Digital Noise: Music and Tech

This is just a quick pointer to a hilarious post I ran across this morning: BBC Magazine invited 13-year-old Scott Campbell, to wear a vintage Sony Walkman for a day. He took the challenge seriously, and wrote up his impressions of the Walkman versus the modern equivalent.

Some choice excerpts:

"It took me three days to figure out that there was another side to the tape."

"I managed to create an impromptu shuffle feature simply by holding down 'rewind' and releasing it randomly."

"I'm relieved that the majority of technological advancement happened before I was born, as I can't imagine having to use such basic equipment every day."

The only advantage Campbell found for the Walkman was the fact that it had two headphone jacks, allowing listeners to share their favorite tunes with a friend. He also noted that the battery life was terrible at about 3 hours, but neglected to point out the (perhaps obvious) fact that at least the Walkman lets you get to the batteries to replace them--you don't have to send it back to the manufacturer or risk voiding your warranty. Another point I'd make for Campbell or other intrepid explorers: some Walkmans had a "reverse" switch on them that let you change to the other side of the cassette--that could be another nifty way to create an equivalent to the iPod's shuffle feature.

Now wait until he discovers Minidisc!

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Music subscription service eMusic has always puzzled me. While it was the first site to offer DRM-free downloads, I never downloaded enough music to justify paying even the lowest subscription rate. The fact that it makes you navigate a long sign-up screen and enter a credit card number before showing you the song selection and other features of the site--even if you just want a free trial--drives me nuts. But despite my skepticism, the site has some big fans among voracious consumers of indie music.

Judging from the angry comments on the site's message board, some of those fans are up in arms. The company announced a deal Monday with major label Sony to add catalog tracks--that is, music released more than two years ago--from Sony artists. But eMusic barely mentioned the fact that it's raising prices at the same time. Specifically:

The lowest-priced Basic subscription ($11.99) now offers only 24 tracks per month (50 cents per track) instead of 30 (40 cents per track). Existing customers will be grandfathered into the old 30-song allotment, according to an eMusic spokesperson cited by the Los Angeles Times.

The mid-tier Plus subscription goes from $14.99 to $15.89 and offers only 35 tracks (45 cents per track) instead of 50 (30 cents per track).

The high-end Premium subscription goes from $19.99 to $20.79 per month and offers only 50 tracks (42 cents per track) instead of 75 (27 cents per track).

Subscribers may be angry, but they shouldn't be surprised. eMusic has periodically raised prices since introducing an all-you-can eat download plan for $10 a month back in 2000. Just look at the prices in CNET's review from 2004 (updated in 2006), and you'll notice that the company has cut download allotments almost in half since the review was written.

Subscription-based music is still an experiment. The royalty structure of the music business was set up to sell individual physical recordings. It's easier to translate that business model to individual downloads than it is to subscriptions. Still, raising prices during the worst economy in more than 50 years doesn't strike me as the best idea.

What really seems to be throwing eMusic fans off, however, is the timing: fair or not, they're blaming the Sony deal for the price increase. Most eMusic fans I've heard from are real music nuts, and are there to sample a wide range of music from relatively unknown cutting-edge acts, not to download music they could find anywhere. Imagine the clerks in High Fidelity suddenly being told that their favorite mail-order distributor is raising prices, but in exchange will now let them order ABBA and Chili Peppers records just like the chain stores in the mall.

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Free, on-demand streaming music is a rising tide: since the start of 2009, I've covered relatively new services like Spotify and Just Hear It, and there are plenty of established players like MySpace Music, Imeem, and Grooveshark.

Instead of trying to stop the tide, Sony Music has wisely embraced it: starting today, the company will introduce streaming music players on the Web sites of its most popular artists, including popsters like Kelly Clarkson, John Legend, and Jacko himself. It makes perfect business sense: instead of letting some third party like Imeem sell advertisements against high-demand music, Sony can sell or display its own ads.

Of course, they couldn't make it too easy--finding the audio on Michael Jackson's site took a few clicks, including one that forced me to identify my country, and the songs were embedded in the Sony-specific MyPlay player, which is an interesting piece of technology but only lets you create playlists with songs from other artists with MyPlay players. More generally, I wonder if it's too late for these label-specific initiatives--I'm sure plenty of hardcore Britney fans have her Web site bookmarked, but most music listeners probably prefer to use services that let you compile lists from multiple artists on multiple labels.

Sony is also adding lyrics to these artists' sites, provided by the company's own Gracenote subsidiary. Excellent move. I can't believe it's taken this long, given the lack of decent lyrics sites out there. In fact, I still don't understand the reluctance to publish lyrics online--what are people going to steal? What money is the artist or copyright owner losing? Kudos for Sony for taking a baby step toward ending this silliness.

AUSTIN, Texas--Thanks to everybody who came out to hear the Artist as Entrepreneur panel on Wednesday at South by Southwest. I had a great time doing it, and I enjoyed my (too short) interactions with the other panelists and with the audience after the show.

We were pressed for time at the end, so I wanted to share some random thoughts and reactions to some questions that I didn't have time to address.

Touring.
Here, I tend to agree with Adam Lewis from Planetary: if you're still opening up on a Tuesday night in your home town, you should probably stick it out there for a bit longer.

Overall, you tour when there's no more reason to stay home, either because you're ready to expand your audience, or because the city's too jaded and isn't giving you the love you think you deserve. (I know bands from Los Angeles and New York who love to tour because they get a much more enthusiastic reaction in small college towns than they've ever gotten at home.) In this latter case, though, think of touring as an investment--you're not going to make money on it the first time out.

Is it necessary for band mates to get along?
Someone asked if you have to all get along to do business together. Some of the greatest music ever created was made by bands whose individual members hated each other--look at The White Album, recorded almost as three separate solo albums by John, Paul, and George, or some of Jane's Addiction's final shows.

But if a band doesn't get along with its agent, manager, or label, it should sever that relationship as soon as it can get away with it. That kind of suffering may be worthwhile in the name of art; it's not worthwhile in the name of business.

Recording yourself.
One person asked for specific tools and services that we'd recommend, and at the end, I mentioned that one of the best investments a live performing act can make is to record every rehearsal.

Not long ago, a cheap but surprisingly effective way of doing this was to plug a PZM mike into a four-track recorder; nowadays, I'd use a laptop with simple audio-recording software like Audacity (great, free, open-source).

The slightly more expensive way of doing this used to be a digital audio tape or MiniDisc recorder; now I'd recommend high-end digital recorders with built-in stereo mics like the Olympus LS-10 or Sony PCM D-50.

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Universal Music first floated the idea of Total Music in 2007 as a way to give customers an alternative to free MP3s available on file-trading networks and anonymous Internet sites.

At that time, the business model called for hardware manufacturers to pay some extra amount--perhaps $5 per month--and optionally pass this cost along to consumers. In return, consumers would get the right to download as much music as they wanted, for free, during a certain time period.

Nokia eventually launched a similar plan, Comes With Music, but Total Music (which became a joint venture between Universal and Sony Music) ran into some antitrust questions and eventually shifted its focus to ad-supported streaming and paid downloads.

Now it's dead, along with Ruckus, a college-specific music download service that Total Music quietly purchased last summer.

Blame the economy if you want, but the real reason for the failure of these services--and every other record industry effort to capitalize on the Internet for distribution--is revealed in two places in this blog post by Total Music's vice president of product management, Jason Herskowitz.

First, he built a mashup service called Friendp3, which takes his friends' Last.fm feeds, searches the Internet for the same song posted somewhere as a free MP3 file, and creates a playable playlist of those songs. On demand. Like the excellent Songerize service--which lets you enter a song name and hear it on demand--it uses the Seeqpod playable search engine on the back end. Very cool.

But the technology's not the point. Did you see what just happened there? There is free music on the Internet! Available with no advertising and no restrictions. That means that any new music service, industry-sponsored or otherwise, is not only competing with iTunes, or Pandora, or Last.fm, or MySpace, or the latest ad-supported-service-of-the-week. It's competing with millions of MP3s uploaded by users and easily findable, thanks to the rapid advances in Internet search technology.

Hold that thought for a second as we come to the end of his blog post:
But wouldn't it be cool if there was a way to do this on a platform that plays nice with everyone? And compensates those that deserve compensation? And somehow can magically cover the costs associated with all of the above (hint: this is the kicker)?

Yes! Yes, it would be cool! I would like a free pony and no more dental appointments as well. And a mint-condition low-mileage black 1997 Mercedes E Series. With tinted windows.

Not to be too flip, but this sentence gets right to the nut of the problem with industry-sponsored online services. Their primary concern is getting paid and making sure that everybody else in the traditional value chain gets paid. That's a laudable and perfectly understandable goal. But that's how they miss the point, again and again and again. In order to create a service in which everybody gets paid, somebody's going to have to be paying.

The only way you will get customers to pay more than zero when there's so much zero-cost unrestricted content out there is by offering them a compelling benefit they can't get anywhere else. This is why iTunes is successful--it offers customers the easiest way to find and buy new music to load on their iPod.

What did Ruckus offer? DRM-encrusted downloads that couldn't be transferred to a Zune, much less an iPod. What did Total Music offer? We don't know because it never launched, but I'm willing to bet it didn't have a clear and compelling customer benefit.

I don't know what the magic formula is. Forget advertising--the ads are so ignorable, and CPMs so low on these kinds of services, that they'll never cover the cost of the content, and users will absolutely reject more intrusive advertising like an audio ad every 10 songs. (Remember: you're competing with free.) So you have to get users to pay.

What are they willing to pay for? A bigger back catalog? Some sort of online storage locker for downloads, which would then let you play them from any Internet-connected device? The ability to share songs with a friend in a seamless electronic way--the equivalent of playing the record you just bought for them, only, you know, with computers and Internets and stuff?

The sad thing is that many of these things have been tried, and industry players have done everything in their power to stymie them with lawsuits (the original MP3.com, file-sharing networks), copyright fees (the battle over online radio), and unreasonable DRM restrictions (take the original Zune's "three plays, three days" restriction on device-to-device sharing, which killed what could have been an interesting feature). But perhaps it's not too late to try again.

As I said in my 2008 sum-up, people tend to overestimate the amount of change that will happen in one year--which means my best bet for 2009 would be to simply reiterate my almost-there predictions from 2008, like the death of DRM and the decline of the concert industry.

But that would be boring. Thus, behold my all-new-and-improved predictions for music and technology in 2009:

Zune phone--sort of. 2009 will finally be the year that Microsoft takes the wraps off its mobile-entertainment strategy, and the Zune brand will be prominently featured. Perhaps as early as next week at CES, Microsoft will announce a version of the Zune Marketplace and accompanying client software for mobile phones--perhaps only Windows Mobile, but perhaps some other platforms as well. There's an outside chance that the company will also announce plans to build its own music phone, but not at CES, and only if the third-party approach fails to gain traction against the iPhone and RIM. I don't think the Zune-phone strategy will be tied to Windows Mobile 7, though, as I don't think that platform will come out until 2010.

$99 iPhone. Apple will introduce a 4GB iPhone that will sell for $99 with a two-year AT&T data contract. (Or, less likely, lower the 8GB price to $99 by mid-year.) With this new lower price, the iPhone will continue to gain market share at the expense of Symbian and Windows Mobile. Apple will also lower the price on the iPod Touch at the same time.

RIM will get music right. Research in Motion continues to do well against the iPhone juggernaut, although the Storm was widely considered a stumble. But so far, RIM has focused on its core strength--communications--and left music as something of an afterthought. This will change in 2009, as RIM upgrades its phones with more memory and a better media interface and signs deals with Rhapsody or other online music services. Or maybe RIM will just up and buy Rhapsody owner RealNetworks: according to Yahoo Finance, RIM's cash on hand ($1.68 billion) is greater than Real's market cap ($479 million) .

Sony will surprise. Not by lowering the price of the PS3 enough to start taking market share from Xbox 360--sorry, but that horse has left the barn--but by releasing a touch-screen Walkman-branded audio/video player at a competitive price point in the U.S. (Read: $1 less than the equivalent iPod Touch). Wi-Fi will be included, as will a link to a new online music and video store that's owned by Sony, but features songs and videos from other companies. (I agree with Donald Bell that a partnership with Amazon seems unlikely.) Reviewers will gush over it, and it'll help Sony recapture some of the old magic that's eluded the company. Music gadget of the year.

A big online music store will fail. It's never fun to predict failure, but the recession will claim at least one of today's major online music sellers--Napster, eMusic, or perhaps Rhapsody.

The Big Four will become the Big Three. Hard economic times lead to consolidation, and the music business was having trouble even before the latest downturn. Look for Guy Hands to unload EMI to Universal or Warner before the end of the year.

Ticket competition won't lower prices. Ticketmaster's contract with Live Nation ends on Jan. 1, meaning that there will be two national ticketing agencies handling sales for big arenas. But this competition won't lower prices--both agencies will still tack on service charges worth up to 20% of the list price. Why? Because big concerts still operate like a monopoly--your favorite stadium band is probably only coming to one place in your city this year, and whoever sells those tickets will have an exclusive.

Online-first releases will become the norm. Radiohead, Nine Inch Nails, David Byrne and Brian Eno, Girl Talk, and a handful of other acts released albums in 2008 in online form well before they came out as a CD. By the end of 2009, at least one of the major labels will make it standard release practice, and dozens of releases from big-name artists will come out online first, perhaps even with a couple of free MP3 samples.

One major act will (temporarily) abandon albums. At least one major artist--maybe an aging legend with a strong touring base, less likely a hot pop or hip-hop act--will announce that they're no longer going to release full-length CDs. They'll go on to release at least a dozen singles--some exclusively online--with no intervening album. Their grosses will suck, though, and eventually they'll compile the singles into a good old-fashioned greatest-hits CD, sold for $20 at HMV and Amazon.com.

The next hip music town will be in an unexpected country. It's been a few years since we've had a ton of hype about a local music scene--I'm thinking about the kind of mainstream media fascination that found San Francisco in the late '60s, New York and London in the early punk days, or Seattle in the grunge era of the early '90s, complete with chart-topping innovators, flash-in-the-pan imitators, and movies featuring beautiful but tragically addicted twenty-somethings in period settings. We're due for another, only this time it won't be in North America or Western Europe. Brazil, India, or Eastern Europe could all fit the bill--are you ready for the St. Petersburg version of Singles?

Recently, I've noticed two interesting changes at my local Apple Store, both evidence of Apple's mastery of retail.

A few months ago, they remodeled to get rid of the large screen and seating area they used for in-store workshops. I liked the few classes I happened in upon during the weekend, but most of them were sparsely attended, and the workshops I really wanted to take--like Garage Band--were during normal work hours. In place of the demo area, they more than doubled the size of the Genius Bar, Apple's in-store customer support desk. The end-result: a mass of highly engaged customers at the back of the store, instead of a mostly empty space. (Engaged might mean enraged, but it seems that even customers with serious problems--like a dead iPod out of warranty--remain calm when faced with a real person as opposed to an anonymous phone support employee.)

More recently, my wife went in to buy me a Shuffle as a surprise--my 4th-generation iPod died a copule years ago, her iPod is permanently connected to an iHome clock radio upstairs, and my 30GB Zune is a little bulky for walking the dog or going to the gym. After talking to a salesperson who led her through colors and GB sizes and prices, she said she was ready to buy and started walking toward the registers at the front of the store. Not necessary--the salesperson had a handheld device with a credit card scanner, checked her out on the spot, and e-mailed her a receipt. Genius.

Sony has a lot of great products as well, but when I go to the nearby Sony Style store, it always feels a little haphazard, with PlayStations next to flat TVs next to Blu-ray discs. And it's never crowded. And I never leave with a purchase. (Although the array of flat-screens looping this Bravia commercial is refreshingly inoffensive--very little branding--and completely mesmerizes my two-year-old daughter.)

I've occasionally seen and heard rumors of a Microsoft push into retail. If so, they should be using the Apple Store as a model--nobody else does it better.

That's tomorrow, Saturday, Apr. 19. Your day to celebrate the old way of buying music, where you got into your car and drove to a local store and talked to the clerk and sifted through the racks and maybe experienced the delight of finding an old CD you'd forgotten about, heavily discounted or expensive and rare. Or maybe you heard a great tune spinning in the background and bought it, like I did with The Monochrome Set's Strange Boutique and PiL's Second Edition and Wilco's amazing live CD (their best album, in my opinion), Kicking Television.

Anyway, a lot of stores are having special events--for example, Seattle institution Silver Platters, which started selling CDs (and Laserdiscs!) back in the early 80s when vinyl was still the norm, is having live music all day long. So if you love music, throw your local record store a bone and buy a disc or two.

MySpace is essential for independent artists. Every band I've played with in the last five years has had a MySpace page, and it completely changed how we did things compared with the pre-Internet days. Getting gigs, maintaining mailing lists, fliering--all of those formerly labor-intensive tasks could be accomplished by sitting in front of a computer. One group I played with got 90 percent of our gigs through other bands on our friends list. Another had a couple dozen teenage fans who'd come to every all-ages show when they read about it on our MySpace page. (We were all in our late 30s and 40s and had no idea that ska would appeal to that demographic.)

But there was always a major gap: if we wanted to sell downloads, CDs, or anything else, we had to guide fans to another site or service, such as our own home page with a PayPal account or CDBaby.

Today, MySpace announced a deal with three of the four majors (EMI is sitting out for now) to offer DRM-free MP3 downloads, ringtones, and merchandise through the artist pages on MySpace. This is long overdue: the music industry needs to go where their fans already are, and with 30 million people regularly listening to music on the site, it's a mystery why the labels haven't tried to reach these folks before now.

But major label acts are a small part of the MySpace experience. The only reason you ask The Police or Death Cab to be your "friend" is to show off your impeccable taste to your real friends, the individuals and small-time artists who you're actually connected with. These are the folks who leave individualized comments on your page and send you instant messages, and their gigs appear right alongside Radiohead's on your home page. MySpace is the ultimate long tail site for musicians, where bar bands and small-town heroes can appear in the same context as the biggest bands in the world.

So I'm not sure that MySpace Music will be a game-changer. Fans of big bands already know where to buy merchandise--the band's Web site, or Amazon's CD section, or iTunes, or their local retail store. Sure, big fans who count major-label acts among their "friends" might now stay within MySpace to buy new songs from these bands, and some MySpace users might discover (and buy music from) new acts via friends of friends. But a lot of fans don't know (or care much about) the difference between major and independent artists, and might wonder why only some acts make their wares available for purchase. The inconsistency will be confusing, and drive users back to the traditional music-buying sites (or free file-trading services, which aren't going away).

The real game-changer comes when MySpace offers a full e-commerce store--downloads, CD sales, the works--to every artist with a musician's page on the site. That way, users would never have to leave the site to buy any music they heard on the site. The challenge would be building the infrastructure, but once things like billing and provisioning downloads are in place for the majors, it might not be much harder to set up a CDBaby-like system for everybody else.