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Why Google Should Buy the Music Industry
Glyn Moody writes "According to one story about Google's attempts to launch its own music service, 'the search giant is "disgusted" with the labels, so much so that they are seriously considering following Amazon's lead and launching their music cloud service without label licenses.' So here's a simple solution: Google should just buy the major record labels — all of them. It could afford them — people tend to forget that the music industry is actually relatively small in economic terms, but wields a disproportionate influence with policy makers. Buying them would solve that problem too."
so crazy that it might just work.
It's a million to one shot, therefore inevitable.
You think there are rumblings about monopolistic practices now, imagine if the owned the whole music industry. Plus why would you want to buy the music industry? That would be like buying cattle with mad-cow disease.
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A very, very bad idea. Google has enough power over content as it is. I'd hate to see them gain even more. Google already controls the most popular search engine and the most popular video hosting site (at least in the US. I'm not sure about the rest of the world.) Imagine if you could only find, say, music videos as youtube "rentals," or had to use a Google TV box for streaming internet radio. Sure, a lot of those technologies are open right now, and Google's motto is "do no evil," but do you really believe that Google wouldn't be able to lock their content down in an instant if their shareholders demanded it?
They should just buy those industries, and get the world rid of a plague. These industries' interest pushing is preventing all kinds of technological innovations and breakthroughs. A LOT of them affect major internet companies like google.
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Microsoft, Google and Apple should buy them all, share the IP rights and then liquidate the corporations. Can you imagine the "W.... T.... F....." reaction in this country if the tech industry finally said "ENOUGH OF THIS SHIT!!!" and brought to bear its ~$1T in net worth to bear on this $50B pest?
You know, I wonder about this sometimes. Despite the epic saga which is Microsoft, Bill Gates actually seems like the kind of guy who wants to make the world a bit better (for instance, see Project Tuva). If I was a man with a hundred billion dollars, I'd have no qualms spending half of that to make several very real and important problems in the world simply "go away."
Political backpressure shouldn't be a problem no matter what you do, since with that much cash you could easily buy the government along with whatever else you want to buy.
What part of "Don't be evil" do you not understand?
If Google would buy one or more of the music labels they would simply refine their definition of 'evil'. Many companies to it every day (and the Google may have already done it once or twice itself).
If Google bought music labels - then there is little doubt that Amazon music service, iTunes and other direct Google competitors services would be out of licenses and out of business shortly. Isn't that obvious? What interest would Google have to provide these competing services with creative work licenses? None whatsoever.
Host a completely free website for artists. They can post new songs that the artists own the copyright, sell them on the site, 100% revenue go back to the artists. Google will eat the transaction charge. Google will also invite top the chart (google's chart) artist to preform at Googles' campus, sponsor them to play at colleges.
Hear no evil?
I think that the music industry is already grossly overvalued and would not be a wise investment.
The US Government on the other hand that would be a valuable investment if they could just find a way to buy them off in bulk.
Lets do the math.
1 Prez, 1 VP, Chief of Staff, Secretary of state ect, Cabinet lets round that to 65 for ease
100 Senators
435 House of Rep
As of January 2009, a total of 3,200 Fed Judges
So we have about 4,000 monkeys to buy. Per year
Average salary is probably around 180k. So we will offer them 10x the amount per year or 1.8 Million per worker.
For only 7.2 Billion per year I think I could effectively own the entire federal government.
I think google can swing that.
If someone weren't already doing just that, I would be scared of that happening.
Why is the solution to every problem of the Information Age a benevolent Google dictatorship?
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Think Sony, made nice hardware for a fair price. Then they started buying "content providers". Turns out the content providers took over and Sony has been going downhill for two decades now.
Google or Amazon buying record labels would ruin Google/Amazon
Why not just approach all bands popular that have due contracts and sign them and start their own less restrictive label and bring change to the industry...
This will cause the Music Industry to Panic and make bands sign very long term contracts with very restrictive conditions which will make bands turn away from any label associated with the RIAA..
Once Google has success things will begin to change... and its highly likely Googles success will also been seen by artists unlike what goes on with the RIAA labels where artists see is the short end of the stick of success..
(Is that coffee I smell... I must be dreaming)
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True, but we already have an oligopoly (major labels) that only exists because of state-backed monopolies (copyright), and the purposes of the acquisition would be to reverse the harm that said oligopoly has caused. In this hypothetical, Google might not even be trying to make any money off of the acquisition, since basically, the music industry's pigheadedness costs them more than the value of the music industry.
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They could buy one major and lead by example. It'd probably be all that's needed to drag them all into the 21th century. I'm not sure I'd trust Google not to use the opportunity to take a low blow at Apple though and that's one thing the industry doesn't need.
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EMI is for sale, as of three days ago. They're owned by Citicorp, the bank. A venture capital firm defaulted on their debt, and Citicorp ended up with EMI. Citicorp wants to unload that unwanted asset for cash.
There was talk of Warner buying EMI, but Warner has financing problems of their own. Either Google or Apple could easily pick up EMI right now.
Nah,
Google is all about content for ads. The labels are all stuck in last century and DRM. Let Google buy them all and share tunes for ads!!
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Or they'll turn it into a fair business that doesn't attack it's customers?
no no, clearly they must be evil.
That can't happen. The valuation of the music labels is too high for there to be any profit in buying them, then changing their business model so that they make less money. Remember, Google is a for profit company with shareholders. They can't purchase something expensive, hemorrhage cash on it, and expect the shareholders to accept that. It seems that the legacy business model of the labels just isn't viable with cost of reproduction and cost of distribution (even cost of storage) approaching zero. So, stop the lawsuits and even more piracy happens because folks aren't scared they will be sued. What else could they change to make the same money? Right, nothing - or they would have done it already. The label execs aren't stupid - it doesn't matter that some people here think they are. They aren't. There just isn't anything they can do to support that old model. And new models don't make as much money. So they try to protect the old one as long as they can.
Yes, but they could buy one major label and have it work in a less evil manner. If that turns out to be profitable and/or attractive to the talent then the others will be forced to follow suit to compete. There would have to be some compelling reason to give the the shareholders (and the only reason most of them will find compelling is "it'll make us a pile more cash"), of course, and Google would have to be careful not to change things to far from the beaten track too quickly lest they get hauled in front of a court to prove they are not abusing their position in other markets.
It's "Don't be evil, not don't buy evil.
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The music industry has already lost. They lost it in 1979 when the compact disc was released. At the time, there were no PCs, 650 MB was a huge amount of data that couldn't be stored cheaply by other means, producing a CD required a factory, and strong encryption was hardly possible to implement in a consumer-grade CD player. As soon as the CD-R was invented, it was possible for average users to make cheap lossless copies. When the Internet became popular, all modern music was already digitized; sharing it was just a trivial matter of compression and hosting. You might argue that the current legal framework lets the music industry inflate their prices, but really, it's hard to beat the convenience of being able to download almost any commercially available piece of music imaginable, DRM-free, for around $1 per track. The music industry was the first to be digitized on a large scale, even before the movie and book industries, and are in a relatively weak position as a result.
The movie / TV industry was lucky to have the DVD come out after all those technological innovations, and learned from the music industry's misfortune. Today, the video market is so consumer-unfriendly that one could reasonably argue that piracy gives you a better product with fewer hassles. (If you pirate music, though, you're just a cheapskate.) For example, just try to purchase a movie without DRM, region coding, or unskippable segments. Try to purchase computer or video equipment without Macrovision, region coding, or HDCP. We don't even have a mainstream patent-free video codec. It's all those technological encumbrances that make the movie industry an even greater threat to the future of computing and media consumption than the audio industry ever was.
Surprisingly, the e-book industry is even more technologically backward than the movie industry. In addition to DRM, it also suffers from marketplace fragmentation. The display technology is new, and the handful of hardware manufacturers are as eager to control the distribution mechanism as the content publishers. The stakes are higher, too. If the music and movie industries manage to strangle themselves, we mainly lose a corpus of entertainment. If books are replaced by specialized gadgets with uncopyable, unlendable, unprintable, and remotely erasable e-books, that would be a serious step backwards for humanity.
Who is talking about hemorrhaging money? Pretty much all of the evidence shows that if the record industry adapted with the times their profit margins would increase.
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> Monopolies are bad.
No they aren't. Like anything else, they have the _potential_ to be used constructively or abused.
Currently, essential services, like Government, Electric Company, or Water company all have monopolies. Replacing them with corporations each with competing standards would be worse.
Which industry? Music or computing? How does one qualify a low-blow?
The music biz, and a low blow would be something like locking Apple out of catalogues through pricing or by just not allowing them on iTunes. Apple's the one who for the large part made buying music on the net legit, popular and reasonably priced through the iTunes store. If Google moved in to the music business and they started to feud, carrying the fight from the computing industry over into the music business, it would strengthen the position of the traditional music companies that Apple has succeeded to cow into making concessions. That wouldn't be good for consumers I think.
I don't know of the CDBaby story. I googled it and it just came up with a one-sided story by the CDBaby founder, 7 years after the fact. I'm not saying it didn't happen that way, there's a ton of stories like that and Jobs can certainly be a ruthless bastard, but anyway it worked out OK for them in the end it seems.
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