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| is is the end of music or the start of a new fad? |
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| posted by karl on Monday October 01 2007 @ 01:08PM PDT |
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is is the end of music or the start of a new fad?
like Prince and others like the Police in Europe have given their Cd's free of charge at gigs...
Now the bands say they would only make some good money from gigs and tours and not from downloads and cd's..
The question about what music is worth has informed the crisis in which the music industry currently finds itself. But by taking that question to their own constituency, Radiohead have done something remarkably radical. This isn’t the way the music industry – or, indeed, any industry, has ever worked. Record companies’ paranoia about the free dissemination of songs goes back to the days when album sleeves bore a skull and crossbones with the legend “Home Taping is Killing Music” on it. In the age of file sharing and free albums given away with newspapers, the problem has merely intensified.
Underpinning all of this is the assumption that, given a choice, people will steal music rather than pay for it – hence the warning that you’ll find printed on almost every CD released by Radiohead’s old parent company EMI over the past three years: giving away the contents of records to other people “has the same effect as stealing from a story without paying for it.”
Related Links
By effectively opening an unstaffed shop, Radiohead are putting that to the test. Go to their site and click on the question mark beside the price field for In Rainbows and it merely says, “It’s up to you.” There’s no doubt that thousands of people will hand over the price of a Sherbet Dip for the download. Presumably though, Radiohead’s argument runs that those people would have obtained the album through file sharing websites.
What this move really relies on though, is the notion that between Radiohead and their fans is a collateral of trust and, dare the term be uttered, decency. Whilst that collateral might not be there between, say Sugababes and their fans, it’s the very thing that has propelled Radiohead to this point of unprecedented autonomy. If this experiment works, it will – at the click of a few million mice – make them the most powerful band in Britain
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I'm going to say right from the beginning that there are at least a couple of false assumptions being presented in your post.
Prince did not give the cd away for free -- the paper paid him (if my research is correct) $3,MILLION USD -- and recouped their investment off of increased sales of the paper and increased advertising revenues associated with the increase in readership. Good move on the part of the paper.
There will be (at least statistically) more of Radiohead's music dl'd from file-sharing sites, "illegally," than via a "you name it price point." The primary philosophy in Radioheads' business model is that of the "loss leader." They figure that if they can get X-number of people to go to their site to get the dl for nearly free (or free), then SOME of those very people will pay out the $84 for the real physical 40lbs worth of product they have for sale. This is innovative marketing on their part, as it makes a great assumption --- and drives business to their store, as opposed to someone elses.
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The argument that "musicians should make their income on the
road" bugs me.
Are authors of books expected to make their money on the
road? Should actors in movie be expected to perform the movie
on the road?
It is very difficult for small artists to make any sort of living on
the road. Especially when you consider that they cannot hold a
day-job while touring around the country. Unless you have the
backing of a label, or you are independently wealthy, it is very
difficult.
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The notion that sales of the actual music are becoming irrelevant is naive, shortsighted, and dangerous.
I've seen a couple interesting things recently:
First, Prince on Copyright:
http://news.bbc.co.uk/2/hi/entertainment/6993752.stm
and, second, a thread discussing a very dumb blog post proposing that somehow the actual recorded music itself is approaching zero value, where that argument gets quite well taken apart:
http://www.side-line.com/forum/threads.php?id=26202_0_20_0_C
And I agree basically with "A Salesman" and "Isedal", too.
And lastly, I've seen the exact same post from "Kari" on other sites! It's looking like spam to me. I KNOW I've seen the phrase "Sherbet Dip for the download" regarding the price of the Radiohead download at least thrice before in the last three or four days.
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This problem could have been solved in 1999 by either making a
deal with Napster or starting up an alternative. Why has this not
caught on?
http://www.eff.org/share/collective_lic_wp.php
- It's simple.
- It's cheap.
- Artists get paid.
Obviously, the payment per individual transaction would be
pennies, but I think this is a workable system that pays
musicians and those who support them for their work, while
acknowledging the reality that digital downloads should be
much cheaper than physical CDs.
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Also, I don't see why a company like CDBaby couldn't be the one to
put this together? I guess it would be a technical challenge to work
out, but I think it's the inevitable solution.
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We are fast approaching a time where the digital sales game = zero sum. Recent sales figures compiled by all reliable sources indicates that as the total volume of purchasable digital content increases relative to a static or shrinking demand, the value of that product reduces to or near zero in value.
The money is in the expression of the music in front of a more active audience, as opposed to a more passive audience. That's why touring is such a dynamic part of the equation today. It's not necessarily cd sales that make up the sales volume at shows -- it's t-shirts, hats, posters, stickers, beer mugs, shot glasses, and any other form of merchandise that can be sold. It's having recorded product made available that cannot be purchased other than at that show, that night .. and/or having new product available on a consistent and frequent basis (say a new ep once every twelve weeks, as opposed to a new LP-cd every twelve to eighteen months).
It's estimated that 10% of any given audience will buy product --- and there are business models out there to show the sustainable model. For many people on the road, the income is not unlike owning a business in some small-town USA ... it can and is being done.
Here's another part of this paradigm. The CD is nearly finished. Best educated estimates range from 6 to 10 years tops, before the cd (as we know the format today) is a niche/boutique item, similar to a vinyl record today. The cd holds too little information, is environmentally unsound, and is made from costly petroleum by-products that ultitmately will cost too much to produce.
As to the notion that recorded music should be paid for? The marketplace increasingly says, "no thanks, we want our music for free." Why pay extra for something we can get for "free" on radio, satellite, cable, internet-radio, and by other means.
Following is a copy and paste of an article just released two days ago: totals sales numbers are represented at a total industry level today, including those independents that are "scannable." So, the numbers discussed include all of us who have music placed out in the retail marketplace today.
By Ed Christman Sat Oct 6, 3:47 AM ET
NEW YORK (Billboard) - Nine months into 2007, CD and total album sales are still dropping -- just not as quickly as they were plummeting when the year began.
But industry executives are predicting that even the relative slowing of the sales decline probably won't be sustained by what is now a slim fourth-quarter release schedule.
Third-quarter sales data released by Nielsen SoundScan show overall album sales down 14.2% and CD sales down 18.5% for the year so far, compared with the first nine months of 2006. For the third quarter alone, CD scans slid 6.8% to 94.9 million from the 114.2 million counted in last year's third quarter.
Compared with the 20.5% drop that shocked the industry in first-quarter 2007, that figure could almost be considered a recovery; CD sales, in fact, have been slowing their decline through the year. In the second quarter, the format had dipped 17.9%, from 122.3 million units to 100.4 million.
But so far, retailers say, fourth-quarter prospects don't look promising. "Although we got a decent amount of rap titles coming, we need some rock and pop titles in the worst way," one retailer says. "The rock schedule is beyond a disaster at this moment."
Another retailer says, "Other than Universal (Music Group, the industry leader), I am still waiting for the majors to come to the plate with some big records."
COUNTRY'S CONUNDRUM
Among popular genres, country has shown the most significant drop-off so far this year: Album sales dipped 26.1% to 37 million units, from the 50.1 million units the genre generated in the first three quarters last year. A primary reason for country's decline, label representatives say, is the sluggish business experienced in 2007 at Wal-Mart, where country sells a disproportionate amount of records. According to the Wall Street Journal, for 10 years through 2005, the mass merchant's sales gains at stores open at least one year averaged 5.2%. So far this year, Wal-Mart's comparable-store sales are up just 1.3%.
Country is also lagging behind other genres when it comes to transitioning to a digital retail model. Total digital album sales stand at 35.8 million downloads so far this year -- or 10.6% of overall album sales. That's up from the 22.6 million digital album sales accumulated during the corresponding period last year. But in country, digital album sales comprise only 5.2% of the genre's total album sales so far in 2007, less than half of the industry average.
Other genres underperforming digitally include Latin, where album downloads account for 1.5% of the genre's sales; classical, at 8.5%; R&B (including rap), at 6.4% of sales; and rock subcategory hard rock, at 9.6%.
The rock category as a whole, however -- and especially another of its subcategories, alternative rock -- is dominating the digital format. In 2007 so far, rock's digital album sales comprise 13.7% of that genre's total album sales, while alternative rock's digital portion stands at 15.7% of its total.
Speedier conversion to digital and better genre sales success don't always go hand in hand, however. If you exclude rap sales from its total, only 6% of R&B albums were sold digitally this year. Yet if you define it that way, R&B is still the industry's healthiest genre of 2007. The genre has declined only 2.8% to 36.3 million units from the 37.3 million it generated in the first nine months of 2006. On the other hand, rap is down 25.4% to 31 million units from the 41.6 million it had sold at this point last year.
DIGITAL DOINGS
In general, the latest developments in the surging digital channel -- including Amazon's September 25 launch of its digital-download store and Apple's foray into wireless downloads -- are at least partially offsetting label executives' worries about the future, if not offsetting CD sales.
Industry executives also see some hope in the growing number of total music units sold, which increased 16.8% in the first nine months of 2007 to nearly 1 billion -- 951.3 million, to be exact -- from the 814.6 million total units Nielsen SoundScan counted in the corresponding period last year.
Fueling that increase, digital track downloads stand at 612.2 million, up 46.3% from the 418.6 million scanned during the first nine months of 2006. So far this year, 26 track downloads have broken the million-unit mark; last year at this time, only 10 tracks had hit the million-unit milestone. In contrast, 20 albums have broken the million-unit sales mark so far this year (digital and physical combined), versus 28 titles last year.
Overall, when the 61.2 million track-equivalent albums sold in the first three quarters of 2007 (using a formula where each 10 digital tracks sold counts as an album) are added to the 35.8 million digital albums sold, the digital format now totals 97 million digital album-equivalent units -- or 24.3% of the 398.6 million album units tallied when track-equivalent sales figures are added to physical album scans.
Meanwhile, in the digital album format, so far this year 14 titles have broken the 100,000-unit sales barrier -- led by Maroon 5's "It Won't Be Soon Before Long," which has slightly more than 223,000 scans. Last year, in the corresponding time period, only six albums had achieved that digital sales distinction.
Universal Music Group VP of sales analysis David Bakula points to another notable digital achievement. In the second quarter, Maroon 5's release became the first to hit 100,000 digital downloads in a week. And in the third quarter, Kanye West's "Graduation" upped the ante when it scanned 132,000 digital albums in its debut week.
"The 102,000 digital downloads of the Maroon 5 album was almost 25% of the release's market share in the first week," Bakula says. When digital can hit 25% of a big-selling title's market share, he says, "it almost seems like we have reached the tipping point. All of a sudden, digital is your biggest account, and that is something we have never seen before."
Reuters/Billboard
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"As to the notion that recorded music should be paid for? The
marketplace increasingly says, "no thanks, we want our music
for free." Why pay extra for something we can get for "free" on
radio, satellite, cable, internet-radio, and by other means."
All of those things cost money:
radio = paid by advertisements
satellite = subscription
internet-radio = paid by advertisements
Most people will pay for digital music as long as it is cheap and
convenient. A $5/month free-for-all would easily cover both of
those requirements.
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We are forgetting to think like the consumer.
Q: What is it the 12 year old boy wants?
A: To be entertained.
Once a black piece of vinyl with 2 to 4 songs on it was a hefty investment for a school kid but the parents allowed it as long as it wasn't to racy. Then that consumer ran into their room and opened up a record player. And stayed in ONE SPOT... listening and looking at the pictures and singing along and soon you transformed an interested consumer into a fan. This was the "on demand" entertainment they craved. TV only had a few channels and you had to wait for something you liked. Radio was ok, but again a lot of waiting and bad sound. Your collection of singles, eps and later lps was a guarantee of having your kind of entertainment on demand. iPods are a tansitional technology. We are heading for a "single source" the end of a "data pipe" and for differing fees the Ownership Society ... uh... whoever owns the big media... will be providing you with all your content.
No more buying or owning files... no more being a librarian for plastic... nor data... it will be on demand and stored on servers elsewhere.
The distinction between "Movies" and "TV" will blur when DVDs are no longer needed.
Visual content is what kids will buy. As a consumer, your account will "Transfer" to your car or office... wherever you are you will carry a pod that has no hard drive but rather sophisticated reception abilities...with that you will be able to demand music, picture, information, browsing, workware, and two way conferencing. (sort of like XM does now but with all the possible usages of digital information)
...and your monthly service fee will be divided up among the owners and content creators.
As musicians we don't know how much of a demand there will be for "AUDIO ONLY Requests" I hope a lot... but maybe those days are gone... just like no one wants to see silent movies anymore... (well I do...) I observe music fan kids these days... they prefer the youtube video of the song playing for free than even their file of it... The often run the songs from a mySpace page behind their homework or web browsing. And sure they listen to Itunes a lot but it wouldn't matter if they owned the files or it was stored elsewhere just as long as they had it on demand.
As an artist you still have the public's mating urge and legal alcohol to help provide a venue for you to come help sell drinks and inspire hookups. You will do what you do. Dress cool... get your picture taken... entertain a crowd. If it's hip, it will be your town's cool thing to go do, see... etc. And people will ask you for a song to take with them or seek you out on their digital pods. When and if that grows then your music will be needed for movies, commercials, release trailers, brand names... All this big business that will want to ally themselves with your fresh sound. From there you will be rotated into "popular stations" in that service (the one that is even in the budget package) and more and more people will want a piece of you. Your requests and plays will inform big buisiness to come write you big checks. No debts... no "points" no "breakage" no nothing. Whoever is cool gets more love. The people who just want to be famous will get invested in if they are pretty and not of they are not. But real artists will always rise to the top... Know why? Cuz KIDS ARE SMART. Every decade... for at least a few years of it... the kids are ahead and they know what's good.
This is all just tribal behavior... the big tribe elevating some strong young hunters to go catch the tribe's meat. Others to sing the babies to sleep. Others to create more romantic feelings. Musicians have always been and we will always be.
I for one am glad the old corrupt system is dying and I don't care what format music is consumed in... because I am really good at it and I will always have a place in my tribe. I know many of those reading this reply are the same way.
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I absolutely agree that "all these things cost money." But the perception (and perception is everything in the marketplace) is that once the listening device is purchased, the content therin is "free" to use.
Sure radio is supported by ad rev (unless you count non-comm radio, which is donation driven)
Sure satellite is subsription based ... as is cable tv.
Sure Internet radio --- wait! Some is paid for by ad rev, some is paid for by subscription ... some is FREE (Pandora for example, and many stations on Live365, etc).
But it's all an economy of scale. How many "spins" does it take at current royalty rates (if you were even able to exact the royalty to begin with) before the income is viably self-sustaining? Time is a finite resource. The number of 3 or 4 or 5 minute slots in a radio station hour is finite. Maybe you get 13 songs an hour in an hour, on average.
Songs need to be rotated often enough so that they gain enough traction to induce a listnership to make a real investment of time and/or money in that music --- so then how many resources are available --- the more resources, the smaller the potential slice of the pie you're carving out of the marketplace.
Numbers ultimately are the real barometer of financial viability. Numbers simply don't lie; they are what they are.
What's fascinating is the new ways by which artists like Prince are manipulating the marketplace -- or the Police, or Radiohead.
It is not "business as usual" anymore --- and while the indie revolution sought to gain ground by breaking the rules, it seems it is we who are increasingly stuck in old ways of thinking and doing business. Fact is, money talks --- those who have it, make the most of it, on average. Those who dont' have it often work to not lose what little they do have. When you work from that mentality, you're more prone to standing still and letting the world pass you by.
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ad and subsrciption driven, for clarification...
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| by D
on Sunday October 07 2007 @ 03:23PM PDT [ reply | parent ] |
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The concept of bands making alot money on the road isnt new... After paying for recording, production and distribution, bands have long been sent out on the road to "promote" the new album.
The road is typically the way that bands help pay for the album they are promoting... the road also helps them pay for the tour. (which, they are also charged for)
The label wants the artist in one of two places... in the studio and on the road... cause thats where the money is... for the record company
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That article says
"Third-quarter sales data released by Nielsen SoundScan show overall album sales down 14.2% and CD sales down 18.5% for the year so far, compared with the first nine months of 2006."
Most of our CDs are not covered by that data. Most data on indie sales is hearsay and unreliable. Yes the labels are in it deep, but that does not mean the end of CDs. The format might change, but the end of any tangible media would make it harder to sell at gigs.
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...that can't, or won't, tour? Or can't or won't tour very often? There are dozens of valid reasons that many can't or won't play live as much as other acts - are they now expected to also "give away" their recorded music as promotion for their live shows, which don't exist, or at least are scares? Please explain how that's gonna work out...
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...those Soundscan numbers are not representative of the whole market AT ALL. They mainly represent majors and major affiliates.
And just because a physical delivery media may be in diminishing popularity, it's unreasonable to extrapolate that music now should be free, just because the new delivery media *can* be copied freely.
When it doesn't cost to record, cost to own instruments, cost (in time) to learn to play, cost (in time) to write and perfect compositions, cost to promote - all things that are either money directly or have monetary value as they take time, time that cannot be spent earing money another way - then and only then shall it be justifiable to say that music should somehow be free.
Otherwise it's illogical BS rationale designed to make people who don't want to pay for what they want to own feel okay about themselves for stealing music that they should be paying for.
How this isn't perfectly crystal clear to everyone is completely and totally baffling.
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...to the 'marketplace's answer of "no thanks, we want our music for free" is:
FINE, you have a choice:
Listen to free (or nearly free) sources like radio or sat radio.
Or don't.
No where is there any excuse to expect music to suddenly "be free" just because you want it to.
I'd like electricity to be free. Wouldn't it be interesting if 'the marketplace' just decided "no thanks, we want our electricity to be free"? What would happen? A whole ton of shutoff notices and disconnects. No money? No service.
Try going into a restaurant, eating a meal then leaving without paying. See how well "no thanks, we want our food to be free" works out for you and let me know.
The ONLY reason people thing that music should be free is because it's so EASY to STEAL.
Again, how this isn't clear to everyone is a mystery.
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How do you guys feel about the album (a set of songs in a particular order) as part of the art? I can see that in a lot of ways downloading digital music makes a lot more sense than having these plastic disks floating around. Especially considering that people often immediately import the songs on a CD they buy into Itunes or whatever.
Personally it saddens me that the "album" is being lost due to the digitization of music distribution.
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Whether or not you agree with or condone file sharing, the reality is that it isn't going away. There is a whole generation of kids that have been indoctrinated into it, and the most computer savvy individuals are among them. The RIAA wants people to think they are winning the battle against illegal file sharing, and its complete and total propaganda. File sharing is bigger than ever and growing rapidly. Bittorrent sites are virtually impossible to monitor. Check out what thepiratebay.org has done in the past few years, and how they've publicly denounced copyright laws and even taunted the big companies that have threatened them.
I'm not saying its right, but we need to wake up and find a way to adapt, because things are going this way whether we like it or not.
Personally, I'm focusing all of my money and efforts into licensing to tv/film/ads. At least that's still a lucrative market for songwriters (for now).
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What artistes such as Prince & Radiohead don't realise is that they once needed record companies AND record stores to help launch their careers.
Having achieved success should they simply turn round and shoot those who have helped them
I speak as someone who runs a small label as well as a record/CD store who is already feeling the pressure from within (downloads -legal and illegal as well as counterfeit product) and without (online games and other forms of entertainment.
These artistes need to help up and coming artistes who today are in the same position as Prince/Radiohead were years ago
Few artistes once famous offer help to struggling artistes (I think U2 did) but if we are to live without record companies or record stores then artistes have to give back rather than take all the time.
Learn from Derek Sivers and give give give to the struggling artistes and songwriters etc
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We're all fucked.. The only thing we can hope to do as individual artists is produce works of sufficient substance, merit or appeal that inspire patronage.
Its not fair and it sucks. Music is everywhere and an essential component to many for a life worth living, but it is all too often taken for granted by many people - like fresh air or water.
The government should be making educational and vocational training available to music business professionals who have been utterly displaced by these profound changes that have occured.
A lot of people express such contempt for labels without ever even knowing the full score or reality of life at a record label.
Major labels employ more than fat cat lawyers and accountants. There are engineers, archivists, shipping clerks, warehouse pickers, etc. - all good, regular people who are also suffering from this radical transformation.
There will always be people willing to pay for live music, but not all studio work or composition is intended for nlive performance. These people deserve compensation for their efforts too.
Its endemic of a contemporary society that frequently values style over substance and is ruled by selfish greed and apathy.
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Thank you, Colie Brice, for your accurate and succinct words. Three cheers to people like you who really know what's up.
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All the philosophizing aside for the moment, I think there are some facts and realities that are evident in the marketplace today.
0ver 90% of those who record at the "local" level will not and do not tour beyond a "3-hour drive" from their home-base.
Of those who do not tour -- let's say our homegrown local acts -- the average established estimate of sales is 250 pcs ea of any given title they produce.
Soundscan does in fact register any and all releases that have a barcode. I keep track of several DIY-independent acts at any given time, using Nielsen tracking, physical sales and digital sales. The only sales that are not counted are those not registered at the street level. Touring acts know to have concert sales verified, so that they can show a steady rate of sales for the purposes of attracting investors.
I do not know if sales via CDBaby are counted. The reports I receive do not break down to the micro internet store level -- so I can't say for sure which online outlets are registered, and which are not. Digital sales however, are counted at all the major outlets.
In reality, this statement, ...those Soundscan numbers are not representative of the whole market AT ALL. They mainly represent majors and major affiliates" is not wholely true.
Most of our CDs are not covered by that data. Most data on indie sales is hearsay and unreliable.
This will depend greatly on how you define "indie." If you're a local band who only plays local shows and you dont' verify onsite sales, then yes, it's true. If however, you are a band that does make the effort to have onsite sales verified, or if your products are purchased via established retail means (online and off) then your sales are being counted as part of the whole.
Yes the labels are in it deep, but that does not mean the end of CDs. The format might change, but the end of any tangible media would make it harder to sell at gigs.
Actually, the end of the cd-format is inevitablej, for many reasons, not the least of which are technological advances. I, for one, am sick and tired of cds. I'm in the "business" so I (like most of us having this discussion) am different than the "norm," but I have an entire room dedicated to storing physical product.
Recently, I've adopted a mentality of ripping that content to a separate hard drive and getting rid of all my cds. I don't need the physical once it's on my storage unit, where I can actually get to it better.
I have a cell phone that allows me to dl directly --- all some band has to do is have a laptop on hand at a show today, and allow me to dl the tracks I want directly at the show ... or be able to dl wirelessly while I'm standing there watching the show ...
The "cd" of the future will be a box or chip that is embedded directly into a device, or it will be the device itself. Why would you want a device that only holds 700mb of information, when new devices like the new Sandisc 8GB flash micro card for mobile devices, tied directly to things like cell phones.
No, physical mechanisms for the distribution of musical and/or video content will not ever go away --- just as vinyl is still viable for some, so too will things like blur-ray etc still retain a small niche/boutique market viability for another half-generation at least.
Paul Resnikoff (Digital Music News) had this to say in his editorial comments this morning: Radiohead recently roiled the industry by flipping the tables on digital music distribution. Instead of dictating price to consumers, Radiohead allowed consumers to call the shots. But what does the move mean for music pricing - and profitability - in the digital recording industry ahead?
Consumers are already calling the shots when it comes to pricing on the internet, and the price tag of choice is usually $0. But the name-your-price offer is an attempt to lure music fans back into a paid channel, and reap a reasonable profit in the process.
One noticeable and quantifiable reality in the marketplace today is that the average Joe/sephine purchases an equivalent of fewer than 10 album titles a year. Boomers, 45-54, purchase more physical product than any other demographic cell, and also purchase more dls per month (9 single titles per month) than the average overall population (6 single titles per month). Once we get down to what has historically been the prime market for music purchasing, 12-24, there's far more "free" than "paid."
BTW, I absolutetly agree with this statement: When it doesn't cost to record, cost to own instruments, cost (in time) to learn to play, cost (in time) to write and perfect compositions, cost to promote - all things that are either money directly or have monetary value as they take time, time that cannot be spent earning money another way - then and only then shall it be justifiable to say that music should somehow be free.
You and I are, however, looking at this from the supply side of the equation. It is evident that the consumer doesn't necessarily see it this way. We are seeing a different reality in the marketplace than what such a philosophy offers as a pov. We cannot base our sales efforts off such a woulda/coulda/shoulda proposition.
Personally, I'm focusing all of my money and efforts into licensing to tv/film/ads. At least that's still a lucrative market for songwriters (for now).
Huge market there to exploit if you are able to produce recordings at the highest possible level of technological accomplishment today, and where the level of demonstrated performance skill meets the standard established in current applications.
In other words, this is not for beginners and most intermediate level players and technicians.
Paul Resnikoff asks an interesting question in regards price mechanisms: Is a 10,000-song collection worth $9,900? It sounds crazy, and ludicrous to virtually every rational consumer.
Also in today's Digital Music News is this article:
Javien, Digonex Announce Payment Partnership, Variable Options
Sweet-spot pricing continues to elude the recording industry, and the verdict on uniform, 99-cent downloads remains sour. Labels are pushing for variable pricing, yet a range of alternatives exist. One comes from Digonex, a company banking heavily on real-time, variable pricing technologies. Just recently, the company paired with payment processor Javien to offer a blended service.
The move allows Javien clients to transform their marketplaces into consumer-driven, variable stores. The model pushes obscure or less desirable content towards cheaper price points, and raises tags on more popular music. That partnership allows the variable approach to be applied towards mobile and online experiences, thanks to the diversified Javien clientele. "This partnership is very exciting for us - it provides an opportunity to leverage Javien's strong position in the market," said Rex Fisher, vice president of Business Development for Digonex.
Story by news analyst Alexandra Osorio.
Permalink: http://www.digitalmusicnews.com/stories/100707javien
What will the consumer dictate the price to be? My guess is like Resnikoff's -- FREE, or as near to it as possible.
Many of us followed Derek's post concerning sales, etc here at CDBaby and at the Digital outlets ... we pretty much are sure at this point that the 80/20 rule is even more like 88/12 or less.
Are we "fucked?" Depends on your motivations and expectations, I guess. Depends on your ability and willingness to understand, adapt, and work within the "rules" that the consumer is establishing today, and figuring out how to supply what they want at a price that gives them a sense of value.
Is music valuable today? it's ubiquitous. it's as plentiful as the air we breathe. As a kid, our music was rare and wonderful, becuase it was scare -- something only a few in our towns could do, and fewer could produce for mass consumption --- today? Well .... how many titles are there anyway?
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...worth every dollar - far more than that 9,900 figure - and then some.
Paying for music and supporting the artists and labels - yes, labels - is often the only way these people can make ends meet.
The consumer is asking the unreasonable with "free" recorded music. If every act could play live at all, never mind play live enough times a year, to make other forms of revenue unnessesary, then this might be a feisable thing. But MANY, for perfectly valid reasons, don't or won't, or can't play live often enough - or at all - to make this new trend something workable. So it's gonna be a force to EVERYONE to essentially give away their recorded work just because SOME acts can live without that revenue? Who, with any rational thought, can see this working?
I'm not saying that artists are entitled to profit, just entitled for the right to get paid a reasonable amount for their recordings if they choose NOT to give them away - and not be stolen from because society somehow has deemed paying for recorded music in all cases an antiquated notion.
Seriously. This is crazy, crazy shit.
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Art is a sideshow. Music is a form of art. Bombs, bullets, missles and staying above the poverty line are probably more at the forefront of most people's lives than art. If someone is having trouble paying for food and clothing or having to consider joining the military in the hopes of being able to make a living, then more than likely they're not going to be able to dish out money for art. And if you started making music for money, then maybe you started doing it for the wrong reason in the first place.
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Well my Dad is a carpenter and loves his craft, but he needs to get paid too.
Art is not a side show. Its essential to the full human experience, the ability to discern, create and appreciate is a large component of what makes a human distinctive from other animals.
I agree that personal survival needs take obvious precedence over art patronage, but the truth is that many resources of this society are misused and appropriated dysfunctionally. The money wasted on this Iraq war would have been much better served for education and healthcare and thus fostering a healthy and intellectually conscious population that might be more inclinded to patronize art.
Have the lawyers, accountants, and war profiteers really done such a great job managing the world?
Maybe its time to give the artists and philosopher another shot..
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Music may be a sideshow, but like any other product, if someone wants to possess it and there is a price tag on it there are two choices: pay the asking price (or find a used copy later for a little less money) or don't buy it at all. There is no third option. To assume that music now must all be free because a few artists are in a rare position to give it away is inherently flawed.
No one is making the argument that musicians are automatically *entitled to profiting from a release*, but that doesn't mean they don't have the *right to not be stolen from*. Most musicians are not in it for the money, but for the music. But in no way does that mean they're not entitled to the right to charge for their music. It costs to make it, they have a right to charge for it. Doesn't mean they'll make money from it, but that's what a free market economy, competition in the marketplace, and capitalism is all about.
Again, their not entitled to profit, but that doesn't mean they don't have a right to not be ripped off.
(And it's nobody's business how much it costs to make the music, either. Just like anything else, a good business tries to keep production costs down, either benefiting from the savings in increased profit or passing some or all of it on to the consmer. But albums, particularly well recorded ones, are rarely super cheap to record. Never mind *promotion*. Oh yeah, there's that. This whole "free" music concept, where the recordings are the loss leaders for live shows completely and utterly leaves out the fact that in order for this "free" music to do it's job of promoting the live show, it too must be promoted. And that's not an inexpensive thing by a long shot. In fact, to do it well and competitively, to stand a chance of getting enough exposure where the live show might actually do well enough for this whole concept to even remotely approach making sense for most artist, would cost so much as to disprove itself by default. Most artists don't have the resources to mount a promotional campaign large enough to remotely do well enough to make this work, folks. No or poor budget to promote the recording = no decent promotion for the live show = no income. Or suddenly are musicians in the same positions as consumers, where consumers now demand all music be free, musicians can demand advertising for their free music be free to them? Where does the silliness end? Come on people, this whole thing is ludicrous.)
"BTW, I absolutetly agree with this statement: "When it doesn't cost to record, cost to own instruments, cost (in time) to learn to play, cost (in time) to write and perfect compositions, cost to promote - all things that are either money directly or have monetary value as they take time, time that cannot be spent earning money another way - then and only then shall it be justifiable to say that music should somehow be free."
You and I are, however, looking at this from the supply side of the equation. It is evident that the consumer doesn't necessarily see it this way. We are seeing a different reality in the marketplace than what such a philosophy offers as a pov. We cannot base our sales efforts off such a woulda/coulda/shoulda proposition."
But that's just too bad for the consumer. I'm sure if someone figured out a way to download cars or food "for free" consumers would suddenly demand that all cars or food be free. It's perhaps what the consumer might want, but it's not realistic for most content providers (read: musicians) to be expected just to give away their recorded works on some speculative (and very misguided) assumption that live shows and merch will make up for it. This is simply not so, and no matter of eloquent debate or rationalization will make it so.
It's not woulda/coulda/shoulda. It simply is the reality of it, versus what the consumer would like. The consumer is doing a lot of woulda/coulda/shoulda, but they don't have enough information, apparently, to make those assumptions.
The consumer thinks all musicians make tons of money. They think all labels are evil and only fuck artists over. They think all tours and live shows are profitable. They think these things based on media hype ("Cribs", anyone, for starters? That leased and rented bling, folks - it's a TV show, not reality for the vast majority of musicians) myths about how the industry works, misinformation or lack of information about how live shows pay, and cost to put on, about how much it takes to make a great recording, and on and on. The consumer is in absolutely no position to dictate that artists shouldn't get paid if they want to possess their recordings. None whatsoever. No eloquent rationales have ever shown otherwise.
Heck, what this new paradigm is essentially saying is "the car should be free because car companies make enough from parts and repairs". And everyone knows that is not logical. And based on assumptions that don't hold up under scrutiny.
"The Consumer" would like *everything* to be free, or unrealistically cheap. But, like anything that takes time, money and resources to make, recorded music is a product. Two choices for the consumer: buy it or don't. Stealing it isn't an option. The Consumer doesn't get to set the price of a head of lettuce in the supermarket - those prices are based on cost of production, distribution, a nessesary profit for the vendor, and, yes, a little bit of market competition. And there is a lot of market competition driving the price of music down. But "free" only works if market competition is the only factor, and it most certainly isn't.
No, the only reason this is an issue is because there is a simple method almost any moron can use to steal music. When it's that easy, it artificially sets the bar low. And there is no, repeat, no argument for file "sharing" that has *ever* been put forth that holds up under scrutiny. None. Every single rationalization is flawed, every single one comes down to misinformation, myth, or simply justifications for not paying for something someone wants to own. I any other part of culture, something offered for sale that is then stolen is not tolerated, yet for music it's somehow accepted. This is ridiculous.
And, back to the point, the only reason people unrightfully now think all music should be free is because a rare few are in a position to give it away, combined with the ease of theft of all music.
Pathetic and sad. Anyone who doesn't see how irrefutably wrong this is is either naive, underinformed, or is using whatever illogical rationalization they can to make themselves feel okay with stealing, maybe even patting themselves on the back for "sticking it to the man". What crap. Not one argument I have *ever* heard has shown otherwise. Not here, not on any other message board, nowhere, ever.
Wake up people, our culture's greed is growing, and screwing itself over in the process.
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Oh, and I don't *actually* agree that music is a sideshow. It's culture. It may not be food/clothes/shelter/healthcare/education essential, but it's something that society has proven that they want, perhaps need, in vast quantities. And who has the right to say that those who make it shouldn't be compensated, regardless of the avenue of expression. That is, some musicians have live performance as their principle avenue. Some have the studio, the recordings. Most have a combination of both. Who has the right to say that one avenue is now suddenly worthless over another? No one. Who has the right to say that an artist *must* play live? No one. Who has the information to assume that it's always a possibility to play live? No one. But yet, that very assumption is part of the issue. Sorry, folks, but you can't force musicians to play live, or play live often enough to make it their only means of compensation. Some can't for a whole number of perfectly acceptable reasons. Some won't for another number of good reasons. And some will. But it's up to them. And it's up to them to decide whether or not their music should be "free" - not some arbitrary wish by "the consumer".
How this isn't clear to everyone is perfectly baffling.
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The consumer is in absolutely no position to dictate that artists shouldn't get paid if they want to possess their recordings. None whatsoever.
I think the consumer is proving that statement to be unrealistic, in light of all current data on the subject. It is a FACT, as opposed to a myth, that overall music sales are diminishing, regardless of the format on which or in which the music is delivered.
I remember six to nine years ago as the subject of P2P and free dls on MP3.com was addressed in countless forums how the "indie" scene was touting FREE. Today, it's the "indie" scene that is saying, "hey, wait a minute, we didn't really MEAN it!" Huh --- to late y'all ... while we were all defending Napster and what-have-ya, the consumer thought, "wow, we really can own music for free." Now, what are we saying? Are we saying we actually MIGHT agree with the RIAA? Funny, that .. huh?
Two choices for the consumer: buy it or don't. Stealing it isn't an option. The Consumer doesn't get to set the price of a head of lettuce in the supermarket - those prices are based on cost of production, distribution, a nessesary profit for the vendor, and, yes, a little bit of market competition. And there is a lot of market competition driving the price of music down. But "free" only works if market competition is the only factor, and it most certainly isn't.
Acutally, in this case market competition is the only real factor. The very fundamental economic laws of supply and demand are dictating the environment we're in today, to a very large degree. There are over 70,000 titles released into retail distribution a year today -- an unfathomable amount of music! If the MOST music is gotten for free, and the consumer no longer believes music carries a MONETARY value, then the music has to be used to create a desire for an alternative source of revenue.
E=Bay has already proven that the consumer rules and can be trusted to assign a consumer driven MONETARY value for product. The consumer desire for less expensive goods has driven the super-retail model to the level that we're now angry about it!
Music is water -- it's air -- it's earth -- it's sky -- it's everywhere... all the time ... it is ubiquitous and the supply is growing. As supply grows, and demand remains static or shrinks, the monetary value of any product or service declines.
Whether we agree or not --- whether we accept the new paradigm or not --- we are entering into a new era ... one that many of us will not survive ... and one that the "fittest" of us will at least marginally ok in, if we adapt to changes in the environmnet.
Here's a note from today's Lefsetz newsletter email, as the timeline of 2007 is presented:
____________________________________________________________________________
OCTOBER
Radiohead distributes its album direct to fans, at a price they determine, even zero. Suddenly, a tidal wave erupts. Jamiroquai and Oasis, also out of their deals, are said to be following suit. The Charlatans just give away their album completely. In nine months, music has gone from something you pay for, at CD prices, whether it be for the complete album or tracks at the aliquot price, to free. The major labels are to blame, for sticking to the old model rather than monetizing the new, but it seems too late now. Acts want to do it for themselves. We may not know for months how successful this Radiohead model is. One doubts the band will release sales figures. But, the acts won't go back to the majors unless they get much better deals and transparent accounting. For even if the album is free, they can make a fortune on touring and merchandise. The album is the loss leader.
_________________________________________________________________________
That is where we are folks ... and it ain't going back to the "way it was." We'd better be using our collective resources on figuring out HOW to make money doing this thing, or just accept that we're doing it for the Love of the Art.
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| by G
on Tuesday October 09 2007 @ 01:16PM PDT [ reply | parent ] |
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You're right. Like it or not...realize it or not...we are in a different place and there is no going back.
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The end of music or the start of a new fad? - A Reflection...
I want to offer an artists standpoint as well as an entrepreneur’s standpoint. Maybe it may offer some insight into this conundrum of a question.
From the artists perspective:
Metallica: I made my music, I should get paid. At any cost.
Prince: I made my music for me and you, but its only free for publicity stunts.
Joe "I got potential" Shmoe: I live music, and I don't get paid squat, please listen to it, heres a free demo. Heres a free download. Enjoy. Until I get big (see above).
From the Business perspective:
Major Label: Your gonna give me money, or I will press charges. I will make all downloading cost money someday.
Indie Label: I would like your money, please. but in the meantime, here is a free download.
"Out of trunk" artist sales: Lets make a deal. Whatever you wanna give.
(I have left out the End User because it doesn't seem to matter what he/she thinks anyway)
The theme I am trying to emphasize is "Evolution". Those Major labels were once small labels, and those "Big Bands" were boo'ed by a room of 10 people at one time(Just like Joe-Shmoe). No one had heard their product, and any exposure for their product was gold to them! As their name (and their very "Evolution-Friendly" product) got bigger, and more refined; the less their exposure was worth, and the more their product became the spoils.
The greedy, (as some have called the downloading pirate-populace), have found a way to gain access to the product that they desire. They risk little, but generally, pay no heed to the consequences; and download music for free. Usually, they break the law, consequence-free, and (supposedly) hurt the music industry, as we know it today. That is arguable.
Does "The Greedy" not include the music industry Major Record Labels — whose prices for CDs have never dropped despite plunging production costs? Who whore all of their product out to radio stations which play it for anyone to hear,(Gasp*) for free??? Who collect money on Movie, Tv, and Radio Royalties, Album Sales, Merchandise, and concert fee's by touring bands?
The true purpose for the fight on "Cyber-Piracy" has and always will be about money. The music itself is overlooked by the politics (not the ethics), and will remain a separate entity in itself. Music is alive, flourishing, and becoming entwined in everyday life, for humanity in general. Cell phone ringtones, TV Commercials, 100,000 person concerts in third world countries, radio, Internet Radio, etc. etc.; they only multiply everyday, and with good reason. Music is such a multi-faceted existence, their is no way to keep it hidden from the world. Like painting, sculpting, and any other art form for that matter. It is evolving, like life itself.
A Human
***Footnote*** (I think these should be addressed)
1)"No, the only reason this is an issue is because there is a simple method almost any moron can use to steal music. When it's that easy, it artificially sets the bar low. And there is no, repeat, no argument for file "sharing" that has *ever* been put forth that holds up under scrutiny."
Even a genuis can write with a crayon. I recommend you look up the definition of "tool". I also propose to never hum a song around another person unless you wrote it, as you will be sharing someone else's work.
2)"And, back to the point, the only reason people unrightfully now think all music should be free is because a rare few are in a position to give it away, combined with the ease of theft of all music. "
Music is free.
3)"...And it's up to them to decide whether or not their music should be "free" - not some arbitrary wish by "the consumer"."
The band "Radiohead" has already disproven this (as discussed in previous logs) There is always a grey area in life. There is no definitive yes and no.
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I think the new model can probably work out fine for the big names artists like radiohead.... and probably presents difficulties for the moderately successful "indie" artists who have fairly large recording budgets and still hope to earn a decent income from their art.
But the real question we should be addressing in this forum is how does the new model effect "little artists" like most of us here? I think what is driving the new model is the technology that makes free copies of music accessible. This applies to the big-names and it applies to the mid-levels, but does it really apply to us?
If somebody wants a free digital copy of one of my band's songs (http://www.cdbaby/cd/chiefly) where are they going to find it? We are not popular enough for our music to be found on file-sharing systems . I would guess that anybody who is interested in a typical CD-baby band is going to be an "early adopter" type, and willing to pay a "premium" ($10 per CD or $1 per song-download) for music that would be very difficult to find for free. Let's be realistic: we are not Radiohead, and we are not even Band Of Horses or Sufjan Stevens. Most of us are Joe Schmoe, and in this particular case, within the marginal market of demand for our music, I think our obscurity works in our favor.
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One of the most "shared" types of music between friends is that of the local artist, whose cd was purchased at a local show ---
--- will it be found on someone's hard drive? Yes, because that is how we now "share" music with one another, via email, IM, P2P etc.
This isn't just an issue of "us and them" anymore. This is a fundamental shift in the way people perceive the value of ownership. Music is a liquid asset -- as easily deleted as it is obtained to begin with.
MySpace gives us our music for "free." No, we can't take it with us, unless we pay to do so. But a dollar spent today, consumed, and thrown away in a couple of weeks is really no different than how we util | | |
