Research: File Traders And Music Purchasing

An anonymous reader writes: "Like a TV preacher taking excerpts from the Bible to support a contrary thought, the results of research can be similarly interpreted in opposite ways. Edison Research just released a pro-record industry report stating '10.1% of 12-17s are actively downloading/not purchasing music.' Richard Menta over at MP3 Newswire noted that this also means 90% of file traders are buying music, a positive result that supports the virtues of trading. Menta then goes through the study's findings one-by-one, questioning Edison Research's conclusions. This includes their recommendation to the industry to fight the 'downloading problem.'"

Comments

It's a broken business model

[spongebob]

The interesting thing that came up in a conversation the other day was that there is an entire generation of people who are growing up not paying for music.

I come from a generation that has been totally used to paying for things. For me there is a "guilt" syndrome about knowing that the music is made with profit in mind. So I am more willing to make purchases or delete .mp3s

How do you stay in business when no one sees a direct reason to pay you for the information they can readily get for free? It's a broken business model for sure and they are really fighting to stay alive in more ways than the average guy realizes.... It will be interesting to see what happens.

Re:It's a broken business model

[mickwd]

I don't support the RIAA by any means, but I do have problems with this "broken business model" argument.

Round our way, lots of kids steal cars and go joyriding in them.

Would you say that the concept of selling cars via a car showroom is now a "broken business model" ? How are car showrooms going to stay in business if kids can just nick cars for free ?

Re:It's a broken business model

[alienmole]

These analogies miss an important point, which is that cars cost significant money to manufacture, and when someone "nicks" one, the original owner is now short one car. Neither of these things (the cost, nor the scarcity) is true of digital products. Like it or not, business models do have to take this into account - it's simple reality, not ideology.

Re:It's a broken business model

[killthiskid]

I suppose this is the point where someone has to explain to you the difference between music and cars.

Can you buy a new car, bring it home, and then make a copy of it using a cheaply and easily available device where by the overall cost of the reproduction is for all practical purposes zero?

How about this? Can you setup a method that would allow anyone in the world to get a copy of your car for a near-zero price?

If you could, don't you think the car companies would take advantage of the very same technology and find a way to make money?

Do you get it now?

Re:It's a broken business model

[Cody Hatch]

Actually...yes. Car showrooms are a horribly inneficient means of distributing cars. It's bad for the car companies, and bad for the consumers. It was a good idea originally because of problems both in tranporting the product to the consumer, as well as in communicating information about the product to the consumer.

Sound familar? Those same arguments are the ones used by the RIAA to justify their existence. Customers and musicians need the RIAA to make sure they know what CD to buy, and that it's on the shelf at the local store. Or so the RIAA says. :-)

Joy riding and stealing music have nothing to do with the problems either industry faces. Instead it's simply a matter of producers trying to collapse their distribution chain, both to cut costs and to allow more direct communication with the consumers. Musicians would like to know what their fans want (how many bands have released a great album, drawn the wrong conclusion about why it was popular, then released a crap album?). Car companies want to know what their customers want (nothings worse for profits than a lot full of a model nobody wants anymore). It's not just these two industries either - Dell has actually made a profit from selling desktop PC's from doing exactly the same thing.

The RIAA is a broken business model (or more accuratly, it looks like it's becoming one). The technology exists to allow them to be bypassed, and an ever increasing section of the population would like to, but the RIAA is fighting back with lobbying, legislation, courtroom battles, etc. Exactly like the car dealerships, incidentally, who have almost uniformly seen off all threats (although some car companies are making small headway in Europe, where dealership networks aren't quite as protected).

Re:It's a broken business model

[SN74S181]

It sounds to me like it's pure ideology, not a 'reality.' Either we adopt the ideology that intellectual property rights are wrong, and share away, or we adopt the ideology that intellectual property rights are fair, and prohibit sharing and punish people who break the rules. Either way it is 'ideology' driving the way things are done.

The second 'ideology,' incidentally, is the only one by which the GPL is enforcable. If there are no copyright laws, businesses will start distributing software under 'trade secret' restrictions. Things like Linux. Not the Linux of today, but the one that supports the hardware, the office apps, etc. Think of the worst scenario Stallman drags out to describe a closed-source Linux, and you have it.

Re:It's a broken business model

[Cody Hatch]

Actually, your missing the point. The marginal cost (the cost to make one additional copy) of almost everything is lower than it's average cost. A Ferrari costs more to make than a low-end Hyundai (or whatever), but the bulk of the difference goes to pay for advertising, design, etc. Similarly, the marginal cost of a single pill of a new drug is almost zero, but you are actually charged enough to pay back it's research costs.

Let me put this in really simple terms: It's stealing to pay the marginal cost of an item if the producer is charging more EVEN IF THE MARGINAL COST IS ZERO. You can't walk up to a Ferrari dealer and pay them how much it cost to make the car (still quite a bit) and then drive off with it. You can't go to Sony Music and pay them what it cost to make a particular copy of the music (zero, if you don't require a physical copy, and only a few cents even if pressed on CD), and then "own" a copy of it. Not legally, anyhow, nor even ethically/morally.

The entire argument about the differences between digital and physical items misses the concept that marginal costs are only ONE component.

You are correct that if there's no lost revenue the company hasn't been hurt, but that's far too much of a slippery slope (not to mention completly subjective) to be relied upon.

No matter how good your intentions, once you have a copy of a song, or game, or book, it's hard to get around to shelling out the cash you would have paid if you hadn't had access to a copy. I'm thought about buying Max Payne, but wasn't sure if I'd like it. I "borrowed" a copy from a friend, played through it, and did like it, and I'm going to buy a copy Real Soon Now(tm). Somehow, I just never get around to it. If I had been unable to find a copy, would I have ended up buying it? I really haven't the slightest idea.

Re:It's a broken business model

[mickwd]

"I suppose this is the point where someone has to explain to you the difference between music and cars"

Ah, maybe this is why I can never get my car stereo to work.......

OK, point taken. So can I take it you also fully support the wholescale pirating of Microsoft and all other commercial software ? Did the richest man in the world really get that way by following a "broken business model" ?

[ Yes, I am a strong open-source supporter. And no, I am not my any means a fan of Microsoft. ]

Re:It's a broken business model

[Moofie]

The GPL is an attempt to use a corrupt system against itself. In a world without intellectual property, the GPL would be irrelevant.

So you're making a straw-man argument.

Re:It's a broken business model

[VAXman]

There is a scarcity of musical talent, top grade recording equipment and studios, and professional producers. The cost of recorded music pays these factors, not for the physical media cost.

Re:It's a broken business model

[alienmole]

It sounds to me like it's pure ideology, not a 'reality.'

There are numerous real facts here that are not ideologically based:

• Stealing a physical product is not comparable to *copying* a digital product. I hardly think I need to belabor this point, but just in case, the point is that copying does not deprive anyone else of the original product.
• Physical products inevitable have a significantly higher cost of production than the cost of copying a digital product. This is a barrier to copying - not many people violate Ford's intellectual property by making copies of Tauruses.
• Humans - not just kids - will do things that they can get away with. This is a sociobiological and game theory imperative. Yes, we have evolved social constraints to avoid all sorts of behaviors agreed upon as undesirable, but most of these are in fact quite directly related to improving the survival capability of societies, individuals, and the species. It's questionable whether, in the presence of a cheap digital copying capability, the ability of Lance Bass to earn the money to fly into space by enforcing the non-copyability of his output is actually in society's overall interest.

If you consider the above three facts in combination, you find that the situation with digital media is factually different from that of physical products. In particular, it seems likely from the above that there will be less social stigma and more acceptance and support for copying of digital media than there will be for stealing of cars. At the very least, it puts price pressure on the products in question.

Business models do need to take these realities into account, and this is exactly what's leading to the current debate. No-one is debating whether it's OK to steal cars, because of the factual differences that I've outlined. Drawing a parallel between the two, as the post I originally replied to did, demonstrates a complete lack of understanding of the issues at work, or perhaps simply an attempt to confuse.

Either we adopt the ideology that intellectual property rights are wrong, and share away, or we adopt the ideology that intellectual property rights are fair

Not at all. You've set up a simplistic binary scenario with respect to intellectual property rights, treating them as equivalent to physical property rights on the one hand, and eliminating them on the other hand. There are an infinite variety of possibilities between those two extremes. You either aren't thinking very deeply about this, or have a vested interest in the current status quo.

Re:It's a broken business model

[alienmole]

There is a scarcity of musical talent, top grade recording equipment and studios, and professional producers. The cost of recorded music pays these factors, not for the physical media cost.

This is irrelevant to the point I am making, which is that it's because of the ease of copying that different business models have to be considered. Legislating against copying, or trying to prevent all copying technically, is just sticking a thumb in the dike.

I've explained some of these points in a bit more detail in this message.

Re:It's a broken business model

[Saeger]

I don't know about you, but I'm looking forward to the day that I can download "molecular scans" of physical objects, like that Ferrari, so that I can then make a perfect copy for free(*). And if I can do that, the company that makes the Ferrari's can to, which means orders of magnitude less production cost.

(*) what's free is the energy (sunlight), labor, and material cost, but the development costs (like with software) will remain.... until AI makes design intelligence less scarce. :)

As an aside, I once did a calculation that showed that if every person on the planet wanted to 'own' the mass equivelent of a modern aircraft carrier, it would require, IIRC, 1/100,000th of one percent of the Earths mass. And atoms dont wear out.

Real estate is looking like a better investment every day... it's truly a scarce resource and can only get more scarce.

Re:It's a broken business model

[killthiskid]

No, I don't... and I don't necessarily advocate downloading music for free.

The thing that does get me is that the RIAA is still behind the times. There is absolutely no f-ing reason I shouldn't be able to download any song that has ever existed for small fee RIGHT NOW.

I'm of the opinion that free-music-downloading is just a market force. Supply and demand... who has the cheapest supply for a product?

Does that make sense?

Re:It's a broken business model

[Cody Hatch]

what's free is the energy (sunlight), labor, and material cost, but the development costs (like with software) will remain.... until AI makes design intelligence less scarce. :)

As an aside, you blithly state that solar power is free. It isn't, in that you have to convert it into usable form using equipment that isn't free (even for plants). And no, having the molecular assemblers you postulate wouldn't make the solar cells free either, although assuming total capacity increased faster than total demand, the price would drop.

Buying $100,000 worth of solar cells just so you can get $10,000 worth of energy per year isn't free, although it'll be a good idea if they last long enough (maybe 11-12 years, depending on a LOT of other factors).

The problem is that the curve isn't that steep. If you devoted the entire output of all solar cells into making more solar cells, how many years would it take for capacity to double?

Sadly, the answer is "quite a while" (too much trouble to calculate any further, but another way of asking the question is what is the return on investment of generating companies in a free market). It's also about the same as any other power source. That means that while solar may end up providing most or even all our energy, it won't provide us with CHEAPER energy. Molecular copiers aren't required - a device that accepts energy and outputs products is known as a factory, and we already have quite a few. :-P

Re:It's a broken business model

[VAXman]

If you would have paid full price for the mp3 file which you copied, you are depriving me of certain amount of money which would go toward hiring another (or a better) musician or producer, or purchasing more (or higher quality) recording equipment or studio time.

Re:It's a broken business model

[VAXman]

"Legislating against copying" isn't a sufficiently different business model for you?

Re:It's a broken business model

[Saeger]

Buying $100,000 worth of solar cells just so you can get $10,000 worth of energy per year isn't free

I don't think you get it. Molecular manufacturing drastically reduces costs and democratizes the means of production at the same time. I don't have to buy those solar cells (or that Ferrari) from Monopoly-R-Us when I can "grow" my own (bootstrapping the process) using abundant resources. (I could then convert to hydrogen storage myself if I wanted.)

Allow me to quote Drexler, since he explains it better than I can:

The basic argument for low cost production is this: Molecular manufacturing will be able to make almost anything with little labor, land, or maintenance, with high productivity, and with modest requirements for materials and energy. Its products will themselves be extremely productive, as energy producers, as materials collectors, and as manufacturing equipment. There has never been a technology with this combination of characteristics, so historical analogies must be used with care. Perhaps the best analogy is this: Molecular manufacturing will do for matter processing what the computer has done for information processing.

--

Re:It's a broken business model

[Cody Hatch]

I don't think you understand basic economics. The quote you give is fine, but it doesn't mean what you think it does.

A current factory takes energy (in several different forms) and outputs finished products, based on a design.

A high-tech factory like you're talking about will take energy (in various forms), and output finished products, based on a design.

So what changes between the two? The cost gets lower. Same output, fewer inputs. Less waste (but not NO waste - remember entropy?), more efficiency. Everything gets cheaper. But still not free (nothing is EVER FREE). You still have to buy those cells from someone (or build them yourself, accepting the opportunity cost that implies). No, it wouldn't be a monopoly, because they're not only available from a monoply NOW. But it still costs.

Currently, a fission power plant will generate more energy than it uses. So I could build one, and devote it's entire output to building another one (by trading the output for the materials and labor required). Once I had two, I could devote BOTH to building a third, and so on, generating a nice ever-steepening curve.

Or I could use your magical factory and solar cells. What's the difference? Well, instead of trading the energy generated for a new plant, I can use the output to build myself some more cells directly. Wooo, I've now saved myself the trading costs. A whole fraction of a percent!

The key figure is how the output compares to the costs. How fast can a given chunk of cells plus a magic factory produce a chunk of the same size? If it's fast enough, the supply will expand geometrically till supply outstrips demand such that it's no longer economic to "waste" the output on making more. At no point, under no assumptions, will we end up with "free" energy.

However, we might end up with some much cheaper energy. I don't see solar as being the answer though. Takes too many wild assumptions to make it work, REGARDLESS of how efficient you make the production side of things. Mayvbe fusion.

Re:It's a broken business model

[alienmole]

Any and all 'physical property' is just the embodiment of 'intellectual property' into physical forms.

Certainly, but the question is whether the greater economic value is assigned to the intellectual "property" (an interesting and artifical ideological concept) or to the physical manifestation. Most of our markets have relied on the physical manifestation as a barrier to "copying".

When you purchase an automobile, all you are doing is 'leasing' somebody's intellectual property, in the form of the tools and know-how that transformed the raw ore into a vehicle.

You're oversimplifying - this ignores important distinctions. You obtain possession of a physical object which you are free to do with as you please, within reason. The intellectual property is secondary to the user of a physical object.

It happens to be far easier to make a facsimilie of a recording of music

It's that word "happens" that I'm saying has implications for business models, whether you like it or not.

the recording of the musical performance is really just somebody's IP forged into a recording that can be played back, the same as an automobile is somebody's IP forged into an automobile

You're the one pushing an ideology here: you've fixated on a single and specific meaning of intellectual "property" which happens to be very close to that of physical property.

I'm not arguing what's right or wrong, simply what's realistically likely to happen, given human tendencies and the facts of the situation.

Both are instances where you pay someone else to do something better than you ostensibly could.

Again, the question is how much you pay for the one-time invention of something like a car, vs. how much you pay for each manufacture of a car. You're assuming, without any basis, that the majority of the value is in the invention. I'm suggesting that the history of human valuation of each other's output does not favor your position.

Far be it for me to change your mind. But I don't have to change your mind. I can just nod approvingly when society as a whole agrees with me, and you are prohibited from acting freely on your beliefs.

I have no need or desire to copy music. I'm simply saying that in the long term, the ideology which treats intellectual "property" as having all the same rights as physical property, despite clear and obvious differences, is unlikely to survive in the marketplace. I don't doubt that in the short term, we'll get DRM and legislation crafted by people who share your views; but I'm equally certain that these measures are bound to fail.

Re:It's a broken business model

[EllisDees]

You seem to be equating the cost of energy with some monetary cost. Once you get a machine that can generate enough energy to produce another working copy of itself and continue to operate, you are getting energy for free from an economic standpoint. Sure, you might be 'paying' by using sunlight or fusion, but that won't necessarily cost you a dime.

Re:It's a broken business model

[alienmole]

A late response, which just occurred to me:

I agree, if it is OK to "share" music and ignore copyright restrictions, it is OK for me to "borrow" GPL'd source and stick it in my closed source software. An interesting conflict for the usual /. crowd!

Is it really a conflict? You're welcome to use GPL software in your closed source software, as long as you don't plan to resell or otherwise distribute that software. As soon as you resell the software, the GPL requires you to make your source available.

I doubt that many of the people who advocate file "sharing" also believe that it's OK to resell other's music. So what you've really pointed out is one of the flaws in the current way in which copyright is applied: that it doesn't distinguish sufficiently between personal use and commercial reselling.

In fact, original copyright law does make this distinction, which is where the concept of fair use comes from. Once you start selling someone's copyrighted work, you have crossed a very clear line. Recent trends in copyright have tried to push this line over to the personal use side, driven by the ease of copying nowadays. However, to do so without making allowances for the differences between personal copying and commercial copying, is not realistic.

Re:It's a broken business model

[Cody Hatch]

You seem to be equating the cost of energy with some monetary cost. Once you get a machine that can generate enough energy to produce another working copy of itself and continue to operate, you are getting energy for free from an economic standpoint. Sure, you might be 'paying' by using sunlight or fusion, but that won't necessarily cost you a dime.

I'm equating the two because they're the same. :-)

Don't forget, if a power plant generated less energy than it consumed, it wouldn't be a power plant, would it? And if it's generating more energy than it consumes, you can use any percentage of that surplus energy to build a new power plant.

If the percentage you choose to use is less tha 100%, you've fufilled your description of a way to get energy for "free". However, maybe it's free to you, but from an economic standpoint, it's anything but. That energy could also be used to do something directly useful (or more likely, run the televisions of suburban America, but that's neither here nor there), so the cost of making a new power plant is not doing something actually useful in and of itself. If the payoff from building a new plant isn't large enough (in terms of the useful things you could do with the new plant later down the line), then you won't do it. If it is, then you'll build new plants until the payoff of building plants drops below the cost of building plants.

No actual cash is neccesarily involved in this, note!

Anyhow, that's why we'll never have free energy, or even power that's "too cheap to meter" like "they" used to say nuclear power would be.

Re:It's a broken business model

[Saeger]

Yes, I realize that opportunity costs don't evaporate... but they do drop as wealth increases. And nanotech will make everyone very (materially) wealthy indeed.

Imagine a future where we've sent a seedling factory to a large asteroid and converted the entire thing in a GIANT solar collector (catching maybe 0.01% of solar output), to be safely microwaved back to Earth to replace all other power generation thousands of times over. Now imagine all it takes is a small team of programmers here on Earth to tell an army of micromachines how to "grow" the earthside collectors, a new global powergrid, and other infrastructure. Now imagine that those programmers love their job. Now imagine that those programmers use this power in the process that reassembles the molecules in their garbage into a juicy steak. I'll stop here. :)

Rent's still gotta be paid though... unless we do something about them squatting landlords (no! I'm libertarian!), else we move offplanet.

--

Interesting..

[neksys]

I don't know about anybody else, but my purchasing habits have changed quite a bit as a result of having the ability to download music. I actually purchase fewer cds than I did before - not because I'm cheap, but because I now have the opportunity to listen to albums before I put my hard earned cash into them. So yes, the record industry gets less of my money from poor purchases - conversely, the bands I truly enjoy and wish to support get more money from me than they would have previously.

I like to consider my money an investment into a band I support - the more money they have to spend, the more music I get from them in the future. And just like any investment, one must have research tools on hand to ensure that your money is going to get a good return - It just so happens that in my case, its gnutella. Its not piracy - its good business. Surely the RIAA understands that.

Re:Interesting..

[dboyles]

I'm playing the Devil's advocate here. I don't really think you're a bad person, but just play along...

I actually purchase fewer cds than I did before - not because I'm cheap, but because I now have the opportunity to listen to albums before I put my hard earned cash into them. So yes, the record industry gets less of my money from poor purchases - conversely, the bands I truly enjoy and wish to support get more money from me than they would have previously.

Ok, but what gives you the right to do that? You're passing the cost of your information (deciding what music you like) on to the copyright holders by doing something illegal. If you would have bought 20 CDs in a year, but instead only buy 10 because you decided you didn't like the other ones after you illegally downloaded and listened to them, you're costing the copyright holders of those 10 CDs money (remember, we're assuming that you would have bought those 10 CDs).

In the same sense, if you download the VCD of whatever new movie with the thinking, "I want to see this movie in the theater, but only if it's good," you are depriving the theater owner of money. The cost of you seeing a movie that you thought you would like but didn't is built in to the system. Now, do you still think that your practices are good business for the RIAA?

Re:Interesting..

[Moofie]

No, you're not depriving content distributers of the revenue that they are "entitled" to: You are forcing them to provide a quality product, instead of a slickly-marketed one.

If I buy a stereo, take it home, and it sounds like ass, I can take it back. If I buy a CD, take it home, and find out the only good tracks are the two singles I heard on the radio, I'm screwed. That business model only works if the customers are forced to be ignorant (IE by limiting their exposure to a new band to the two singles that are "free" to listen to).

I don't care if it's illegal. (I happen to think that it is not) I will not pay $20 for a CD that some marketroid packed with crap because they wanted to save some "good" songs for the next disc. Not going to happen anymore, especially since I've got a superb alternative.

Re:Interesting..

[jd142]

What about returned cd's?

Let's say I hear a song by A on the radio and go to Best Buy and buy the cd. I open it up and it sucks, so I return it for store credit. You can still do that, right? I was able to listen to the album and find out it is crap, then get my money (or the equivalent) back. Did this hurt the musician? It didn't help them, because they didn't get my money, but I certainly don't think that is stealing.

Or let's say I had a friend and listened to the album at his house. He says, "You got to hear how bad this is." So I do, and agree I wouldn't buy it. That didn't harm the artist.

How about buying the cd used? How about checking it out from the library? (How many people here knew most libraries have cd's to check out?)

It is a slippery slope. Where do you draw the line?

I draw it by buying albums that I actually listen to and deleting the crap I download but don't like.

Re:Interesting..

[canadian_right]

At most stores you can only return a CD if it is DEFECTIVE. You can't return it because it sucks. At reputable stores, they will play the CD to check your claim if getting a cash refund, or allow you to exchange the bad one for a good copy of the same CD.

Re:Interesting..

[Moofie]

Best Buy and Wherehouse will only accept exchange in kind.

Now, I'm lucky in that there's a superb record store near me called Good Records, and that coupled with a few very very good used record stores near me have given me access to lots of great music.

Re:Interesting..

[duffbeer703]

The only people getting hurt are the morons who are still purchasing music. The rates that you pay for a CD will be higher -- which is your problem.

The music industry exists because older forms of recording were too expensive for a non-commerical customer to record to and transport. They took advantage of technology to make a living.

Now recording technology has caught up and the barriers of entry for those who wish to produce and/or transmit music recording are approx $40/month for a phone and internet connection.

Remember that there was no "music industry" 100 years ago -- and music was still produced, and good artists didn't starve. If the RIAA member companies went out of business, the only people losing would be multi-millionaire pop "artists".

Re:Interesting..

[dboyles]

No, you're not depriving content distributers of the revenue that they are "entitled" to: You are forcing them to provide a quality product, instead of a slickly-marketed one.

But as you pointed out, that's illegal. You may not consider it unethical, but a lot of people do. Just because you don't like the business model doesn't give you the authority to circumvent it illegally.

I think we've got a difference of opinion on this one, and I doubt either of us is going to change our respective position. But let me ask you this: Let's say XYZ Band comes out with a new CD and you download it and decide that although it has a couple of good songs, you don't want to buy the CD. Do you then delete the entire CD, or do you keep it (or at least those couple of songs) under the guise of "Well I wouldn't buy it anyway."? If it's the latter (and I've got a sneaking suspicion that it is), do you consider that ethical?

Essentially, if you don't want to "pay $20 for a CD that some marketroid packed with crap," you can choose not to. I do it all the time. What I don't do is justify my illegal actions by blaming the musicians or the RIAA.

P.S. Don't take this as a flame, I'm just debating this subject, not attacking you as a person.

One point may be flawed...

[handsomepete]

The Edison article seems to make it pretty clear right away that the people not part of the "thieving" %10.1 are purchasing music:

"*A majority of downloaders have gone on to buy an artist's CD after downloading a track for free from the Internet."

...but maybe I'm reading it wrong(?)

Precision

[plumby]

Inappropriate precision really bugs me. The figure "10.1%" suggests that their reseach is accuruate to 0.1%. There is no way that that is true. Why don't they stick with "approximately 10%"? It just suggests to me that people are trusting the conclusions far more than they have a right to given the raw data that they started with.

Re:Precision

[WolfWithoutAClause]

Actually, the last digit of a value in any scientific figure is known to be an estimate.

Huh? A figure isn't scientific unless it has an attached standard deviation. Last digit an estimate? Where's that written?

Re:Precision

[richieb]

Don't you know that 87.24% of statistics are made up?

Re:Precision

[plumby]

But really that's all they've got. If, as the article claims, they've got a +/- 3%, then that gives them between 7%-13%. Their best guess would be 10%, but it's still a guess, so it's approximately 10%. If you take your "second to last figure is accurate" theory, then 10.1% indicates that they know that it's 10% +/- .5%, which it isn't.

Re:Precision

[plumby]

Apart from the accuracy that they quote (+/-3%) means that they don't know where it falls in the 7-13% range.

Let's see an up-to-date business model

[stevens]

Blockquoth the poster:

How do you stay in business when no one sees a direct reason to pay you for the information they can readily get for free?

I'm with you. I keep hearing about the "outdated business model" that the RIAA are using. Ok, I'll stipulate that, so what's a model that works?

I'd like to see someone start a label that signs artists, gets music recorded, books tours, and gives away mp3s without worrying who copies what. If there is a business model in there somewhere that takes mp3 copying and makes it remunerative, then the first guy to do it will be well rewarded.

Plus, it'll end all this bickering as the RIAA members fall over themselves to be the first to copy it.

Re:Let's see an up-to-date business model

[jd142]

start a label that signs artists, gets music recorded, books tours, and gives away mp3s without worrying who copies what

How did the Greatful Dead do it? They made money from concert tickets, t-shirt sales (Hey, that's the sweetest pie! quoth Krusty.) and probably a little from album sales. But they never really cared about concert bootlegs. Don't know how they felt about trading actual albums.

I'm not a deadhead by any stretch of the imagination, so maybe someone can explain.

Re:Let's see an up-to-date business model

[Bartab]

People that critique the RIAA/MPAA business model tend to not really think-through the long-term self-interest of themselves

No. People who critique the RIAA/MPAA business model don't really care if the RIAA/MPAA businesses thrive or dissolve. Nor should they. I for one have significantly increased my music purchases, while maintaining an unbroken RIAA boycott. I don't care if the RIAA makes a profit or can adjust.

Re:Let's see an up-to-date business model

[Rasta Prefect]

How did the Greatful Dead do it? They made money from concert tickets, t-shirt sales (Hey, that's the sweetest pie! quoth Krusty.) and probably a little from album sales. But they never really cared about concert bootlegs. Don't know how they felt about trading actual albums.

I'm not a deadhead by any stretch of the imagination, so maybe someone can explain.

Concerts are where most bands make the vast majority of their money. The only people making real money off CD's are their labels. The only reason bands need the albums at all is to raise awareness for their concerts. So if they can use the Internet to make others aware of their existence, the labels are no longer nessecary. Excellent business model, but theres no place in it for the RIAA, and hence they'll fight it every step of the way.

Re:Let's see an up-to-date business model

[The Cat]

I'm with you. I keep hearing about the "outdated business model" that the RIAA are using. Ok, I'll stipulate that, so what's a model that works?

A comprehensive, searchable database of freely downloadable mp3s, recorded at multiple bitrates and including all the relevant song information in the file. Price: $29/year.

It would take one weekend to have a million subscribers.

Re:Let's see an up-to-date business model

[alienmole]

You're asking the wrong question, with faulty assumptions: that the amount of money that can currently be generated from a very successful album is somehow a necessity. It's not. Your question is a little like asking how the buggy whip manufacturers are going to sell as many whips to car owners - not a perfect analogy by any means, but my point is that there's a discontinuous change here, and "business as usual" will have to change as a result.

One model that can work has already been mentioned by someone else: to focus more on making money from live performances, a la Grateful Dead. Not everyone gets to create something and stamp out millions of copies very cheaply, making huge profit margins on each one. The music industry is actually something of an anomaly in this respect.

Providing convenient and cheap downloadable music would also help, so that it's easier and preferable to pay a small fee to download a high-quality recording than it is to copy a crappy one. No-one has yet actually done this, the middlemen are all too busy resisting the inevitable reduction in their revenue stream.

The fact that middlement are being disintermediated doesn't mean that there's no future for the industry as a whole, just that there's no future for certain kinds of middlemen.

RIAA members won't fall all over themselves to copy whatever successful model arises, because that model will not involve them at the profitability levels they currently enjoy. However, I'd bet that consumers and artists will both find the end result more congenial, on average, with the possible exception of the likes of Maddona, Britney, and the Back Street Boys.

Re:Let's see an up-to-date business model

[DarkZero]

I'm with you. I keep hearing about the "outdated business model" that the RIAA are using. Ok, I'll stipulate that, so what's a model that works?

The problem with this question is that no one will ever accept anything as the right answer. The current situation with the RIAA is like a gasoline fuel company trying to keep their profits up when everyone has switched to electric or hydrogen cars. The market is simply gone, and the best that the company can hope to do is sustain itself by changing to a new, smaller business model that serves the few customers that prefer their product. Like or not, it has become a solid fact that people now regularly trade music between each other and burn mix CDs for their friends. From here on, the RIAA can hope to keep themselves from dying by finding a newer, smaller business model, but they cannot get back the annual profits that they once had.

I'd propose a new business model for them, but I'm one of the people that just thinks that the RIAA is doomed and that the music "industry" is bound to join the art and book "industries" as small but popular businesses that offer a good product at a sane price. I believe that the days of musicians being huge superstars and their companies making billions of dollars are reaching their end, and that that is not as bad a thing as many people think it is.

Re:Let's see an up-to-date business model

[Saeger]

No-one has yet actually done this, the middlemen are all too busy resisting the inevitable reduction in their revenue stream.

Well, I suppose if you've got the power, it makes perfect sense to spend that power on gouging people for the maximum profit you're used to for as long as possible. Why adapt to a new business model before you absolutely have to? To be fair and progressive so that the history books remember your grand foresight? :)

If Congress (hopefully) denies these dinosaurs their life extension laws, things will get interesting much quicker - and even quicker in the unlikelier case that copyright is reformed (instead of extended again and again and again...).

--

Re:Let's see an up-to-date business model

[Moofie]

I don't understand how the scenario you describe is any different from the music business today.

It's not hard to imagine that the smaller labels could band together and offer their own service on their own terms. It would be far easier for the smaller labels to compete against the big 5 on the Internet than on the shelves at Wherehouse Music and Best Buy (or their retail analogs there in that weird country where y'all use units of weight as units of currency. : )

Re:Let's see an up-to-date business model

[The Cat]

One with a server on each subnet, who would then be e-mailed a bill for about $12M for bandwidth overages, even though the server was dropped from the routing table after 72 hours because nothing else would ping.

But thanks for playing.

GOODNIGHT EVERYBODY!!

Re:Let's see an up-to-date business model

[Moofie]

If I could get it for a reasonable price without making a year-long commitment, I'd give it some thought. But the fact that they're trying to lock me into a long-term commitment in order to make their numbers leads me to believe that they think I'll get bored with their service after a month or two, and I'm not going to play that game.

If they were confident in their product, they wouldn't force me to make a commitment. Forcing a commitment makes sense if they were to have, say, given me a phone that they need to recoup the costs of, but for just flipping a bit in their database I'm not willing to make a commitment to them.

Re:Let's see an up-to-date business model

[Chris Burke]

Providing convenient and cheap downloadable music would also help, so that it's easier and preferable to pay a small fee to download a high-quality recording than it is to copy a crappy one. No-one has yet actually done this, the middlemen are all too busy resisting the inevitable reduction in their revenue stream.

I hate to repeat this constantly, since it makes me sound like a fucking advertisement, but EMusic.com has essentially done this. Okay, the quality isn't exactly any better (128k mp3), but the point is having some added-value over the free options -- in this case, fast servers and browsing by genre/etc. In any case, I find it much better than buying CDs or browsing Gnutella.

I guess I don't feel bad plugging EMusic, because it is the business model that will work, right here and now.

Re:Let's see an up-to-date business model

[namespan]

so what's a model that works?

There are a couple of local artists in Utah that seem to be doin' just fine for themselves. Peter Breinholt is the quintessential example.... he played a ton of shows, built up a following, produced his own records (from $3200 to $10,000 for the recordings), and sold them (at $10-$15 a pop). Since he's sold well over 10,000 copies on each of 4 almbums, he's not doing half bad. Certainly better than the musicians discussed by Steve Albini and Courtney Love. This leaves aside the 1,000-2,000+ seat venues that he consistently packs.

He testified at a field senate hearing a while back. He was pretty pro-P2P .... because he figures it's a high tech version of the same sort of word-of-mouth which won him local fame.

"So far," stated Breinholt, "my music has been a cottage industry. I paid for CDs to be made, found people to distribute them, designed covers, booked concert halls, took out ads in the paper... So I've stayed independant. That's not to say I'm anti-label...there's a lot a label could do to make my music available to more people. And if a fair deal came along, I might do it. I've just never seen a deal that would be fair to both parties." He spent some time delving into math of record deals, comparing his self-produced work (which makes $7-9 per CD sold) with that of a friend who went the label route (and makes $1 per CD sold, after all the record label's costs are covered, and doesn't own the rights to the CD anymore).

"It's a lot of work, but I like doing it. Not only that, but I think I understand my audience, and I get to be protective of them. I like being able to decide ticket prices for shows, who is goign to open for us, what the next CD will sound like, or how aggressively I'm willing to advertise," Breinholt said.

So there's your business model. Play and write like a maniac, keep the rights to your recordings so that when you sell copies, you actually see a couple of bucks.

Incidentally, Breinholt is not the only doing this. recently turned down a $250,000 recording contract because the terms sucked, but they seem to do just fine. Ryan Shupe and the Rubberband have won lots of attention at SXSW, and similarly sell out 1000+ venues on a regular basis, and have a couple of good recordings that people buy (even though they're really a jam band and mostly worth listening to live).

Re:Let's see an up-to-date business model

[Moofie]

but see, that's my point. They feel they have to beat me with a 50% stick to let me buy the music the way they want to. I decline to let them.

I will have music on my terms, or not at all. That's fine with me.

Re:Let's see an up-to-date business model

[alienmole]

I agree with you about the focus, that it's not really important if the current music industry makes money. But in arguing with people who seem to side with the music industry (often because they think they're siding with artists), they don't tend to understand it if you simply say "well, the music industry as we know it is toast, get over it".

What's important is that good artists can earn a decent living, and that there are incentives for them to do good work, and that there's a way to pay for any infrastructure that's necessary to promote and distribute music. So it's quite likely that some kind of "music industry" needs to exist and be able to make money, but what resemblance it will have to today's industry is open to question.

As for the reasons for the strict controls on computer equipment, what it comes down to is that many people perceive computers as an indispensable tool but at the same time as a terrible threat to existing ways of livelihood. They think they can control the perceived threat with laws and technology. I guess they (and unfortunately, we) are just going to have to find out the hard way how well that'll work...

Re:Let's see an up-to-date business model

[alizard]

You have the usual misunderstanding of the purpose for RIAA labels trying to put MP3 downloading and Internet Radio out of business. Evidence that these act as cheap promotion for albums is abundant. The problem isn't that record labels object to cheap, the problem is that anybody can play, anyone can upload to P2P or submit a record to a Internet Radio station, the payola the RIAA labels provide for a monopoly on FM radio access suddenly becomes a lot less valuable.

You also don't quite get that sales/revenues are declining for both FM radio and major labels. Is it because of downloading? Let's take the word of the RIAA for a change since they tell us that the 90% of download users buy CDs. This tells us that people are buying, if it's good... and what they are paying for is better than 128K MP3 sound so they can hear something they like better. The MP3s that are played with the listener saying "what total shit" going into the bit-bucket and he's just saved $20. Part of the RIAA model depends on the listerer finding out that an album is crap AFTER paying $20 for it.

One can blame this the decline of sales on the recession, but I would attribute to the "mass market" fragmenting into niches which are getting small enough to limit the potential market value while simultaneously increasing the expertise required for the labels to know what they are selling, who they are selling to.

Their attempts to use traditional marketing, focus groups, polling, etc. to find the next million-record seller are an attempt to hit a target that is not only moving, but becoming illusory. Why are people turning off FM radio? Why did you? If it doesn't cater to your tastes, why bother?

However, this doesn't answer the rest of your question. The answer is drastically cheaper promotion and physical distribution making it possible for a record label to break even / profit on far fewer sales. A record label that intends to be around in 2020 needs to find a business model that doesn't depend on a significant number of their artists going consistently platinum.

The goal here is to make sure that an artist selling 10K records is a profitable and prosperous one. Since an artist who is selling 10K records a year that she is producing and selling herself is grossing about $100K a year, the question is... how can a record label add value to this product to justify an artist doing business with it?

The other point is that with the fragmenting of the mass market, a record label that depends on a few record artists going platinum to allow making a profit despite the other artists who "only" sold 5K or 10K or 20K records is going to find increasingly fewer platinum records and ultimately, will find itself in Chapter 11.

Remember, an artist who sells his own music and finds an audience of a few tens of thousands of people is better off without an RIAA label supporting him. Musicians know that the odds of signing with a label and going consistently platinum are not only comparable to winning the lottery, but if the label gives up on that person or band, that person/band is no longer able to sell his/their own music.

One piece of the puzzle is missing for a record company to make this new business model possible. The TVD (terabyte removable media in CD/DVD form factor) won't be out until next year. This would make possible a black box driven by a TVD jukebox that would allow CD-on-demand purchases at any record store which has a copy. Automated production equipment for CDs on demand already exists. It would need to be repackaged for non-geeks...

This allows full quality CDs to be purchased at any record store which has the black box and TVDs from each record label they carry. Each record label could send a TVD out weekly or monthly with every single record on the label, including the back list. Encryption could be used to allow only legitimate stores to use this to make copies. Automated record keeping can be done with the machine to tell the store who to send checks to every week.

This eliminates physical production and distribution of CDs from the label POV. This also eliminates a great deal of the financial risk with respect to signing a band, as the incremental cost of getting them into stores drops to about zero.

Promotion? Stop worrying about "anybody can play" and start supporting Internet Radio (unfortunately, outside the US) and MP3 networks. Start buying ads in music print media to tell people where the new "cool places" to find new music is. Make effective use of the Internet. Don't try to be all things to all people, find a niche and try to expand to neighboring niches. Keep overhead low and develop serious expertise in a category to allow effectively helping the artist to promote themselves. The converse of this is that musicians won't be able to

If a record label develops the expertise to pick artists and give them effective support at a low cost to the label, they don't need to worry about controlling promotional channels.

Once word gets around to musicians that XXXXXX Records knows how to market, to Internet Radio that they can pick music people actually listen to, and to the industry that they are making real money with a collection of artists who wouldn't even show up on their mid-list and haven't spent a penny on FM payola, a monopoly on FM Radio becomes a whole lot less valuable.

You wanted a new business model? While I think the technology and environment probably makes other alternative models possible... I've certainly answered your question in detail adequate for a slashdot post, anyone who wants me to work on this further can discuss my hourly consult rate with me.

Re:Let's see an up-to-date business model

[jafac]

A comprehensive, searchable database of freely downloadable mp3s, recorded at multiple bitrates and including all the relevant song information in the file. Price: $29/year.

It would take one weekend to have a million subscribers.

While, as a music consumer, I would consider this to be "the holy grail" of music - I would probably become very quickly pissed off to jump onto their server I just paid $29 for and find that due to insufficiently allocated resources, their server can only handle 100 people downloading at a time, and that for all practical purposes, I could probably only get one or two downloads in the space of a week because of that.

I might pay perhaps - oh - $50, $60, maybe even $70, if the service level was fairly decent - or if it was supplemented by a P2P system. (with a file-verification mechanism that made sure I wasn't downloading ads or loops or mislabled corrupted garbage.)

Re:Let's see an up-to-date business model

[epeus]

I've spent the last year thinking about this, and I have come up wiht one that will work. It is calledmediAgora

This is fuel for the record industry.

[Mad Quacker]

10% is a _huge_ number to a capitalist corporation. They won't stop short of murder to get this 10% in their pockets.

This is the game of greed.

Re:This is fuel for the record industry.

[dattaway]

Unfortunately, only 10% of that population has jobs. The rest go to school. And they wonder *why* they aren't buying their music, but listening to it for free on the radio? Pirates! Stop them!

I stopped buying them

[Kizzle]

I'm 17 and I don't buy CD's anymore. Instead I download the 2 good songs from the CD. I, like most teenagers work at low paying job so money is tight. I don't want to pay $15 if the artist is only going to see 10 cents of that.

Re:I stopped buying them

[neksys]

Another possible option is to download the songs you want, or a whole cd of you so desire... then find the band's contact address and send them a bit of cash. Perhaps it'd only be symbolic, but I know for a fact that the $2.50 you send them in the mail would be substantially more than what they'd get otherwise - plus, the band might just get that "playing music for the sake of music" feeling again. It's worth a shot *shrug*

Re:I stopped buying them

[Kredal]

Dear (insert band here),

I recently downloaded your new album, "Strange new thing" from the internet. I refuse to give my hard earned money to the RIAA, whom you should be able to get rid of if you so desire. Because of this, and because I feel you should be compensated for your time and talent, I have enclosed a check for $16.99, the cost of your CD at the store. Feel free to do whatever you want with this money, but don't give it to the RIAA.

Sincerely,
John Q Public.

----------

What would be really cool is if we all did this instead of buying CDs at the store. Artists would make TONS more money.

Spin

[URoRRuRRR]

22% of Americans 12-44 years old agree with the statement "You no longer have to buy CDs, as you can download the music for free from the Internet."

The RIAA will interpret this as 1/5 of the population of America will never buy CDs and they're losing out. HOWEVER, this could simply be the large (and growing) faction of Americans who are discovering independant artists via the net and downloading music free legally. They then support the artist through T-shirts and concerts.

Re:Spin

[foonf]

The RIAA will interpret this as 1/5 of the population of America will never buy CDs and they're losing out. HOWEVER, this could simply be the large (and growing) faction of Americans who are discovering independant artists via the net and downloading music free legally. They then support the artist through T-shirts and concerts.

Dear me. You can't actually believe this can you? Have you ever looked at the majority of what is available for download on peer-to-peer systems?

Re:Spin

[flonker]

Good review of the survey, but they seem to have missed a point.

Some 74% of 12-17-year-olds answered in the negative when asked if "there is anything morally wrong about downloading music for free off the Internet."

This strikes me as an odd statement. They seem to be assuming that all music downloaded off the Internet is illegal. Not some. Not the vast majority. Not almost all. All. Is there anything morally wrong with downloading a song off the internet that the artist put there? The question was phrased wrong.

This is further supported by: The majority of music downloaders do have "some reservations" about artists' and labels' not being compensated but download music for free anyway.

Re:Spin

[Chris Burke]

Dear me. You can't actually believe this can you? Have you ever looked at the majority of what is available for download on peer-to-peer systems?

Sheesh. Have you ever looked at the majority of what is available in a record store?

Just like in meat-space, the alternative independent bands are in the minority of availablity. The difference is that if I happen to see one of these bands on the net, I can download it and see if I like it without shelling out $15 just to see if it's crap or not.

Broadband and the net are going to result in people experimenting more, simply because they can afford to do so. Comments about frequency of mainstream vs alt music are largely irrelevant.

Re:Spin

[foonf]

Thats a flawed analogy. What is available in record stores is decided by the record companies and store management, and can properly be regarded as artificial. The selection on peer-to-peer systems is literally the contents of the hard drives (or whatever portion they choose to make available for sharing) of all of the people who use the system. And these people are the subject of all of this controversy. If you think that anywhere near 1/5 (the figure given out by the original poster) of the music downloaded by people is not pirated commercial pop music, but rather legal tracks from "independent" bands on mp3.com or wherever, its pure delusion. You may like some of this stuff but as far as the broader picture is concerned, its irrelevant.

My own experience finding music I actually want to listen to (which is admittedly skewed towards my own tastes, largely modern classical music) is that the more commonly available a recording is, the easier it is to pirate it online, whereas anything out of print or on a smaller label, or otherwise less common, almost has to be bought (if it can be found at all, that is). If anything, by making availability directly proportional to the existing market presence, internet music piracy (lets be honest) makes commercial pop music even more dominant. But the record companies oppose it anyway, since it simultaneously erodes their ability to charge money for their product (and this is more in the future than now -- lossy compression sucks right now, and broadband is not that widespread -- we haven't seen anything of its true potential effects yet).

Re:Spin

[Chris Burke]

It isn't an analogy. It's direct comparison. How could it possibly be considered surprising that the selection of tracks on p2p sharing networks closely matches that which is available through traditional channels? That which is available -- and advertised to the hilt -- is what people buy which is what they then share. If I were to share every song I own, the vast majority of it would be mainstream big-label recordings, since it has only been in the last couple years that I've started branching out -- which is a direct result of not having to shell out $15+ for every venture into the unknown. Even if sharers are mostly downloading pop music, they are -able- to experiment cheaply, and that will make all the difference.

The figure, by the way, was 1/5th of people, not downloaded music. These clearly aren't the same, as a person who is downloading songs by bands they know is going to download far more than someone checking out new music. Do I believe 1/5th are branching out? No, but I could see it being half of that. Then again, since I myself no longer see buying CDs as necessary, but also get all my music legally, I may suffer from the natural tendency to assume there are more like me than there actually are. Yet the study not only doesn't conclude that this isn't the case, it makes suggestions that in fact this group may be larger than we would otherwise think.

making up for it?

[dboyles]

The Edison study shows that 53% of 12-17 year olds have burned a CD instead of buying it. Unless you disagree with the data (and I mean scientifically, not just "no way, man!"), you can't argue that such activities don't cost the copyright holders money in the form of a lost sale. So the real question is, is that money made up? It's certainly possible that the 53% mentioned previously bought two CDs that they would not have otherwise bought, thanks to MP3s they downloaded for free.

The study also says that 22% of Americans 12-44 say that you don't have to buy CDs any more, you can just download it for free. Again, unless the data was not correctly put together, that's keeping profits from the copyright holder. So is the other 78% buying enough extra music because of illegal file swapping to make up for the 22% who isn't? I'm sure there are several /. posters who have bought a few extra CDs in the last year because they heard it online for free first, but we all know that the /. demographic != that of America (or the rest of the world, for that matter).

Re:making up for it?

[GigsVT]

The Edison study shows that 53% of 12-17 year olds have burned a CD instead of buying it. Unless you disagree with the data (and I mean scientifically, not just "no way, man!"), you can't argue that such activities don't cost the copyright holders money in the form of a lost sale.

Uh, yes you can. You can like a band enough to listen to them if it is free, but not enough to shell out $15 for them if you couldn't get it for free. $15 is a lot of money for someone 12-17.

Re:making up for it?

[dboyles]

Uh, yes you can. You can like a band enough to listen to them if it is free, but not enough to shell out $15 for them if you couldn't get it for free.

No, the key phrase here is "instead of buying it." When we see headlines like "Software Piracy Costs Microsoft $500 million Each Year", we say, "But not all of those people who pirated it would have bought it." In this case, however, the study is saying "Instead of buying the CD, these people just copied it."

Re:making up for it?

[MushMouth]

$15 is a lot of money for someone 12-17.

$15 is a drop in the pan considering they are downloading the music on a $1500 computer through a (probably broadband) ISP which has a cost of something like $50 a month. If they are getting free access from college, then it is especially small compared to the cost of education. Last time I checked most CD were purchasable either used ($5-$10) or in on sale ($12), I buy more than 4 discs a week, and I don't remember the last time I paid even $15 for a disc. It's funny that the most affluent of our society bitches the most about the cost of music. If you don't want to pay the piper, then don't listen.

Re:making up for it?

[Fjord]

The Edison study shows that 53% of 12-17 year olds have burned a CD instead of buying it. Unless you disagree with the data (and I mean scientifically, not just "no way, man!"), you can't argue that such activities don't cost the copyright holders money in the form of a lost sale. So the real question is, is that money made up?

Another question is "has digital technology made this number higher and thus the loss greater"? Remember that when we were young, we used to use tapes to copy music. I'd be surprised if it was as low as 53% of people from my generation had copied a tape. Making a CD copy is a pain in the ass in comparison, and requires expensive equipment. We just needed a $40 deck.

Also note that these actions were legal under the Audio Home Recording Act as it states:

No action may be brought under this title alleging infringement of copyright based on the manufacture, importation, or distribution of a digital audio recording device, a digital audio recording medium, an analog recording device, or an analog recording medium, or based on the noncommercial use by a consumer of such a device or medium for making digital musical recordings or analog musical recordings.

Re:Hate to be bursting bubbles...

[plastik55]

Sorry to burst your bubble, but the figure was 10.1% of teens who actively download music.

What are OUR solutions?

[dowobeha]

Before /. explodes into a massive frenzy against the recording industry and the senator from Disney, I have a question for the community:

What is OUR solution to the (perceived) crisis of "piracy" that is today's filesharing world?

Powerful lobbying interests are hell-bent on coming up with some sort of solution. We've all seen the laws being proposed to combat this and other DRM-related problems.

File-sharing may have a detrimental effect on sales. Then again, it may be helpful to sales. Either way, most file-sharing is theft - plain and simple.

I propose that if the online community can not come up with a way to deal with this issue, then the politicians and the lobbies will; and I am pretty sure that whatever they come up with will be a lot less freedom-friendly than what we'd like to see.

So moaning and complaining aside, what are our options? What can be done that is fair to artists and to consumers?

(steps off soapbox, slips on soap, lies unconcious for some time...)

Re:What are OUR solutions?

[evilquaker]

What is OUR solution to the (perceived) crisis of "piracy" that is today's filesharing world?

A three-fold strategy:

1. Cut prices in half...
2. Provide a value-add beyond just the music. Concept albums and/or albums with extensive artwork, liner notes, etc. are two ideas. Access to exclusive online content (keyed by UPC and revoked if used from more than 3 different geographic regions (just like the porn sites do)) is another.
3. Provide custom-order CDs with customer-selected tracks for $2 a song or so.

The bottom line is that you need to give people a reason to buy your content instead of downloading it.

Re:What are OUR solutions?

[Alpha State]

File-sharing may have a detrimental effect on sales. Then again, it may be helpful to sales. Either way, most file-sharing is theft - plain and simple.

I fail to see how it is theft, particularly if it helps sales.

Here's a solution which will work - a p2p service available for a subscription fee, which allows users to share any music they want. The service will also track what is traded (possibly with some help from users), and pay the artists in proportion to how much their songs are traded. Better still, have the songs available from a central server as high-quality mp3s. The key here is compulsory licencing - that way you don't have to worry about identifying tracks, watermarking and a lot of other bs.

Many people have proposed something like this, both on Slashdot and elsewhere. However, this solution will never fly with the powers that be because it cut out their source of power. The closest thing to this ATM is emusic, which is still very limited and beholden to ASCAP/BMI/RIAA.

Re:What are OUR solutions?

[karlm]

Either way, most file-sharing is theft - plain and simple.

First of all, I definately go through periods where I whipe all of the songs I don't own from my computer and I go through periods where I say "hmm... deleting the songs from my computer for 6 months didn't cause me to buy them... so my having them doesn't hurt sales." I'm on the fence about the morality of copying music.

In any case, we need to stop using industry-supplied propaganda terms like "theft" and "piracy". These kids aren't taking other kid's lunch money or forcably taking control of seagoing vessels. They are infringing on copyright, just as if they'd snuck a camera into an art museum. Using horrably innacurate terms doesn't help Joe Public or Jim Congressman think more clearly about the issues. (Once, I'd like to see someone use a Britney song turned up full blast, or a bured MS iso, to forcably take controll of a seagoing craft in international waters. That's music/software piracy.)

As far as solutions, the music industry needs to shift from being property based to being service based. Tours, custom content, subcriptions to a website with the latest pre-mastered songs and outakes, latest news on their favorite band, etc. (Yes, and T.V. ads.)

I admit, I don't know enough to say exactly how it should work, butI do know that the current state fo thing is decidedly bad for the economy. It's highly artificial. Imagine if the cottage weavers guilds had succesfully gotten the government to limit power looms to the same output speed as human weaver. This is the situation we have today. The new, more efficient method of content distribution is being legally stifled becuase a lot of people have a lot invested in the old system.

I'd also like to point out that telling people they're comitting theft or piracy by downloading music kills your credibility. It's like telling kids that pot is as bad for them as crack. People may not be able to articulate their feelings, but most people know deep down that theft isn't the right way to thik about it. Copyright infringement of this sort is illegal, and perhapse morall wrong, but let's call it what it is.

(People lose respect for the law when the law doesn't make sense. I think we'd have fewer pot smokers if tobacco were illegal. I don't smoke pot or tobacco, but I think if we had to pick one of them to make illegal, we picked the wrong one. Do the worst pot addicts smoke more than the equivalent of a pack per day? Nicotene is pretty nasty stuff. I looked into chemically extracting it and creating the sulphate for use as a skin contact fast acting mouse poison. Look it up in the MERK index. Nicotene's primary natural function is killing insects that eat tobacco leaves. It's a pretty efficient poison. Many long-term smokers have heart problems from having elivated blood pressure and heart rates for most of the day. In many ways, copyright laws are just as screwed up. If the laws were more consistant, I think they'd be respected and obeyed more.)

Get it right, damnit!

[hrm]

The statement made in the article isn't what's quoted in the summary,
"10.1% of 12-17s are actively downloading/not purchasing music",
but it's rather
"10.1% of 12-17-year-olds who actively download music from the Internet did not purchase a single CD or cassette in the last 12 months"

The real statement allows the conclusion that 90% of downloaders still buy music media. The one in the slashdot summary, as too often is the case, is plain wrong.

Re:Get it right, damnit!

[Dr. Awktagon]

"10.1% of 12-17-year-olds who actively download music from the Internet did not purchase a single CD or cassette in the last 12 months"

That's still open to interpretation. Let's assume that 12-17 year olds make up 40% of the music buying public (meaning, people who can afford to buy music and who like to listen to music, not necessarily buying it). Of those, let's say 75% "actively download", whatever that means. Of those, let's assume 50% would've bought a CD or cassette in the past 12 months. And of those, let's assume 80% would not buy non-CD or non-cassette music (MP3 downloads for instance). Because they limited the question to "CD or cassette". So of this group (so far we're down to 12% of the potential music-buying public), only 10.1% (love that decimal point, implying accuracy) are lost sales for the record companies. That's 1% of the potential market for music-buying. Well within the margin of error, perhaps?

Of course I just made all those other numbers up but that's the problem with these statistical "text bites" thrown out without any rigorous analysis.

Then again I didn't read any of the articles (shock, surprise). Then again, I bet the RIAA won't either, they'll just use the text bite!

Sick of these studies

[Monkeyman334]

I am tired of posts and articles that point out file sharing increses profits. Even if that's true, it's still against what the RIAA wanted when they put it out. When Morpheus switched from the kazaa-like client and switched to an open source client, even though it was great for open source, the first thing people asked was "Does it comply with the GPL?". It didn't matter if it was good for open source, they did it against the rules. With the RIAA, it's their music, let them release it under their rules, and if you have a problem with it, don't use their product.

I'll Buy it if I can get it for Free?

[thales]

Yeah Right, and the Linux distros are making so much money that they aren't laying off anybody, and no one beleaved the recent rumors that a distro had folded.

Poorly stated statistic

[slamb]

From the second article:

But her interpretations of some her own data [sic] struck me as curious, an interpretation that I picked up in the title of the email she sent me "10.1% of 12-17s are actively downloading/not purchasing music". This implied to me this was a negative stat. Doesn't this also read 90% of teens are both downloading and buying?

No, that statistic says that there are four groups:

• Downloading and not buying. 10.1%
• Downloading and buying. Unknown. (Only 90% if the next two groups are 0%, which I doubt.)
• Not downloading and not buying. Unknown.
• Not downloading and buying. Unknown.

But apparently he misquoted, because the original article actually says:

10.1% of 12-17-year-olds who actively download music from the Internet did not purchase a single CD or cassette in the last 12 months.

Which is a completely different statement. And implies that 90% of teens who download music are buying music.

This doesn't really mean that much by itself. There are at least two contrary arguments you could make with it:

• 90% of teens who download music buy it, as opposed to 30% of teens who don't. So it increases their likelihood to buy. (I just made up that 30% statistic for this example. No idea what the real number is.) It increases their interest in music and therefore their likelihood of buying music.
• 90% of teens who download music buy it, as opposed to 98% of teens who listen to music but don't download. So it causes artists/labels to lose business. (This has an opposite cause/effect assumption from the argument above.) (Again, the second statistic is fake for this example.)

Clearly to get useful information, you need some way to determine which is cause and which is effect. (Probably a little of both.) And in both cases, I made up a second statistic that wasn't supplied by the article. Real numbers might be interesting.

Edison research?

[Pig Hogger]

Lemme guess... The result is 99% perspiration...

No business model

[Mad Quacker]

Perhaps there isn't a business model to be had, that may be a better than any business model. How much money did musicians make before records that you could sell? Not much, but they did anyway, and we have a rich and diverse history of music. After the record industry got started, musicians still made almost nothing, just a few fatcats who had the money to invest anyway. With better contracts and sales of multi-million units, some artists have made a decent amount of money, but this is an infinitesimal number of all musicians. All the while some pseudo-anonymous fatcats with little talent but a large pile of cash, are making their pile larger.

The time for super-stars and immense amounts of wealth for the few may be at an end, at least for this industry. I welcome it. How many bands that have gotten silly, filthy rich produced a good album afterwards? Exactly.

Re:No business model

[MORTAR_COMBAT!]

How many bands that have gotten silly, filthy rich produced a good album afterwards?

red hot chili peppers. californication.

dave matthews band. broken stuff.

radiohead. amnesiac.

okay, that's all i can think of for now. but i'll agree there's not many. but i'll posit a different question: how many bands that have gotten silly, filthy rich produced a good album at all? you might find the same list of bands already mentioned here.

Re:No business model

[omnirealm]

How many bands that have gotten silly, filthy rich produced a good album afterwards?

That's the funny thing about our capitalistic system. The possibility of becoming a monopoly is a powerful incentive for innovation and production in the first place. However, once a monopoly actually occurs, then the system begins to fail (specifically, that which follows leaves much to be wanted).

I submit that the dream of becoming a multi-millionaire superstar (in the area of music), or the dream of producing the de-facto desktop operating system (in the case of Microsoft) gives motivation to struggle in the market and to produce. Take away the mere possibility of ``striking it big,'' and you affect the number of people that are going to try.

Re:No business model

[martyn s]

That's an interesting theory, and might be true of other areas like in industry, but in creative endeavours, the prospect of becoming rich does not lead to better art.

motivation

Of course, as with everything, you should consider the source.

My honest No B$ answer

[t0qer]

I don't fill my hard drive up with that frivolous crap. I consider data like any other peice of data, just another bit to babysit. My hard drive is filled up with some games, tons of applications that I use, and tons of stuff that I work on for other people, backups of their postnuke sites, graphics, renderings from truespace, ect.

I do have cat5 strung up throughout the block(and my house of course). Click on my user, look back a a few of my posts, sorry i'm a little lazy to do that right now.

Back to my point, there's a few house frau's that i've taught how to turn their CD collection into mp3's. Over the 4th we pirated the FUCK outta their collection by piping the MP3's through a D/A convertor, then through an amplified coil attatched to some paperish material inside of this big wooden box.

OkOK I lied, I do have a huge collection of stuff I grabbed when napster was still around. I don't swap songs with people though. My upstream is capped at 128.

OKOK I lied again, everytime I have a lan party, I add new songs, but they're not on MY hard drive they're on my other FILESERVERS hard drive. I don't wanna put that kind of junk on my 10kRPM Ultra 160 drive! Yeah I'll just shove it on that crap 80 dollar IDE on the fileserver.

Fuck it, it's too hot and i'm too cranky to write anything usefull. Go ahead and use those mod points to mod me down.

--toq

Absurd logical fallacy in topic.

[Elwood P Dowd]

'10.1% of 12-17s are actively downloading/not purchasing music.' Richard Menta over at MP3 Newswire noted that this also means 90% of file traders are buying music,

Ok, someone correct me please, but...

Based on the two given distinctions, there are four groups of people:

12-17 year olds downloading and not buying.
12-17 year olds downloading and buying.
12-17 year olds not downloading but buying.
12-17 year olds not downloading and not buying.

The research shows that the first group is 10.1% of 12-17 year olds. Is Richard Menta saying that that means 89.9% of downloaders buy music? That's what the topic indicates, and there are about ten different really absurd assumptions that would be necessary to make that conclusion. I'm not particularly interested in reading the article, but the way it's presented in the topic is braindead. Hopefully Richard Menta had different reasoning.

Re:Absurd logical fallacy in topic.

[Kredal]

The article states it very differently, and it makes sense.

10.1% of all 12-17 year olds who ACTIVELY DOWNLOAD do not buy music.

So we're only looking at people who download here... the other 89.9% of downloaders do buy music. This is, for the RIAA, a Good Thing(tm). But they don't want to see it that way. They'd rather the downloaders who are not buying be in the catgory of people who don't download anything.

Shrug.

Re:Absurd logical fallacy in topic.

[Kredal]

Direct from the article...

-----
10.1% of 12-17-year-olds who actively download music from the Internet did not purchase a single CD or cassette in the last 12 months.

Or 90% 12-17-year-olds did purchase CDs even though they actively download music from the Internet. In other words, the record industry is having excellent penetration in a market where most of its audience doesn't have a paying job. As for the other 10% can you honestly assume all would have bought CDs if there were no file trading?
-----

That says they're only looking at people who are downloading music. The sector of the population who is not downloading music isn't counted at all.

Make the god damn CDs available, then I'll buy it

[British]

How about the fact that some things simply aren't AVAILABLE on CD? Yet, if I went to AG(before it "died") I could download all the Martha and the Muffins tracks minus a few songs? Had the CD been availble(and no, I'm not gonna get vinyl), I'd be more than happy to buy it.

Perhaps its just the genre of music I like, being rare and obscure early '80s music. The music stores don't seem to get the hint that I want to buy actual releases of Devo instead of the dang compilations. Yes, I want the not-so-popular tunes made by them and others.

Re:The State of music

[autocracy]

Yeah, and even then listening to the CD isn't quite as fulfilling, now is it?

Re:My habits

[alouts]

Interesting habit...

I'm trying hard not to sound condescending, but you do realize the fact that your playlist often syncs up with what's on TV at the time means that your playlist is pretty limited, right? I haven't been a serious viewer of MTV or VH1 in quite a while, but I still occasionally flip through, and the one thing that always stikes me about it (aside from the lack of music on music television), is that just like mainstream mass radio, the playlists on MTV and VH1 are very, very small. Like on the order of 2 or 3 dozen songs available to be played, tops.

Now don't get me wrong, I'm not saying that all that music sucks, or that your taste is bad - I like plenty of music that is popular - I'm just saying that there's a much wider world out there to choose from as well. I really think if people sampled a little wider variety in addition to what they like in the mainstream, the overall quality of music available and promoted would be dramatically increased.

And for me, that's where the internet comes in. I've been exposed to so much more variety in the last 5 years than ever before, and my music collection reflects that.

I pirate shamelessly

[Anonymous Coward]

Seriously. The only software I buy anymore is Linux distributions, the odd computer game, and a rep theatre movie ticket. Plus, there's no way I'm going to pay for a CD that I can't preview, and without Napster that pretty much means I either steal from my friends or develop a deeper appreciation for the stuff I already have.

I look at all the media corporations out there and I see rich bastards at the top who are looking to fleece their customers, employers and investors so they can buy that umpteenth car or beach-house. Whenever competition comes up, these corporations try to squelch it. If wage earners base salaries went up in the same ratio as corporate CEO's over the last two decades, we'd all be earning at least 20$ per hour.

If CD's, software and movies were priced according to the realistic cost of production, maybe I'd be a little more inclined to pay. But, since it's not, and since the sham rich people pretend is capitalism keeps it that way by killing upstarts, I don't have any option other than to pay (thereby enabling the system I want to fight), or pirate.

So, really, I'm doing it out of a sense of duty. That and the fact there's no way I'm forking over $15 for another mindless Hollywood blockbuster, $25 for another crap-filled album, or whatever inflated monstrosity of a price Microsoft is charging for an OS upgrade. Fuck that.

Just my two cents.

Re:I pirate shamelessly

[aardvarkjoe]

You know, this seems to be a popular argument these days. "The music is crap, so I shouldn't have to pay for it." If the music, movies, and everything else are really all that bad, then why are you so intent pirating it anyway? Nonsense. You like the music, you're just too cheap to pay for it. At least stop trying to make lame excuses.

Slashdot Music Servers

[the eric conspiracy]

Hmmm. If I was the RIAA I would be looking to see if I could find evidence that the Slahdot offices/employees are actively pirating music. It seems like every other day Slashdot's editors are posting some article which in effect says "Those stinking Nazi RIAA creeps are harrassing us because they are attempting to enforce their legal rights against copyright infringement AND are lobbying Congress to further restrict copying" I mean, could the bias be any more obvious? What is Slashdot hiding?

Clearly the RIAA is doing what any other industry organization - protecting its members legal position, and lobbying for legislation that would be more favorable to its members. This after all is why these sorts of organizations exist. It's no different from other organizations say, like 'The Technical Association of the Pulp and Paper Industry', etc. except that Slashdot thinks what this organization does gores the precious right to swap files despite the existance of long standing laws that clearly state such activities are illegal.

Maybe people just aren't buying music + suggestion

[0x0d0a]

I never bought a single CD before MP3s...I just didn't listen to music. Now, I have some MP3s that I listen to. If those MP3s went away, I'd just go back to not listening to music.

Because "10.1% of people downloading music are not buying music" does not mean that the music industry is losing sales from all those (though I'm sure it is from some).

I wonder how feasible it would be for someone like Borders (trying to compete with Amazon as a music retailer) to directly sign for tracks with artists. Then they maintain at each location a fat data pipe (if this isn't economically feasible, it will be -- small credit-check data lines are already in place and data gets cheaper and cheaper, whereas CDs stay the same). Then they have a really fancy burner or press or whatever at the location. They download losslessly compressed tracks from the Borders central server and cache them at local locations (to avoid retransferring popular tracks). Then people can simply say "I want a CD and I want track X, Y, and Z on it". The money goes directly to the artist, aside from Border's profit.

So lets see why this makes sense:

* Artist gets money, users have less incentive for piracy.
* User gets to specify what tracks they want/don't want and get better quality than they would pirating MP3s.
* The user can buy CDs more cheaply -- by eliminating the middleman, they pay maybe $3 to Borders per CD (you automate the thing, with a little Borders card reader, and there's very little per unit cost) and 10 cents to the artist per track (hell of a lot more than the artists are currently making), and you get a full-quality CD where you're supporting the artist for $5 tops.
* Users would have a much broader selection, not limited to the few hundred titles that might be in the store.
* Borders makes money -- I suspect unit costs after amortization would be about 50 cents per CD, so they get a healthy $2.50 in profit per CD, which is probably more than they currently make.
* Borders risks far less than they currently do -- adding an artist to their central database is cheap cheap cheap. They don't have to risk warehousing and blowing shelf space on CDs that people don't want.
* New artists can break into the market easily -- they simply register with Borders, send in their music to the main server, and start getting money. They don't have to convince much of anyone of their music quality, since there's no massive production/warehousing costs for all the CDs.

There are two drawbacks. One, you don't get extras in the CD. You might be able to print out the cover and the CD label, if this "Borders mini-CD maker" machine was fairly capable, but you might not get other stuff jammed in the case. Second, even with a hefty local cache, Borders still has to transfer 300MB per full CD (assuming lossless compression averaging 2:1) for infrequently requested CDs. This may not yet be feasible -- however, data lines keep getting cheaper, and CD prices stay the same.

Finally, a $100 80GB HD can store about 160 fairly full CDs, and 300 with lossless 2:1 compression. That's a one-time cost -- like incredibly cheaply expandable floor space. At those prices, Borders can afford to have enormous local caches -- one sale of a CD much more than makes back the cost of storing that CD locally.

Re:Let 'em Fight Downloading

[Kredal]

That would work, except the money they spend would be taken out of "honest" people's wallets too, as prices for CDs go up.

But wait, then more people would just download music, and not buy overprice cds, and the RIAA would raise prices even more to cover legal costs....

Hmmm. Interesting, to say the least.

Lower the price

[Anonymous Coward]

Some young person earning $5 per hour at MickeyDees has to work 5 or 6 hours to earn enough after tax money to pay for a CD. That is absurd. Lower the price. A list price of $9.99 would go a long way to curbing piracy.

You know damn well that the artists are not getting much money from the sales. It's all gravy for the fat parasite executives.

Re:Lower the price

[MushMouth]

And they will have to work how long to buy a computer or get a broadband connection?

Price

[Thorin_]

If cd's were more resonably priced I think more people would buy them. I can go out and get a casset for around $10 where a cd would cost me around $20 usually. Cd's are cheaper and easier to make than cassets and they are no longer new technology. The only reason they are so expensive is because RIAA makes them that way with their oligopoly.

Broadband makes a big difference

[Animats]

Take a look at the graphs from the study. Only 14% of dial-up model users downloaded 100 or more songs. But 41% of broadband users did. 73% of broadband users are downloading music.

Next the RIAA will want a tax on broadband connections, I suppose.

Lies, damned lies and statistics

[guttentag]

10.1% of 12-17s are actively downloading/not purchasing music.

Technically, this statement says 10.1% of 12-17-year-olds fall into one of the following two categories:

1. People who are actively downloading music (this doesn't necessarily mean they're not buying music, downloading music they already "own" or downloading indy music that has been made freely available by the artist)
   
   
2. People who are not purchasing music (like people who don't watch television, there's nothing criminal about not supporting the popular media)

The "or" operand (/) leaves open the possibility that the entire 10.1% consists of people from either group. However, the statement is designed to be open enough for you to reach your own conclusions based on your personal or corporate-sponsored biases.

In short, I think it's safe to say that anyone who cites the statement as "evidence" of anything is standing on very shaky ground.

"Actively not purchasing music"

[GeekDork]

Yow! That's active passive resistance. Ghandi would have been so proud.

But here we go again, the same old crap we have seen with other research and - especially - with benchmarks. Some company, club or whatnot buys a researcher to bend statsitics their way and hopes that no one really notices that they're just reading a modified excerpt from How to lie with Statistics/Charts. And most of the time it works, because most of the really important folks (legislators) exceeded their level of competence when they were elected (you know who you are). They get those really biased statistics on glossy paper with lots of really biased charts, have a look at it and say: "Man, those [insert enemy here]s are really bad and should be [put against the wall|fried|gassed|drowned|beat to teath|stoned]." (Personally, I'd prefer the last one afther ther Berkeley definition.)

Then, it all ends. Why? Because any counterargument comes on standard paper, printed all in black with perhaps one or two graphs meant for people who know what they're looking at, and not for decisionmakers!

In the end, we can all just sing and hope that the revolution's coming and we get to decide who's to be put against the wall. Or at least who's to rethink their corporate policies to avoit a smack-bottom.

"actively not purchasing music"

[Dr. Awktagon]

Ah, such beautiful doublespeak. Would you like to hear the sad tale about the twenty-something who is actively not purchasing a new Lexus? In fact, said twentysomething actively doesn't purchase a new Lexus every single day of the year. Assuming a new Lexus costs $40,000, that adds up to nearly $15million per annum, which is a lot of lost revenue for the high-end car industry.

When questioned, this twentysmoething admits he feels no moral misgivings about accepting rides to work in his neighbor's Lexus without the company's express permission, and will probably continue to get free Lexus rides without paying in the foreseeable future.

Something needs to be done about this not-buying Lexus problem!

I'd buy more but they won't let me...

[sootman]

I used to buy an average of 2-4 CDs per month. Less than 1/4 was new stuff, mostly I was just fulfilling my dream of owning every song I ever liked. So, I bought a lot of Greatest Hits discs, Best of the 80s, etc. However, even before I started downloading music, I was already beginning to slow down, not because I was anywhere close to achieving my goal, but because there was less and less good stuff to buy. I won't buy a $16 80s compilation just to get 2 good songs any more than I'll buy any *new* CD just to get 2 good songs off of it. Then Napster came along and life was great-- I got a lot of good old stuff that was either difficult, impossible, or economically unfeasable to buy. Given the opportunity, I would have *happily* paid $1 for _every_single_song_, assuming it's a)in a common format (like mp3) so I'm not tied to any one player and b) mine to do with as I wish--burn to CD, keep on a file server so I can get at it from anywhere in my house, etc. I would have _preferred_ that to going the Napster route and winding up with bitrates ranging from 64 to 320, badly encoded songs, songs that have a second or two of the previous or next track on the CD, etc etc etc. If they would make it easy for me to get the music I want in a format I want, they could hook an IV to my wallet and drain money out of me at a steady rate for the rest of my life. As long as they don't, fuck'em, I'll download whatever I want. This isn't a rationalization for what I'm doing. Stealing is wrong and that's exactly what I'm doing. But like I said-- fuck'em.

BTW, listen.com and rhapsody is pretty good, but not great. AFAICT, they don't have a way to download portable tracks. In the classical area you can download 10 burnable tracks per month, but that's retarded. 1) give them to me in a format that I can use as *I* want--I'm trying to move *away* from CDs, idiots! 2) why limit me to 10/month? Let me download portable files at $1 apiece and I'll spend at *least* $25/month, right now. Probably more like $50 a month to start, then $10-$20 a few months down the road. Hell, if I didn't spend $20 a *day* for the first week or two, I'd be surprised. Remember when Napster was good and you'd get 50-150 songs in a could hours? I'd do it again in a heartbeat, and happily pay as I went along.

And if they *really* wanted to clean up, they'd ship a copy of "The Billboard Book of Top 40 Hits" to every new customer.

Re:Bit of a narrow age group...

[alouts]

Because it's the teenagers who are the most easily persuaded into purchases by radio play, promos on MTV, and the like. They are the ones who will buy a CD, listen to it for 2 months until it becomes "old" and then move on the the next big thing. It's one of the record industry's strongest demographics.

My parents (a little over the 44 age mark, but not too much) didn't own a single CD until two or three years ago, and now only own a dozen or so that they listen to all the time. I, on the other hand, have bought a few hundred in my time.

Beyond western music

[teetam]

There is an implicit assumption in forums like this and many others that only western music is swapped in P2P networks. That is far from true. Just type the name of any foreign language in your favorite P2P program and see.

If you are living far away from your country, quite often there is no way to buy the music that you like. Napster and the later P2P networks let people who do not have English as their mother tongue keep in touch with music in their language and songs that are extremely hard to find.

Is that illegal? Possibly. But one thing is for sure - shutting down these networks will not increase record sales in any way. The alternative is simply to not listen to the music you love.

Re:Maybe people just aren't buying music + suggest

[handsomepete]

Overrated my ass. That's a quality suggestion. I'll bet someone from the RIAA modded it down.

Anyways, I really like the sound of that. Expanding it beyond the bookstore/coffee shop to radio station ID tags (i.e. listening to the radio if you can remember the time and station you can add it to a collection via the station's website and get radio station burnt CDs for a fee or something) is another possibility (whether it's feasible or not is another story).

I would say that your drawback regarding the extras of a CD (art, etc.) are actually incentives to purchase the actual product, not disadvantages to burning your own. That would justify a slightly higher price for the complete product. Hopefully by the time something like this could be implemented we'll have something that can alleviate those concerns about bandwidth.

Don't forget!

[The Cat]

Since the word "purchase" appeared in the story, don't forget to use the important phrases when talking about paying a small amount of money for something:

1. Plunk down
2. Cough up
3. Lay down
4. Fork over
5. Shell out

Then again, also remember to use the term "snap up" (a term normally used when discussing finger sandwiches or donuts) if discussing a nine-figure purchase, like all the we're-so-much-hipper-than-you
journalists do. For example:

"After meeting for eight months, the committee decided to make the purchase, snapping up the 1200 acre shopping mall, entertainment center and theme park (which employ some 18,000 people) for an agreed price of $412,349,293.12, payable over 20 years."

Re:Hmm

[uncoveror]

"If the record labels make a concerted effort to get their artists to educate the public about how downloading takes money directly out of the artists' pockets, things may change." This quote tells it all. The recording labels view artists as a commodity they own, like slaves. They tell artists, "I made you a star, and I can take it away!" What nonsense! They view music fans as a commodity as well. Boycott the recording industry. Don't buy CDs. We, the fans decide who is and isn't a star. The RIAA and record executives are the real pirates.

both are correct

[Trepidity]

The last digit should be an estimate, and the number should have an attached margin of error to indicate how much of an estimate. I.e. 10.5 +/- 0.3 indicates that the 10 is exactly accurate, and the 0.5 is an estimate to within +/- 0.3.

You're not supposed to do things like 10.51 +/- 0.23 though -- that should become 10.5 +/- 0.2 (or +/- 0.3 if you're being conservative).

Buying music online from the source...

[silentbozo]

As a shareware author, I can say, unless there's a brainless way of dropping dollars into someone's pocket, that pretty much almost NOBODY is going to compensate you for your work if you offer it to people for free. It's an ugly truth, but people are used to "free" programs, and they're getting used to "free" music. To take the time to put money in an envelope (or fill out that form for PayPal) for something you've already got, is more effort than most people want to make.

On one hand, maybe it's not so bad that everyone thinks your stuff is good enough for them to use - at least they're not stealing your work and passing it off as their own...

You could always pass a law to FORCE the RIAA to put the taxes that they collect on the sale of blank media in the hands of a neutral party, who would parcel out the funds based on "votes" placed by the average user, based on what they were copying. I think people would be much more free with "votes" than they would be with their own hard-earned dollars, just as politicians spend our tax-dollars so freely. As it stands now, it's the RIAA who chooses where the dollars go, from what I understand.

Of course, there's nothing to stop the band from selling their CD download online for a reasonable amount, say $7.50, with the MP3s encoded at 384 instead of 128, and a "try before you buy" version at 64 for trading online. I think people might want to get the "real goods" from a reliable source for that amount, than relying on incomplete downloads and slow connections via P2P. Benefits to the band? No physical media to ship, no production costs per unit, just the cost of bandwidth and the cost of assembling the original album. Sell the physical CD for $16 (with an upgrade from the MP3 version for $9) for those who want the cover art, booklet, etc.

Does anyone know the cost of pre-production for a decent album these days? Including recording engineer, studio time, mike rentals, mastering costs, art, etc? Working backwards from that, you could estimate how many download albums you'd have to sell before you could start turning a profit...

Bands cannot accept cash for sales

[enota]

As much as I would love to mail some cash to my favorite band, if they are signed with a halfway intelligent label, there will be a clause in the contract forbidding them from being paid for the music they record while under contract unless it comes through the label. They will nullify their contract with the label if they accept it. yeah, it sucks, but on the bright side, you may give them a sign that a record label isn't 100 % neccessary these days. Perhaps all that is needed is a recording studio, a band, and some way for people to hear the music, ie download site, internet radio, etc.

Re:Bands cannot accept cash for sales

[gmhowell]

But, if enough people do it, maybe the Lars and others of the world will say "waitaminnut. Our fans AREN'T trying to fuck us. It's really the RIAA."

Re:Bands cannot accept cash for sales

[karlm]

If the bands can't accept direct payment for songs, then don't pay for songs. Just make it a donation for the well being of the band. Problem solved. The RIAA is unreasonable and powerful, but I doubt that they would/could use thier power to prevent no-strings-attached gifts. Then again, the US has been heading south for a few years.

Isn't 90% *more* than the general population?

[eschasi]

Hmmm...

What percentage of the general public buys music CDs? I bet it's significantly less than 90%. Combine that with 90% of the downloaders buying CDs, and you can make a case that downloaders are more likely to buy CDs than the general populace.

Now, admittedly that's a bogus arguement. Almost anyone who is downloading MP3s is doing so because they're a music fan, and therefore is not representative of the US as a whole. But it sure sounded good for a second, didn't it?

"There are lies, damned lies, and statistics." -- Benjamin Disraeli.

And for instructions on how to do it, see this.
--
"97.45% of all statistics are made up." - me

10% of 12-17 y.o. not buying music???

[pjt48108]

Heaven and ministers of fate defend us! When did our youth take such a sinister course in life? Where did we fail?

The record industry is obviously hoping none of us recall how, in the days of cassette tapes, those heady days of the 70s and 80s, MOST 12-17 year olds didn't pay for music. Lord knows I rarely did, if I had a friend with the tape or LP. Better yet, I'd ASK friends to dub tapes, because I lacked either the equipment or the ambition to do it myself.

Did I buy music, ever? Ohhh yes. But only if I'd had a chance to hear it on it's own merits without feeding the corporate WHORES who claimed to make it possible. That meant hearing music via non-payola avenues. If I liked what I heard, I bought it, and bought other albums by the same artists.

Unfortunately, it appears to this reporter that corporate execs are as ignorant of all-powerful 'word of mouth' today as they have always been of good talent and new and innovative approaches to music.

That is, unless it appears it could bring in lots of money for them and to PROMOTE and ADVERTISE that they, geniuses that they are, have reinvented the wheel, once again, and tht to buy anything else is evil and unpatriotic, dammit!

Grrr.

Re:What about people like me...

[MushMouth]

If it all sucks why are you downloading or listening to anything?

Nobody wants to hear it but...

[leabre]

If the prices of CD's were lower

If the price of a CD was $11 a CD many people in here probly would still rather download the MP3's instead of go buy it. If the price was $8.99 most people would be more likely to buy the CD but still, would be just as likely to download the song if it was convenient to do so especially if they just happened to notice to lower price CD after they spent $60 on new DVD's or something.

The arguement "if the prices of CD's were cheaper" really was true, than we'd all be buying the bargain CD's (even of popular tunes) off the shelf, but as it stands, I browse through music stores here and there and notice not too many people lining up to the the latest hit CD for the bargain of $9.99.

The same excuse is used with software. Reality is, people pirate $5 shareware just as much as they do $500 commercialware. Don't believe me? Do a search on your favorite "security related search site" and every piece of software comes up listed. Some of it is even freeware but requires you send a postcard to get a reg key and people still request serials for the software. If this excuse was really an arguement worth it's weight in gold, then there would be no serial or crack for any software less than $50 listed on any file trading network, serial 9000 archive, ASTALAVISTA, or usenet. But alas, WinZip $29 is listed, to name only one. This excuse is as much crap for music as it is software.

If the artists were being paid more

If the artists were to recieve more money and the CD's still cost $16-18 a piece, you'd still not be happy that not 50% or more is going to the artist and you'd still download music because it may still be more convenient, again, if you just spent $60 on new DVD's, $30 for a porn renewal, car payment, rent, whatever, you'd think, "I'll just download the (1) song I want". Yep, and 1 becomes 2, and then 3, and then 3000 songs are in your collection.

I may not be speaking for everyone, but lets face it, while there are those who would gladly support their favorite indy band or whatever, $16 is still $16. If you're a college student struggling and have a hard time paying $16 a CD now, how are you going to afford it if more percentage went to the artist? When was the last time you donated $x to your favorite band because you felt like they needed more money? Uh huh. That's what I thought.

I won't buy a CD because there's only 1 or 2 songs I like on the album

Yeah, and when the newest Britney Spears song appeared on a Single you were the first person to go purchase it instead of download it, right? Or I know for a fact some of you do, and not everyone who uses this excuse does. Why, because when you run a keyword search and the song pops up in the list, it's just too tempting not to download it... after all, that $2.99 for the single can buy a beer, or something, right? Or it all adds up if they happen to have to 30 favorite singles you like for sale, you'll spend $2.99 x 30 for all of them, right?

If the cost of a song was $1 to download without restrictions

For many, not all, if you can download an unrestricted song for $1 each, would you really go an download the same 3,000 songs you have in your MP3 catalog currently? Hmm... that's what I thought. If you're friend downloaded some $1 songs and happened to offer you a copy of that "unrestricted" song file, would you happily say "no, I'd rather buy it myself" or would you say "sure, here's the blank CD".

What if the songs were instead $2.50 per download, unrestricted. Lets say you have 1,500 MP3's in your collection, would you go happily replace them with legit purchased copies at $2.50? What if you have 250 MP3's, would you go spend $625 for 250 unrestricted files at $2.50 each?

What if the price was $0.25 per song but with some copy restrictions in place (only works on Windows, perhaps all OS's but only Brand X player, limited only to the purchasing PC, etc.)... would you even purchase 10 songs at 1/4 of $1?

I'm a poor college student, so I have to download them...

No you don't. If you don't have money the grocery store will not give you free groceries. The car dealer won't give you a free car. Mircosoft won't give you a free Windows. Your insurance company won't give you a free month's premium credit. Your electricity company won't keep your lights on if you don't pay the bill. The gas station won't give you a free tank of gas. So why do you feel like you need to download music (for free) if you won't do it in other aspects of life?

It's simple. If you can't afford it, wait until you can.

I will pay to support indy labels

So you'll pay $16 for your indy labels who you don't even know if they are paying the artists better or worse than the cartels, but still complaining about RIAA $16 CD's because they're too expensive and you're a starving college student who only wants to hear that 1 song, even on the indy CD? Yeah... okay...

While there's a free alternative I'll just use that instead

I actually agree with you there. You will download it for free, even if there was $1 unrestricted song per download and the cartels or indies paid more to artists. Why? Because everything is just an excuse. Because you won't pay $1 per song for all 3,000 songs in your archive (not in the same year, anyway). Because you're a starving student. Becaues it's too expensive. Because the system sucks. Because you're a deliberate copyright infringer.

I already own the CD

Good, then purchase a MP3 converting program (usually $39 or less, after all, if software was cheaper, you'd buy it, right?) then convert your song to MP3 or OGG or whatever, then you won't have to propigate statistics buy downloading them when you already own them right?

You see, when you get right down to the point, it's all just a bunch of excuses. No real substance.

Thanks, Me

Re:Nobody wants to hear it but...

[dh003i]

You've obviously been brainwashed by the RIAA/MPAA, or are affiliated with them.

Try thinking for yourself, for a change.

FACT: people download thousands of songs. FACT: even before Napster, no one bought thousands of songs. Thus, people may be downloading many songs, but they woudldn't have bought most of them anyways; its only a loss to the music industry if people download something they would have otherwise bought.

People's buying habits tend to stay the same, or become invigored. They rarely buy CD's b/c most stuff is crap -- i.e., one hit song, 10 filler songs. If anything, file sharing has been good for the music industry because its generated alot more interest in music.

Music is better off today than its ever been.

Re:Nobody wants to hear it but...

[t_allardyce]

I'm a poor college student, so I have to download them...

Lets say you go without the music, as you suggested. You dont buy it, the shop makes no sale. No money is transferred, no physical goods are moved.

Lets say you download it. You dont buy it, the shop makes no sale. No money is transferred, no physical goods are moved. Nothing has changed. The shop/record company dont magically 'loose' a sale, because you never intended to buy it anyway. No-one has lost anything the situation is the same as before, except you are listening to the song, you are being brainwashed by its cheap teeny-pop/rap/techno melodies to buy stuff, thats all it is, they want you to fall in love with the band and follow them around like sheep, the music is saying "hey, we are a great band, give us your money" you may argue with this, but even if its not true, the first bit remains the same - nothing has changed... hmmm ok, so i went a bit off-topic there.

Re:Nobody wants to hear it but...

[dh003i]

All this moralizing stuff is BS. Intellectual property is not a basic right like the rights laid out in the 10 amendments.

The simple fact is that everyone looks out for their own interests. The RIAA/MPAA tries to look out for their interests by being nazi's about file-sharing -- though they're certainly harming themselves (you don't make more money by pissing off customers). Similarly, so are file-sharers looking out for their own interests.

Excuse me if I don't feel sorry for multi-million dollar swindlers in the music industry, who are on par with Gary Wennig and Whaley of Global Crossings & Enron, respectively.

The Music Industry's spin.....

[Newer Guy]

Look, the music industry wants to CONTROL DISTRIBUTION. Why? because then they can charge whatever they want for music. If there's competition, then the price will fall. That's capitalism. What the record industry is is a cartel...Cartels exist to keep prices UP. Look at OPEC for example.

The music industry is looking for an excuse for their poor sales. I can give them several, and one is THEM!

First off, they mainly market to teenagers, the ones most affected by recessions. It's the low income base jobs that go first in a recession, which means that many teens just don't HAVE the $$ to buy $20.00 Compact Disks. Also, many of these teenagers' parents are feeling the pinch too, which trickles down to the teens. Frankly, I'm surprised that sales have only dropped 10%...I would have expected a bigger drop. I wonder is anyone has studied other markets for teens like boutique clothing. A friend of mine manages a mall clothing store and he says that his sales are in the toilet. Of course, the music industry doesn't want to know this...because it plays ostrich to anything that doesn't agree with it's belief that downloading causes all its problems. I have an idea for these clueless idiots: Why not try to produce and market music for people who STILL HAVE $$ to spend: mainly 25-54 year old adults?

Secondly, we're about to wind up in a depression. Just look at the stock market recently. People are scared, and when we're afraid we save money instead of spending it. We buy necessities instead of frills. We keep the old car a bit longer instead of buying a new one. We don't remodel the house. We refrain on buying big ticket items...Just walk into the HDTV area of any Best Buy or Circuit City and look at how empty it is. I consider twenty dollar CD's
as frills, because 20 bucks buys a meal for my family too.

I think that the music industry needs to take an objective look at why their sales are down...and stop guessing what their problems are. maybe then they just might find out that their problems are under their control and therefore solvable.

FUCKING RIGHT ON!

[Tom7]

I agree with you. For an example of a wealth of music not influenced by money, just browse the many artists on mp3.com. If you spend a few minutes you can probably find something that you like, made by someone who actually cares about their music, and someone you can have a real conversation with.

In the future, I forsee that the following will be profitable business models:
- Touring and playing live shows (for it is impossible to MP3 the experience of going to a concert)
- Services that find music for you that you will probably like

But NOT recording a disc for a day in the studio and selling the same thing a gillion times.

Re:FUCKING RIGHT ON!

[Danse]

I think it's been proven that people will listen to whatever is spoonfed to them on the radio. These acts don't get tons of airplay because they're popular, they are popular because they get tons of airplay. So if the record industry were to disappear tomorrow, you'll just have a whole different, and much larger group of artists getting airplay. And people will be just fine with that. They'll go see them play in concert. They'll still buy CDs and/or MP3s (as apparently 90% do now). They'll still make money.

Re:FUCKING RIGHT ON!

[Tom7]

An AC flames,

> Well you're wrong. If it comes to a battle between you and the huge number of people
> affected by your sophmoric beliefs, you will lose.

> As for mp3.com, most people expect to make a small quantity of money from it. Of course
> they also expect free advertising, which they get. But if in general no one sells,
> mp3.com will not make money and you'll see it disappear along with all of those people
> that "care" about their music.
> This doesn't touch on the fact that most of the music to be found there is rather bad,
> but since I have a friend that distribute music via mp3.com, I can also understand why.
> He, like many (as is obvious) don't really have much experience making music, nor are
> overly talented. You might find some bands you like, and I'm not apt to like them. And
> my neice that adores Britney Spears probably won't, either.
>
> Not that you have any clue when you mention people recording an entire disc in a day.
> Yeah, that happens so often. Like never.

Well, a day is a bit of an exaggeration. The point is that it is done in a short amount of time . Anyway, it is not unheard of to record an album in one session. I know Captain Beefheart and his Magic Band did it with their classic Trout Mask Replica. When you write the songs and practice beforehand it's not too hard to play them all in a good take or two during one day in the studio.

(Indeed, as I've shown with my album-a-day project, it's possible to even write *and* record an album in a single day. I have plenty of experience with this!)

Anyway, please do not assert that my beliefs are wrong and then go on to make up some scenario yourself. Most people have access to free web hosting, and really the only thing mp3.com does is act as a service that helps people find amateur music. (It doesn't even do a good job at that, which, combined with your stubbornness, is probably why you never found anything you like.) Is it really more likely that the music industry will find some way to silence all of the free mp3s (and pirate mp3s, for that matter) and make music replication on silver platters profitable?

PS. "sophomoric" has an 'o' between the 'h' and 'm'. That's a pretty amusing error.

Re:What about greengrocer apostrophes?

[jd142]

You might want to look at http://www.lboro.ac.uk/departments/el/teachingzone /cae/coursework/reports/apostrophe.html where they specifically use "CDs" as an example of a plural that "NEVER EVER" needs an apostrophe. The confusion arises because plurals of letters and numbers do take apostrophes as in "Missippi has two p's." "Use an apostrophe and s to form the plural of letters, numbers, and signs, and for words referred to as words." (Punctuation Rules)

CD is either an abbreviation of cd-rom that doesn't use periods period or it is an acronym for Compact Disc. In either case, cd has become a word in its own right in the same way that scuba has. The confusion arises because we pronounce the word as if it were just the letters and letters do take the apostrophe.

Concerts make very little money

[MushMouth]

I would like to know where you get the statistics that the majority of artists make the majorty of money by touring, because it just isn't true. Very few bands make much money touring, maybe the biggest ones who either, no longer make new records, or have huge arena shows that sell 20,000 $50 tickets make money touring. But these are only the top 1%, the other 99% of the bands out there, you know the ones that if they are very lucky become U2 or some band that you like, bust their ass to drive 6 hours a day to play in a small venue (bottom of the hill here in San Francisco is a good example) which holds about 200 people, charge $8 or less for tickets and then distribute that money to 2 or more bands who have generally 4 or more musicians, and one roadie each. If they are lucky they will sell 50 tee shirts at $8 per, but only a profit of $4 per, which brings us to a total of $1800 split over 10 guys, $180 per, wow tons of cash. But you get to spend an evening in San Francisco.

Re:Concerts make very little money

[God! Awful]

I read an article yesterday which stated that bands such as Linkin Park payed $75,000 to appear on the OzFest tour last year. I can probably dig up a link to the article if you like.

-a

Re:Concerts make very little money

[God! Awful]

I think the problem is, perhaps, musicians have gotten it in their heads that they're somehow entitled to earning millions of dollars like Phil Collins. Well, I have a goal of making as much as Bill Gates but yet I only earned $50k last year.

Well I, for one, doubt that you really have that goal. Assuming you have any experience and education, you're silly to work for that little. But I guess there's always the lottery...

Your economics are seriously fucked. Assuming a band can actually get 260 gigs a year (sounds easy, doesn't it), you're not allowing them any expenses. They have to buy a tour bus, hire a driver and a manager (to get them the 260 gigs), somehow buy and repair their instruments and amps, eat in restaurants all the time, etc.

You're offering musicians an opportunity to live on the road, away from their families (I guess they can always sleep with the groupies), sleeping in a bus (I don't see any money in there for hotels), and all for only $50k per year minus expenses. Then, in whatever little free time you leave them, they have to write and record songs (at their expense) so freeloaders like you can download them off the Internet.

I don't thinks so!!!

-a

Re:Concerts make very little money

[God! Awful]

And I don't ask anyone to work for free. If the artist doesn't want to produce music, that's fine. But the market has spoken and the market will no longer pay for the digital representation of a song. I'm part of that market and will continue to pay the current market price for sound recordings: zero.

And with that statement you debunk two arguments: yours and another of the prevailing sentiments on Slashdot. Firstly, the market has not spoken; the mob has spoken. Do you consider "the market" to be so broad as to encompass theft? I may just go out and buy me a Porche (which I have conveniently valued at $0).

Secondly, for all the people bitching about how the artists aren't being fairly compensated, the reason is that there is a huge glut of wannabe musicians out there. The labels know that if you don't want to sign away 90% of your royalties to get a contract, there are 100 other bands out there that will.

I know they won't get 260 gigs a year. I know there are expenses. There are also expenses involved in getting a 4, 6, or 8-year education for those careers that require it. And we all have to eat, too, whether at home or on the road.

We all have to eat, but most of us don't eat in restaurants every day. It's expensive (unless you want to eat complete crap). And to be a musician, you have to learn to play an instrument. I know some punk bands brag about how little they practice, but the bands I like are composed of very talented musicians. Heck, some of them even went to university to get a degree in music.

My point? Where is it written that musicians should earn a lot of money? There are a ton of jobs where the people earn peanuts. Many people can't even make ends meet, but they still go to work and do their job.

People who are good at what they do deserve a chance to make good money. You have organized it such that even a successful band will barely break even. And for the privilege of making peanuts, they have to literally live on the road. That's just crazy.

Just as there are people who love to write code and make it open source and free for everyone--and many of these projects are arguably better than those which cost $300 off the shelf--there will be musicians that will create good music (arguably better than Britney Spears) and make little or no money doing it. Heck, if you consider their time they might even lose money... just like open-source programmers.

Well I happen to think that the GPL is a communist plot and open source contributors are idealistic dupes, but at least free software advocates (mostly) don't advocate stealing proprietary software. If free music advocates simply made equally good music and allowed people to copy it that would be defensible, but consumers are greedy and they want all the best music for free. If you remember, that's all Lars Ulrich said anyway: I don't mind if bands want to allow people to share their music, but no one ever asked us if we wanted to participate.

And no, I don't think the music out there would be as good if it was impossible to make a living as a professional musician. Britney Spears would probably continue to do quite well, seeing as she is a performer and is capable of filling stadiums. The one who gets screwed is the guy who writes her songs, which is a shame because I thought some of them were quite well written.

-a

Re:Concerts make very little money

[bungo]

I agree with you most of the way there, but ...

People who are good at what they do deserve a chance to make good money. You have organized it such that even a successful band will barely break even. And for the privilege of making peanuts, they have to literally live on the road. That's just crazy.

My wife studied for 7 years for two degrees in language translation (Russian, French, English) and international economics. I dopped out of university (twice) and after 15 years I'm only completing my degree now. The best job she could get paid not alot more than the minumum wage. I get hundreds of thousands a year, and don't work half as hard as my wife.

Does my wife deserve more? Yes.

Do I deserve less? Probably.

Is life fair? No.

Just because someone wants to do something for a living (musician, Russian translator), doesn't mean they will get justly rewarded.

Life sucks. No-one owes you anything. If I could change the whoe economic system, I would, but until then, people will unfairly get shafted.

Re:Concerts make very little money

[EllisDees]

Most musicians do not ever make enough to support themselves under the current system. One-hit-wonders have just about zero chance of breaking even, let alone making any money. Even somewhat large acts (like the Goo Goo Dolls), and huge acts (TLC) will often wind up completely screwed by the record companies. The current system doesn't do *anything* for anyone except the people who are leeching off of those who actually make the music. Removing the recording industry will not harm the majority of musicians in any way.

Re:Concerts make very little money

[swb]

Doesn't it depend on the performer and what they bring with them?

I saw Richard Thompson play last winter and the rumor I had heard was that he was getting $10k per concert. It was a solo accoustic show, and he traveled with maybe his manager and a single sound guy.

If you played 20 shows in 3 months (one every 5 days), you'd have $200k, even less taxes and expenses you'd have close to $100k free and clear.

A band comprised of 5 guys, a manager and a roadie/sound guy is going to need more money, less stuff and more touring to make money EVEN AT $10k per show -- you just can feed, house and pay 7 people very well on that kind of money.

The sweet spot for most performers is when they get to the point when they can fill a 1,000-2,000 seat venue @ $30 per seat consistently and can net out $15-20K per show. By playing smaller venues they presumably pay less money in rental, haul less gear around with them, require fewer roadies, and generally overal lower operating expenses.

You're not getting rich doing this, but if you can make $2-300K per year free and clear doing it, what's wrong with that? It sure sounds like a better lifestyle than 98% of the population lives, and 99.9999 percent of the world lives.

Re:Concerts make very little money

[God! Awful]

Just because someone wants to do something for a living (musician, Russian translator), doesn't mean they will get justly rewarded. Life sucks. No-one owes you anything. If I could change the whoe economic system, I would, but until then, people will unfairly get shafted.

Okay, let me clarify what I said earlier. People who are good at what they do deserve a chance to make good money when their product is in high demand. Let's not kid ourselves. Music is in high demand, and I'm sure Russian-English translation services probably aren't.

Your average major label band may not be making a fortune, but they sure as hell ain't starving in the street. Many of them even seem to find the money to support a drug habit. We've all heard how artists are getting ripped off by the labels, but Lextra's solution is to make sure they are completely destitute. Now is that fair?

-a

Re:Concerts make very little money

[MushMouth]

Duh, Richard Thompson is one of the 20 most talented guitar players in the world, who has been around since the 60's. He is in that less than 1%. How much does the the most talented laywer, doctor, programmer, or used car salesman for that matter make? He can get $50 a ticket and sell out a 2500 seat arena, although he couldn't sell out a 20,000 seat arena at $10 a head. What you said is nothing more than a anecdote, there are 20 places like the Bottom of the Hill, which has 2-3 bands playing at $8 a head EVERY DAY for every place such as the Warfield which has 1-2 shows a week, seats 2,500 and charges $30-$50 a head. 2-3 grand free and clear, Tell me who is the greedy one?

Re:Concerts make very little money

[God! Awful]

Most musicians do not ever make enough to support themselves under the current system. One-hit-wonders have just about zero chance of breaking even, let alone making any money. Even somewhat large acts (like the Goo Goo Dolls), and huge acts (TLC) will often wind up completely screwed by the record companies. The current system doesn't do *anything* for anyone except the people who are leeching off of those who actually make the music. Removing the recording industry will not harm the majority of musicians in any way

I am fully aware that musicians get ripped off by the major labels. However, I don't that justifies the mob rule solution of declaring that music should be free for all. Nike shoes may be made by child labour in Indonesia, but if you are concerned about that then your correct action is to boycott Nike shoes, not steal Nike shoes.

I would like to see all of the following happen:

1. Bands to read the fine print of contracts and show them to a lawyer before signing their life away.
2. New bands to do some research on music industry economics. Read the Courtney Love rant then decide if you want to sign with a label.
3. Governments to nullify grossly unfair contract provisions, such as the 7 album clause.
4. Bands who don't sign with major labels to empower themselves using the Internet: setup their own web sites, sell CDs/tracks at whatever price they wish, offer sample tracks for free download, offer sample tracks which may be shared, put tracks on MP3.com, etc.
5. Governments to continue to shut down illegal use of file sharing systems, such as Napster, Kazaa, etc.

When a system has a flaw you don't have to throw out the whole system. In this case, the Internet can be both profoundly bad and profoundly good for musicians. If they throw off the shackles of their RIAA oppressors only to be screwed by the general public then it's out of the frying pan and into the fire. But if they can use the Internet as a means of cutting out the middleman, then we can effect social progress without having to resort to anarchy or communism.

-a

Re:Concerts make very little money

[swb]

Duh, Richard Thompson is one of the 20 most talented guitar players in the world, who has been around since the 60's. He is in that less than 1%. How much does the the most talented laywer, doctor, programmer, or used car salesman for that matter make?

If he's so talented, why is he so cheap? For $10k we could hire him for our neighborhood block party. I think he represents the "workman" side of the music business, not the megabucks pinnacle. A small but loyal fan base.

The bands that play nightly at the Bottom of the hill for 200 people is the professional equivilent of a doctor that's just out of medical school practicing two days a week. Is it any surprise they make no money?

obligatory simpson's quote

[eddeye]

Homer: "Facts are useless. You can use facts to prove anything that's even remotely true."

I'm more than just a little curious...

[NanoGator]

...how many of the people that are actively not buying music are doing so because the RIAA called them a bunch of thieves? I certainly wouldn't have a guilty conscience about downloading music sans paying for it after that.

Words

[Chris Burke]

In this case, however, the study is saying "Instead of buying the CD, these people just copied it."

Are you sure? Are you sure that what they actually are saying isn't "These people copied the cd, and also did not buy it"? You're reading into the word "instead" the idea that they would have bought the CD had they not copied it, when that is not actually implied. Particularly based on how the question in the study was worded, e.g. "Have you copied a CD instead of buying it? (Y/N)", the results may or may not have any relevant implication toward actual purchasing at all. What we really want to know is "X percent of people copied/downloaded the CD and would have purchased it had those options not been available". That is the statistic relevant to determining sales lost to illegal copying.

Re:Hmm

[uncoveror]

Naturally, a 13 year old would listen to Eminem. A prefabricated product of the industry like him might be willing to preach some stodgy record executive's party line to kids, but that would kill his rebel, bad boy image that angers parents, and makes him look so cool to teens. He would help himself more be encouraging file traders. An industry that wants to sell things to kids who don't even have jobs for 20 bucks each is no better than the dope dealer on the street corner. Boycott the recording Industry. As Axl Rose said in the song, Shotgun Blues about a record executive, "and while you're ripping off children, somebody's F**king your wife." Record executives, and the RIAA are the real pirates.

Re:My habits

[Cardhore]

I'm trying hard not to sound condescending, but you do realize the fact that your playlist often syncs up with what's on TV at the time means that your playlist is pretty limited, right?

What on earth are you talking about? I never said they were the same songs. Just that some parts of them synchronise with the TV. And I'm sure you have better tastes in music than anyone else does.

Re:Maybe people just aren't buying music + suggest

[moncyb]

They could have listening stations, then you could search through the entire database and find the artists you like. They could also allow employees to choose what music is playing over the stores loudspeakers too...you won't necessarily get only Britney Spears that way.

Re:The State of music

[autocracy]

And I am making a rather flat joke to what you referenced. haha, lol...

Follow the money?

[cortriga]

I suspect the music stealing that's going on is not just a problem of how easy and penalty-free it is, but also a function of people feeling a little vague about where that $15.99 is going in the first place. I, personally, have this picture in my head of a fat-cat record executive standing on his penthouse balcony with a fist full of cash tossing nickles and dimes down to starving musicians clad in filthy rags groveling in the street below.

But is the distribution simply $15.89 to the exec and $0.10 to the artist? Has anyone done a comprehensive breakdown of where all the money goes? A&R, advertising, promotion, marketing, etc.? A link would be appreciated.

I'd love to see Ross Perot come on national TV with a pie-chart: "See right here? Two dollars* of every CD goes to the A&R guy. Can I finish?! Two dollars, people! That's over twelve percent!"

*DISCLAIMER: I have no idea how much money actually goes to the A&R guy.

Lossless compression?

[moncyb]

I agree with your post, however why do they need lossless compression? I would think having high quality mp3s (or oggs) and just burn the compressed files on a data track along with the audio tracks should do just fine.

Also, as for extras, they could also burn time indexed lyric files onto the data track--I don't know of any standard format for time indexed lyric files, however it can't be hard to create one. Hell, they could even allow you to buy all sorts of files and burn them on the disc--software, ebooks, music videos, pictures.

The only problem is getting machines that can view/play all that extra information for a resonable price--I don't think computers are quite there yet...well unless you count an ancient machine running Linux, however most people probably couldn't set it up. The game consoles are probably almost there, however they still need a little more software on the mainboard. What is needed is a computing appliance that runs for under $200 or even $100 and doesn't need to be set up--those could not only view the data, but they could also browse the web, read email, do wordprocessing, etc. We'd already be there if it wasn't for Master Bill and his resource chugging OS--his company also bought out WebTV and killed it.

As for printing the covers: I don't think printing the thing should be a problem. I don't imagine writing a program that allows one to select the image on the cover and print all the lyrics would be very difficult. The problem I can think of is cost--wouldn't printing with inkjets and color laser printers be expensive? Maybe they could just do B&W? Then again, it is only one sheet of paper, maybe they can just charge an extra dollar if you want a cover. That should take care of the printing and high quality photo paper (or whatever they use) costs.

I don't see any 'extras' that you get with normal music CDs that you wouldn't get with a well designed system doing you described.

Loaded questions too.

[moncyb]

Those questions seemed very loaded. Like the one asking if there is nothing wrong with downloading music for free. What? Why should there be anything wrong with it? Maybe if they had asked whether or not it was wrong to download music without the copyright owner's authorization. It seems the cartel's FUD is working. Half the people said it was wrong just to download music from the internet--as if there is some moral dilemma just using the network reguardless of actually committing any illegal act!

The model

[Restil]

The RIAA represents a business model that might not be necessary anymore. As many have stated many times before, the artists make their money from concerts, merchendise, and other outlets, and not so much from the sale of CDs that you buy in the music stores. Those CDs are almost completely for the expressed purpose of marketing the artist so they can make money elsewhere. CDs are the RIAA's baby.

Its possible, we simply don't need them anymore. Distribute everything in mp3 and cut out the recording industry completely. It wouldn't hurt the artists any, and it would completely eliminate the whole piracy issue. Of course, there is a chance that the RIAA DOES provide a useful service, but I find it hard to believe that artists won't be able to get coverage if the RIAA isn't around to support them. Radio will still play the good stuff, and they will actually go looking for the good stuff. People will send in good stuff for them to play. It'll happen. It can work, and the RIAA and the companies it represents simply don't need to exist.

Of course, I'm sure they have a different opinion in the matter, but times change. Industry changes. And they had a good run. But its ending. It might be in their best interests if they realize that now and change to match the way the world is going, or they're going to become the insignificant righteous.

-Restil

Conclusion at end of study

[RedWizzard]

I like their conclusion on the Internet and sharing:

Attempt to frame your side of the digital music debate more positively. People do think musicians should be compensated -- it's all of you that people feel are ripping them off.

The study and particularly the press release does focus on the negative a bit, but then it's clearly been commissioned by the record industry so that's no suprise. E.g they forgot to mention in the press release that 20% of people who download music are buying more of it, and that 62% of people who have downloaded a music track have gone on to buy the artists CD.

Re:Maybe people just aren't buying music + suggest

[God! Awful]

* Artist gets money, users have less incentive for piracy.

If you read the data that is supplied along with the article you will see that the vast majority of people don't care about the issue of supporting the artists as opposed to the labels (51% vs. 53% believe that music download sights need to compensate the labels/artists). For teens there is a slightly wider gap (7%), but teens care less than any other age group about compensating either party.

-a

Why I 'steal' music...reply why you do(n't)

[fcrick]

I'm 21 years old, and I don't buy music...ever.

Admittedly I'm from the more technical branch of society, but I think many people my age just convert over to exclusively using mp3s they didn't pay for for their music needs. I won't claim that I know exactly why people like me do this, but I think it centers around three reasons, and I certainly don't think these reasons would motivate everyone.

reason one: I don't have to pay. Personally I think paying 20 bucks for a cd is a total rip-off in my current financial condition, and I'd just rather not pay if I don't have to. Hopefully in a few years if I ever buy music, this reason won't even cross my mind. But...I really don't think this is the reason I don't buy cds...I would probably just listen to the radio if I didn't have my computer...what do I care...

reason two: Convenience. I think this is a big winner for mp3's. I'm confortable with my computer and I enjoy trying out new software. I feel like everything should be do-able with a computer. When I listened to mp3s for the first time, more than six years ago, it just seemed like the most natural way to listen to music. Why would I ever want to actually go somewhere and buy a bulky cd if I could just get it more conveniently packaged without ever leaving my desk? The few cds I've been given are just coasters now...its far too much effort to slip them into my machine when I can download them with a few mouseclicks and keystrokes. Plus, its more fun when you see what mixes are out there for the songs you like when you search for them.

reason three: Collecting. People rarely bring this up in discussions of digital piracy, but I think its a major motivation driving some people. I just like collecting stuff on my computer. I feel like I'm wasting space or something when my hard drive isn't full. I know it seems silly, but when you have a few minutes, downloading some songs or movies is just a great way to pass the time (after I read /. of course). I'm not as crazy on this as some people I know - some people just collect and collect, with some strange dream of actually getting the entire history of recordings on their machine. Some people have over 50gb of music alone, but they never listen to even half of it. Somehow just having it available makes them feel better. I guess I get in a collecting mood sometimes, and thats it.

Why do I think its ok? I don't claim my reason is legitimate and legally justifiable or something, but I think its a good point at least.

CDs are a total pain in the ass and I've thought so since I first used a computer with decent speakers and a hard drive. I don't feel bad not buying them because I think they are a horrible horrible things that should have never survived as long as they have. What kind of stone age are we living in where we have to carry this kind of crap around? I would never buy a cd just because I think they are grossly out of date and I can't stand worrying about losing them or moving them or worrying about people stealing them or something. If I had a little more money, I'd be perfectly happy paying 20-50 bucks a month so I could stick headphones into my cellphone or pda and listen to any music I wanted to, and frankly the technology is there and I'm really annoyed I have to be guilt tripped about downloading mp3s just because the mega-rich music industry has no motivation to innovate with their comfortable oligopoly. What a bunch of rich pricks!

Re:Hmm

[NanoGator]

"If the record labels make a concerted effort to get their artists to educate the public about how downloading takes money directly out of the artists' pockets, things may change." This quote tells it all. "

Yep Yep. What bugs me about all this is that the Music Industry makes music look like it's free, then acts surprised when you find non RIAA ways of acquiring it. For example: Go to the store, buy a radio, turn it on. Result? Music. There was no registration form to fill out, no subscription to pay, not even a warning saying "FBI Warning: This music is not to be copied." What people thought they were buying when purchasing a CD was the convenience of hearing a song whenever they wanted, not a 'license'.

What would have happened if people bought FM cards for their machines and figured out how to rip MP3s off them, as opposed to CDs'? What would the argument be then?

It just bugs me that they make music seem as free as could be, then they wait until we all adopt the idea of MP3's to overreact to it. It almost makes me want to use the word 'entrapment'.

If I were a conspirist, I'd believe that the RIAA intentionally turned Napster into a justification to submit the SSSCA. I know that sounds silly, but they really could have handled this whole thing better. I mean jeez, why didn't they set up a site where you could donate money to the artists in order to make up for having MP3s you don't have the CD for?

Re:My habits

[alouts]

Ok, sorry, I guess I misunderstood you. I thought that what you were saying was that it was very frequently the case that whatever you were playing on winamp was the same song that was being played on the TV. I suppose I just misunderstood what you meant by "synced up".

I knew that it would be somewhat difficult to get my point across without sounding too arrogant, and that people would be pretty touchy, but I tried anyway. I really was not criticizing anyone's taste. In fact, I said a couple times that I wasn't and that I like plenty of stuff that's played on major commercial outlets.

My taste is my taste - no better or worse than anyone else's.

All I was trying to say (which is a relatively moot point now since I guess I misunderstood you in the first place), was that if the pool from which you choose your favorite songs is limited by what corporate radio and MTV present you, you are missing out on a lot of good stuff. I happen to like a lot of what they give me, but I like a lot of other stuff as well. Sorry if it came off wrong, but I meant it more as an encouragement to go look for cool stuff outside of what you hear on the radio and TV, and less as a condemnation of whatever it is you like now.

Re:My habits

[Cardhore]

Sorry if it came off wrong, but I meant it more as an encouragement to go look for cool stuff outside of what you hear on the radio and TV, and less as a condemnation of whatever it is you like now.

Don't sweat it. I'm just an arrogant jerk. And you are certainly right in that there is good music that you just won't hear on the radio or TV.

By their own numbers downloaders = more customers

[Alsee]

One pie chart in the report has the following figures:

50.3% are not downloaders and have bought a CD in the last year.
15.1% are not downloaders and have not bought a CD in the last year.
Percentage of non-downloaders who bought CDs: 77

29.1% are downloaders and have bought a CD in the last year.
5.5% are downloaders and have not bought a CD in the last year.
Percentage of downloaders who bought CDs: 84

People who download music are 9% more likely to buy CDs.

See! The pirates are killing the economy!
Errrr... ummmm... I mean uhhh...
Pirates are bad ummkay?

-

Something like the movie industry has with DVDs

[moonboy]

I saw another quote on Slashdot (different story, but applicable here IMHO) that talked about the DVD model for the movie industry. People are bootlegging movies to VCD/CD using DiVX, et al. But people are still buying DVDs in droves. Why? Because of the value add. DVDs are obviously better in quality, but they also have extra features. I think the music industry needs to adopt a similar model (as some artists already have - Paul Oakenfold is one recent example) and add extra features to their CDs.

This is idiot math

[ahamos]

When did we all get math-stupid? How could this:

"10% of 12-17's are downloading/stealing"

mean this:

"90% of traders are buying"?

I didn't read that 100% of 12-17's are downloading anywhere in that text. This is absurdly flawed logic.

Consider: if only 10% of all 12-17's are downloading at all, then 100% of downloaders are NOT BUYING. If 20% are downloading, then 50% are NOT BUYING.

I find it hard to believe that 100% of teens download music--particularly when some parts of the country still run on dial-up or have no internet access.

They are missing a new market...

[gosand]

This includes their recommendation to the industry to fight the 'downloading problem.'

This is why the RIAA is ignorant. They see a shift in the market as a "problem".
Instead of saying to themselves "10% of our market has shifted, we need to be where they are going" they are saying "10% of our market has shifted, let's force them back into our way of doing things".

Now I am not businessman, but that seems pretty stupid to me. Here is an idea - make people WANT to listen to more music. That is your market. The MP3 format has woken up the music-listening public, much in the same way CDs did. Hey, it is a new format to listen to music on. With CDs it was quality (over cassettes), and with MP3s it is convenience and portability. It HAS these attributes, so utilize them instead of trying to control them.
DAMN. This makes me want to send $5 to some of the bands whose music I have downloaded, and a letter of encouragement to release more stuff outside the record company.

New study: 80% of radio listeners don't buy

[multimed]

A new study done by the Flugenheimer Institute shows that 80% of the listeners of FM radio do not buy music in stores. "These people are clearly being unethical and taking food off the table of starving slav...er artitsts," said Hilarity Red. "By listening to the radio in place of purchasing music, they are endangering the artistic incentives for all of humanity."

steve snyder

Is legally downloadable music hurting sales?

[mactari]

Furthurnet.com has a "Free as in beer and speech", legal, peer to peer music trading network that allows people to trade shows from bands that allow taping. Examples include The Grateful Dead and Phish, of course, but also The Black Crowes, U2, and Doc Watson (course if you were big fans you probably already knew).

This music is *good stuff*, often patches right from the soundboard, usually traded online using the Shorten format, a lossless audio compression format (etree.org). The only thing separating these shows from a recorded CD are hot mikes and missed chords. To me, this "pure music" is often better than "professionally mixed & polished" CDs. All in all, there are many popular bands with scores of great, free shows.

If mp3s are hurting sales, I'd have to think bands that release their content by allowing taping would also be hurting sales by the same token. Yet I don't hear about that happening. Hrm, maybe because allowing free tapes in your fan community is free advertising which makes for more sales? Call me crazy...

mp3s don't sound like store-bought CDs, and won't for a while. The record companies should wake up while they have the chance (ie, until 600 megs isn't a bandwidth problem for anyone and everyone has lossless copies of CDs available to them and it really isn't easier to walk to the store to buy a CD with all those 1's and 0's than to download it) and figure out a new way to make some dough out of their music!

When you download MP3s, you download Capitalism!

[Pseudonymus Bosch]

So if, as many say here, people who trade MP3s are more likely to buy CDs, and CDs are produced by evil corporations, doesn't it follow that to hurt evil corporations you should boycott MP3-like things?