or lesser degrees, they are all implicated in the informal economies that form significant, and growing, portions of productive activity around the world.

Anatomy of a Mixtape
While, in the days before digital reproduction, mixtapes were literally tapes, the term “mixtape” has survived in hip-hop lingo as a catch-all for compilations of songs… most of which are now burnt onto CDs. Tape or CD, mixtapes take one of two basic forms. The first – what Cannon and Drama primarily produce – is the “DJ mixtape”, a collection of songs assembled by a DJ, whose personality (expressed by his choice in music and the characteristic phrases he inserts between and over songs), image, and technical skill unify the presentation. DJs piece their tapes together from previously recorded, commercially available songs, “leaks” (as-yet commercially unavailable songs provided by artists or label representatives), and “freestyles” (commercially unrecorded verses usually layered over commercially available beats previously used by other artists).

The other basic mixtape type is the “artist mixtape”, a tape tied together by the personality, image, and product of the artist. Although they showcase a single artist (rather than a collection of artists), artist tapes are more or less similar to DJ tapes – they typically feature some mix of an artist’s better known, commercially available recordings interspersed among freestyles and leaks. DJs can be prominently featured on these tapes: Drama has put together tapes for everyone from Young Jeezy to Little Brother, and DJ Whoo Kid has been virtually synonymous with G-Unit. Regardless, on artist mixtapes, the DJ takes a back seat to the rapper. Also grouped into this second category are tapes produced by unsigned artists, which usually feature original material (verses and instrumentals) alongside freestyles over high-profile beats.

Laying Down the Law
There’s a crucial difference between mixtapes and bootlegs. Bootlegs are unofficial (and deeply discounted) copies of albums that listeners would otherwise buy in stores, and therefore, categorically illegal. Mixtapes, meanwhile, sit in a nebulous grey area. Determining just how much illegal content or how much legal content there is in any tape is a prosecutor’s headache. (Better send some Excedrin down to Atlanta’s District Attorney Paul Howard, Jr. – he and his crew will be at it for a while.)

While artists might distribute leaks to DJs and record “drops” (sound bites where artists promote themselves or shout DJs out) to lend “authenticity” to the DJs’ tapes, most artists have no legal right to reproduce or rebroadcast the songs they write and record; such rights usually belong to the record label that funds their recording. Even in cases when artists supply self-funded recordings, most also risk violating contractual restrictions that limit their ability to perform on recordings not distributed by their label. For record companies, part of the value added in inking an artist to a contract is gaining a monopoly over their voices. Freestyles, further, are typically recorded over instrumentals over which neither the artists nor the DJs have a legal property right.

The involvement of labels in all of this further complicates the question of legality, and also adds new layers to the mixtape “typology” outlined above. DJ tapes and artist tapes featuring signed artists can each be subdivided between tapes that are label-sponsored (in whole or in part) and those produced without label-approval. Sometimes (or a lot of the time, depending on whom you ask) promotions reps from labels slip DJs advance copies of singles or albums, a capellas, and instrumentals – but does the royalty-collection arm of the label know that? Probably not.  And have any contracts been signed laying that out? Definitely not.  (Maybe send some TUMS to Cannon and Drama’s defense team while you’re out shopping for that Excedrin.)

Leak provided by the artist (illegal). Leak provided by label rep (legal?) Original freestyle over someone else’s beat (half legal content, half illegal?). Original lyrics over an original beat (legal). So that makes the tape as a whole…?

From Rule of Law to Real School Economics
In other words, the “legal-illegal” dichotomy doesn’t really, in and of itself, fit mixtapes. More importantly, however, the legal framework doesn’t really help us get at what purpose(s) they serve. There’s a reason why illegality is tolerated in the industry. Straight up: Labels, rappers, and DJs make money off illegality, directly or indirectly.

Better, then, for describing mixtapes is the concept of “informality”, that is, the informal economy, a concept that’s long been a favorite theoretical tool for writers and planners working with developing world issues wherein the exchange of goods and services among actors takes place outside standard regulation. In America (at least for now), the bulk of general economic activity is “formal”, meaning that most exchanges (whether buying something in a store or paying someone for their services) are recorded and easily taxed, and most workers work in employer-provided facilities (like offices or factories) with government-insured protections (minimum wages, health coverage, anti-trust laws, union rights).

There are three important things to understand about the informal economy.  First, it’s not a synonym for “illegal”. Second, participants of an informal economy are not necessarily “poor” – informal workers can have a high level of income.  Third, it’s not a synonym for “unimportant” or “unrelated” to the formal economy.  Informal economies are analogous to formal economies and interpenetrate them. Informal networks may be illegal (violating existing legal norms) or extralegal (occurring in a space that is unregulated), but wherever they fall with respect to the law, they produce goods or provide services that are similar to those produced in formal markets (whether it be in the form of clothing or matches sold individually). Informal laborers are not isolated from global capitalism; rather, the work of a sweatshop laborer or an unpaid intern, for example, supports the formal economy.

Mixtapes are the quintessential informal economic product. The very cache attached to mixtapes as “illegal” (whether they are or not) and “cutting-edge” (vehicles of new, otherwise unavailable music) allows the tapes to be used for marketing purposes, thereby promoting the artist and, by extension, the label where other music by the artist can be found. For unsigned artists, mixtapes are basically elaborate auditions or audio business cards – a way into the industry. Signed artists dissatisfied with their treatment by labels have also used mixtapes to force their labels’ hands, either by threatening to release recorded material early (offering so many “leaks” that a commercial release would be unmarketable) or using sales figures or buzz from mixtapes to demonstrate fan support for a formal release.

Indeed, the labels are just as aware of the power of mixtapes as artists are. By allowing rappers to work with prominent DJs and appear alongside other prominent peers, labels can secure street approval for artists. Meanwhile, by leaking formally recorded songs early, labels can build buzz and test-market potential singles (songs that could later be serviced formally to radio and video outlets at significantly greater costs). And, talking strictly about overhead, why should a label endure the expense of hiring a formal marketing and promotions staff when a well-placed “leak” on a mixtape – or a whole mixtape – will do the job at a fraction of the cost? Why not just write a one-off check to some DJ who lives in a one-bedroom apartment in Brooklyn, who will then “hire” a bunch of unpaid interns to do his own promotional work? This is “informal outsourcing” at its finest, right in America’s own backyard… or in America’s mom and pop stores, street markets, and subways, stacked up in slim-line jewel cases next to the “Gucci” belts, sweat-shop produced shirts, and loose cigarettes being sold by any number of nameless, faceless first- generation (or aspiring first-generation) Americans who are also, in this fashion, participating in the informal economy.

Globalized Off of Radio:
A Theory
As noted above, mixtapes have been around since people were listening to tapes. Any legitimate Hip-Hop Hall of Fame would have to have at least part of wing dedicated to mixtape DJs. But mixtapes haven’t always been such a prominent component of hip-hop, nor did the mixtape circuit represent such a large proportion of a rapper’s output. And while labels might be feeding the phenomenon through either commission or omission, the mixtape economy isn’t the creation of labels. Viewed from a slightly more historical perspective, mixtapes seem to have boomed in response to changes in the structure of the American mass media.

Even as rap became a popular commercial commodity, the formal avenues for its production, distribution, and broadcast began to erode. The ‘90s saw a seismic restructuring of the American music industry. Frenzied mergers and acquisitions over the course of the decade produced a situation in which, by 2006, four transnational conglomerates (Universal, Sony BMG, EMI, and Warner Brothers) controlled upwards of 80 percent of the music recorded in the United States. Concurrently, the Clinton Administration (through the Telecommunications Reform Act of 1996) deregulated American radio as part of a broader international effort, encouraged by the World Trade Organization, G7, and lobbyists from corporate, financial, and media magnates to liberalize telecommunications.

Deregulation basically removed the limits on how many stations a single corporation could own, and so it set the stage for the gradual reorganization of American radio stations under the umbrella of a small number of national programming interests.  This phenomena was led by ClearChannel Communications, a radio conglomerate that currently controls 1,100 active stations (for more on ClearChannel, see Eric Boehlert’s extensive expose on Salon, ”Radio’s Big Bully,” Eric Boehlert, March 14, 2001 to August 8, 2001), and is hence dubbed, “Clearchannelization”.
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The ClearChannelization of hip-hop radio gave disproportionate power to a set of regional or national programming directors (for all the gritty details, see Mark Anthony Neal’s three-part PopMatters series “Rhythm and Bullshit?: The Slow Decline of R&B”). This arrangement effectively replaced a set of local or metropolitan markets with a single national market, one which was serviced with a centrally programmed playlist.

Whether you’re in Los Angeles, Houston, Atlanta, or New York, you’ll likely hear the same mix of music. While, as Neal has suggested, nationalized playlists have allowed unknowns to transform into megastars virtually overnight, such big breaks obscure the grim math of the post-1996 scene. Local artists face fiercer competition for air time, now, as they’re now forced to vie not only with other local artists, but also the entire national pool of hip-hop talent. This competition, in turn, is pitched in favor of corporate-backed acts, since major record labels offered substantial payouts to secure airtime for their artists.

The collapse of traditional radio posed a real threat to both aspiring and established rappers, limiting their access to what had historically been a crucial promotional tool. But alongside the threat of Clear Channel came an opportunity. With developments in digital production and reproduction, it finally became cheap enough to produce CDs in large amounts quickly, meaning that basically anyone with a PC and a CD burner could run a small recording and distribution business. Without a doubt, digitalization would have made informally produced music more popular one way or the other. The collapse of radio should be seen as having given the push to artists and DJs to exploit new reproduction and distribution technologies to the fullest extent.

50 Cent’s 2002 signing with Interscope Records, primarily on the strength of tapes like Guess Who’s Back?, legitimized mixtapes as an alternative route to the top. After his major debut, Get Rich and Die Tryin’ (2003), rocketed to multi-platinum sales, the floodgates had officially opened. The most recent case of an informal-to-formal success story on the 50 Cent-model has been Houston-based rapper Chamillionaire. Long a fixture on Houston’s mixtape circuit, he inked with Universal shortly after the release of his sprawling three-disc mixtape, The Mixtape Messiah. His Universal debut, The Sound of Revenge (2005), went platinum and spawned a Grammy-winning single (“Ridin’ Dirty”). He’s yet to abandon mixtapes; in fact, his recent mixtape work is the most obvious example of how tapes can easily be transformed from a vehicle of the starving artist to a corporate shill. Cham’s Mixtape Messiah 2 – which he made available for free download for Christmas 2006 – featured freestyles over several commercially available beats and countless reminders of release date for his official follow-up to The Sound of Revenge.

While 50 and Cham used mixtapes to get into the industry, other New York acts like Cam’ron (and his Diplomats crew) or the LOX/D-Block – both of whom have had historically complicated relationships with major labels – have used mixtapes to transform themselves into local street empires, flooding Harlem and Yonkers (respectively) with mixtape content.  On the strength of their tapes (and knock-offs produced by other DJs looking for the hottest music), Dipset and D-Block became readily recognizable, rabidly followed local commodities. These artists haven’t totally abandoned major labels. Cam’ron, for instance, is signed to Warner’s Asylum label, and his protégé Juelz Santana has a deal with Def Jam; but the success of the Diplomats eagle as a marketable street brand has also allowed the Diplomats to explore independent deals for their other artists.

In this respect, the mixtape economy isn’t just a subsidiary to the formal economy of major labels; mixtapes have become a way of building parallel music markets. After all, why even try to sell a million albums with a royalty of $1US a copy (or less) when you can charge $6-8 for a CD produced in a home studio and printed up on the fifth floor of a bombed-out, front-doorless, Midtown high-rise at only 25-50 cents a pop? Rather than rely on a massive, lumbering, global media firm, why not create a small, flexible, decentralized operation of your own? Or, if making money directly off the tapes seems like too much work, why not take advantage of the free promotion that a well placed freestyle can generate?

But whether a rapper is trying to land a major deal, attempting to build a small empire pre- or post-deal, or just doing extra promotion for his next album, he’ll most likely end up stepping outside the formal rapper-label relationship, dropping lyrics over borrowed beats and dropping drops for flocks of mixtape DJs. If he’s really on his grind, he’ll step out into the streets himself, doing the same sort of heavy labor, feverish networking, and hand-to-hand hustling done by anyone trying to eke-out a living in a volatile economy. And if he won’t do it, hungry DJs will. Rapper or DJ, these informal economy entrepreneurs have one foot in the world of suits and contracts, and one foot in the world of white-tees and handshake deals.  They operate in that gray area between legal and illegal . . . the high-stakes informal economy.

T.M. Wolf lives in London where he is currently undertaking graduate study at the Development Planning Unit (University College London). Prior to becoming ambivalently expatriated, he worked in New York’s mixtape economy. His writings on hip-hop have appeared in Stylus Magazine, Undercover Magazine, and The Foundation: A Mixtape Magazine.  He can be found weekly in OkayPlayer.com Reviews section. Readers can peruse his blog, CanineMind.