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The Record Industry's Decline
June 26, 2007 6:47 AM Subscribe

The Record Industry's Decline. "The record companies have created this situation themselves," says Simon Wright, CEO of Virgin Entertainment Group, which operates Virgin Megastores. Rosen and others see that 2001-03 period as disastrous for the business. "That's when we lost the users," Rosen says. "Peer-to-peer took hold. That's when we went from music having real value in people's minds to music having no economic value, just emotional value."
posted by geoff. (279 comments total) 24 users marked this as a favorite

I'm going to call BS on Mr. Wright. I think that music does have an economic value in most people's minds, we just don't think its worth $20 per CD, of which maybe, maybe, $0.25 goes to the artist. The RIAA, the labels, and all the other middlemen have an overdeveloped sense of both how necessary and how valuable they are.
posted by sotonohito at 6:51 AM on June 26, 2007 [4 favorites]

There are some CDs worth $20 or more. Britney Spears ain't it.
posted by Brandon Blatcher at 6:58 AM on June 26, 2007 [1 favorite]

The RIAA fucked themselves over. They're currently continuing to fuck themselves over by suing people.

I hope every label who participated in that goes bankrupt.
posted by empath at 7:00 AM on June 26, 2007

Maybe if you guys hadn't put out so many godawful CDs, so many one-hit-and-fourteen-tracks of shit CDs, for the low low price of 18.99, you wouldn't be in this predicament.
posted by jason's_planet at 7:02 AM on June 26, 2007 [3 favorites]

This is a pirated MP3 of the smallest violin in the world playing for the record industry.
posted by The Card Cheat at 7:03 AM on June 26, 2007 [111 favorites]

Other than a few timely updates (EMI allowing iTunes to sell its music without copy protection, for instance), this is the same article about the decline of the major labels that's been popping up once a week for several years now. If the big guys are indeed sinking into the tar pits, their death scream seems to have a whole lot of notes.
posted by kittens for breakfast at 7:05 AM on June 26, 2007 [1 favorite]

I think they will cease to exist in another 5 years or so. There are students at ASU as well as every other university, that are passing around 500GB drives filled with CD quality music. In the time it takes to go to a store to buy an album they can copy 80,000 songs. Their business model is dead, dead, dead.
posted by Mr_Zero at 7:05 AM on June 26, 2007

I look forward to seeing thousands of record company executives forced to stop mooching off of talented artists and go get real jobs.

As for the songwriters and backup musicians who are finding themselves struggling for work, I do sympathize. Why not come to my town and play a few gigs, guys?
posted by Faint of Butt at 7:06 AM on June 26, 2007 [3 favorites]

I think that music does have an economic value in most people's minds, we just don't think its worth $20 per CD, of which maybe, maybe, $0.25 goes to the artist.

I think that music creation, i.e. creativity, has an economic worth in people's minds but that music copying does not. You kind of touch on that with the $.25 going to the artist. I think people would be more than happy to pay, say, $10 for a CD of which $7 goes to the artist and $3 to the middleman who makes the pretty package, does the work of the actual mindless copying, etc.
posted by DU at 7:09 AM on June 26, 2007 [1 favorite]

Its ironic that they were instrumental in driving the development of the technology that made thier distribution model obsolete.

The RIAA put napster on the map by suing it. At the same time it gave people reason to look for an alternative file sharing product. Several different, more decentralized technical solutions emerged and each gained massive user bases as people flocked away from the young napster. But eventually the riaa figured out which points in a particular new p2p system are control bottlenecks, and they sue it. They have done this several times, and each time a software model was legally crippled. And each time the massive user base moves on to a more decentralized p2p system. Thus we arrive at bit torrent and decentralized trackers. The only thing left to sue is everyone. Thus alienating your entire customer base.

Well done RIAA.
posted by Merik at 7:09 AM on June 26, 2007 [4 favorites]

I think that music does have an economic value in most people's minds

For many people, though, the price it's worth is the lowest price they can get away with, and that price often is zero. And it isn't just music and the recording industry; people now feel comfortable about filching anything electronic -- if the original isn't damaged, it is assumed that no harm is done.
posted by pracowity at 7:09 AM on June 26, 2007

It all comes down to ease of media ownership. Cassette tapes killed 8-tracks, CDs killed cassettes...the industry was just incredibly slow to adopt the file based medium which is now becoming popular for use in portable players. Because they had no faith in its viability and instead spent tons of money on lawsuits against indiviuals who could not realistically pay them back for "damages caused" they are in turn self defeating.

The reality is, most people want to use the mediums that best suit their music enjoyment. Most would pay a resonable amount of money to obtain unlimited replay rights to the songs or albums they like....otherwise legitimate services such as iTunes and Rhapsody would go nowhere.
posted by samsara at 7:10 AM on June 26, 2007

Well, if anything it shows that if technology provides a near-free way of procuring an item, even if it means the barrier is some technological sophistication, even incredibly well-funded industry groups cannot bully it back into place.

What is most ludicrous of all is that consumers are still paying a lot for music, just not as much as before. Nor are the distribution models the same, comforting models they were. People will pay for ring tones (the article quotes that it is a $600MM/year business, with low overheads). Most of my music consumption is indirect and isn't as easy to calculate as purchases at a point of sale store. I never watched concerts before the advent of HD, and now a large portion of television are beautifully shot and produced concerts on HD channels and venues for new music (London Live). MTV has moved itself into a position of being a lifestyle brand for mainstream under 20 demographics, as evidenced by the proliferation of reality shows. For the rest of us it is back to basics: live shows from real bands.
posted by geoff. at 7:14 AM on June 26, 2007

Aww Yeah.

And the thing is, I feel absolutely no compunction about pirating music now thanks to these assholes. They're utterly obnoxious, why would I want to support them at all? I mean at one point in the past few years they actually supported legislation like this that would have made iPods illegal. In fact, it would have made PCs and any other digital device capable of playing music or video illegal if they didn't have mandatory built-in DRM.

So I say fuck 'em. They wanted to steal our rights, I say "steal" their music. I can afford music now if I wanted to buy it, but why would I want to send money companies that sue 12 year old girls and generally act insanely heavy handed? Why support lobbying efforts to stamp out the internet?

That said, I still think 99¢ is too much for a single track. And why all the same price? I'll probably start buying music when I can get tracks for 25¢ or maybe albums for $1. With no distribution cost, why not? And also if major acts don't want charge more I'm fine with listening to Indy stuff.

But I'm never going to pay anything for major label music again.
posted by delmoi at 7:17 AM on June 26, 2007 [1 favorite]

I do think some people are willing to pay for music, but I know a lot of people, serious ass music fans, that pirate the shit out anything and everything they can. People underestimate just how cheap people can be.
posted by chunking express at 7:21 AM on June 26, 2007

just emotional value

Oh yes, those useless emotions, nothing compared to the almighty buck. Not.

Yup, it's about time the song writers and musicians profited from their work.

The Brill Building is near where I live and having heard it was important in the music world I should have looked it before but your post prompted me to Wikipedia it.

A record store owner I met brief years ago said that it was the mafia of record distributors, who ruined the record industry. A record might be made but unless the distributors said so, the record never got distributed and sunk like a stone.

Since then have been curious about the politics of the music industry. A quick Wikipedia search turns up "record label"...often part of an international media group. ah, it's the Corporation mafia.

No wonder music made a break from mega-corporate chains and went the way of Napster and mp3. YAYYY music!

Will be interesting to see if a healthier business template, in regard to the music makers, arises out of these particular ashes.
posted by nickyskye at 7:22 AM on June 26, 2007 [1 favorite]

But Mr_Zero, what the hell would you do with 80,000 songs? I've got maybe 3 or 4 thousand songs in my fairly small record collection, and that's far more than I can appreciate or effectively use.

Maybe the real worry for artists should not be the decline of the redundant record industry, but the ubiquity of music in modern society. It seems to becoming a kind of security blankets, or maybe psychic cotton wool, very useful for stopping yourself from hearing what you're thinking. I've found customers getting quite agitated and complaining to me if I turn the music off once in a while (I'm a barman). Will this end up devaluing music as an art-form, and destroying distinctions of quality?

Well, probably not, actually, but even so.....

I'll stop. I think I was about to rant.

Cheers!
posted by howfar at 7:22 AM on June 26, 2007 [2 favorites]

I think [the record labels] will cease to exist in another 5 years or so. [...] In the time it takes to go to a store to buy an album [students] can copy 80,000 songs.

But where do those 80,000 songs come from? It still costs money to make records. Sure, the overhead involved in making and distributing reasonable-quality recordings is shrinking, but it's still not free. You can write all the music you want, but without good engineers and a talenter producer, most bands make terrible recordings. You have probably heard them on Myspace.

Somebody's got to pay those people, preferably up front, which is what record labels do. Yes, the business model is outdated and needs to change, but that doesn't mean there's no place for record labels, if only as investors.
posted by uncleozzy at 7:22 AM on June 26, 2007

This is still the best set of reasons for delmoi's position I've seen.
posted by imperium at 7:22 AM on June 26, 2007 [7 favorites]

According to the sidebar ads accompanying the article, if it comes down to it, no doubt record industry execs could use their extensive knowledge of Will Smith to get a free Red Lobster dinner for two, thus holding off starvation another day.

Of course, if Red Lobster acted like those same execs, each poor executive's 20$ dinner would only have one or two bites worth trying, many bland bites, and a few shit kernels in buttersauce. The whole thing would be delivered slowly by a horde of waiters who, knowing that tip is included for each of them, would take their sweet time and not really care about the exec's dissatisfaction with the meal or service.

Eventually the execs would stop going to Red Lobster, thus forcing all the waiters out of a job, sending them to use their knowledge of Will Smith to try and win free dinners at, I dunno, Long John Silvers or something. They'd sit together in sad bunches, eating their cold popcorn shrimp, pining for the good days of family seafood dining. One will start to cry and the others will all look away, awkwardly.
posted by robocop is bleeding at 7:24 AM on June 26, 2007 [18 favorites]

The entire recording industry based itself on sale and control of artifacts of recorded music.

Recorded music is not the same as music.

I personally am rather thankful that the proliferation of individual recording devices is returning us to an era of real musicianship - that is, composing music and playing it live for an audience that is right in front of you, which was the main mode of music 'distribution' throughout human history, with the exception of the last 70-some years. In order to make money in volume from the work of another person, you simply have to control the production and duplication of that person's recordings, and that's just not going to be possible any more, ever.

The model I'm interested in now is the one embodied by bands like Old Crow Medicine Show, who built their following completely through touring and selling homemade recordings out of the back of the van. They ended up with a recording contract, but they are a touring band and that's how they make a living - largely not from CD sales. Promoters and managers and venues and merch designers can still make money by working with the band, and there's nothing wrong with that -- when a band starts to achieve some success, the first thing they want to do is let go of the harassing details of booking and writing checks and the like. So there's still a 'music industry' in this model, it's just not built on artificial control of a material object.

For all those interested in this issue, I recommend the documentary film "Before the Music Dies," now being independently released and screenable anywhere for a reasonable fee. While it has some flaws, and stops short of a critical analysis of recorded music as a whole phenomenon, in general it's a pretty good summation of why the music industry is suffering so much - with some kickass artist interviews, to boot.
posted by Miko at 7:24 AM on June 26, 2007 [7 favorites]

Apparently, the RIAA thinks we just don'geddit:

“The music industry is transforming how it does business and embracing digital distribution models of every kind,” said Steven Marks, Executive Vice President and General Counsel, RIAA. “For students, many of these high-quality digital music options are available at deeply discounted rates – or even free. Those who continue to ignore great legal services and the law by stealing music online risk a federal lawsuit that could include thousands of dollars in penalties. With so many simple, easy and inexpensive ways to enjoy music legally these days, why take that risk?”

The full list of schools they're presently targeting can be found here. Mr. Zero, looks like you're safe . . . for now . . . mmwahahahaha
posted by Bixby23 at 7:28 AM on June 26, 2007

Of course I didn't RTFA, but...

I've been going through what amounts to a periodic music binge, and I've both acquired and purchased a HUGE amount of music in the past couple of weeks.

What's struck me is that there are so many independent labels now, many more than there were back in the day. The internet doesn't just facilitate music sharing, it lets people get the word out about their records, which encourages people to buy them.

I remember days spent poring over every ad and review in MRR every time it came out, well before the internet, and there just were not as many labels out there. It seems like every band is releasing their own stuff, or they're on a label that has a roster of just three or four bands.

I've never been one to spend much money on major label releases, but I do think that now many more people are probably buying independent because they know about independent bands and labels in a way that they did not before. It takes an afternoon on the internet to explore a scene or a style, and listen to 25 free songs with no effort at all. In 1985 or 1990 it took a lot more effort to discover and listen to new music, and the majors were a lazy alternative. I think the playing field is much more level now.
posted by OmieWise at 7:30 AM on June 26, 2007 [1 favorite]

But Mr_Zero, what the hell would you do with 80,000 songs?

What don't you do with them? These kids are carrying around so much music that it is difficult to name a song they DON'T have. Hey, I want to listen to that album Dope On Plastic, no problem. Hey, remember that stupid song from the 80's, Safety Dance, no problem.

But where do those 80,000 songs come from? It still costs money to make records.

Not really. There are all sorts of mom and pop recording studios here in Phoenix. A converted room in a house or garage. Virtually all the equipment has been replaced by a computer or two. Record to digital and distribute.
posted by Mr_Zero at 7:31 AM on June 26, 2007

Next: recorded movies.
posted by East Manitoba Regional Junior Kabaddi Champion '94 at 7:33 AM on June 26, 2007

You're all assholes. Please step off your moral high ground, your ginned-up excuses, your sudden interest in the economic breakdown of record sales, your phony posturing on behalf of "the artists", and just admit it:

Free beats paying for it any day of the week.

Please. Just come clean. Because all your self-congratulatory positions are about as valid and sincere as "we were looking for WMD's." The recording industry isn't dying because of their business practices (and I'd like to know what sort of "business model" accounts for 80,000 pirated songs on some dipshit's portable hard drive); it's dying because you'd rather get something for free than pay for it. Simple as fucking that. So fuck you and your fucking moral-high-ground reasoning.

Of course I didn't RTFA, but...

Of course you didn't! You just wanted to inject your pre-made, undigested opinion that someone else gave you into this thread. Thanks for contributing!
posted by solistrato at 7:38 AM on June 26, 2007 [7 favorites]

I think the music industry was bound to go down at some point. The business model was designed to squeeze the absolute most dollars out of a fairly unstable product. I'm not sure how things worked before rock and roll, but once some entrepeneurs realized that they could get a shit ton of cash for themselves while ensuring that their artists got the fame they desired (often with little compensation for their artistry) everything turned to shit.

The late-fifties model of selling music just doesn't work anymore, and technology is the culprit. I don't think this is a bad thing in the least, and I hope that the system will change enough to allow artists to receive the money that their talent is worth.
posted by frecklefaerie at 7:41 AM on June 26, 2007

Of course you didn't! You just wanted to inject your pre-made, undigested opinion that someone else gave you into this thread. Thanks for contributing!

Perhaps you should read what I wrote, which was in no way a justification for downloading free music. It was an opinion, strangely formed all by my lonesome, about why people might actually be spending more money on non-major label releases than they did before.

But don't let that get in the way of being an asshole, asshole.
posted by OmieWise at 7:43 AM on June 26, 2007 [4 favorites]

Let me offer a solution to the RIAA.

1. Stop suing people. Like delmoi suggested, I'm oppositional enough that the more you sue, the more I download. Bring it on.

2. The RIAA needs to assume to the role of a middleman. One of the easiest ways to sample music is on YouTube or other video sites. The RIAA should approach Google (youTube's owner), and invite them to take the same ASCAP blanket license that the satellite radio stations take. That way, google pays ASCAP for the music that people include in their videos, ASCAP divvies iut up among the artists, but the videomakers themselves don't have to be burdened with rights management. The process is transparent to both all users of YouTube.

3. You should see how google paying a blanket license changes things. You search google for a song (people are already doing this), google serves it up, you hear it, they pay ascap, and the artist gets paid by ascap.

The fact that the song is on someone's personal site doesn't matter, because you got there from google. Google gets ad revenue from the search results, so they make money from song searches. I suppose this angle needs to be thought through more (and maybe it should be amazon instead of google) but the idea is that the search finds people the music they want to hear, and google collects incredible statistics about search, so that's the most obvious avenue of payment.
posted by Pastabagel at 7:43 AM on June 26, 2007 [4 favorites]

Not really. There are all sorts of mom and pop recording studios here in Phoenix. A converted room in a house or garage. Virtually all the equipment has been replaced by a computer or two. Record to digital and distribute.

That wasn't the point; did you read the rest of the comment? Maybe you disagree, but I think it takes talented engineers and talented producers to make a good record. It takes some amount of skill to translate good music into a good recording, and that's what's missing in a lot of indie records. Yes, there's something charming about a recording made for $500 in somebody's basement, or even $5,000 in the studio down the block, but it doesn't necessarily do the music justice or make me want to hear more of it. There's a difference between the experience of live music and that of recorded music, and a good recording uses the medium to enhance the performance.

I'm sure there are plenty of indie bands who are out there writing great music (just like there are plenty of major-label acts writing crap), but when the record is lousy, I think it takes a lot more effort to appreciate it or even to recognize the gem of a song. The people with the talent to turn a good performance into an engaging recording don't work for free.
posted by uncleozzy at 7:47 AM on June 26, 2007 [3 favorites]

Looking around at a lot of people in this city, I have to wonder what percentage of their day is spent without hearing any music. For many I'm guessing less than two hours a day.
posted by hermitosis at 7:48 AM on June 26, 2007

But Mr_Zero, what the hell would you do with 80,000 songs?

What don't you do with them? These kids are carrying around so much music that it is difficult to name a song they DON'T have.

I forgot to mention this in my comment about google above, but why carry around a hard drive, when it's easier to carry to a network device that links to the internet? Hypothetically, if google cached all of the songs on the internet, and if every song is on the internet (because in this hypothetical scenario the RIA gave google permission to cache everything), then you don't need your own local copy, right? Maybe google or amazon builds a music specific interface, you dial up the song you want and hit play, and it streams it.

See the idea of keeping a hard drive is the same kind of thinking that keeps the RIAA fixated on CDs - a physical local copy of the song. But why? Instead of a million copies of a file, why not a million pointers to the same file. For the user, its still free, because google or amazon keeps track of which songs you play and pays the ASCAP royalty based on that. And maybe they make some $ feeding your browser or little network ipod thingy an ad or two.
posted by Pastabagel at 7:49 AM on June 26, 2007 [1 favorite]

BTW. Today is the Internet radio silence day. In protest of the staggering royalty fees that have recently been levied against Internet based radio.
posted by Mr_Zero at 7:49 AM on June 26, 2007

I'll probably start buying music when I can get tracks for 25¢

I pay 18 cents a track at emusic.

I have no problem paying for music but I don't buy major label stuff.

Recently, Sam's, a large (and the first major) chain in Canada announced they were closing and many people are disappointed and upset. I say good riddance. I worked for the company for 4 summers and their management/owners are total assholes whose policies and practices did not take the consumer into account at all... until they had to and then it was too late.

When I worked there, there were no returns or exchanges even if the product was still sealed and you had the receipt. Even if you bought it ten seconds ago from me I could not return or exchange it for you. Even if you hadn't left the friggin store. In addition, the head office (which also was one of the largest distribution companies in the country) forced franchises to purchase only from them. That's not abnormal. Howevr, that same head office would sell the same product from their flagship store for considerably less than they sold to us. For instance, a cassette would cost us about $11 and we'd sell it for $15. However, that same cassette was available to the public for $8 or $10.

Good fucking riddance.
posted by dobbs at 7:51 AM on June 26, 2007

iTunes Number 3 in U.S. for Music Sales

"We all know that iTunes is doing very well. The stunning success of the iPod and Apple's resurgence the past half decade have not gone unnoticed. Just how successful have they been, however? It seems that their online store has trounced not only every other online music retailer around, but comes in third place for retail sales in the U.S. If you based it on number of units sold, iTunes apparently has a 9.8% market share for 1Q 2007, putting it behind only Wal-Mart and Best Buy:
iTunes had a 9.8 percent market share in the first quarter, ranking behind Wal-Mart Stores Inc.'s 15.8 percent and Best Buy Co.'s 13.8 percent, according to The NPD Group. Online retailer Amazon.com's share was 6.7 percent, slightly ahead of Target's 6.6 percent, NPD said."

posted by ericb at 7:52 AM on June 26, 2007

I bought the 45, I bought the 33, I bought the cassette, I bought the 8 track, and I bought the CD... I am not stealing if I download music I have previously purchased. So please Mr. RIAA get off my back.

Whew! that said, the "Music Industry" has yet to learn that they need to add value to what they admit has lost value. CDs must be released with additional content, accompanying DVD, concert discounts, etc.
posted by Gungho at 7:53 AM on June 26, 2007

MWAHAHAHAHAHAHAHAHAHAHAHA!!!!(gasp!)uhuhaHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!!
posted by es_de_bah at 7:54 AM on June 26, 2007

The recording industry isn't dying because of their business practices (and I'd like to know what sort of "business model" accounts for 80,000 pirated songs on some dipshit's portable hard drive); it's dying because you'd rather get something for free than pay for it.

No, it is the model that is causing it to die. If the tomato farmers decide to start charging $50 a tomato and I decide to start growing tomatoes in my backyard, am I being a cheap asshole destroying their business model? No, of course not. There's all sorts of places to derive profit from the music industry, I don't see why it is a right for musicians and record industry executives to be earning millions of dollars a year, or at least a right that must be protected.

We are going from a bunch of people being very, very rich to just very rich. Sorry future Keith Moons, you may have to think twice before driving a Bentley into a pool. Quite simply digital replication has made the cost of production and distribution nearly collapse. Each piece of that long distribution chain saw marginal profits. People still want, and are willing to pay for entertainment. Just because the market shifts does not mean it disappears.
posted by geoff. at 7:54 AM on June 26, 2007

oh, oops.
meant to say:

.
posted by es_de_bah at 7:54 AM on June 26, 2007

but I think it takes talented engineers and talented producers to make a good record.

I agree fully. But I feel there are many more talented engineers and producers floating around than the few that work for the big corps.

Why carry around a hard drive, when it's easier to carry to a network device that links to the internet

There are lots of places people like to listen to music where there is no Internet. Camping, the beach, boating, etc.
posted by Mr_Zero at 7:54 AM on June 26, 2007

Whoa, as much as I dislike the record companies, the idea that they are such high-level scammers is more than a bit conspiratorial.

Most people have no idea how to find new music and discover their favorite bands they will argue with you about for years by advertising and radio. Hell, Trent Reznor is a big anti-record company voice, but in the early 90s you couldnt walk 10 feet without seeing a NIN billboard or walk 30 centimeters without running into one of those NIN stickers plastered everywhere. Nor could you turn on the TV without seeing a NIN video or turn on the radio without hearing a NIN song. This is the work of all the "suits," the marketers, the MBA, the promo people, the radio people, etc. This costs money.

This isnt a justification of the status quo, but a realistic view of how thigns are done and why there are so many hardcore NIN fans and why Trent can run around with his record company aquired celebrity and pretend that the music industry is a meritocracy instead of an advertocracy. How does the meritocracy of web downloads work without the bazillion dollars in promotions and advertising? He's aquired his celebrity and needs nothing from them, but without them he'd be another guy who plays synths on the weekend. How can the band down the street get that kind of exposure from "web downloads and digital flyers?" THey can't.

I'd like to hear realistic proposals for better labels (as well as where promo money is going to come from) and how to embrace digital music instead of this childish "corporate america bad, mmmkay." I doubt things are ever that simple.
posted by damn dirty ape at 7:55 AM on June 26, 2007

The quote in the post summarizes why, in my view, the industry is failing:

"That's when we went from music having real value in people's minds to music having no economic value, just emotional value."

Fuck you very much, Mr. Wright. You and those like you have made the fundamental conceptual error of assuming that, because you produce and sell pieces of plastic--and make lots of money doing it--that the pieces of plastic are what people are buying.

Music is an experience, not a thing. Just because we used to need to buy pieces of plastic to get the musical experience doesn't mean that we actually want a bunch of plastic (even if it is shiny and silver). Music is not a commodity, and decades of effort by the record industry will not make it thus. The industry is belatedly waking up to that fact, and it's likely too late to save themselves. Fine by me, that industry is anti-music.

Music doesn't have real value if it doesn't have economic value?? Fuck that guy and everyone who thinks like him. Music is far, far more important to human beings than mere commerce.
posted by LooseFilter at 7:55 AM on June 26, 2007 [5 favorites]

"I personally am rather thankful that the proliferation of individual recording devices is returning us to an era of real musicianship - that is, composing music and playing it live for an audience that is right in front of you, which was the main mode of music 'distribution' throughout human history, with the exception of the last 70-some years."

Having a job, I am personally disappointed that I will no longer be able to enjoy music unless I am there in person. Although perhaps I may make it high up enough the corporate ladder that you proles will labour while I enjoy my leisure time promenading and attending concerts.
posted by patricio at 7:56 AM on June 26, 2007

Why carry around a hard drive, when it's easier to carry to a network device that links to the internet

There are lots of places people like to listen to music where there is no Internet. Camping, the beach, boating, etc.
posted by Mr_Zero at 10:54 AM on June 26

This is true now of course, but is less true with each passing year. In a few years, your phone will have broadband, and your phone will work everywhere. There are a lot of wide area wireless technologies that have not been rolled out yet.
posted by Pastabagel at 8:00 AM on June 26, 2007

He's aquired his celebrity and needs nothing from them, but without them he'd be another guy who plays synths on the weekend. How can the band down the street get that kind of exposure from "web downloads and digital flyers?" THey can't.

Word. Much as I hate these fuckers, it is difficult for me to imagine a world of music megastars without said fuckers funneling their vast resources into multimedia promotion.

I am not convinced, however, that this is a bad thing...
posted by kittens for breakfast at 8:00 AM on June 26, 2007

The industry got fat on a cornered market. Well they don't have that exclusivity any more, and we no longer have to buy an entire LP or CD just to hear one song. The fact that the RIAA couldn't make "the jump" to digital sales was because they couldn't philosophically let go of the circumstances that produced an overvalued product and a deep and fast-running revenue stream. They played a good game for a while, but with everything the economic and technological landscape shifts and that business model is no longer relevant. As web labels and independently released albums pop up more and more, there is a larger variety of more interesting music than at any time I can remember. It's akin to blogging vs. the publishing conglomerates and it's an inevitable development.

The larger question seems to be, "What is music worth?", and does superimposing a moribund corporate bureaucracy on the freewheeling interwebs provide us with the best model for new musical creativity and distribution?
posted by gallois at 8:05 AM on June 26, 2007

I agree fully. But I feel there are many more talented engineers and producers floating around than the few that work for the big corps.

Sure, but again, they don't work for free, or even cheap (nor should they). The days of albums costing hundreds of thousands of dollars to make are, hopefully, over, but without someone to back them, most bands probably can't afford to make a really good record, which is where I think the "industry" belongs.

What can I say? I'm a sucker for slick, commercial recordings, and I'd be sad to see them disappear entirely. (I am a bit torn, though, since I do really dispise the big labels' mentality.)

How does the meritocracy of web downloads work without the bazillion dollars in promotions and advertising? [...] How can the band down the street get that kind of exposure from "web downloads and digital flyers?" THey can't.

Bingo! The distribution end of making music isn't just about getting the music into people's ears, it's about making them want to hear it.
posted by uncleozzy at 8:06 AM on June 26, 2007

Which is a valid point, LooseFilter, but people still have to find some way of getting paid for making it. Few musicians, with or without recording contracts, are particularly wealthy. The opposite is much more often the case.

Musicians, producers, engineers and the like devote huge amounts of time, effort and skill to creating musical experiences, and should be able to expect renumeration for this.

The predicted collapse of the record industry doesn't seem to me to be much of a bad thing, but there is still the task of finding something better to replace it with.
posted by howfar at 8:06 AM on June 26, 2007

I have pirated a fair amount of music, but listen to very little. What the record industry needs to understand is that their competition is not just p2p but also many other forms of entertainment. My alternative to listening to pirated music to the extent that I do is not that I would listen to paid-for music, but radio to some extent, and NOTHING for the rest. I had not bought a CD in 15 years for all the well known reasons, low signal to noise, and just plain too expensive or rather not enough value. Its also a free time issue. I don have time to sit down and listen to CDs - not in college anymore. I dunno how many folks are like me, but I think a fair amount. The attraction to me of having 80k songs is not that I can listen to ALL of them, but rather that I can listen to ANY of them. I would pay for a time based service as opposed to a song based service.

As an anecdote. I have an acquaintance who is/was a big record industry exec. No stereotypes broken here. Watching this guy makes me very much hope that record companies go broke as monies are redirected to talent.
posted by sfts2 at 8:07 AM on June 26, 2007

The recording industry isn't dying because of their business practices (and I'd like to know what sort of "business model" accounts for 80,000 pirated songs on some dipshit's portable hard drive); it's dying because you'd rather get something for free than pay for it.

Maybe, but my main reason is:

The recording industry decided my tastes were no longer worth their time/money.

The music I listen to regularly is either indie bands on indie labels (Shins, Decemberists), 1990s catalog albums, or some mix of older jazz/funk/pop. I barely listen to hip-hop or rap, don't much like Norah Jones' music, and don't get this My Chemical Fall Out Linkin Park sound. So, I'm not paying for the development of new music through the major labels, though I am through the indies. But the record companies don't care about me, someone who used to drop $1000/year on CDs but has bought one so far this year. What they care about is selling $20 CDs to teenagers.

That's laudable, since teenagers always seem to have money for music/electronics/weed. But they're not buying those CDs; they're downloading them. Their business model is failing.
posted by dw at 8:07 AM on June 26, 2007

Oh, and there was an article in Q about 10 years ago saying that the internet and electronic distribution would bring down record stores, with renderings of the big London HMV and Tower stores shuttered. Wish I could find it.
posted by dw at 8:12 AM on June 26, 2007

it is difficult for me to imagine a world of music megastars

I am not convinced, however, that this is a bad thing...

Word. What's wrong with being the neighborhood hero? Or having a relatively small but devoted community of fans, like Jonathon Coulton(sp?)?

My theory is megastars are a contrivance, a PR mechanism for record labels, used as bait to lure unsuspecting talent into the music biz, where their talents are exploited for the enrichment of others until they're eventually tossed aside. Sure, it works great for the ones at the top of the pyramid...

thanks for this topic geoff.
posted by saulgoodman at 8:13 AM on June 26, 2007 [2 favorites]

Greedy and harmful to the majority of the artists it "represents", greedy and litigious towards the people whose enthusiasm gives them their very lifeblood. Kill the RIAA faster.

Broadcasters, netcasters: call their bluff -- they want too much? Give them nothing. Switch to independent label artists who crave rather than abuse your attention.
posted by dong_resin at 8:14 AM on June 26, 2007 [1 favorite]

Good. Couldn't happen to a better group of assholes.

There were any number of ways to respond to new content distribution mechanisms springing up in the late 90's. Any forward-looking executive worth his salt could probably have predicted that the winds were a-changin', and modified his business plan accordingly. Nope. Not these guys. These guys thought they could take on Congress and popular opinion, and maximize profits by suing their own goddamned customers. I don't think I could come up with a more idiotic strategy if I sat down and put some serious thought into how I could send my customer base fleeing madly into the night.

And now it's all coming back to roost. People have stopped kowtowing to strongarm tactics, and it's only a matter of time before most of the major distributors find themselves in serious financial straits because of their own moronic business practices. The countersuits that are being filed now aren't just seeking compensatory damages, they're criminal cases, pushing for punishment under RICO.

It's a corrupt, morally bankrupt business, which is now trying to garner sympathy from the very customers it's been actively persecuting. You know what? Fuck you, RIAA. I swore a vendetta against you the day the Napster madness began, and people looked at me crosswise for refusing to buy albums. Ten years later, you're being crushed beneath the weight of your own incompetence, and you'd better believe I'll be the first one to toast your demise when you lose your first major court case and begin got feel the pain of death by a thousand pinpricks. Good luck getting copyright law rewritten to bail out your sorry industry now, assholes.

Everyone who embraced digitalization is reaping the benefits of thinking progressively; I eagerly look forward to the next generation of music distribution, which will inevitably arise to fill the vacuum left by the collapse of copyright monoliths with no ability to think beyond next quarter's bottom line.
posted by Mayor West at 8:15 AM on June 26, 2007 [3 favorites]

Didn't the record industry decline start in the 70s? The whole idea behind CDs was to jumpstart the cash cow by forcing people to upgrade their vinyl collection.
posted by JJ86 at 8:29 AM on June 26, 2007

I always pay for albums from small bands on small labels; I figure they need the money, and my payment is simple respect for their time and work. I have a subscription to emusic, and happily download tracks from small label websites.

There is something to the idea that music has become some kind of uncertainly-sourced soundtrack to people's lives. But as I want musicians to be able to make a living, not to mention those who work on small labels as mostly a labour of love-- I will always pay them.

The majors? Not so much. Also, live music is thriving-- festivals, tours, etc. My expectation is that we'll end up with a mosaic of small labels and niche labels, with musicians making a decent living directly from their sales and touring. The time of record company employees burning through pounds of blow is likely over, and I can't see that as a bad thing.
posted by jokeefe at 8:29 AM on June 26, 2007

Pastabagel writes "In a few years, your phone will have broadband, and your phone will work everywhere."

...and I still won't be able to use it to do these sorts of things without paying an enormous fee monthly to do so. Unless the telcos realize that they can make more money from more people by dropping data rate plans into a reasonable realm, it's still easier and more cost-effective for me to take an iPod with me.

In all honesty, getting music for free is a good thing - I'm cheap enough to admit that. On the other hand, if I hadn't had the chance to get music for free by trading with friends, swapping songs with my brother, etc., I wouldn't listen to a lot of the music I now like. I was burned way, way too many times by the record industry and radio - how often do they get you interested in a group because of one song, only to have you realize after the fact that the CD you paid $20 for has nothing worth listening to except that one song?

So, yeah, the record industry sucks. Yeah, I'd like to see artists paid for creating good music. Yeah, I like the idea of trying something for free before I buy it. And, yes, a lot of what I try and like I don't end up buying very quickly - either because I have little extra money, or because I can't find it in the stores, or because I just plain can't remember what the hell I was looking for when I do enter a brick-and-mortar record store, and end up leafing through the bins of used CDs trying to find the one or two albums I can remember I liked. This doesn't make me a free music pirating fanatic; I'm not downloading crap 24/7, and I don't keep stuff that I don't like when I do acquire music through alternate means. But I can't count on commercial radio to introduce me to things I will like, I can't count on the RIAA to encourage and promote acts that aren't pre-packaged plastic pop tarts, and I can't even count on internet radio to enlighten me any more thanks to the new goddamn restrictive rules, so aside from downloading and trying things, where the hell else can I get good new music?
posted by caution live frogs at 8:33 AM on June 26, 2007 [1 favorite]

Word. What's wrong with being the neighborhood hero?

Because the more likely outcome is music being reduced to whatever novelty can get 5 seconds on the front page of Digg. Or astroturfing or direct corporate sponsorship deals. Whatever replaces the record labels is going to be even worse for pretty much everyone.
posted by cillit bang at 8:36 AM on June 26, 2007

I personally am rather thankful that the proliferation of individual recording devices is returning us to an era of real musicianship - that is, composing music and playing it live for an audience that is right in front of you...

I'm not sure how that follows. There are entire genres of music that are not possible or practical to perform live. Granted not popular stuff, probably nothing that's going to sell a million copies. But I submit that whole megastar model is one of the major things wrong with the big record labels anyway.

Their business model is basically "fuck off if you're not the next Britney or 50 Cent". 90% of musicians with big-label contracts go bankrupt. Record labels are basically loan sharks for musicians, who then decide what to do with the money the poor suckers loan from them. How could that continue indefinitely?

Maybe in the near future, "stars" will get their 15 minutes of fame via internet meme instead, and will not really be much of a big deal. ::shrug::
posted by Foosnark at 8:40 AM on June 26, 2007

On preview: heh.
posted by Foosnark at 8:41 AM on June 26, 2007

patricio: Decemberists are on Capitol, Shins on Sub pop. Warner Music Group owns 49% of Sub Pop. Those are majors. when I say "indie", I speak not of a style of music, but of representation.

More importantly, I don't know specifically of which people you mean by "the people who are not paying", but for myself the last album I bought was Tom Waits' Orphans discs (label: ANTI), after I "pirated" the mp3s because I wanted the the physical disc, the notes, the sound quality, the full thing. That enthusiasm is the true currency of artists, not the individual products they use to create it. That's what makes people part with a buck. The myopia of not getting that is the true source of the RIAA's woe, not file sharing.
posted by dong_resin at 8:43 AM on June 26, 2007

Well, they did it to themselves.

Here we are, and with each passing second, amateur recording tools get better and more affordable. Internet bandwidth is cheap, and there's an ever better-indexed and all-encompassing blogosphere/music reviewsphere giving attention to all kinds of acts, both big and small.

So, uh, now that production, distribution, and promotion are well within the grasp of those with even little means, is the loss of the majors really a big loss?

Of course, they're still shooting themselves in the foot with their current practices, i.e. getting Congress to keep increasing royalties for Internet radio while pumping millions of dollars through "independent promoters" to the music directors of Clear Channel radio stations so they will play the new overproduced, bland single from some mediocre, focus-grouped "band" whose album has twelve tracks, two of them good, and is selling for $18, of which the band gets a nickel.

These are the assholes who encourage legislation to legalize hacking into the computers of people they suspect are pirating music, make attempted copyright infringement a crime punishable by up to 10 years in prison, and remove your fair use rights to record things from the radio or other broadcast media sources, as though the fucking "Home Taping Is Killing Music" thing never already happened and became a joke. And they line the pockets of enough Congressmen to make it happen (oh word DMCA?), so we have to take it seriously, no matter how batshit their ideas actually are.

Plus they sue fans for unrealistically high amounts of money, try to infest our computers with inept and harmful methods of copy protection, and stifle technological innovation at every turn.

The market is trying to speak! It's saying: "Get fucking lost!"
posted by cobra_high_tigers at 8:50 AM on June 26, 2007 [4 favorites]

dong_resin -- I agree. I'm in the same position as caution live frogs. I'm just not sure that the people referred to above who are trading 500 GB HDs have that enthusiasm for all the tracks... they want to possess as much as possible as cheaply as possible.
posted by patricio at 8:52 AM on June 26, 2007

I look forward to a world where there are not only no more record executives, but no more rock stars. Where kids don't want to be musicians because they dream of making millions of dollars, but because they want to make music. A world where, if you are driven to, you make music on your laptop at home for a nominal cost and then upload it to the internet, and anyone who wants to can hear it. If you aren't that good, or are making music that doesn't really interest people, then you keep doing it as long as you are called to, and maybe a couple of dozen people download your stuff, and you are 'paid' in attention and getting to share doing what you love. It can be a fun hobby for after you get off work at your day job. Maybe you play shows on the weekend in your town or busk. Not a bad life.

If you make music that gets lots of attention and that people love, then you get to live the dream. You get to quit your day job and tour around the country playing live and earn a decent living ($20k to $50k a year) charging people to hear you play and selling merchandise. No more billionaire musicians swimming in golden pools filled with coke and strippers, no more music industry whatsoever, and a better world. Once we finish that, then we can start dismantling the professional sports world. One day people will do fun things for fun and not for money.
posted by ND¢ at 8:53 AM on June 26, 2007 [16 favorites]

I think that entire article can be summed up with the observation that they didn't quote a single musician.
posted by uri at 8:59 AM on June 26, 2007 [2 favorites]

patricio : ah, I misunderstood what you meant.
posted by dong_resin at 9:02 AM on June 26, 2007

Pssst....hey, record companies. Let me give you an example of how a paid transaction might work these days:

1) Potential customer asks for music recommendations from trusted community web site.

2) Many suggestions are made that include links to artist web sites.

3) One particular artist stands out to the potential consumer. The web site was streaming full-length, high-quality audio of the artist's works.

4) After repeated listens, the potential customer decides the music is worth paying for. The potential customer can purchase MP3s, or for a slightly higher amount, a CD with attractive, desirable packaging that reflects the spirit of the music.

5) Artist receives money from transaction.

Now come on. There must be some place in there where you can slip your grubby little fingers!
posted by Otis at 9:07 AM on June 26, 2007

Although it's wonderful schadenfreude to read of Hilary Rosen's crocodile tears for the mistakes made in 2001-2003 (suing your customers - wtf??), the music industry began shooting itself in the foot long before napster came along. I was involved in a major label project in the mid-nineties and had some discussions with their technical department, and any discussion of the internet or digital distribution was met with stone-faced silence. Remember, long before this, the industry had insisted on crippling DAT, and so on. The media cartels were well aware that digital media was going to make it very hard to maintain their bottleneck, and were determined to hold back the tide as long as they possibly could. The Napster lawsuit wasn't the first mistake, but rather the last moment at which they could have avoided their current fate.

The weird thing is, the solution has been obvious for a long time, and actively lobbied in many ways and places (eg. the music-industry insider mailing list Pho), but pretty much completely ignored. It goes like this:

1. place surcharge on internet access, to be allocated to rights holders.
2. place a compulsory licence on all digital media, so that anyone can download anything as long as they follow the rules
3. use actuarial techniques (eg. random sampling) to determine how to divvy up the pie.

What the hell is wrong with this idea? Everybody wins! Except the completely useless middlemen who add no value to the process....
posted by dinsdale at 9:07 AM on June 26, 2007 [1 favorite]

All this talk of their failing business model reminded me of something. It's not that the model is failing so much as a lack of vision to develop a new model.

Sears was started in the 1890's as a mail order business to compete against local general stores (think of all those westerns with "General Store" on one of the buildings - they were Sears competition). The guys Sears worked on railroads, and he saw all the middlemen tacking on markup as products moved west in the distribution chain until they go to the stores.

So he started a catalog, the famous Sears catalog in 1893. It was 300 pages, and had everything. Now think about this for a second. In 1893, you had a mail order catalog that sold pretty much everything that was for sale in 1893 - machinery, bikes, toys, dry goods, etc. Does this sound like another business you know?

So every year the catalog comes out, and after a few decades it becomes an American institution. For much of the population, the Sears catalog includes a decent quality, low cost version of every mass market nonperishable consumer product in the United States that wasn't a car (they did sell those at one point very early on. They also sold mobile homes too, up to the 1940's).

You could pick anything from the catalog, mail in your order with a check, and in a few days/weeks you'd get it. If you didn't like it, for any reason, Sears had a "satisfaction guaranteed" policy that you could return it at anytime for a full refund.

Now pay attention, because here's where it gets good.

In 1931, Sears starts an insurance company - Allstate. It buys financial investment firm Dean Witter and real estate broker Coldwell Banker in 1981. In 1984 it starts a joint venture with IBM called Prodigy, an online computer service, sort of a prototype AOL. In 1985, Sears launches a new major credit card, the Discover card. For the next eight years, the only credit card you can use at Sears is Discover.

At this time, the early 80's Sears is the largest retailer in the U.S.

By 1993, the 100th anniversary of the Sears Catalog, Sears had built up considerable goodwill in the mind of consumers. They weren't the lowest price, but they had what you needed at good prices and the service was second to none. They had real estate, insurance, financial planning, and all at good prices with top customer service.

This is 1993. In quite possibly the greatest example of corporate shortsightedness, Sears shut down it's mail-order business in a cost cutting measure. It spins off Allstate that same year, and soon dumps Dean Witter and Coldwell Banker.

In 1993, Sears had the most extensive and sophisticated mail-order retail operation on the planet and they closed it.

Two years later, Amazon.com launched, and was soon selling everything that sears sold through it's catalog. By the late-90's Walmart's push of low-cost China imports killed Sears retailing. Online banking takes off. Credit card use surges as mail order and retail purchases are shifted online.

Sears had its own computer network in 1993. They had access to IBM, they should have understood the power of the internet. All they had to do was shift the catalog online instead of killing it off, promising in store returns and the same Sears satisfaction guaranteed. Discover could have been the credit card of choice for security and protection online. Dean Witter could have been what Schwab, E-Trade and Ameritrade became. Back in the mid-late 90s when many people were hesitant to use credit cards online, Sears could have been a familiar face online.

Sears could have used the Catalog to create searscatalog.com or wishbook.com and owned online retailing, owned amazon's business, owned online brokerage and banking, but they blew their chances to save a few bucks in 1993. They could have made huge profits in the early 2000s real estate boom by leveraging that success with their real estate arm (imagine if Amazon sold houses).

By my estimates, Sears could have spent about $200 million in 1994-1996 to develop and promote retailing and financial services online, and they'd be reaping billions.

Sears could still be a huge American company today, instead of a historical footnote.

The lesson - arrogance and lack of vision. I look forward to the day in a few years when we can look back at the RIAA as a similar case study in lethargy, greed, and arrogance.
posted by Pastabagel at 9:07 AM on June 26, 2007 [295 favorites]

The ideas in this thread overlap the discussion going on here.
posted by BitterOldPunk at 9:07 AM on June 26, 2007

You know, I often hear people saying "most people are willing to pay a reasonable price for DRM-free music", but I really don't think that is true. Nobody I know has actually purchased a CD since high school (seven years). I think free music has really reached a tipping point and there is no business to be made from recorded music in a few years.

The industry should have been ready for this years ago, and moved into the live music arena or, better yet, using their huge payrolls of studio musicians and engineers and recording spaces start making people actually pay to record albums, instead of throwing it in for free with the hopes of selling albums in the future.

For smaller bands/artists the cost for recording a professional sounding album has just plummeted in the last few years. You can build yourself (or buy) a fanless PC with a 24-bit soundcard with optical and 1/4 jacks for less then 400 dollars. Ridiculous!

Also, in a thread from yesterday, a member pointed out the new domination of MP3 players in black culture. This REALLY will be the final nail in the coffin for the recording industry. Anybody who has worked in a music store (near any kind of urban population) in the last few years knows that black people were the strongest customers and really kept the industry going for a few years past their actual death.
posted by lattiboy at 9:23 AM on June 26, 2007

Damn, Pastabagel, that's amazing.
posted by Pope Guilty at 9:28 AM on June 26, 2007

The industry should have been ready for this years ago, and moved into the live music arena or, better yet, using their huge payrolls of studio musicians and engineers and recording spaces start making people actually pay to record albums, instead of throwing it in for free with the hopes of selling albums in the future.

I can't follow you at all. You think the traditional RIAA model involved giving studio time away? And that they haven't had a hand in the arena-show till?
posted by COBRA! at 9:31 AM on June 26, 2007

If you make music that gets lots of attention and that people love, then you get to live the dream. You get to quit your day job and tour around the country playing live and earn a decent living ($20k to $50k a year)

$20k a year is a decent living? While dealing with the demands of touring? Umm...that certainly isn't my dream. I'd rather work at Arby's and stay at home where I can see my wife and cats.

Touring isn't the panacea that some make it out to be - promoters are overinflating ticket prices just as much as labels have overinflated the price of CDs. It seems as if Pearl Jam's attempt to dethrone Ticketmaster has been entirely forgotten and dismissed.
posted by malocchio at 9:33 AM on June 26, 2007

The ideas in this thread

There are ideas in this thread?

Fish, barrel, etc
posted by cillit bang at 9:38 AM on June 26, 2007

It takes some amount of skill to translate good music into a good recording, and that's what's missing in a lot of indie records.

but not all of them ... and not even in all of the music recorded on someone's desktop ... these skills are just like playing the guitar well or singing well ... they can be learned

There are entire genres of music that are not possible or practical to perform live.

it's been my observation that the great majority of bands are trying to reproduce what they do live on cd, which is one reason music is lacking these days

falling sales aren't the only thing that's killing the major labels ... their costs of production and marketing are ridiculously out of proportion to anything that could make them a profit and they've bribed the radio industry to narrow playlists so much that most of their artists get locked out ... and then much of the broadcast industry concluded that it wasn't worth their time to promote new music when they could get more people to listen with old music

40 years ago, record companies could sign an act, get it recorded and get the record out on the streets within a month or two and the prevalent attitude seemed to be "throw it against the wall and see if it sticks"

they made a shitload of money back then ... and they're still making money from what was recorded then

now the internet and indie companies have taken that role from them while they foolishly tried to get that goose to lay two golden eggs a day instead of one ... for awhile, they did it ... but now the goose is dead

it's incredibly ironic that the same generation that made the record industry in the 60s, when they were kids, is now running it and killing it off in the process
posted by pyramid termite at 9:40 AM on June 26, 2007

Whatever replaces the record labels is going to be even worse for pretty much everyone.

Why? It doesn't have to be? During the early days of rock and roll, there were too many small record labels to count, and the coin of the realm, as far as mainstream success was concerned, was the single--yes, the single! Remember 45s? Artists made their fame and fortunes off of not album sales, but singles sales. If it worked then, why can't it work now?

Why not internet singles?

I think a possibility just as probable as the worst case scenario you're worried about is that, once everyone finally recovers from their astonishment over the collapse of the old guard, a new, much more grass roots system could eventually emerge, and in that system, the artists themselves and the many small record labels that serve them will be the drivers of the industry.
posted by saulgoodman at 9:43 AM on June 26, 2007

You think the traditional RIAA model involved giving studio time away?

sure ... band x records album for 100,000 bucks at record company's expense ... record company takes band x's royalties until the 100,000 bucks is paid back ... the only problem being that the album only sells 5,000 copies and they don't get their money back

and 100,000 bucks is cheap ... but not cheap enough
posted by pyramid termite at 9:44 AM on June 26, 2007

It's always amusing to hear someone muse about what they think is a "fair" price for a song. Anyone that actively seeks out a way to get free music is a thief, if that music can be otherwise downloaded for a reasonable price. iTunes gives a consumer decent quality, a decent catalog, and convenience. I have no problem with college kids downloading on P2P networks,, right up to the point where they pretend it's an act of rebellion on a par with protesting for expanded civil rights. Anyone over 25 with a day job that steals music they can just as easily pay a buck for is a sad sack of shit, the assholery of the RIAA notwithstanding.
posted by docpops at 9:44 AM on June 26, 2007 [1 favorite]

sure ... band x records album for 100,000 bucks at record company's expense ... record company takes band x's royalties until the 100,000 bucks is paid back ... the only problem being that the album only sells 5,000 copies and they don't get their money back

and 100,000 bucks is cheap ... but not cheap enough

Right. Which is to say that fucking the bands through expensive studio time was a cornerstone of the business model.
posted by COBRA! at 9:47 AM on June 26, 2007 [3 favorites]

docpops

pretty much sums up my attitude. Screw the RIAA, I hope they die a miserable death. But iTunes basically gives you everything you need in a nice legal format, though you can debate that 99 cents is too expensive etc, it's still only a buck for a song and usually around 10 for an album.
posted by slapshot57 at 9:50 AM on June 26, 2007

@ COBRA!

I should have clarified the way pyramid termite did. For instance, I think Korn's last (shitty) album cost FOUR MILLION dollars to record (this included all types of overwhelming rockstar related bullshit, of course) I'm not even sure if that album went much over platinum. They do give it away in the sense that ONLY successful bands (which make up less then %10 of most labels rosters) actually end up paying for the recording sessions.

As for the live-music involvement, record companies have let third-parties given away much of the power in the touring industries to third parties and festival organizers in hopes of artists appearances spurring they're dead ass record sales. It was an act of sheer laziness and lack of vision (Why shouldn't the RIAA be getting all of that sweet sweet TicketMaster cash?).
posted by lattiboy at 9:53 AM on June 26, 2007

... Yes, there's something charming about a recording made for $500 in somebody's basement, or even $5,000 in the studio down the block, but it doesn't necessarily do the music justice or make me want to hear more of it....

Then you are the exception. A musician with a good ear and basic computing skills can make quite a good album with a decent computer, some investment in good mikes and speakers, and good recording software like ProTools. It is not at all the same as it was 10 or even 5 years ago. It is not at all like "recording in a garage" with just a few tracks and crappy mikes.

Having heard what the local music people in my area (and I'm married to one of them) can do this way, to my non-audiophile ears, it's as good as anything I get from a major. I think most audiences are going to feel the same way.

And many musicians do hire techs themselves, if not for recording then for help in mixing, or in mastering the final mixes. They may also hire local backup musicians, local film school grads to make a Youtube video, local photographers and/or artists to make album/Web site art, hire independent CD printers, and play local gigs, thus contributing to the local artistic economy in ways the majors do not.

There was a tremendous amount of bloat and waste in the way music was done under the majors, but the talented people were there because they had nowhere else to go. As the majors rush to irrelevance, the talented will find other ways to produce good music.
posted by emjaybee at 9:54 AM on June 26, 2007

Which is to say that fucking the bands through expensive studio time was a cornerstone of the business model.

yes, but it only works if the record company can sell enough cds of their hit acts to make up for the many acts that they're losing money on

and that's what's happened ... they stopped selling enough cds to make up for it and haven't adjusted to the new terms of the business

meanwhile most studio owners are fine ... and even if they take a hit from all this, their bread and butter is commercial accounts
posted by pyramid termite at 9:55 AM on June 26, 2007

Dinosaurs are extinct? News to me.
posted by phaedon at 9:58 AM on June 26, 2007 [1 favorite]

If the record labels could get away with paying artist nothing they would, hell they have in the past. So, when execs talk about music having no economic value, what they are talking about, in reality, is people not wanting to pay high fees for reproductions of music. Especially of lame ass music. So all the crying is over major record labels having such a hard time. Boo fucking hoo. I can recite off a dozen small labels that are doing ok, a third of those are local. Overall, music distribution and recording in the past decade has expanded significantly, even if you don't count MP3s. There's more of it around, and if it where simply emotional value it's hard to understand why everyone and their dog has a guitar and is belting it out.
posted by edgeways at 9:58 AM on June 26, 2007

the last album I bought was Tom Waits' Orphans discs (label: ANTI), after I "pirated" the mp3s because I wanted the the physical disc, the notes, the sound quality, the full thing.

Same for me-- for music that I really like, I need to have the physical disc and its packaging. But then, I'm an over-30 oldster.
posted by deanc at 10:05 AM on June 26, 2007

dw: slightly as an aside, the people who are not paying are not paying for indie music like the Shins and Decemberists rather than not paying for Norah blah Jones. Simply being on an indie label doesn't make you immune to being downloaded, and will likely give you the fanbase who have the ability to do it, rather than the MOR crap.

Well, that's really not the point. The point was that this is where I am, and I think there are others like me.

I know that the Shins and Decemberists get downloaded off BitTorrent just like My Chemical Fallout Boy or whatever they're called. Heck, Arcade Fire's last album was on BT months before it came out. But the point for me is that I'm not buying the records the industry spends millions on developing. Yeah, I bought the last Decemberists album on Capitol, but do you think Capitol sunk the sort of capital (no pun intended) into that album that Warner sunk into the last Linkin Park album? Or the money UMG sunk into the latest Maroon 5?

The point is, I'm not buying what they're investing in. A lot of people aren't. Many are stealing music via filesharing systems. But many others just stopped buying altogether because the record companies stopped making stuff they liked.
posted by dw at 10:06 AM on June 26, 2007

Remember 45s? Artists made their fame and fortunes off of not album sales, but singles sales. If it worked then, why can't it work now?

This was a great model because you could walk into a record store, hand over a few dollars, and walk out with a lot of 45s, giving you a wide range of music to listen to and sample. It was much better than handing over your entire music budget for the week on just 1 or 2 full-length albums. A now-close record store in Boston used to stock a lot of new 45s, and I took great advantage of it.
posted by deanc at 10:13 AM on June 26, 2007

Maybe music will eventually just become like commercials for other products. Something that is given away free, in hopes that people will attend a live show where they will make some money.
posted by Mr_Zero at 10:14 AM on June 26, 2007

I'm just not sure that the people referred to above who are trading 500 GB HDs have that enthusiasm for all the tracks

I could fill up 500 GB of HD with high rate MP3s or FLACs and be very, very enthusiastic about every track on there. Very enthusiastic. My 3 ancient 80 GB drives are strained to their limits. I actually wake up in cold sweats wondering if my drives just failed, even though I keep a partial backup.

You mean I can have the entire FAX catalog? Tresor? Planet E?

And none of it would be from RIAA member labels. I don't even want that corporate shit for free. My time is more valuable then the time it would take to download that unredeemable crap. The internet didn't kill the RIAA, the RIAA's total lack of taste killed the RIAA.

... they want to possess as much as possible as cheaply as possible.

Then there's tracking down artists you've downloaded and sending them money directly. Which I've done.

Then there's the fact there's thousands and thousands of tracks on my HD you couldn't buy anywhere, at any price.

Some of it is available only via filesharing, be it direct download, P2P or sneakernet. It is born, released, made, and enjoyed on the internet. It never sees a CD mill or vinyl press.

This, more than anything, should be giving the record execs nightmares - music creation, production and distribution entirely outside of their control. And as people (youth, in particular) look for fresher, newer, more original sounds - these DIY indie sounds are going to be the only game in town. Counter-intuitively the model will change from outright distribution control to access control, where less is more, and artificial scarcity makes it even cooler.

This is already happening, now, and has been happening for a few years. I have a few hundred to about a thousand tracks, some techno, some chiptunes, some random errata which are not easy to find - and as a DJ, I don't talk about where I got them, nor do I share them. They're mine. It took years to collect them, and I enjoy having something unique and unusual to offer when I DJ. Sharing them would be a bad tactical move which would make this not so.

Conversely, some of it is terribly out of print and/or rare. Try buying old Coil, Nurse With Wound or Halfer Trio. On vinyl? What, did you just win the lottery? Try collecting the entire World Serpent catalog, or Wax Trax, or SST, or early Sub-Pop.

Unless you're made out of nothing but obsession, money and time, you probably can't collect all that.

Also, what ND¢ said. When you're truly having fun your heart is pure - be it in darkness or lightness, a pure heart pours out pure art.

Something we'll never have enough of in this world, I'm afraid. Which is fine. Never feel guilty about making more.
posted by loquacious at 10:18 AM on June 26, 2007 [4 favorites]

How can the band down the street get that kind of exposure from "web downloads and digital flyers?" THey can't.

Erm, anything above an 8.0 on Pitchfork seems to work pretty well to drive sales/raise profiles....
posted by jokeefe at 10:19 AM on June 26, 2007

Sears could still be a huge American company today, instead of a historical footnote.

The lesson - arrogance and lack of vision.

My grandfather was a salesman for Sears in small-town Oklahoma. He sold all sorts of things door-to-door -- chain-link fence, vacuums, domestics.

I should note that by small town I mean about 15,000 people, maybe another 10,000 in a 20-mile radius. The Sears catalog store was the only place you could see the big-ticket items they could ship to you without having to drive to the big Sears stores in Tulsa or Oklahoma City.

He never made much money. Eventually, my grandmother went to work for the power company to keep food on the table. But Sears was a huge part of my life growing up because of the employee discount. Back then, it was 20% off; they've since cut it down to 10%. Christmas in my youth meant getting the Wish Book from Grandma and circling what we wanted. Most of our toys came from Sears. So did our clothes.

Last Christmas Grandma took my wife and me to the new Sears to buy clothes for our toddler daughter, thanks to Grandma's still extant employee discount. And I thought, you know, this is just another department store now. There's nothing to distinguish it from Target anymore, other than the lawn tractors and appliances. And as I thought about, I realized all the things that were missing. Mail-order. Layaway (or, how my mother and her brothers got their Christmas presents one payment at a time). Knowledgeable sales people. Everything under one roof.

But all of that is still around (except layaway), you know? It's just scattered between Amazon and so many other places online.

And I think that's what makes your comment so true. Sears was Amazon. They were feared by the brick-and-mortars because they had selection and the ability to get it to you plus shipping and handling. The one difference is that Sears eventually stuck stores on their distribution system, and then that distribution system hardened until they were unable to see anything but that distribution system.
posted by dw at 10:24 AM on June 26, 2007 [2 favorites]

It's funny that this post appeared the day after this bit of research from Keele University in the UK. Daily Mail (ha!) write-up:

The middle classes are showing an unprecedented contempt for the law, with two thirds admitting to offences such as tax evasion or hiking up insurance claims, a survey suggests. The middle classes justify their behaviour by treating it as a "revolt" against apparent injustice. For example, insurance claims are inflated as a reaction against "smallprint rules or over-priced premiums".

posted by athenian at 10:25 AM on June 26, 2007

There are students at ASU as well as every other university, that are passing around 500GB drives filled with CD quality music. In the time it takes to go to a store to buy an album they can copy 80,000 songs.

This is not going to go away unless technological progress comes to a screaming halt. I don't know exactly how long it will take, but sometime in our lifetime it will be trivial to store a copy of every song ever recorded. And equally trivial to give a copy to anyone you know. All it takes is a few dedicated folks to keep tracking down and accumulating it all. See MAME roms for an example.

And anyone who can't see that this is a beautiful, wonderful thing must hate libraries. Must hate the internet. The brief economic shake-up of the music industry that we'll have to suffer through is nothing compared to how rich everyone will be for having all that music available. And don't tell me that there won't be lots of money to be made in hardware and software and cataloging and recommending and generally helping people best enjoy all that music.
posted by straight at 10:33 AM on June 26, 2007 [4 favorites]

Reading about the decline of the music industry in Rolling Stone is like watching an episode of Dateline about the sad state of television.
posted by hypocritical ross at 10:33 AM on June 26, 2007 [5 favorites]

The point is, I'm not buying what they're investing in. A lot of people aren't. Many are stealing music via filesharing systems. But many others just stopped buying altogether because the record companies stopped making stuff they liked.

But I think part of the problem is that because record companies do track what people are downloading in P2P programs, if people are still downloading mainstream music from big music labels, the record companies are going to continue to think that the product they put out is still desirable, but they just need some way to make people pay for it, hence the draconian DRM measures.

If instead, people were just boycotting mainstream music altogether and refusing to even download big label music from P2P programs, wouldn't that send a stronger message to the record labels that the problem isn't that there isn't enough DRM, but that the music they're putting out isn't desirable?
posted by gyc at 10:33 AM on June 26, 2007

I could fill up 500 GB of HD with high rate MP3s or FLACs and be very, very enthusiastic about every track on there. Very enthusiastic

OK, so lets just say you're talking FLAC albums. They are usually about 250 - 325MB , correct? OK, so that breaks down to about 1800 albums. That's (roughly) 18,000 songs. You are VERY enthusiastic about EIGHTEEN THOUSAND SONGS?!?!?!?
posted by lattiboy at 10:35 AM on June 26, 2007

lattiboy writes "Nobody I know has actually purchased a CD since high school (seven years)."

Hi, nice to meet you. I purchased all of my CDs since high school (15 years), including Bob Dylan's newest CD, which I picked up a month or two ago, and the couple of Thievery Corp. discs I snagged last month (all three used, of course).

deanc writes "for music that I really like, I need to have the physical disc and its packaging. But then, I'm an over-30 oldster."

Both apply to me as well. Ha. Which is why the iTunes model isn't my main preference; I like having a hard copy of the music I own. Sure, these days I am just immediately ripping the CDs and then putting them in storage after poking through the album art - I typically just plug my iPod into the stereo - but I like them. A box of CDs in the basement isn't going to crash on me. I don't have to worry about database corruption, or having my entire music library become an obsolete file type, or stop working when I get a newer computer, portable device, operating system or whatever.

I also don't have any kind of DRM on the CDs (so far as I know). I can re-rip them if I have to, I can copy them to keep a disc in the car (until I get a line in jack for my car stereo, anyway), I can do pretty much whatever I want - including re-sell them to a used music store - because I physically own them. And, much like the records I "liberated" from my parents, I hope that at some point the physical media might have some sort of sentimental value for my own future kid some day - a snapshot of who I was at that age.

slapshot57 writes "iTunes basically gives you everything you need in a nice legal format"

Legal, except for the "if my library is corrupted I have to buy it again" thing. And the "I don't really own it, because the majority of it has DRM that restricts my use and enjoyment of the music". Plus all the other reasons above I prefer a physical storage medium. I see a distinct difference between having music to listen to and owning music. As I said above, I'll try stuff for free, but if it gets into a heavy rotation on my iPod I typically buy it. Eventually.
posted by caution live frogs at 10:36 AM on June 26, 2007 [1 favorite]

I often hear people saying "most people are willing to pay a reasonable price for DRM-free music", but I really don't think that is true.

I pay unreasonable prices for DRM-free tracks from Beatport. Cut that price in half and I'd buy more than twice as much, I imagine.

The DRM-free tracks on iTunes are selling better than the DRMed versions even at a higher price:

She confirmed that sales of the legendary Pink Floyd album, Dark Side of the Moon had increased since it shipped DRM-free - these are up 350 per cent.
posted by kableh at 10:36 AM on June 26, 2007

pracowity writes "people now feel comfortable about filching anything electronic -- if the original isn't damaged, it is assumed that no harm is done."

People know at a gut level that they are being royally screwed by IP law. The original copyright enacted in the US for 14&28 years was a fair trade; limited protection in exchange for incentive to contribute to the the public domain. The current law that doesn't see stuff enter the public domain for 5 or 6 generations is obviously unfair and people know it. In effect the harm caused by copying is much less than the harm perpetuated in the name of the rights holders.

dinsdale writes "The weird thing is, the solution has been obvious for a long time, and actively lobbied in many ways and places (eg. the music-industry insider mailing list Pho), but pretty much completely ignored. It goes like this:

"1. place surcharge on internet access, to be allocated to rights holders.
"2. place a compulsory licence on all digital media, so that anyone can download anything as long as they follow the rules
"3. use actuarial techniques (eg. random sampling) to determine how to divvy up the pie.

"What the hell is wrong with this idea? "

Why the SMEG should I have to kick money to the RIAA and their ilk when I'm reading Metafilter or uploading content to my website? As it is it pisses me off to no end that every time I burn a CD for a client the music industry gets paid.
posted by Mitheral at 10:36 AM on June 26, 2007 [2 favorites]

But many others just stopped buying altogether because the record companies stopped making stuff they liked.

If you have an oink account, you can see that it's full to the brim with serious-ass indie music. People are downloading music they like period, irrespective of whether it's from a big name artist backed by a label, or some dude in his basement. It's disingenuous to argue that people aren't buying music because the big labels churn out crap. This may be true, but many people don't buy music because they can get it for free now.
posted by chunking express at 10:38 AM on June 26, 2007

Damn, Pastabagel, that was a totally awesome story. I am not 100% sure that it applies here entirely (the music business has other problems too I think), but it is a damn good analysis of Amazon/Sears. But could the music business really rescue their butts by going on-line? I don't think so, because the internet doesn't only break distribution, it horribly breaks promotion; the internet is a lot less controlled place then radio and record stores. And if you break promotion, the business -- as it is today -- breaks.

Another interesting concept is the Customer as Competitor which, with respect to music distribution anyway, seems to apply.
posted by Bovine Love at 10:38 AM on June 26, 2007

"But Mr_Zero, what the hell would you do with 80,000 songs?

The Record Industry's Decline June 26, 2007 6:47 AM Subscribe

The Record Industry's Decline
June 26, 2007 6:47 AM Subscribe