DURHAM — Like most things about Merge Records, the label's name fits it perfectly. Memorable and elegantly simple, it works on a practical level. But it also implies something more abstract, about conjunctions: between big and small, ambition and pragmatism, art and commerce.
That balancing act has always been the key to Merge's success. Twenty years removed from its modest origins, Merge has grown from occupying part of a bedroom to its own office building -- and also to the upper reaches of the charts.
Five years ago, no Merge release had ever reached the Billboard 200 album-sales chart. It happens with some regularity nowadays, and two Merge albums have even made the top 10.
Formerly a part-time occupation for co-owners Mac McCaughan and Laura Ballance, Merge now has 13 full-time employees. The label used to sell a few hundred copies of local bands' cassettes and vinyl singles. But now it has an international roster, including name acts such as Arcade Fire and M. Ward, and it sells hundreds of thousands of compact discs and digital downloads.
At a time when most record companies are struggling for survival, Merge stands as one of the industry's few modern-day unqualified success stories. And yet a lot of things about Merge are pretty much the same as always.
"You know, we've just never stopped working and putting out records," says McCaughan. "It never ends. And even though most of our releases don't do that massive scale of business, they still need a lot of attention, even if they're not selling 200,000 copies. They're different, but the same."
A million things
It's a recent weekday afternoon at Merge's downtown Durham offices. McCaughan is just off the phone from tending to business. Ballance comes in carrying a can of WD-40. She was just up the street at the other building they recently purchased, talking to a contractor.
"Yes," she sighs, "that's my job here -- custodian."
Actually, the thing that's occupying most of McCaughan and Ballance's time lately is planning Merge's 20-year-anniversary festivities. There's "Score!," a subscription-only box set with track lists of Merge songs curated by David Byrne, film director Phil Morrison, author Jonathan Lethem and other cultural luminaries. Coming in September is a book, "Our Noise: The Story of Merge Records, The Indie Label That Got Big and Stayed Small" (complete with a gushy introductory essay by Ryan Adams).
Of course, the program includes a live-music festival, XX Merge. McCaughan and Ballance's band Superchunk will play this week during five nights of sold-out shows at Cat's Cradle and UNC-Chapel Hill's Memorial Hall, alongside an impressive chunk of the Merge roster: Lambchop, Spoon, She & Him, Polvo and many others.
But even with all that going on, McCaughan and Ballance are already working on fall releases, including the reunited Polvo's first album since 1997.
"At the start of this year," McCaughan says, "we were looking at everything and thinking, 'Doesn't look like we've got much coming out. That's good, since we've got this anniversary.' And, of course, six months later, we've got a million things coming out."
"It always seems to happen," Ballance says, laughing.
A bedroom beginning
Merge began the way most artist-owned independent labels do, as a do-it-yourself operation that generated a lot more work than money. Merge's first "office" was Ballance's bedroom, and its first few releases were on cassette tapes in the summer of 1989.
By 1990, Merge had graduated to 7-inch vinyl singles by Angels of Epistemology and Chunk, McCaughan and Ballance's punk band. But the first single that put Merge on the national radar came after Chunk expanded its name to Superchunk and released "Slack [Expletive]" in April 1990 -- a perfect 2:53 of anthemic, wage-slave rage.
Superchunk soon graduated to a three-album run on the large New York independent label Matador Records. But Ballance and McCaughan also kept Merge going, releasing 7-inch singles by Polvo, Erectus Monotone, Finger and other mostly local acts.
By the time Superchunk's Matador deal concluded with 1993's "On the Mouth," the band was a hot property. The great alternative-rock gold rush was on, thanks to Nirvana, and every major label in America wanted in.
Instead of taking the jump to a major, however, Superchunk chose to remain independent. The band cast its lot with Merge, releasing five full-length albums in seven years while touring relentlessly. Superchunk's sales and stature enabled the label to grow and cast its net farther afield for acts, and Merge gradually grew from being Superchunk's label to a business capable of standing on its own.
Georgia band Neutral Milk Hotel was the first Merge band to outsell Superchunk, with 1998's "In the Aeroplane Over the Sea." New York City's Magnetic Fields made major waves with the 1999 box set "69 Love Songs."
Merge also signed a Texas band coming off a disastrous stint with the major label Elektra: Spoon would be Merge's first act to crack the top half of the Billboard 200. Soon to come was Montreal's Arcade Fire, whose 2004 debut album picked up worldwide raves and Merge's biggest-ever sales (449,000 copies sold to date). By the time Arcade Fire's second album came out in March 2007, demand was so high that the album made a splashy chart bow at No. 2.
"For me, Merge growing very conveniently pushed Superchunk to the side," says Ballance. "By the late '90s, it was clear that Merge would continue beyond Superchunk. We had bands selling more than us, and running the label was demanding more and more time."
Weary of the road
Superchunk has been semi-inactive since 2001's "Here's to Shutting Up." Since then, McCaughan has spent most of his musical time on his other band, Portastatic. But Superchunk's hiatus appears to be ending. The band released a five-song mini-album in April, and a full-length album is in the works.
Still, don't look for Superchunk to resume its road-warrior ways. For one thing, all four members are in their 40s, and drummer Jon Wurster keeps busy with other bands now (including Mountain Goats and Bob Mould). For another, Ballance and McCaughan both have young children, in addition to Merge, to tend to. Ballance, for one, won't miss the road.
"I'd rather stay home, even though touring keeps us in touch with what our bands have to endure," she said. "That's always been the thing about Merge. Mac and I know both sides of what's involved."
Two that made mistakes
Even though Merge has a few big-selling bands now, the label still has plenty of acts that sell just a few thousand copies of each release. But that works because Merge has avoided many of the pitfalls that come with success, such as giving in to offers to sell out.
You can take a lesson in what happened to two other similarly successful local independent labels, Mammoth and Sugar Hill. Both threw in with major labels, only to be dissolved several years later when neither could duplicate its earlier successes.
Instead, Merge has stayed independent and kept its overhead low. There's not a "Merge sound," because McCaughan and Ballance sign bands they just like and let them do what they do.
"Merge never lost sight of the fundamentals," says Eric Garland, CEO of the music research company Big Champagne. "They're still doing things with artist development that recorded music companies used to do 50 years ago. Most of the biggest players lost sight of that long ago, focusing too much on pursuing big, obvious jingles.
"But Merge seems so much more stable and rational, because in the end they're not trying to exploit something. They're not trying to get you to make a regrettable impulse buy, a CD you'll be carrying to the curb in a crate 18 months later because you're tired of that one song."
Merge's biggest commercial successes have come with bands the label signed and then helped to develop an audience, mostly via college radio. Mainstream media are no longer out of reach for Merge's biggest acts -- Arcade Fire and Spoon have both played "Saturday Night Live" in recent years -- but the label has resisted the temptation to pursue that too aggressively.
"We've never made the mistake of going after commercial radio too much," McCaughan says. "We are a niche business, although that niche can get very big with certain bands. But it would be a mistake to think, 'We've got to keep expanding.' We're not in the business of trying to win over Jonas Brothers fans. The industry may be shrinking, but what's shrinking is a part we never relied on."
As to the future, that is the great unknown, given how rapidly the industry is changing. McCaughan estimates that between 30 percent and 40 percent of Merge's current business is in the form of digital downloads with the rest in physical CDs. That margin works well enough for now.
Merge seems better-positioned to ride out the online revolution than the Sonys and Interscopes of the world.
"I'm optimistic Merge will make it through, because they've kept their overhead manageable and not extravagant," says Molly Neuman, director of label relations for the online retailer eMusic. "They seem to have the resources they need to grow, without going crazy, and their growth has been consistent. ... Mac and Laura are wisely cautious and really thoughtful."
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