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The Music Business and the Internet
Lots of people sent in links to stories about the music industry holding a press conference and claiming that people are copying music rather than buying it (see their press release if you like). But there are some alternative points of view too: a study at the University of Buffalo claims that music sharing may cut down on superstars and promote new music. The New Republic has a story about a band that released their album on the Net six months before CDs were available, and is now wondering whether fans will buy more, less, or about the same number of aluminum and plastic circles. And a nice chart I saw a few days ago compares CD sales vs. price over the last several years and suggests that price-fixing by the recording industry may play a part in slowing sales.
You know, it's hard to have sympathy for an industry which has killed most of the real talent from getting into the popular market (with a few exceptions) ... and then it gouges the consumer with strong-arm tactics at the record stores in order to keep prices up.
For Pete's sake, CD's are still more expensive than tape cassettes. It's not about cost of manufacturing -- it's about gouging the consumer.
-- We live in a world where lemonade is artificial and soap has real lemon.
At some point, the recording industry is going to have to realize that they have things BACKWARDS. Now, artists tour to increase and promote album sales. In the future, it's going to have to be the other way around -- artists will put out albums to promote and support their tours. Go see a band live, then buy a copy of the performance you just saw on your way out.
The record industry doesn't have that many options. The best one seems to me to start giving away the virtual (i.e. the actual songs) and sell the material (i.e. nice hard to break cases, quality booklets or even books). The special edition Kid A from Radiohead is a good example of a CD you want to buy (if you like Radiohead, that is).
This, combined to other non-downloadable merchandise (t-shirts, posters, etc.) and -- of course -- live performances, should enable musicians to keep making a living while preventing customer alienation (which you'd imagine would be the "prime directive" for the industry -- not so). As for big-time, multi-million producers, well...we have no moral or legal obligation to keep them multi-millionnaires. Just because an industry is well-established doesn't mean it has to be preserved by law -- especially when it alienates customers, infringes on their constitutional rights and goes against technological development.
Reminder: find a new sig
... would have to change. So should the music industry.
They should have to become leaner and more focused on quality and price instead of just driving legislation.
I understand that the music industry wants to keep their stranglehold, where they can charge pretty much what they want.
There is a strong competition on furniture, electronics, computing etc.. so why not in this industry as well?
The whole napster/gnutella/whatever issue is just a wakeup-call from the consumers that they are sick of price-fixing and control-freakish behaviour from RIAA and their members.
Instead of just listening to the industry, legislators should let the music-sharing force the industry onto a new path.
What the consumers want is pretty clear:
1. We want to be able to buy a lot more music. Price has to go down.
2. We want more control over how we get the music and what music we want (no longer having to buy an album with 13 shitty songs, just to have 2 good ones.
3. We want a much more innovative and competive industry.
If the music industry can't satisfy my wishes but the file sharing networks can, what do you expect me to do?
If you say that compared to a year ago file sharing is up by X% and sales are down by Y%, then that doe not tell you if that X% caused or contributed to that Y%, if Y would have been larger without the grass roots marketing effect of file sharing, or something else entirely. A single data point (or pair of data points in a time series) doesn't provide you with enough information to reach the kinds of conclusions people on both sides of this debate are pushing.
But then, this isn't science, it's politics and money, so everyone involved has a huge incentive to twist the facts to support their position.
- Internet music sharing was rampant in the UK (probably partly attributable to increased availability of broadband) and
- CD sales in the UK rose 4% (NB: vinyl sales rose by even more; go figure), contrary to a downward trend everywhere else
Hrm, let me see...Unfortunately, this information didn't make it through to their web site, as far as I could see...
RECESSION! RECESSION! RECESSION! RECESSION!"
Very true. Interestingly their own stats seem to show it's the impact of the recession, saying that England, one of the few places not impacted by it, saw sales rise. There were earlier statements in other places where they said that CD sales were down for the first time since a drop that had occured 10 yrs ago. Guess what. That was a recession too. It sure goes to prove, anybody can take stats and make them say what they want. I'd guess they'd say the drop in sales 10 yrs ago due to ? (Guess they'd better think up a new excuse.) In my case, my purchases of CD's are down to nil. Not the recession, and I've never had napster or other file sharing on my computers. I simply won't pay obscene prices to buy what I consider crap. (Though someone's study could as easily, and rightfully so, indicate that a small n %age drop in prices would spur a n% increase in sales. Did they ever consider the raping of the customer to be one reason they don't sell as well?
At the time the record companies started squawking, the US was headed into a recession. Things like food, clothes, and rent became priority over Nsync CDs. As unemployement rises (look at Fingerhut!) buying CDs is a rediculous way to spend the money I don't have.
Since the dawn of Napster, it was obvious that the record companies can't stop file sharing. As bandwidth increases, CDRs get cheaper, and prerecorded CDs get more expensive, new ways of ripping and sharing files will stay far ahead of the record companies and legislation.
There is no reasonable defense against an idiot with an agenda
:wq
Another factor, I believe, in the "slowing" (read: anything less than 10% year to year growth) sales of the Music companies has been their deliberate decision to abandon the "Single" in CD format, reducing the choice a person has when they hear a single song that they like to A) Buy the entire CD at $18+ for the known 4 minutes of good music and take a chance on the rest or B) oh wait, there is no other valid 'choice' as defined by the RIAA.
.. that is 7-inch records with one song on each side (Memo to 13-year old 'l33t doods': this is where the terms "A-Side" and "B-Side" came from). In fact, I bought about 250 7-inch singles a year. At $1.99 each, I could affort to take a chance on music I wasn't 100% sure about.
I wish I had the link to a recent online news story I read which talked with the industry reps who discussed their decision to abandon Singles as they felt it was cutting into their album sales.
It seems to me that they believe that when a consumer can't get just the muisc they want a la carte, they would be willing to buy a whole lot of extra music to get it. In this situation what they should be selling is the single in downloadable and usable (read MP3) form for a small price. (Memo to Record industry: charging $7.99 for one song when there is no physical cost of goods and encoding it in a format that users can't play on their iPod/Rio/Empeg/Nomad/Archos/Etc isn't going to fool very many consumers).
I can recall back in the late '80, I used to buy a lot of "45's"
In the early '90's the record companies moved to put out Singles, both 7-inch (2 songs) and 12-inch (3+ songs/Remixes) in CD format. I even bought some of those 3-inch CD-Singles in mini-longboxes (remember those).
Selection of CD singles in the USA, at least at the retail level, seemed to peak in mid '90s and has really diminished in the past 5 years.
However, this situation seems to be confined mostly to US retail. Amazon is good source for CD singles, and in Europe the format is much more popular, so ironically sources like Amazon.uk are great for getting singles to popular songs in the USA.
So this is where the availability of single song MP3 files, available for download, could be doing damage... entirely because they are filling a nitch and need that consumers have, but the labels have abandoned. A lot of those people who download probably would be good customers to buy a cheap CD single, if it was available and had the content they wanted.
it's a similar statistical argument for lowering taxes. there is a curve, and somewhere on that curve, is the 'maximum' income (for record companies in this case, for the government in the other case). if the labels charged $100 for CDs, they would sell hardly any. if the government taxed 100%, hardly anyone would file a second time (everyone would have 0 dollars). if the labels charged $0, they would obviously be out of business. if the government taxed 0% it might find itself with millions of starving, diseased citizens.
but somewhere on the curve is a bump - probably around $9.99 or so, but that is just a guess of course - where the labels would be selling so MANY damn CDs the money would be pouring in. likewise somewhere on the tax curve - probably around 19% or so, but that's just listening to economists - where income is maximized to the government.
why doesn't anyone pay any attention to economical fact, statistical fact?
-rp
ps - there are lies, damned lies, and statistics.
Music sharing does not hurt music. It hurts the music business.
It does not hurt the artist. It hurts the pop star, the producer and the sleazy lawyers (hi, Hillary!), but not the artist.
You know, there was a time when artists (and athletes, and scientists and whatnot) did not aspire to earn billions of dollars and live on crack. There was a time (I'm really dating myself here) when they just loved their art (sport, discipline) and considered themselves lucky to just make a living doing it. Not millions of dollars. A living.
Greed is the bane of our time.
This isn't hypocrisy, this is the free market economy in operation.
:-)
Think about it - the whole point of the free market is that the cost of goods and services will reach the level that people are willing to pay for them. If more and more people are downloading, copying or otherwise getting their music for free, it appears that the market is saying that music is overpriced. Thus, the price should fall to a level which people are prepared to pay. (Note that there is no guarantee that this level is not zero)
By outlawing the methods by which people obtain music for free, you are in effect attempting to artificially keep the price of music higher than the market wants it to be, thus making the market less free.
Incidently, your comment about free speech is wrong. Freedom of speech guarantees just that - the freedom to say whatever you want. It does not, and should not, guarantee you an audience. In other words, you should have the freedom to speak, and I should have the freedom not to listen. I should also have the freedom to make whatever comments about what you say that I like, including calling it socialist propaganda
Cheers,
Tim
It's official. Most of you are morons.
If music CDs were like AOL CDs, music stores would give them away like candy. Then, when you got home, you'd only be able to do anything with it as long as you paid $19.95/month. And since it's online authentication, you wouldn't be able to listen to them in the car. In short, you're really comparing two completely different things here.
Or to put it another way, if an AOL CD is really equivalent to a music CD, you don't need music CDs. You can just get free AOL CDs instead, and rock on to the groovy sound of "You've got mail!"
Besides, the price of music CDs has nothing to do with the physical medium. It costs money to produce the information on a music CD. The information on a music CD has value to many people. The physical CD is just a way of getting around the problem of transferring that information. In short, it's the information that has the value -- you'd think that out of everyone, Slashdotters would understand this.
(And yes, I'm well aware of the "information wants to be free" argument. Without supporting or condemning that philosophy, it doesn't change the facts above -- whether it's a fully GPL'd Linux distribution or a commercial, shrink-wrapped game, it still costs money to produce and has value to the users.)
Don't confuse moralism, idealism and economy. You are being moralistic and confusing it with idealism. The irony is that this a simple economic problem of value adding. Any sound business model is based on adding value to something and subsequently charging for the resulting product.
Most of the cost represented by the price of 20$ for a cd is not related to the music creation process (i.e. the artist's work). Instead it is related to the production, marketing & distribution of plastic discs containing the music. Napster has 'reliefed' the record industry of these tasks so the record industry is no longer adding any value to their products. Given this reality, our capitalistic system is simply functioning properly and the only result can be that either the record company finds a new way of adding value to their product or will simply die.
The record industry has managed to slow this process by price fixing, seeking legal protection, persuading politicians to adapt the law when that didn't work, trying to persuade hardware manufacturers to adapt their products and many other tricks. However, they have so far failed to add value to their product and have even started to remove value from their products (e.g. the celine dion cd that makes your pc crash).
It's as simple as this. Because the record industry is no longer adding value they are losing market share.
Consider the invention of book printing. Before book printing, clerics would spent months or even years manually copying books. The resulting volumes were expensive. Then book printing was invented and greatly reduced the cost of creating a copy. This probably killed the market for hand copied books. Is that bad? Is that evil? No it's a simple case of no longer adding value. Just like hand copying books is no longer a good business model, creating little plastic discs with music on them has also become a waste of time.
Jilles
The press release from the IFPI says in part,
So, in other words, 65% of the people in the U.S. who download the most music off the 'Net either:
So overall it appears as though downloads might not be to blame for cutting into sales. One would want to know, for example, how much more and how much less these subgroups bought, and whether they were heavy music buyers before.
This is a rather clumsy blunder in a press release intended (apparently) to scare the music industry and raise sympathy for their plight among their friends in government. A minority of the heaviest users of a new technology are buying less. Hard to feel sorry for the industry.