Gateway as Content Distributor?

crovira writes "CNet has an article about Gateway testing the waters of the music business and using their retail stores as music outlets." crovira excerpts: "So far, Gateway executives have not specified exact plans that the company will pursue, but they have indicated that it could position itself as a conduit for content from established and new artists. Turner also indicated that Gateway is contemplating bypassing the titans of the music industry if necessary. 'We have retail stores that aren't beholden to the music industry,' Turner said. 'There are a lot of artists out there.'" Makes one wonder if the xxAAs will roll-over and take their tithe or if they'll try to find some anti-competitive legal maneuvering leverage to keep Gateway out? And can Apple be far behind with video services out of their own retail outlets?"

Comments

new business model

[tcm614ce]

Maybe since Gateway is in the tech business, not the record business, they will be able to come up with the business model that can make money for themselves and [their?] artists with new technology.

Re:new business model

[johnjones]

yeah its called streaming

wake up Video + music will be on a server and you select what you want when you want it

the tradtional ISP is gone as soon as the Mobile networks have enough bandwidth to do Video

that way if you have a TV/STB then you put in SIM chip and recive what you want paying for rentels via sim(what we think of as the phone)

and if you want music plug in you earjacks into phone and away you go

I have not seen a single new phone (based on OMAP) that cant do streaming MP3

its only a matter of time until the networks (mobile) work out this revenue generator and kick the cable co/baby bel/incumbant ARSE

muh hahaha

regards

john jones

Deathmatch

[DCram]

the great thing is Gateway has enough clout to pull this off. And the more holes Gateway puts in the wall the more cracks smaller guys can squeese through.

Coverage on CNN Next

[ShaggusMacHaggis]

They had a short bit about this on the show CNN Next. Included were interviews with the president of the RIAA, she was not happy at all. Basically said that Gateway was supporting piracy. Lol, what will they think of next?

Conspiracy

[sketerpot]

Yes this is paranoid, but perhaps the **AA would make a deal with gateway: gateway puts content protecion into their mahines, the **AA lets them be in the content distribution racket.

Bet then perhaps we'd see a rise in people getting computers from little companies no one has ever heard of.

Gateway founder's brother started Samson Records

[K8Fan]

Ted Waitt's brother Norm started Samson Music back in 1997. They signed a bunch of new artists, but then dropped them, changed their name to Gold Circle Records and signed a bunch of 80's leftovers.

interesting idea, but

[z_gringo]

It is hard to see how they could really succeed here. Would they sell CD's? Or would they simply allow MP3 downloads? Or would they do it all online with some Napster-like service?

I'm all for a totally new music distribution system (and who isn't? except for the record companies). The article is a bit light on details. Hopefully there will be more information soon.

Hey maybe one day, you will be able to call up and order you PC and have it shipped to you preloaded with your favorite MP3s!!!

Re:I wish them luck....

[Erasmus Darwin]

"Finally they will get sued, meaning a whole lot of hassle to only serve a few users."

I don't see how they're doing anything that exposes them to a lawsuit. From what I read of the article, they're only distributing music that they can legally distribute. It sounds like they're essentially a more commercialized version of mp3.com's regular service (not to be confused with the lawsuit-ridden BeamIT service).

I suspect many artists will use this system as a way to promote their work without giving up all of their work. They could create a few freely distributable singles and allow those to help drive album sales. It would be similar in nature to one of the big pro-P2P arguments (exposure to artists/sample before you buy), but it would be done with the full consent of the copyright holder and it wouldn't necessarily result in the entire album being available.

Apple as a Content provider

[danielkdwalker]

IIRC, Apple are legally unable to sell music due to a deal with Apple Music (of Beatles fame) way back when. Not sure if this still applies. IANAL

Apple is *supposed* to stay out of music biz

[BigJimSlade]

Apple Records sued Apple Inc. in 1989 over a secret agreement the two had in 1981. Apple Records allowed Apple Inc. to keep their nifty little apple logo as long as they stayed out of the music industry. This came up again recently with the release of the iPod, although I don't know the outcome of the suit.

Re:I wish them luck....

[SVDave]

But I am thinking gateway will fall flat on thier face with this one.

When my parents got a computer a few years ago from Gateway, they got their ISP service from Gateway.net . It was truly awful. The folks at Gateway obviously didn't have a clue as to how to run an ISP, but were just trying to jump on the internet bandwagon. Now my father is on Earthlink, and my mother on AOL, and Gateway.net has apparently become part of CompuServe.

I have a feeling that this is another attempt by Gateway to experiment with the latest trendy thing. They should just stick with what they know.

How The Music Industry Can Keep Gateway Out

[SloppyElvis]

The big players in the music industry don't have a monopoly on talent. Just look at the crap-slingers on the Billboard Top 40, and tell me nobody else has this type of "star power", and I won't listen to you anymore, because it would waste my precious time.

Now Gateway comes along, trying to salvage getting its butt whooped by Dell in the home pc market, thinking it can capitalize on this fact.

Here's the problem, if you want to make stars (like the music industry most certainly does), than you need to get them exposure. The web isn't bad for distribution, but promotion is tough. The simple reason is there is just too much out there for people to focus in on a group or two and make superstars out of them. In the music business, people are spoon-fed the next big thing; they make a selection from a limited pool of applicants.

Now, if the music industry tells the radio conglomerates not to air artist so-and-so, you can bet your arse you won't be hearing them. If Bobby and Sally Teen USA don't see your awesome band on MTV, then they could only ever be "a great underground band". To Gateway's dismay, great underground bands don't usually make top dollar like the industry puppets do [save your counter-examples, I speak in the general sense].

So, the music industry can easily prevent Gateway from impinging on their turf by leveraging their might concerning radio and television against Gateway. Without these conduits of distribution, Gateway's plan is more hype than hope, I'm afraid.

Re:How The Music Industry Can Keep Gateway Out

[drinkypoo]

The big players in the music industry don't have a monopoly on talent. Just look at the crap-slingers on the Billboard Top 40, and tell me nobody else has this type of "star power", and I won't listen to you anymore, because it would waste my precious time.

Or to paraphrase, "If you disagree with me, I will not listen to you, thereby preventing myself from learning anything."

Big Media music is not about talent. If you believe nothing else I say in this comment, believe that. There are a great number of people who can do what Eminem can do, for example. Let's look at his list of qualifications:

• Bitter
• Hostile
• Doesn't mumble
• Symmetrical Head
• Room for the puppeteer's hand in his... you know

(The latter is important for conventional American standards of attractiveness.

One of my best friends as a young teen fit all of those qualifications, and he rapped as a kid. While visiting my neighborhood Karaoke bar (which has since closed, more's the pity) I ran into one of my fellow ex-students, who turned out to be able to spit out a pretty good freestyle.

All of this reminiscence is only to prove a point; EMINEM IS NOT SPECIAL, as a person, except insofar as every human is unique, and therefore precious. Big Media creates these people in their sense as a "superstar", whether it be eminem, britney, or whoever. Some of these pop media icons have shown exceptional talent and wit and risen somewhat above their media masters to become real cultural phenomena in their own right; people like Madonna and Prince, for example. Both are very much in control of their music, and to the extent that any of us can be, their destiny, because they knew how to market themselves, and they have actual talent and staying power.

Now, you're saying that it comes down to exposure, and that's partly true, but it is truer to say that it comes down to marketing. Talent is not enough to become a superstar, a pop icon, the "king" of anything. You need to be marketed correctly, you need the proper void or the easy creation of one in the soundscape, and you need luck. Big Music doesn't get a "hit" with every artist, they have to fire many salvos of semi-talented hosers at the populace before one takes. Maybe their release comes out on a day when the world is feeling optimistic, maybe it jibes nicely with a current meme... But everything is half chance.

So what do I have to say about all of this? Gateway can make money selling music using a traditional model, where they do what the record companies tell them, or they can make money selling music from independent labels who will be more open to the idea of selling individual tracks for reasonable prices. We've been waiting for the whole 'custom cd' thing to take off, without costing an arm and a leg and other vital portions of one's anatomy besides. With CD burners getting faster and cheaper all the time, on-demand CD production (whether it's mix and match or entire albums) has become reasonable; Perhaps someone will make it a reality.

Gateway is NO BETTER..

[Archfeld]

they are the same as the RIAA/MPAA they just don't have the $$ yet to buy the political muscle. Look at their PC agreements. Open the box void the warranty, it MUST be serviced at Gateway.
I would not buy a computer from them what makes you think I'd buy music from them ? Just because someone is competing with the Music Behemoths does not make them our friend, probably the exact opposite.
Stand up for yourselves, you are NOT consumers, you are CUSTOMERS, and need to be treated with some respect.

This is exactly what we *don't* need!

[errxn]

Yeah, good for Wal-Mart, bad for just about everyone else. The thought of Wal-Mart running their own music label is truly frightening. They would institute a brand of censorship over their artists...the likes of which the world has never seen.

No, Wal-Mart should stick to selling shotguns and fishing rods.

Re:Gateway often goes against the big guys

[Surak]

I'm not trying to say that Gateway is some sort of Utopian selfless corporation or anything, but I just have to cheer when I see big-name companies taking on the big bullies.

I think this has more to do with the personality of their CEO than anything. Ted Waite is something of a rebel himself. One time a couple of years ago, Intel really pissed him off, so he publically vowed to change Gateway's entire line of PCs to AMD chips. Unfortunately, Gateway is a publically traded company and their stock consequently dropped like a rock the next day, so he had to take it back, and I believe they ended up switching all their PCs to Intel-only chips later on...

Also, Waite caved in to Microsoft's pressure about the Amigas, so Gateway spun that off. But we can't really fault them for that, after all at that point in history nobody dared to stand up to Microsoft... they wielded too much power, even more than they do today (the DOJ case has [temporarily] partially defanged them.)

But Whose Music?

[JeffRC]

If Gateway were to distribute music online the question is whose? The major labels aren't going to license their hoard to Gateway. The artists might, but most of the major names are tied by exclusive contract to their label. So Gateway is going to release music by unknowns? Without some major artists providing music the idea would be doomed.

Gateway, the Don Rickles of computing

[Orangedog_on_crack]

These guys are burning bridges with the zeal of a pyromaniac. First they Actually had the stones to go public about Micro$oft's policies towards OEM's. Now they're basically toilet papering the RIAA's front yard. I'm no Gateway supporter. Like mentioned in an earlier post, they cater to the lowest common denominator. But I haven't seen Dell or Compact saying anything publicly about the way MS bullies the OEM's. Maybe they'll start doing commercials that show the Gateway cow taking a dump on the Dell-dudes front yard (Dude, what's that smell?!) or commercials having some fun with the internal pissing match at Compaq/HP. If these guys want to have even a chance of surviving past this year, they need to be socking the other companies in right in the chops every time they get a chance, because I don't know of too many success stories providing content like they're planning to.

Gateway, Inc. : On-Demand Publisher

[Anonymous Coward]

This could be the first working example of a much-touted, but heretofore unimplemented business plan: an on-demand publisher.

Let's say a customer lives near a Gateway Country Store, and doesn't have broadband Internet access. Said customer could use MP3.com to mix-and-match an album, then pick an option to have it burned to CD at the Gateway store. Assuming that each Gateway store has a pipe with halfway-decent bandwidth, and assuming that some of their demo models have CD burners, the disk can be waiting for the customer by the time they drive to the store.

If Gateway allows users to surf to the site from the stores' demo machines, then Gateway can even generate impulse-driven sales. The "netCDs" at MP3.com are $4-6 each, Gateway would buy blank CD-R in bulk (less than $1 per), toss in one dollar for bandwidth/employees/profits, and Gateway can charge $6-8 per CD, undercutting MP3.com (because there's no shipping) and RIAA (because their not evil, price-gouging control freaks).

What do you think?

Say WHAT? This is Big Media vs The Internet again

[Ungrounded Lightning]

Here's the problem, if you want to make stars (like the music industry most certainly does), than you need to get them exposure. The web isn't bad for distribution, but promotion is tough.

Now, if the music industry tells the radio conglomerates not to air artist so-and-so, you can bet your arse you won't be hearing them. If Bobby and Sally Teen USA don't see your awesome band on MTV, then they could only ever be "a great underground band".

That's the way it WAS.

But we're on the Internet now.

The Mainstream Media is getting CREAMED by the Internet, in one venue after another: news, content, and and exposure to name just three.

To paraphraise the way my wife puts it:

"Word of Mouth" takes on a whole new meaning when you can get on your computer and recommend an artist you like to "a couple million of your closest friends".