March 15, 2007 4:00 AM PDT
Perspective: Where did the music industry go so wrong?
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Labels set the deal terms for artists. Managers handled the "biz." The touring circuits were maintained by well-mannered warlords that politely divvied up the venues. And everyone had their place in the pond.
So where did it all go wrong with the music business? Somehow, the pond became stagnant over time, mucked up with greed, laziness, contempt and excess. People got bored with music. Then, someone threw a rock into the middle of it called the Internet, and nothing will ever be the same. Today, anyone can hum a tune, mix it with a rhythm track and some samples on their Mac at home, put it up on MySpace.com, and end up with a publishing deal from Moby, which will then sell it to the next Super Bowl sponsor.
The industry has become decentralized. Major labels no longer have the market muscle or control over the distribution channels as they once did. Technology and consumer choice have caused a shift from the traditional music business model of major labels throwing copious amounts of money behind a few big hits to that of a vast collection of individual artists creating pockets of more moderate success among passionate fan bases.
This shift requires a different approach to the development and monetization of music by the producers and promoters--one that more directly resembles that of more traditional venture-backed business. The entrepreneurs (artists) create new intellectual property (music, artistic brand) that has a demonstrated market (fans) that is robust enough to attract investors (for example, a label) that wants to own some equity in that IP and wishes to put money into the asset to enable it to engage in value-building activities (distribution, merchandising, licensing, and so on). Oddly enough, this "new" model is, in fact, not new.
We've all heard of The Grateful Dead, Phish, Ani DiFranco, Aimee Mann and the Barenaked Ladies. These great artists have grassroots beginnings. They all employed clever uses of the technology available to them at the time to find fans and create direct distribution channels (from bootleg cassettes and toll-free phone orders to MP3s and e-mail distributions). Using these methods, these "artist-entrepreneurs" have circumvented the traditional channel gatekeepers and have blazed a trail for the rank-and-file working artists and the weekend warriors to follow.
Now all serious artists need to conduct themselves as entrepreneurs engaged in building a business, not just playing and selling music. There are many tools and services out there that artists can use to help them sell. Still, it's not enough to put up a MySpace page and get a song on iTunes. They need to build a brand that has long-term value. They need to own that brand and their customers outright. There is a need for artist platforms that make this process more efficient so the economics make sense. Those solutions increasingly are becoming available.
Investors--including the major labels--need to understand the intricate partnership role they play in development. It's no longer about throwing money into the ether, marketing to no one in particular, and seeking only mega-hit payouts. It's about patience and commitment and focus. The labels--or their successors--need to get down to sea level, pick up an oar, and help row with the artist into this new ocean of opportunity.
Biography
Patrick Faucher is the CEO of Nimbit.
See more CNET content tagged:
artist, entrepreneur, MySpace, brand, music
The bad: There is less and less of a 'filter' these days, so sampling music is a must. Now that more and more of the music that is for sale on the internet and elsewhere is coming from unknown bands, without a rep or a spot on MTV.
But that's OK, because alot of bands are letting people stream their entire discography for free these days, giving out free MP3's and promotional CDs, etc. which are things that in the past might have been taboo for a band to do. But the overall benefit is that now people can buy music that they actually like, rather than be pigeon-holed into buying something from the Top40. This means that talentless bands will flounder instead of being propelled to the top, and bands that are actually good will develop followings of people who actively seek out their music. On the internet, you arn't forced to listen to a crappy song 400 times until you like it.
It's nice to see you've founded a company aimed at usurping the majors and supporting the true content creators, but there's nothing in your piece worth saying. You didn't even answer the question posed in your headline. Or maybe you did... I saw the word greed in there somewhere.
What you need to be doing is speaking to congress to get some of these ridiculous laws repealed... laws aimed solely at protecting the profit lines of well established industry fatcats, bought with lobbyist money and imaginary statistics.
Most of the "kids" growing up in this time were claiming that once they bought it, they could share it with the world. This was stealing, no matter how you whitewash it. The only positive outcome of the "Napster era" was that it shook up the status quo and started a change to how much is created and distributed.
The problem is not so much legislature, as the stranglehold of a few companies on the distribution of music. Even with some of the draconian measures of DRM, they are still losing this grip.
There has to be a fair balance in the process between supply and buy side that insures fair pricing, open distribution, and adequate compensation. Apple paved the way for a positive dialogue between both sides that is leading to an equitable solution and others like Pat are continuing the work.
I do agree that his commentary rambled. 8^)
this was really refreshing to read. i will be sad when sonyBMG arranges for you to have an "accident".
Well, most music is still distributed by the major media organisations.
Most of the music being produced is produced by the major media organisations.
Most of the money is still flowing through the major media organisations.
Yes, the internet allows people to self publish and this is a good thing, but it hasn?t changed the world.
I believe most people are inherently lazy and will gravitate to the easy option to get their entertainment. A trip to HMV or iTunes rather than wander around mySpace to find the one act that actually has a decently produced song available for download.
The music industry is still controlled by the big corporates and they have more than enough time to adapt to the new marketplace before they lose this control.
Come back in 10 years time and let?s see who is running the music industry.
Bottom line is that there isn't much new/good music heard in a widespread fashion, partly due to the fact only a few corporations own most radio stations which in turn all play the same stuff that we all heard before and likely already own.
The Internet should make it easier for people to get exposed to new music and in turn, have the potential number of music buyers expand.
But the RIAA has no interest in popularising new music and are in fact killing the industry.
What's with those insane licensing fees for internet radio? That is another nail in the music industries coffin.
If the music industry wants to survive, kill the RIAA.
I'd like to add that there is also the mind-numbingly shallow
swill that they call "music" these days, the swill that the music
industry executives are pushing (and MTV pushes) and the little
kids that haven't been around long enough to know what real
music sounds like just follow the leader and buy what MTV says
is good.
There is still good music out there worth buying (Blind Melon
has reunited and is working on a new record...) but it's just too
hard to find so you have to dig around with your favorite search
engine.
Then CDs came out. We had read that music publishers should have been able to sell CDs for less money than cassettes, because they were cheaper to make (after CDs had been out for some time). But CD prices never went down. $21.99 for new releases. And again, there was usually only one song that you wanted. I used to wonder why I couldn't walk into Tower Records, step up to a kiosk and pick and choose the songs I wanted, and have them placed on a custom CD just for me.
But then, MP3s and CD ripping came along. Then Shawn Fanning created Napster. Then came the Rio MP3 music player. These three events changed things FOREVER. Now, I could have just what I wanted. Yes, I was slightly bothered by the fact that, essentially, I was breaking copyright laws by using Napster and collecting music. But Napster was so compelling. Just heard a old song on the radio? Search for it that evening on Napster and have it. No muss/no fuss!
I gave up Napster when the RIAA started going after them. I never used any of the Napster replacements. But now we have iTunes/iPod. Music fairly priced, easily searched, downloaded and uploaded onto my iPod. Fast, cheap, easy and legal. There simply is no turning back, and now, I believe that Apple will someday be able to have popular artist sign with them, rather than one of the traditional Big 5 music publishers. Great!
The music industry brought this on themselves. They had the power to offer these features LONG TIME AGO, yet they chose to continue the practice of ripping of their customers. You always felt shafted after paying for a CD, knowing the bulk of the sale went to the publisher and not the artist. Now, with iTunes, we get VALUE. Music publishers never intended to offer value to the consumer until technology and the marketplace forced their hand.
I'm willing to buy music from them, however I am not willing to buy CD's and DVD's that might have two or three songs on them that I like, just to get those songs.
They should have, long ago when CD burners became popular, made a system where people could download ONLY the songs they wanted and burn them to a disk in MP3 format or even a standardized protected format.
Unfortunately, they NEVER did that, which is leading to their problems now.
The thing about prices is also true as well. Even including the cost of making the music in the first place and shipping costs, the cost of a CD to make is about 40 cents.
$20 for a CD that costs 40 cents to make? Sorry, not going to pay that.
The advance of data networks and technology will make further major changes.
This isn't about greed or industry mistakes or big bad executives.
Technology changes spur changes in society.
I think that about covers it.
anderson
around for eons, and for good reason.
The music cartels have always been greedy, lazy, and outright
scandalous with their tactics and collusions.
Things is, back in the day, laws were limited and kept them in
check. Technology was also limited so there was no outside
threat to what they did.
Laws were limited in many ways: Copyright was once only good
for 28 years (until the music and movie industries pumped
enough cash Congress' way to get those extended to nearly
Eternity). Fair Use was a widely understood concept, and aside
from a small fee charged for blank media like 8-tracks, and
Reel-to-Reel tapes (does that fee sound familiar?), anyone could
copy what they received off the radio gratis, and pass it around
w/o fee to all their friends.
Technology was limited in that one couldn't keep the music they
listened to without either buying the songs on permanent media
(LP's tapes, etc), and/or buying moderately expensive equipment
with which to record it. Recording movies (or even buying them
for home viewing use) was pretty much out of the question back
then.
Then came the VCR. More compact video cameras. Cheap
cassette players that also recorded right off the radio. This made
the *AA's slightly defensive... and while they managed to up the
average cost (even accounting for inflation) per song, they still
began to feel threatened, and fought these advances hard in
many a courtroom.
Then, along came the CD-R. The Internet. The DVD-R. Then...
Napster. The cartels reacted the best way they knew how: fear
and intimidation, and the purchasing of legislators everywhere
they could. No small wonder the DMCA was funded in huge part
by these industry associations.
I can say fear and intimidation for certain because in nearly
every case where the defendant stood up to them, got a good
lawyer, and said (in so many words): "screw you and your
'settlement' offer! I'm innocent, and I'll see you in court!"... the
case was suddenly and mysteriously dropped by the plaintiff
(usually the RIAA). They know that their discovery tactics won't
stand up in court, they know that they're basically fishing blind
for victims to make 'examples' of, and, they don't want a court
case which could set a precedent that falls against them, which
could blow their whole scheme apart.
Then again, w/o the DMCA and loads of other laws that they
almost personally funded into existence, they wouldn't have a
chance.
That said, there has always been that streak in them, and history
is full of examples to prove it.
/P
On the flip side, when did choreography become as, if not more, important than the music? I'll pick on Britney Spears for a minute since its so easy. If you go to more than one of her shows, you'll get the same thing from city to city. No spontaneity (except when the backing tape skips), everything choreographed. Record companies no longer seem interested in taking the time to put their money into those artists who show true musical potential. It's all about who looks good, who has great dance moves, or who has a great video. It's about the "product" and the almighty dollar. It seems that whenever one turns on the radio, you hear the same kind of thing - bad music accompanied by vocals that sound as if the singer has a permanent case of constipation. On top of that, it all sounds the same. Gone is the variety of yesteryear.
Slightly OT but perhaps a good analogy:
A artist/writer gave a talk in a local gallery. She'd spent two years making a most marvellous children's book on the ecology of north Queensland. Enormous paintings on silk, wow.
She spoke to a group of schoolchildren about the process of creation. And then the business side. "What do you think I get from the sale of this book?" It was beautiful indeed, and I was happy to pay the $25 but ... after several naive guesses from the kids, she told them: "twenty-two cents."
What's wrong with this picture?
Back in the day, I had a book published.The initial advance against royalties on publication wasn't anything to write home about. But that was the easy part. Beyond that, I had to hound them for further royalties.
So when I hear the music and publishing industries taking the high moral ground about THEIR intellectual property, my eyes weep crocodile tears. Yeah.
Musicians will have to work their day jobs, and settle for music as a hobby. And that's OK, that's how folk music was born, isn't it? And folk music is what started everything, right?
And there will be no more nonsense about music defining a common culture by expressing common feelings like there was in the Rock period around the Vietnam War era. Nope, each person will sample a thousand different points of view that they and their friends may NEVER hear of again from garage bands. True expressions, formed by angst of working in the service industry by day while thinking about playing music.
And that will be all right because we will still have a thousand cable TV stations telling us what to think, pounding us with music snippets and oldies. I just love hearing about 5 seconds of "Who" songs, you know, just the bridges, or the 5 seconds that are really worth listening to, like just the scream from the end of "Won't Get Fooled Again." Doesn't everyone?
And musicians are lousy observers of history and feelings anyway, aren't they? That's whay they've given up social commentary, except for a few "old heads" and those awful Dixie Chicks. Who needs them? We have a very unpopular war, and there's no need for any to supply any music as a rallying point, like that stupid "Woodstock" song, oe "Ohio", is there?
I mean, as long as we can get some stuff on our iPODs so we can tune out everyone and everything around us, isn't THAT what life is about? Self-pleasure? A musical hook-up, not a commitment?
It's good to know that music doesn't define anything that people are willing to pay for anymore.
"It's good to know that music doesn't define anything that people are willing to pay for anymore."
- Is the album dead or dying?
- by myluckyfeet March 18, 2007 10:17 AM PDT
- I am a huge music fan, but I no longer by Cds and have no interest in buying them ever again. I don't really ever get a chance to listen to a whole album anymore either, I prefer to shuffle. Its only the albums I grew up with that i can listen to all the way through. But i'm in my mid twenties and have a million projects and have to pay for lots of stupid things.
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Showing 1 of 2 pages (41 Comments)But what about teens and college kids they have a lot of excess cash and time? Are they still buying CDs? So i'm wondering if I think the album is dead just because its not relevant to me and my lifestyle anymore. Anyone work in a record store, who buys the most cds?