Free File-Sharing or Bust: We’re Already on that Road

Professor Del Colliano at USC Thornton School of Music has often mentioned to “embrace the inevitable” and be fluid to change in order swim with the wave, rather than be drowned by it. It must be applied to music industry business models today in order for labels (what’s left of them) to remain afloat. Labels refuse to bend to the whim of their lost consumers who have resorted to illegal file sharing, causing hundreds of millions of dollars in lost revenue. But can embracing the change resuscitate the flat-lining pulse of this business?

It’s worth a shot. The record industry is so far into its own mess, that it has no where to go but up. In the medical field, people are being cured with the very same viruses that have riddled their bodies with sickness. This can be done with the record industry and file-sharing. Why not use file-sharing as a friend rather than foe, exploit artist’s music as a means of marketing, public buzz, and taste-testing to whet the appetite of the consumer. The average consumer is no longer enticed by a mere band photo and artist logo in Rolling Stone or Spin. Consumers are jaded and convinced that it’s all the same. They need to be exposed to the band with more than just one sense. This in no way means that music consumers solely need to hear new music on the radio, because radio is another horse that’s been already beaten to death. Offer free, high quality downloads to consumers! Revolver Magazine has already embraced this model, exposing its readers to 6-7 free, legitimate artist downloads upon purchase of each monthly issue of its magazine (a download code is provided to regulate traffic).

iTunes itself offers free weekly music downloads (one weekly per user), exposing artists to millions of consumers. Although many attack the idea of free downloads, because it poses a disadvantage to the artist, but critics should chew on this: out of all the artists out there, how many are already making a comfortable living by selling their music? The answer: probably a handful. In today’s sea of pre-packaged crap from labels where rappers have pre-negotiated “bling accounts” and rockers have an endless supply of tight pants, new artists are hungry for a shot at exposure.

Three years ago, Techdirt released an article for its readers to build upon a theory or business model in which record labels would embrace file-sharing rather than fight it. The article “A Business Model Involving Free File Sharing” (http://www.techdirt.com/articles/20030912/1032238.shtml ), was widely acclaimed and widely despised. The staff at techdirt chose a model which relied upon tour and merchandise revenue, even suggesting that labels be formed into “fan clubs” where users pay yearly membership fees to have all-access to artists, media, music and the whole lot. A user suggested that

“The bands are now making money from (a) concerts (b) fans who are "subscribed" to their service and (c) still from selling tangible merchandise. Fans get to directly support the bands they like. The actual music can be enjoyed by a wider audience. Digital music files are seen as promotions, and thus a band is more likely to get a wider audience, meaning more people joining their fan club. No, not everyone will join, but so what? Not everyone buys CDs now.”

A Desperate Need for Shifts in the Record Industry

We’ve all heard it. The music industry is dying, sinking, disintegrating, whatever. Executives should no longer look at CD sales as the lifeblood of this industry. There is disregard for copyright with the advent of file sharing and illegal downloading, yet the bigheads at the label refuse to change their business models in order to give way to a new channel of revenue. We find consumers downloading digital singles rather than the purchase of a tangible album in a jewel case from their local music stores (which are already on the brink of extinction). Why hold on to the life raft that cannot float?

The New York Times has recently written an article on how the album is no longer a commodity. Strong sentiments do hold true to some extent, as we see in the article (http://www.nytimes.com/2007/03/26/business/media/26music.html?ei=5090&en=7a35acc488a8c811&ex=1332561600&partner=rssuserland&emc=rss&pagewanted=all )labels have already begun signing artists for singles at a time (no longer option periods for albums). The actions are logical, since ringtones and downloads are purchased at one song at a time. The average consumer only purchased an album because of the 1-3 songs that they really really liked on the CD, anyway. iTunes main revenue is through the sales of singles purchased at $0.99. Album recording costs are extremely inflated, album marketing is extremely risky, etc….but why not focus on one hit? Would it be possible to sign one hit, record one hit, market one hit, sell one hit, and profit from one hit? It does beg the question of how a band or artist would perform only one hit on stage and then exit stage right, but it does present an opportunity worth looking into.

In ties with the New York Times article, Techdirt.com offered a plausible business model in an article here “If Albums Are Dead, Why Not Offer Playlists?” ( http://www.techdirt.com/articles/20070326/005758.shtml ), suggesting Playlists. Why? Because with the rise of the iPod, MySpace playlists, iTunes, and file-sharing there has always been: The Playlist. We use playlists to entertain parties, burn CD’s and keep us interested on-the-go. It seems highly logical since most consumers now lack the attention span to listen to albums for even 3 songs through. We prefer CD mixes over the album when in the car. We are entertained by the house DJ with his cherry-picked selection of singles and remixes. ITunes offers playlists for sale, made by iTunes staffers and users alike. Every playlist’s price is marked proportionate to the number/popularity of songs combined, and sell moderately well if arranged well. The proof is in the “Now, That’s What I Call Music!” pudding, arranging a mix of the season’s/year’s top singles arranged in an album form. It seems as if the bigheads have their work cut out for them, if they choose to shift. What do you think?

An interesting picture...

How desperate is the RIAA? This desperate.

Gizmodo passionately boycotts the RIAA with a manifesto

Gizmodo, one of the most popular technology and gadget sites on the interment, publicly bans the RIAA in a manifesto, uncovering the wrongdoings of an association who has claimed to be wronged itself. This is one of the first times any media agent has openly called for action against the RIAA. An excerpt from the maifesto (which can viewed here: http://gizmodo.com/gadgets/home-entertainment/gizmodos-antiriaa-manifesto-239512.php ) features two distinct muckraker-esque articles which have “hit the nail on the head” in regards to sentiments on the music industry in its entirety. This is the except from the article itself which has featured the two pieces from Courtney Love and Steve Albini.

“Rescuing Artists From Those Claiming to Support ThemAs we're a technology website, we're most in touch with the RIAA's actions in response to music downloading as opposed to their history of poor artist management and unfair retail tactics. However, it's worth noting that issues such as the underpayment of artists and album price-fixing are quite serious and should be considered as good a reason as any to keep your money from going to their pockets. Two articles worth reading to study up on how major labels screw over the artists they claim to represent are Courtney Love's speech to the Digital Hollywood online entertainment conference and The Problem with Music by Steve Albini. Both are written by artists who have first-hand knowledge of just how badly major labels take advantage of musicians, and both are guaranteed to change how you view the music industry.”

In these articles, Love and Albini roughly calculate how much of money made from an album is directed towards an artist and how much of it goes to the record label. The article from Steve Albini is highly acclaimed, offering insight to how funds for a band are spliced apart, leaving virtually nothing for each of the band members, even though the band itself sold 3 million copies of their album. The article definitely raises eyebrows as to how much a labels are looking out for the welfare of their dancing monkeys/artists. Exactly how well do labels take care of their artists? If you take away superstar artists and calculate income from an average joe/indie band, are they better off working at a 7 eleven? Is it the band's fault that it never recoups? Hopefully both the record labels and the RIAA will listen to the public outcry for change in the music industry. Things need to change.

UK TOP 40 NOW INCLUDES DIGITAL DOWNLOADS

“Essex rock band Koopa could become the first unsigned group to land a UK top 40 hit thanks to new chart rules”

Until 1 January, bands and artists were only allowed to release singles on CD or one alternative physical embodiment - which would only mean that an artist required a record deal - to be qualified to enter the charts.
However the rules changed, effective January 1st, bands who sold songs on their own through official downloading services, like iTunes, are eligible to enter the charts. The band, Koopa, which entered at #17, made their place in the charts through internet/mobile downloads. Most of the downloads were made via mobile phone, usually coming from teenagers the bulk of their fan base. Mobile downloads allow new markets, like teenagers to have the power to purchase music, since a lot of them “don’t have credit cards.”

“Once again, the music industry is rapidly evolving toward the self-generated digital market”

Although the news is coming from the United Kingdom, it should serve as a harbinger to the music industry in the States. The news shows that music industries in other countries are changing standards and rules to keep up with an evolving industry. It gives artists power to help themselves, without a strong arm of a record label. However, even if it allows bands to further their careers without a label, it may even help bands get signed. It will show labels what kind of music they should start supporting, as a means of scouting and interest.

The article was written by Ian Youngs from the Entertainment reporter, BBC News website. It can be views here: news.bbc.co.uk/2/hi/entertainment/6248535.stm