This brief flirtation with chart success led to a five-album deal and substantial advance from Polydor Records who mistakenly viewed Otway as a punk. Unfortunately sales of his second album would prove to be disappointing. The follow-up singles fared no better as one flop, became a succession of flops and despite some creative promotion, it seemed Otway was to be no more than a one-hit wonder. Ideas to prevent this included the offer for Otway to perform "live in your living room". The 1979 single Frightened and Scared was pressed with three copies without Otway's vocals. If you were one of the lucky customers to buy one of these elusive copies, Otway would come round to your house and add the vocals live. Unfortunately, most people had seen Otway's live shows, had witnessed the carnage he created and didn't want him anywhere near their homes. In 1980, after DK 50-80 reached number 45, Otway & Barrett's often fraught relationship came to an end as the pair decided enough was enough.
Although no-one wanted to listen to Otway on record, the live show remained as chaotic as ever and the possibility of physical injury meant that his audiences remained loyal. By the mid-1980s, Otway had appeared as a special guest in the final episode of the BBC comedy The Young Ones and was constantly touring, clocking up around 150 shows a year.
However, lack of record sales inevitably led to the record labels losing interest and Otway's musical career began to falter. Seeking alternative ways to remain in the spotlight the ever resourceful Otway turned to acting. He co-authored the play Verbal Diary and created a role for himself playing a disorganised, likeable twit. By playing himself to perfection, Otway found other work playing similar characters in television commercials whilst also having bit part in an episode of ITV's Supergran.