When will the music industry do it right ?

Can the music industry cry wolf any longer?

This is the only industry in the world that can see thousands of its retailers close, reduce the number of products it sells via cutbacks in artist rosters and albums released, cut back marketing and promotional dollars and then blame a reduction in sales on someone or something other than themselves.

That big bad boogieman of piracy is blowing down everyone’s house. The poor music industry. Except of course that there is nothing more than anecdotal proof that Peer to Peer networks hurt music sales, and to counter those, there are studies and anecdotal evidence that the sampling opportunity that P2P networks create actually help sales.

Of course, the other digital entertainment mediums have seen booming sales over the same period. Games. DVDs. VHS. Even books on tape have grown. I’m not saying anything new here, nor I am saying anything I haven’t said before. Which leads to my points:

1. The amount of money the RIAA is spending, along with other lobbying efforts in the industry, could go to artists, and probably be better spent on marketing the industry and getting consumers excited, rather building a wall around your industry that only slows it down.

2. It’s a crime that our politicians have fallen prey to your “please protect us please.” Our country is in enough debt. We don’t need to spend more to put legal walls around your industry. How long before we have tort reform for the music industry?

3. There are solutions that are simple. Learn a lesson from the cable and phone industry. Go to where people already are paying for digital access to your product, and for a little bit more money, give them a more product, legally and easily.

Why in the world haven’t you gone to AOL, Cable and DSL providers and offered your catalogs by genre for 10 or 20c per month, per subscriber? Universal, take a lesson from your NBC/Universal pals. Create a rock channel, an 80s rock channel, a hip hop channel, an oldies channel, etc, etc. Put your catalogs for each genre channel on a server that you control. Go to AOL, et al. Offer their users access to DRM protected music that gives them the same rights as ITunes or the MSN store or whatever makes you feel good at night rights. Price each channel cheap enough that all the broadband or dialup ISPs can package them in marketable solutions with the other labels. Its a no brainer sale. AOL et al, send out emailers and promotions.. “Want the latest rock hits from artists like xxxxxx ? AOL brings you legal peer to peer. Download all you want, check us every day because we add more music every day.

It’s the Rock Download Channel from AOL and its only 1 buck per month on your AOL bill. Click here, and you can start now… (billing is for a minimum of 12 months) Of course there is also the oldies channel, the hip hop channel. The old school hip hop channel, the R&B channel. However many ways you can dice and slice your music, thats a buck a month. Per channel. Per Sub.

Consumers will do it because its easy, safe and cheap. We are used to being sold “1 more channel,” or “1 more tier” or “call waiting for an extra 99 cents per month.” We will commit to five channels per month at a buck each for a year before we would ever commit to spending $60 on CDs at a sitting.

We like to buy things a dollar at a time. If you wanted to be greedy. You could even offer a $99 dollar setup charge that allows the users to dump the complete channel on their music device or hard drive right when they sign up. ISPs, AOL, Cable companies and Telcos will jump up and down to sell these value ads. They will advertise them. They market them. They will probably offer you lots of money to do exclusives with them. They all need and want new digital services to drive their digital tiers and Hi Speed Data.

Comcast is making a huge bet on Subscription Video on Demand. Why would they be any less excited about Subscription Music on Demand? Universities could get a discounted version that they offer at cost. $50 bucks per head, per semester and you are a legit downloader. It’s included in your options at the beginning of the semester. Then of course the kids are going to want it when they get home.

I’m sure this isnt a new idea. I know its been talked about, because I have brought it up in meetings again and again. So the question is, why hasnt it been done? It’s so much more profitable than anything that could ever happen with per song downloads. 200mm singles sold gets you 200mm in gross revenue. One song at a time. 5mm people buying five channels at five bucks per month gets you 300mm dollars in predictable annual gross revenues.

But that’s far from what the market will be. I’m guessing, but it could easily be 40 million people averaging five dollars per month. Thats real money. In an industry that sells 800mm or so albums in a year and makes what, 1 to 3 bucks net, per CD, that’s nothing to sneeze at.

I know, you are afraid it will cut into your CD sales. It won’t cut into your CD sales, or should I say, it won’t help your CD sales any more or less than existing peer to peer networks. This is a great time for the labels to decide to make some money. Consumers want a cost effective, easy to use way to buy music. Broadband and dialup providers want new revenue options and to stop dealing with subpoenas from the RIAA.

The only ones against the move? Probably the RIAA and our politcians. The RIAA would have nothing to do but give out gold and platinum records and the politicians would lose a gravy train of money.

82 thoughts on “When will the music industry do it right ?

  1. I think the first thing they should do is get rid of the A&R\’s at the record companies no one needs them anymore they are over paid with almost no real music back grounds and then as one of you stated the government should step in and make them compete more like the tech companies do.

    Comment by Sam -

  2. Now that music is digital and the venues are there for comsumers to buy just the songs they want for a buck each vs. 15 bucks for the whole disc, the industry needs to realize that the consumer’s expectations have shifted and no amount of laws to limit how music is distributed can change those expectations back.

    Comment by runescape money -

  3. The bands are out there, but the pinhead lawyers running the talent branches keeping using their narrow sighted formula (pretty face, nice body, can’t sing but that’s ok we’ll just have her lip synch, can’t write songs but that’s ok we’ll have our staff writer song machine come up with something) to try to stuff down the consumer’s throats.

    Comment by wow powerleveling -

  4. interesting post.
    thank you.

    Comment by yoyo -

  5. Hi i read your blog on music. This blog is quite informative, useful and helpful in sharing knowledge resources.

    http://digital-music.blogspot.com/atom.xml

    Comment by prabhjot -

  6. Mark,

    I read with interest this article as I am someone who has been frustrated with this and am doing something about it. You actually had a run-in with a partner of mine but we are a group that opened a website 3 weeks ago offering downloads of singles and full CD’s and we pay the artists back. No exclusivity, no sign up costs. We are marketing Independent Artists and labels in the Americana/Texas Country/Red dirt genre that has seen an exponential explosion in the artists on the scene. You can check us out at http://www.ourtracks.com and since we have opened we have more than doubled the artists we have available on the site and continue to get interest on a daily basis. Our marketing is roots based at this time till we gain enough capital to do sponsored shows and invest in advertising.

    What we are trying to do is specifically about the music vs. the almighty dollar. There are literally thousands of musicians out there just trying to sell their CD’s at their shows or from their website. We are just a vehicle to deliver that product!

    Comment by Larry Mofle -

  7. Mark,

    I read with interest this article as I am someone who has been frustrated with this and am doing something about it. You actually had a run-in with a partner of mine but we are a group that opened a website 3 weeks ago offering downloads of singles and full CD’s and we pay the artists back. No exclusivity, no sign up costs. We are marketing Independent Artists and labels in the Americana/Texas Country/Red dirt genre that has seen an exponential explosion in the artists on the scene. You can check us out at http://www.ourtracks.com and since we have opened we have more than doubled the artists we have available on the site and continue to get interest on a daily basis. Our marketing is roots based at this time till we gain enough capital to do sponsored shows and invest in advertising.

    What we are trying to do is specifically about the music vs. the almighty dollar. There are literally thousands of musicians out there just trying to sell their CD’s at their shows or from their website. We are just a vehicle to deliver that product!

    Comment by Larry Mofle -

  8. Mark,

    I read with interest this article as I am someone who has been frustrated with this and am doing something about it. You actually had a run-in with a partner of mine but we are a group that opened a website 3 weeks ago offering downloads of singles and full CD’s and we pay the artists back. No exclusivity, no sign up costs. We are marketing Independent Artists and labels in the Americana/Texas Country/Red dirt genre that has seen an exponential explosion in the artists on the scene. You can check us out at http://www.ourtracks.com and since we have opened we have more than doubled the artists we have available on the site and continue to get interest on a daily basis. Our marketing is roots based at this time till we gain enough capital to do sponsored shows and invest in advertising.

    What we are trying to do is specifically about the music vs. the almighty dollar. There are literally thousands of musicians out there just trying to sell their CD’s at their shows or from their website. We are just a vehicle to deliver that product!

    Comment by Larry Mofle -

  9. can we make friend?

    Comment by lyrics -

  10. As of 4pm on Friday March 4th, 2005, I had never downloaded a ringtone in my life. By 6pm the same day, I had free access to every ringtone in the SprintPCS catalog. Yes, 50 Cent personalized tones, the Stanford Fight Song and Usher’s “Yeah.” How did I do it? Read on to learn how SprintPCS and the music industy have lost their mind (and their content), again.

    It all started when I decided to buy a ringtone – 50 Cent’s In Da Club, to be specific. I went to Downloads -> Ringers -> Get New -> Browse by Artist -> 50 Cent -> In Da Club. However, I was shocked to see the price tag ($2.50) was more than buying the song outright on iTunes ($.99) AND it expired in 90 days. I am cheap bastard and immediately decided ringtones were not for me.

    I quickly searched for “free ringtones” on Google and found a piece of software from Xingtone (http://www.xingtone.com) that allows you to make ringtones out of your own MP3s. Since I own In Da Club, I could make it myself. Within five minutes, I had In Da Club as my ringer. But, I wasn’t satisfied.

    I wanted to get the newest, coolest, ringtone so I went to my account on SprintPCS.com and clicked See All Ringers -> What’s Hot. #1 on the list is “Lovers and Friends” by Lil Jon, so I clicked on the song name and then clicked Listen Here . What happened next not only shocked me, but instantly revealed how SprintPCS and the music industry have completely lost their mind.

    A window opened on my computer:
    Do you want to open or save this file?
    Name: PCS18544C192636.mp3
    Type: MPEG Layer 3 Audio, 87 KB
    From: content.sprintpcs.com
    [OPEN] [SAVE] [CANCEL]

    Of course, I clicked save to see if it was actually possible that SprintPCS just opened up their entire library of content to a first time user. Sure enough, they did. You want Tiger Wood’s custom ringtones? 50 Cent? Fight songs? Movie themesongs? Celebrity voices? You name it, it is yours to save to your hard drive as an MP3 and then upload to phone via software like Xingtone – all FREE OF CHARGE courtesy of SprintPCS and the music industry.

    So, within a matter of ten minutes, any teenager in America can download the entire SprintPCS library of ringtones and upload them to their phone? Do we really think that people are dumb enough or too lazy to do this / figure it out. Furthermore, how many DRM solutions are there on the market to help companies like Sprint avoid opening up there ringtone libraries? There are hundreds.

    As former member of the music industry from Universal Music, I really believed that the industry had grown up and had learned from their mistakes. I guess I was wrong.

    Comment by Tod Sacerdoti -

  11. Man.. as far a CDS. people would buy them if they were a little bit more cheaper and actually had a decent 74 minutes worth of music on them instead of just one single.

    Peace
    Gnx music
    Producer/ Engineer

    Comment by GNX Music -

  12. This is one sweet post…you had me at ” It’s so much more profitable than anything that could ever happen with per song downloads. 200mm singles sold gets you 200mm in gross revenue. One song at a time. 5mm people buying five channels at five bucks per month gets you 300mm dollars in predictable annual gross revenues”

    Cindy
    TexasGigs.com

    Comment by Cindy Chaffin -

  13. I agree with Heather: I think p2p programs like napster have done a good thing to the industry. Researchig new music, finding out whose music it is and searching for more of the same. Then go buying the cd.

    But what to say of (for example) Sony. They have a recording label with many popular stars, but on the other hand, they sell dvd recorders and other media that’s used to duplicate.

    Just my opinion

    Comment by fitness en buikspieren -

  14. I think the whole thing is ridiculous. When I was a kid we used to copy each others’ tapes on our jamboxes. Now we copy MP3s. Other than the global aspect, there is no difference.

    Sites like Napster helped, not hindered the industry. We would look up artists we liked and download some song we had never heard before. If we liked it, we’d do some research, find what album it was on, and go out and buy it.

    The artists who were throwing the biggest fits only managed to upset their own fans: the people who attend their concerts, buy their paraphernalia, and probably do buy their albums.

    As far as the government goes, they are simply pacifying a baby.

    As a musician, I hope the whole industry does go bust, so we can restructure the whole thing. Most of what is presently being released isn’t any good anyhow. It’s more of a beauty contest than a display of talent. If the industry goes under, musicians would have a chance to reclaim it for themselves.

    Comment by Heather -

  15. I think the only good thing to come out of all this is how with the industry’s size, it tends to trip over itself, creating hilarious moments like this: Sony Corporation, right now, is in a lawsuit against itself. Sony, being a large company, has many subsidiaries and offsets of itself with the same name as the company (Sony Music, Sony Entertainment, Sony Pornography and Coke Dealing, etc.). Sony Music filed a lawsuit against the makers of portable mp3 devices, because they promote illegal downloading (according to them). Of the companies they are suing: Apple, Creative, Rio, and (here’s the hilarity) Sony Entertainment. The make the new digital mp3 playing Walkman. If they keep this up, the industry will end up falling flat on its face, and I, as a musician, will stand back and laugh.

    Comment by Jeremiah -

  16. Well, just have a look at the oil industry for example. It’s really the same mechanism that keeps them afloat. Politicians, laws, and brute force economics are so easy to use for their purposes, it makes no sense for them to change their business.

    Anyway, currently I trust Apple more than any other company to “balance” customer interests vs. RIAA policy – even though the premise may have flaws. Radical change IS going to happen, just don’t expect it to be this year. Oh yeah: and don’t expect it to be good for customers.

    The way I see it, RIAA/*IAA is beyond the principle of “what’s bad for our customers is bad for our business”, because we as a society are so critically dependant on “entertainment”, we lost any meaningful way to fight their wishes. They are our drug dealers. We are ALL hooked. Just like we’re hooked on oil products of course.

    Where is my tin foiled hat again?

    Comment by Udo Schroeter -

  17. The words ring clear, but the problem lies in the fact that the RIAA fears technology which it has no control over. Being unfamilar and hesitant toward a world in which anything can easily be circumvented grants a great paranoia over the music industry. They have been caught up in the details of cease and desist, rather than attempting to work with an inevitable technological future. And this is the reason why it seeks to undermine all other avenues aside from the “tried and true” methods for extracting blood from the consumer. For them, it’s easier to sue Joe Average downloading a song sample, and put fear into other people’s hearts than it is to rewrite hundreds of record contracts to include the new digital media.

    It would also involve the RIAA understanding technology, to which is has yet to achieve. Sadly, this also can equate to the postering being viewed in Washington over similar fields, where old men in fine suits argue over digital rights management, not knowing how to even turn on their expensive Dell while their 14 year old is listening to the latest cd ala Bittorrent and has grasped newgroups, php and linux before even learning to drive.

    We have a long way to go with this. Sadly, I fear that the music industry today will take this lesson far harder than it did when CD’s came about (as you’ll remember, history has a tendency to repeat itself). Suing your customers is not the action to take. This only pisses off the customer and lessons your sales overall. Rather, a taste of the new is what the customers want. To put it another way: Why would I want to buy a 20 dollar album when the expansive claws of modern media have only given me one song to listen to from every radio station across the country? And I can’t return the cd (due to it being opened, and that somehow means you’ve copied it, regardless of whether you did or not)? Of COURSE no one’s buying the albums…when choice has been taken from them, they seek other avenues which have choice.

    Maybe the recording industry will come to its senses and help the consumer. If not, you won’t hear this digital presence weeping.

    Comment by ShadowEyes -

  18. Your comments make no sense, nothing inovative here, go to itunes MArk to see it done right.

    Comment by wathet -

  19. I agree with you all the way, that is why I started helping out iPAC, (www.ipaction.org) it is a political action committee that is focused on reforming IP laws. Our Principals are:

    1. Creators of ideas and inventions have the right to be compensated for their work, but not to limit political expression, veto technological innovation, or restrict education and scientific research.
    2. Intellectual property laws should be judged by their potential to foster new creativity, as required by the U.S. Constitution.
    3. Intellectual property laws should be clear and explicit, so anybody can create without fear of lawsuits.

    This PAC is rather new and any support (financial or volunteer) would be greatly appreciated and very effective.

    For more information please go to the iPac website @ http://www.ipaction.org

    Comment by Anuj Patel -

  20. I agree with you all the way, that is why I started helping out iPAC, (www.ipaction.org) it is a political action committee that is focused on reforming IP laws. Our Principals are:

    1. Creators of ideas and inventions have the right to be compensated for their work, but not to limit political expression, veto technological innovation, or restrict education and scientific research.
    2. Intellectual property laws should be judged by their potential to foster new creativity, as required by the U.S. Constitution.
    3. Intellectual property laws should be clear and explicit, so anybody can create without fear of lawsuits.

    This PAC is rather new and any support (financial or volunteer) would be greatly appreciated and very effective.

    For more information please go to the iPac website @ http://www.ipaction.org

    Comment by Anuj Patel -

  21. Is your vertical integration going to go as far as hooking up with someone like Steve Perlman and making a box with a hard drive to hold all this HD content you’re storing up? Throw in tuner comptaibility with dish network. Leave plenty of room for downloading those songs. Perlman’s Moxi center never did blow up but I always liked the idea.

    Comment by Joey -

  22. The RIAA is thick as a brick. Regardless of the validity of your comments, I am afraid they are falling on deaf ears Mark. As an interesting aside, the RIAA didn’t learn from their experiences in Canada. Not sure if you know the history behind it, but the short version is this.
    A decade or more ago, the Canadian government at the endless pressure of the CRIAA, placed a tax on blank tapes and CDs to “cover the lost earnings from homemade mixed tapes and CDs”. What this did in fact is nagate any future claims by the CRIAA that Canadians weren’t “paying” for their music. Get the full story here. http://techcentralstation.com/081803C.html
    And after they went after every college student and 12 year old with a DSL connection for “stealing” they tried to come after Canadians again. And lost. They appealed. They lost again and again.
    So, Mark, I feel your frustration when the solution is so simple. I concur, buy up a label, and do it right. Perhaps what they are waiting for is someone with future vision to take the lead. You know how people are, they don’t like change, it scares them. Help them Mark, lead the charge. I know you can do it.

    Comment by Barbara Black -

  23. A company named Veritouch is currently trying to push a product called iVue on the RIAA. In an attempt to thwart piracy they are proposing that music users be required to present their fingerprint to verify that they are authorized to hear said music. It sounds to me like exactly the kind of bad idea the RIAA will jump all over, to the continued detriment of revenues.

    http://www.veritouch.com/news/100104.html

    Comment by Publius Rex -

  24. Hi Mark,

    You are right on. I think the music labels did this to themselves. I think suing Napster was the stupiest thing the labels did. All it did was make file sharing harder and harder to shut down, as newer file sharing networks added decentralization, open source code, random ports, and other schemes that make them less vernebale to attack.

    I think your idea of a collective license system in which users pay a monthly fee is a good one. I know many who pay would pay for a P2P service if the catalog and usability were as good as the original Napster was and KaZaa and Blubster are today, and if a good portion of the money went to pay the artists and songwrtiers of the songs they downloaded.

    The RIAA’s tactic of suing music fans is bad on two accounts. For one, it causes more people to boycott the industry. Additionally, it may encourage P2P developers to work on more anonymity schemes, such as proxy tunneling, VPN tunneling, and even foster the creation of closed darknets that are invitation only, and the RIAA never gets invited in.

    Comment by Stephen Hinkle -

  25. Checkout my blog post regarding software piracy, and how to fix it.

    http://doctorlazy.blogspot.com/

    or http://www.wilgrowinvestments.com

    Comment by Greg Wilson -

  26. A lot of solid points made here. I agree that piracy isn’t destroying the record/music industry. The fact is the industry hasn’t figured out why people are PIRATING in the first place. Who wants to pay $15 CA for a music album with a couple of good tracks? Its about targeted marketing, people want to buy those couple tracks. Sell them in a package like you proposed and at least the music companies will win over some of the market pirating the music.

    To be fair though, the people getting ripped off with $15 albums will start using their service and will only be shelling out $1, 10 cents, or whatever they decide to charge. So unless theres 1000s of piraters for every 1 legitimate cd buyer, I think we are going to see the music industry hold on their position.

    Comment by Richard -

  27. Congrats on Mavs victory over heat. I am sure that there is learning process in new team but as owner how do u feel that u dont have shooting star on your team or a good guard. I know people comment a lot without wathcing but I think game stats speak for themselves. Eric is good but no one for offensive rebound. If Dirk has bad shooting night, team is nowhere. That should not be the way. Think about this and have a freshman or someone who is better than Daniels.

    Comment by kedar -

  28. I may have missed a few comments in the long winded posts but I only read one post that dealt with the REAL ISSUE. It has nothing to do with how the music is transmitted (CD, Airwaves, Internet) it has to do with the CONTENT.

    The record industry got in a rut where they created their artists. They would hire a person to create a band like you would a television show. Record company (A) would put out a “Boy Band”, a”Punk Band”, a “New Metal Band” and treat them all the same. It worked for a while but the public caught on and record sales fell. So instead of dealing with the real issue they blamed illegal downloading.

    I ask you this. . . can you name the #1 Selling album last year? I can’t but I bet you I could figure out what was the best selling album in 1992.

    For the record i still purchase cd’s. I like a printed piece with liner notes and pretty pictures.

    Comment by David -

  29. Mark,

    As usual, you are completely right. My close friend Dr. Koleman Strumpf (www.unc.edu/~cigar – a draft copy of the paper is available there) did a study (which was quoted in the NY Times) which proved that P2P networks DO NOT affect CD sales. IMHO, just like you said, CD sales have gotten killed by the price of CDs and the crappy business practices of the record companies.

    Comment by Albert Monroe -

  30. I don’t think I have bought a single CD since I started downloading music, circa Spring 2000. Of course, if they offered music in a format I wanted, with the songs I choose, and not a bunch of filler crap that they fill out albums with nowadays, I probably would have bought some music. And, a lot of the music I downloaded I never would have bought. Many of the songs I downloaded are the only song by that particular artist that I possess. No way I’d buy an album to get that one song, but I would have bought the song, had it been available to download for 99 cents, or whatever…

    Comment by Tim -

  31. Here is a suggestion, why not make songs available for download for 10 cents per track instead of 89 or 99 cents that they are currently charging? Just think about it. People would much rather spend a buck to download 10 songs than 1, in fact, i am not going to spend $1 just to download one song, but I’d happily spend it to download 10 songs. Unlike CD sales, where each CD has a production cost, digital tracks have no cost, so the record company gets the same profit whether they sell 1 track for $1 or 10 tracks for 10 cents. See where I am getting? It would not only increase the profit margin, but also discourage piracy because a lot of people would rather go to a website with good user interface where they can browse albums by artists, see the new releases, most popular albums and tracks, than use a file sharing program, which doesn’t have any of those features. Just think about the possibilities. For example, AOL could have exclusive pricing agreement to offer its members music downloads for 9 cents. It’s a whole new market. People who would never otherwise buy a CD, would easily spend $1-2 dollars per month on impulse music buys. It’s a win for everyone, the record company will increase its profits, internet providers like AOL will get more members and us music lovers will be able to get songs legally without breaking our wallet. What do you say Mark?

    Comment by Ray -

  32. Ethan has missed the point. Mark’s arguments are not fallacious at all. The fact it is admittedly far harder to download a DVD movie than an MP3 song is not relevant to the argument. There are, of course, other lessons to be drawn from DVD v. CD – you might notice, for example, that music videos produced by those same “suffering” labels increased some 150% last year. It’s called making money by giving consumers what they want, when they want it, in the form they want it at a reasonable price. That is much of what Mark was discussing and is the real problem for the music industry – sticking to an old “mega-hits” CD model when taste were changing (a trend starting in 1975) rather than following Andy Grove and Kevin Kelly’s advice: figure out how to kill your product before someone else does.

    The point Mark correctly makes is that the wounds the major labels are suffering are all self-inflicted. All you need to do is look at the numbers of the RIAA’s web site (www.riaa.org) to see that during the period 1999-2003 their raised prices significantly. If you get the figures from SoundScan (see the Economist article on the music industry)* you will see that they lowered the number of titles available by the middle of period (2001) by over 20 percent. Classic economics tells us that raising prices and lowering the amount of product available results in lower sales. Duh! Had they not cut titles, and each one sold only 3,000 copies, their revenue in each year would have exceeded 1999.

    Then something happened. By the end of 2003 major labels increased the number of titles almost to 1999 levels and lowered their prices, but still not quite as low as 1999 pricing. Guess what? The majors had a dramatic increase in sales the first half of 2004.

    There is much, much more evidence backing Mark’s premise.

    The problem is that some legislators bought the RIAA ipso facto argument (our sales are down, people are using P2P to steal our stuff, it’s all due to P2P). Their solution? Something like the Induce bill to hobble investment and innovation in the $3.55 trillion dollar CE, IT, and Telecomm industries to see if we can help the record industry “recover” their $1-2 billion short fall.

    *http://www.economist.com/business/displayStory.cfm?
    story_id=3329169

    Comment by Jim -

  33. Good points but a subscription based model would never be implemented if it’s VOD without alot of adverts.

    Artists are still paid royalties according to the $9.95 price of vinyl and cassettes. Retailers used to stock music and videos because they would draw people into the store, like Best Buy. Now with big chain stores like Walmart offering media, it makes alot of financial sense when each sale can get them $3-4 profit compared to the relatively small profit margin on food.

    A VOD subscription service would kill artists and media companies. The general concensus i’ve picked up is giving the consumer even leased rights to a DRM file is not acceptable without a good chance of a sale coming from it. If you have a low cost subscription model from your ISP or whoever, you’ll keep that and there’ll be no need to actually purchase the music rights permenantly. How many of us just buy a CD, listen to it a few times then it never circulates in our playlist again? Think back to Wham, come on, raise your hands who ever got a Wham cassette and who still plays it regularly?

    A VOD wouldn’t be acceptable but I think multicasting is the way to go. I spoke to you before about my plans of creating a multicasting station where DRM music files are multicast to the user with one-play access rights (ie when it is being streamed) and then you simply upgrade the license if you wish to purchase the track. The ISP gameplan is a good one, I’ve been speaking to a few UK ISPs (small to medium sized ones) about offering our services free to their subscribers simply by peering at the datacentre. It works for them as the max bandwidth they use is 20Mbps across their own network.

    Comment by Kanes -

  34. The new theory that is quite popular now is that music companies’ sales are going down for reasons other than P2P. Mark cites that DVD, VHS, and Games sales are going up in the same time period, therefore it must be something innately wrong with the music industry, and not P2P.
    Mark has made a fallacious statement here. The different between DVD, VHS is that they are video. Have you ever tried to download a movie from Bit Torrent? It takes forever, and an avg. HD nowadays is only 40-80G – so how much can you really hold (not to mention the quality reduction). Games, on the other hand, are software – software is much more capable to have built in mechanisms (technical or otherwise) for protection.
    Songs are small files, easy to find, and easy to enjoy (oh yeah, it sucks to watch a movie on a computer).
    I have been a “P2P” participant even before NAPSTER – via the dumb way of swapping files via FTP with communications on forums.
    Since MP3 and P2P networks like Napster, I can say that ALL my friends and I have stopped buying music. When we want a song, we simply go find it on some sort of P2P network or share files we have with one another. So, unlike what Mark thinks P2P IS killing the music industry’s revenue. I only buy CDs that I am crazy about – and that doesn’t come often.
    But Mark IS right for the industry to stop crying and trying to stop something that can’t be stopped. They should look for innovative ways to go around P2P. I personally work for a ISP – and trust me – our director here would go crazy with joy if Universal came up to him with Mark’s idea – in fact, in our brainstorm meetings we talk about this idea as well!

    Comment by Ethan -

  35. I think that Napster has the best pay/usage format right now.

    Oh and the NBA sucks butt.

    Comment by Drew Olanoff -

  36. Don’t forget that CDs are one of the only, if not the only new consumer products to go UP not down in price once they hit critical mass.
    And don’t forget that the music biz is perhaps the only industry that routinely cheats the artists and producres who are their biggest asset. They have dozens of lawyers who are paid large salaries and benefits to figure ways to chisel a few more pennies from their artists.
    They are scum who are mainly interested in holding on to their jobs and who care nothing about music or the artists who make it.

    Comment by John Lomax III -

  37. First of all, don’t lay all of the blame on the industry. If artists didn’t sign rediculous contracts with major labels that require the “recoup fees” of things like marketing, and accept huge “signing bonuses” than they wouldn’t be in the “industry stole all my hard-earned money” business. Before these artists can make a dime from sales, the label needs to be paid back for recording costs, manufacturing costs, marketing/promotion, paying radio stations to play songs, video production costs, and then line their own pockets first. Then and only then, do most artists on major labels make any money.

    The established artist, like a U2 or Aerosmith, actually make money on recordings because they have made it through those dismal entry-level contracts, and are now operating under a more acceptable regime, based on their own personal experience and hard fought attemts to circumvent the label’s attempts to pingeon-hole them again.

    Do you remember when Prince wrote the word “Slave” across his face several years ago? This is exactly what he was getting at.

    Until, the rise of the internet, artists that wanted their craft to reach the maximum number of people, had no choice but to sign these “deals” with major labels….until now.

    Check out this site…
    http://www.audiolunchbox.com/

    (From their ‘about us’ page) – Audio Lunchbox was founded in April 2003 by 4 individuals with a common vision: to increase exposure and availability of great independent music. Audio Lunchbox is not just a digital download site, it is a lifestyle. We strive to make the purchase of digital music quick, easy and affordable. When you download from our site, you are not restricted by DRM (Digital Rights Management) like some of the other download services. When you purchase audio from us, do with it as you please, as long as it’s for personal use.

    Most songs are .99 cents and most full-length albums are 9.99. Purchase a lunch card and get a price break on bulk purchases.

    ALB is cross-platform and entirely web-based. No need to download any extraneous applications or software to get our system to work. Just connect to the net and browse away.

    Comment by Chicago -

  38. Here’s why I have no sympathy to the greedy stupid bastards in the record industry. If a person could download any song for 5-10cents instead of 99 cents or whatever, 10 million downloads of 10 cents is worth a hell of alot more than 1000 downloads at 99 cents & it doesn’t cost them any more to do this. This is where these people are so stupid. No one with any brains is going to pay 99 cents to download a song when they can get it free on the internet.

    Comment by Phil -

  39. Here’s why I have no sympathy to the greedy stupid bastards in the record industry. If a person could download any song for 5-10cents instead of 99 cents or whatever, 10 million downloads of 10 cents is worth a hell of alot more than 1000 downloads at 99 cents & it doesn’t cost them any more to do this. This is where these people are so stupid. No one with any brains is going to pay 99 cents to download a song when they can get it free on the internet.

    Comment by Phil -

  40. Honestly, if I read one more time that a CD costs $18 to $20 I’m going to die. Does anybody pay attention to NPD’s data? New data says the average sale price of a CD is dropping–and it’s been dropping. It now stands at about $13.00 even. Bottom line: If you’re paying $20 you’re not a wise shopper. I’m sorry, but it’s the truth.

    Mark, I appreciate your comments and I think you have a lot of good ideas. But your take looks at the issue from two sides: that of a tech company and that of a consumer. Approaching the issue from the side of a music company who has a lot at stake would be a valuable excercise. Just because the technologies exist doesn’t mean they should be utilized.

    I do not think for a second that the music industry does not want to change. It knows it has to change. It is, in fact, changing–but obviously not at a speed or in a direction you and your readers would prefer.

    Let’s look at the recent changes in the marketplace. EMI and WMG are out of the manufacturing business (foreshadowing the future, don’t you think?). iTunes has lead to a slew of online music stores. Consumers can buy downloads, they can stream (Rhapsody, Napster). They have access to independent artists via sites like eMusic.

    There has never been more options for the consumer as on the 10th of November, 2004.

    And there will be more consumer choice. But these things take time, and, unfortunately, they will require compromise. Now, we can obviously blame the RIAA for its unwillingness to compromise, but the very same can be said for the representatives of the tech community. Both are at opposite sides of the bargaining table and no nobody’s budging.

    One thing that has not been embraced is P2P. And why should it be embraced? There is not yet a good working model. Voluntary collective licensing? I don’t see that as a viable solution.

    Until P2P is embraced, music industry critics will continue their assault ad naseum. The sad part is that the critics throw out ideas as if this were such a simple issue. It’s not a simple issue. Let’s remember that.

    Comment by Coolfer Glenn -

  41. And screw the artists that bitch about piracy. If they want to make money, they need to go on stadium tours instead of lip synching Saturday Night Live.

    Comment by Entertainment News -

  42. Your concept fails to address some underlying structural issues:

    1)The performing rights organizations which collect publishing and mechanical royalties.

    2) Music labels’ physical distribution networks.

    The performing rights orgs have staked out geographic territories for collecting music royalties. They essentially prevent any one company from efficiently setting up a global music service.

    The music labels have invested $Bs in their physical distribution networks and they have limited expertise or assets in the digital world.

    The labels will either have to develop these assets or cede their distribution networks to companies like Microsoft, Apple, etc. The labels will be relegated to A&R and promotion.

    Comment by Elliot -

  43. Here’s the problem, when a medium comes along that can duplicate and resonate your “talent” so perfectly, it’s time to consider other methods.

    Once we went analog to digital and gave the digital form a place to roam free, the fall of the music industry’s grip over the masses cranked into high gear. You will only be able to stop so many when the only method of control is legal protocol, something that is inherently not compatible with the internet.

    When you see a painting at a museum, you see the original painting, not the duplicate, which is of lesser quality (in the social sense). Meaning, that original painting has something more to it than what you’re looking at. There is history and humanity subtly framing that work.

    In the music sense of the analogy, we sense the same things at the live concert as we do standing in front of a great art. Regardless of how much technology is seething over the performance, we still sense that desperate fire of the performer. That’s why we go, that’s why we listen.

    So, the music on the radio, the music on the internet, has little to do with that live performance, except to remind us that we want to go back.

    Recorded music should be used for what it was intended for, to promote the live concert. Not make a sole living from.

    In the end, music, movies, and entertainment must be uncompressed, decrypted, slowed down or sped up, and converted to match the perceptions of the human senses. Because of this, you are always handing the person the key to unlock everything you worked so hard to secure. So you must change your paradigm to adhere to current reality. Until the music industry does, this silliness will go on for some time.

    Comment by Transistor -

  44. On another note just so you can know the true reason that the Music industry dosen’t want this format . Transparant accounting, would stop them, from paying themselves two or three times on their way to recouping the artist….

    The artist have not received a dime from the lawsuits brought by the companies, nor have th3e songwriters.

    Comment by James -

  45. Mark:

    With your great insights and business sense, and the low vaules that the music industry has set on it’s current (Gold Mine) catalouge, why not put your money where your mouth is , and lets go buy some, lables now, we can make a deal with Comcast, & Music Choice, for our music, and we can sell it in the format that you have outlined, better yet we can buy the Music Publishers that have had booming profitable years in spite of the “recorde” industries crying and moaning. My good friend Zach @ universial, knows this but he’ll be the first to tell you that they are down over the previous year, in CD sales, but will fail to tell you that licenses are up in Publishing, and that they are making money hand over fist.

    They have shed overhead, stopped the outrageous spending of the past, gotten rid of a lot of high priced executive talent. If you want to talk contact me.. I would love to tell you my ideas of what’s availble for sale… Is there not a better time to be in the Business of Songs, and copyright ownership.

    Best regards,

    James

    Comment by James -

  46. I think when it comes to loyalty to a certain artist, consumers will pay the going rate. For example, I buy anything by Ben Folds, who is releasing 4 to 5 song eps through a website (attacked by plastic). I don’t know if he’ll ever release his work through traditional means again (except his recent collab. with the great William Shatner), but it doesn’t matter to me. It’s still work I want to experience.

    Comment by Steven Hopwood-Lewis -

  47. Times are changing… Have you heard the news that Walmart is forcing all the record companies to lower thier prices on all cds to around $10… This is going to force everyone to change now!

    Comment by Ed Olvera -

  48. Bottom line…There is a lack of good music being made and promoted by the big record companies. The bands are out there, but the pinhead lawyers running the talent branches keeping using their narrow sighted formula (pretty face, nice body, can’t sing but that’s ok we’ll just have her lip synch, can’t write songs but that’s ok we’ll have our staff writer song machine come up with something) to try to stuff down the consumer’s throats. Think of all the great bands that came up in the 60s & 70s (pre-MTV)…how many have developed since the 80s and had any staying power based upon actual talent? It’s an order of magnitude less. Great songs/albums will sell (see Norah Jones). When you have John Hammond searching for new acts to sign you get Dylan, Springsteen, SRV, etc. Today you get that girl that got run off the SNL stage. I buy hardly any music today because I have almost everything that I want (from past purchases). Yes, CDs cost too much (and do sports tickets and all other entertainment related items) and the distribution channels could be streamlined, but if you don’t have the goods then what good would it do to fix those problems? It’ll take a major record company or a financially backed independent label to jump start the industry. When that company signs some new artists that have something real and starts cashing in, the other companies will have to change their talent selection and promotion methods or start eating dust…

    Comment by Jim -

  49. We need more Asian artists in the mainstream. Mark, start your own record company and sign me. I’ll be like your Yao Ming in the music industry.

    Comment by n. nishino -

  50. I’ve been saying similar things to people I know in the music biz since the Napster days, but they just don’t get it. Its as if they have blinders on… they comment I always get is along the lines of “downloaders are stealing, we wont help thieves”.

    I think the music industry has had it easy for so long in terms of their monopoly position in distribution, they have forgotten (or never learned) the basics of competition and offering their customers value. I could go on about more of their gaffes, but I’ll close by saying that they are digging their own grave and its not as if they haven’t been offered reasonable solutions to their predicament. Simply unbelievable.

    Comment by Jack -

  51. Put your money where your mouth is. ‘Nuff said.

    Comment by C. Bryant -

  52. The RIAA doesn’t care about artists. They are nothing more than a band of lobbyists/thugs out to protect the cartel (the major labels) and push to have the government pass laws that protect the labels at the expenses of artists and fans.

    Do you think the RIAA cares about artists losing money off downloads? Of course not. Hell, most artists make a few coins off the sale of that $20 CD – with the bulk of it going to the label itself.

    Furthermore, the music industry is the only one where one person will create something, then have the CORPORATION slap the copyright on it. When you crack open a John Grisham novel, the title page does not say Copyright Dell Fiction.

    Why are sales dropping? Mark touched on a great deal of it. Labels are constantly cutting the number of artists they have (because it will make larger short-term profits to bring in an unknown new artist and hope they give you 2-3 quick hits than to develop long-term careers). Furthermore, fans are pissed off. They’re tired of being treated like the enemies by the labels and RIAA, and tired of price-fixing schemes like the one the industry was caught red-handed in back in 2000. They’re tired of paying $20 for two good songs and 50 minutes of crap. And some of us (like me) are just plain pissed off that the artists who do care about their music are often ignored by their own labels and receive the smallest piece of the pie most often.

    I’ve bought two CD’s since 2000. Both were recorded by the same artist, and both of them released by an independent label after she left Arista. I’ve quit putting money into the pockets of the RIAA and the major labels.

    And, quite frankly, I wouldn’t shed one tear if the Big Four and the RIAA collapsed because the fans quit buying. It’s time for real change in the industry. It’s time for the artists to have more rights, and to quit being treated like slaves. And it’s time for the fans to quit being treated like enemies.

    Return music to the artists and the fans – where it belongs.

    Comment by "Madonna" -

  53. i think the main problem is that the music industry is being left behind coz they don’t know how to diversify their products…they think they can keep making money off of CDs by scaring ppl into going back to buying CDs. Personally..i stopped buying CDs after napster shut down. i would really like to see them start trying other venues for making money..

    Comment by charlie -

  54. Mark—-lead the way. If you do it we can know that it will be done right!

    Comment by tcw3131 -

  55. Good stuff Mark. One line to describe the music conglomerates fate: “The tighter you grasp, the faster it runs through your fingers”.

    They are trying to offer some of the services you describe through Rhapsody and others, but also trying to keep a draconian-like control over everything. One of the HUGE money-making potentials they’re missing out on is releasing back-catalog content. A lot of people using P2P networks go on not because its free, but because they can’t find the songs for sale anymore. Great article in Wired describing this and more: http://www.wired.com/wired/archive/12.10/tail.html?pg=4

    It’s a dillema because we can’t, and I am opposed to, having government mandate the music companies rights. They own that property and no one should tell them what to do with it. Instead, let the market decide, and when they alienate all their customers let them go down with their ship, holding on to their property rights for what good it’ll do them.

    Comment by Haig S. -

  56. The CD is dead. Dying like a large oak tree with its roots cut. It may take a while to fall over, but it’s dead.

    It’s just that the RIAA and the companies in it don’t want to admit it. It’s frustrating that they won’t just make the change that they will have to eventually anyway.

    Meanwhile, many people like myself aren’t buying CDs. It’s not because of P2P, it’s because of the RIAA.

    Comment by David Irwin -

  57. The music industry should be grateful consumers were willing to put up with paying for an entire album just to get 2 or 3 songs for as long as we did. Now that music is digital and the venues are there for comsumers to buy just the songs they want for a buck each vs. 15 bucks for the whole disc, the industry needs to realize that the consumer’s expectations have shifted and no amount of laws to limit how music is distributed can change those expectations back.
    The fact is that consumers know we need to buy our music to some extent still, but we also know that we should only have to pay for what we want to buy. Many artists (who only have 1 good song) and record execs may dislike that fact because less CD’s are going to sell in the long-run, but the quicker they embrace the market that is still there the better off they will be. Case in point; tell me that U2 is sufferring from embracing the 1 good song = $1.00 concept(‘Vertigo’ is Apple iTunes #1 downloaded song at the moment).

    By the way, if you’re looking for Dallas Mavs prospects; we here in Chicago would gladly pitch in to enroll Sammy Sosa in some basketball camps this winter if it would mean you’d take him off our hands. It seemed to work well for all involved with the Manute Bol/ hockey initiative.

    Comment by Matt L -

  58. Mark,

    I think you are right, and I would venture a guess that the music industry would agree with you to some degree as well. In their defense, and it’s hardly a rock solid defense, I don’t think they remotely recognized the impact the internet would have. If they did anticipate any of the effects of the interent, they surely didn’t anticipate them happening as quickly as they did.

    I bounced you entry off some folks I know within the industry and they agreed with what you said, while reiterating they just weren’t remotely ready for the impact of the interent.

    Always great to hear your view on things…Earl

    Comment by Earl -

  59. I agree with poster number 1.
    I dont really buy CD’s anymore.. Prices are outrageous. Remember the days we would make Cassettes recorded from the Radio? I sure do.. I dont know how the “industry” claimed p2p hurt sales.. they are just stupid.. people have been recording music for along time now.. back in the cassette days even..
    P2P made me increase my sales too.. b/c i got to hear artists i never would have heard otherwise.

    In reguard to the downloads.. I DO NOT like the 99 cent download thing… its just too easy for me to add up in my head how much money im spending. I would like a “all you can download” format for X amount of dollars a month.. But again.. when and if someone does that.. They Better have a good library of songs.. not 1 top ten label. and the rest .. junk.

    Comment by Mike Verinder -

  60. i wrote the above article 4 years for consumable…it includes links to 2 books which are must-reads on the music industry.

    the one which is considered the bible for payola (and is still a must-read at many major labels) is hit men by fredric dannen.

    i’ll believe the music companies’ cries of looking out for their artists when they terminate deals with the music clubs. that’s a bread and butter winner for them, and a lose-lose for artists. why? because artists only get royalties on music clubs cds that are *sold*.

    so, if you join a club – get 7 free – buy 1 cd – get 4 more free…out of those 12 cds, *1* of them is sold. thus, only one artist gets royalties.

    the rest? the labels / music clubs get the difference between “cost of making a cd + shipping” and “how much they charge you for shipping and handling”. and, of course, they get profits on the “full price” $19 cd.

    also…i believe the record labels currently make a significantly larger profits on online sales than those in music stores.

    Comment by bob gaj -

  61. Careful, you’ll be fined by the RIAA. Starving artists need the money.

    (Good thing someone can afford to speak his mind.)

    Comment by Keri -

  62. mark how hard is it for you not to invest in all the ideas that you put on your blog and those you do not. i have business ideas that i want to do but am trying to build my own capital; if i had $ i think i would venture into everything i think of, is it lack of time? but back to the blog, you have a great idea that someone will eventually follow thru on; the first one will make the most money and then the rest will follow and get the left overs. i wouldnt mind paying my ISP an extra couple of dollars a month for downloads. as a hip hop fan, there are so many songs, remixes to remixes to remixes. that said i just log on to a P2P and download for free. i used to buy 1 to 2 cds every tuesday…now i buy 1 to 2 cds a year. only the artists that i have been a lifelong fan of will i continue to put $ in their pockets, the 1-hit wonders no longer get any $ from me.
    –Luis
    http://www.dallaspartyrental.com/

    Comment by Luis -

  63. I think you’ve hit the nail on the head in your final paragraph. The problem with the music industry isn’t piracy, it’s the sad fact that the RIAA doesn’t know that it has outlived its purpose. Or, rather it does know that, but keeps buying lawmakers to try to fight off death for another brief moment.

    I invite you and all of your readers to come and check out IPac, http://www.ipaction.org . IPac is a political action committee “defending the public interest where culture and technology meet.” Or, in other words, we’re trying to have a significant influence on the way policy is crafted in DC on issues just like you’re discusing here. We backed six candidates in the recent election, and five of the six will hold seats in the new congress.

    (And, if you’re looking for a good place for your next charity-fine donation, IPac could do a lot of good with a few more dollars.🙂 )

    Go Mavs!

    Comment by Ben Stanfield -

  64. We need governement de-regulation in the music industry like in every other monopolisitic industry before (energy, telcom, etc) to force them into a position where they have to compete on razor thin margins in order to make innovation more attractive. CPG, Electronics, and Computer companies battle it out all the time. They still make money, I guess the Music industry just won’t take a little money, they want it all or nothing.

    Comment by Scott K -

  65. Wow, be careful now. The NBA might fine you for saying stuff like that!

    I’d wanted to comment on the previous post, but here we have a perfect cross-section here. Both the NBA and the media cartels (RIAA and MPAA) are stuck in this top-down post-WWII management style. The media cartels are trying to protect themselves with status quo litigation and legislation; the NBA is protecting itself with an absurd cost structure for its employees and members who dare speak their mind in public.

    The media cartels have no excuse for this. So long as they cling to their business model as it stands today, they’ll be toast sooner than later. The NBA’s model isn’t directly hurting their business (I suppose), but it surely isn’t the right way to run a business either. It is, however, a fantastic way to discourage outspoken and innovative people to join The Association.

    Because, ya know, the NBA is *perfect* today and should never have to change. EVAR!

    Comment by Adam Keys -

  66. As several commentors have already indicated, I don’t know anyone who still buys CDs. My opinion was different when I was a student (and unable to afford music of any kind), but now I’d gladly pay a reasonable price for digital music without unreasonable restrictions. When I can’t find that, I’m forced to acquite it via other methods.

    Bottom line: It’s a digital age and consumers want digital music without overbearing strings attached. No amount of legal tactics, threats, or DRM cripple-ware is going to change what consumers want. RIAA, you need to get over it or you will die.

    Comment by Richard Doll -

  67. Finally! Someone is actually taking a look at the music industry from a look at taking advantage of peer-to-peer. I can vouch, from the consumer side, that over the last view years I’ve bought more CDs simply based on sampling the CD online than I did before P2P. Yet, I’d still vouch for the number of cohorts who still d/l songs over the net, illegally. It’s unreasonable to prosecute xxxx-odd number of illegal P2P leechers. It’s a vicious cycle it was Napster, then Kazaa … who next? Is the RIAA going to go after every P2P network online? Good luck. Your idea is a perfectably legitimate stake at reclaiming part of their industry they can’t get a marketing/profitability hand in. On the other side, why not market some sort of digital media at the store front level? There is a new line of MP3 players being made from companies associated to record labels that offer exclusive content from their artists if you buy their MP3 player. Why not offer that digital content with the CD purchase as well? “Want the remix of the hit “xxxx” buy the CD and get that and other exclusive tracks, FREE! Jusy by logging on to our website with the login information provided within.” Or why not even push it farther? As flash memory prices go down, why not market the CDs in an compact form that can mount up to your MP3 player, car stereo, home entertainment system, etc. It’s portable, expandable … but the content originally on it is permanent. Instead of waiting for CDs to load you simply push and pop a flash card. I’d go for that even, expensive right now but it’d be affordable in the long-run. Better yet, why not market it in a “Netflix” form. It’s similiar to your theme. Pay such-and-such amount per month to compile your “hit-list.” “Want that new jam that’s crushing the waves, we’ll send you that hot track and your other jams to your computer, MP3 player for $x a month.” It could be stored on a portable player that could be plugged, like Sirius or XM receivers into your car and then toted into your house for continued listening anywhere. Yet all these ideas are just tweaks of your own.
    The basis of the whole thing, make it accessible and affordable for me. I’m a college student. Why do I have to hear the new Destiny’s Child song on the radio a month before I can legally buy it? Obviously, they’re trying to tease you to get out and get their CD. But if I like the track and I want it now, do you expect me to wait that long when I can find someone on the internet I can get it from and put it in my mix rotation? Sure, I might like songs of the rest of the album and hell, I might even buy it … but I’m for instant gratification. Bravo for you ideas. Offer them to someone and I’d be in. Props!

    Comment by Kieran -

  68. by the way, i think you are right that the music industry is to blame for their downfall but i also think you underestimate the impact of the p2p services… i havent bought a cd in 2+ years and i wont ever buy one again

    that being said the music industry raped and pillaged the countryside while they could… the cost of making cds went lower than cassettes or lps but that savings wasnt passed on to the consumer… then you had retailers, in the malls in particular marking up the price of cds and alienating customers until the p2p movement starts and you end up unprepared, even after the 1st two plus years… after then its already too late because you have people like me who know cds should have been cheaper and know how much the recording industry rapes their artists in their contracts and for that reason will never buy another cd as long as p2p, mirc, or other free sources exist

    Comment by edward -

  69. im really happy with our roster this year and i have to give you a lot of credit for the moves you made… we are really far ahead of where we were last year and this is a team that could definately go all the way

    that being said, one thing bothers me… the playing time of sean bradley and calvin booth… if you only saw bradley in the last year or two playing his limited minutes you would think hes the worst player in the nba… when he gets in the game its embarrassing, he bumbles along gets worked over physically and makes some horrendus missed shots or turnovers, but if you look at his career stats you would see that when he gets decent minutes he puts up some pretty good numbers… the mavs need to get rid of this guy, its really not fair to keep him in this role… my analysis of him is that hes the type of player who needs at least 20 minutes every night to keep his confidence… giving him 4 minutes here and there really hurts him to the point where hes of no value to the team, so much so that i really cant understand why calvin booth sits on the bench and hasnt played a minute this season… booth couldnt possibly be less valuable than bradley is in his current role… booth has actually proven to be better suited to be a low minute guy over his career… i really think the mavs should trade bradley even though i realize he may be hard to move considering his performance as of late and his salary… even if we got a low 1st round pick we would probably be better off, we already have far too many centers and its not fair to sean to have him sit on the bench like he does only to come in for a few plays to be laughed at by the opposing fans… and its not fair to calvin booth either, the guy is a pretty solid player and he deserves to get some minutes, especially since he could be far more effective than bradley in a low minute role (not saying much there)

    p.s.
    whats up with pavel the russian, i havent heard anything about him since he was drafted, is he having health problems again?

    Comment by edward -

  70. I have been a Rhapsody music-on-demand subscriber for over a year and I can’t imagine living without it. Hundreds of streaming stations (and custom stations) and 800,000 or so songs on demand. Higher quality than most p2p versions I would find and always faster. $10 a month for all the music I want to hear. I don’t burn much of it at all because, like movies, I don’t want to own 90% of the music I want to hear, I just want access to it whenever I want to hear it.

    Comment by sirshannon -

  71. Some people just can’t see the writing on the wall. I think it was best explained in Who Moved My Cheese by Spencer Johnson. People are resistant to change once they become consumed by what’s familiar. The record companies obviously don’t see what is plain to everyone else. One day they’ll wake up and their cheese will be gone. Then, they’ll wonder who moved it when it had been diminishing gradually right in front of them.

    Comment by Chris Scott Davis -

  72. well said!

    RIAA needs to wake up and start giving customers what they want. If people start ripping CDs the moment they got home, it is a big hint for them to start providing musics in digital form. Resisting the social trend is futile.

    RIAA also thinks it can tell what the customer can or cannot do; And if the customers dont do it in the way they like, they’ll sue the customer. Now replace ‘RIAA’ with a company of your choice and repeat the two sentence again. Does it make any business sense?

    Radio has not killed tape; CD has not hurt their bottomline; Every war RIAA has fought only adds to its silly history.

    Comment by James Seng -

  73. I like it. I could see myself getting that “one more channel”. I certainly don’t buy CD’s anymore. Seems rather outdated. But I haven’t been able to get excited about this one song at a time thing either….

    This is very good. I would sign up.

    Comment by Clover -

  74. Voluntary collective licensing is, to me, the way forward:

    http://www.eff.org/share/collective_lic_wp.php

    The EFF makes a strong case for it:

    “The concept is simple: the music industry forms a collecting society, which then offers file-sharing music fans the opportunity to “get legit” in exchange for a reasonable regular payment, say $5 per month. So long as they pay, the fans are free to keep doing what they are going to do anyway—share the music they love using whatever software they like on whatever computer platform they prefer—without fear of lawsuits. The money collected gets divided among rights-holders based on the popularity of their music.”

    Comment by Darren -

  75. You have an industry that’s only concern is generating a profit. So they find cookie cutter performers and buy time on MTV and force feed their music down consumers throats. And they sell these CDs for $18-20 bucks a shot when the actual cost of generating these disks is 2-3 bucks. They give the artist 1 dollar per CD, and reap the rewards of their manipulation of the music industry.

    Most people use downloading to get access to the music they are denied. And when they are busted, the RIAA hides under the umbrella of protestic artists merit. What a joke.

    Please, when has any major record label looked out for its artists? Its like the oil industry -only out for its own head honchos to make money. Do you think that Exxon or Shell would sell gas at $1.00 a gallon if they knew it would cost them their yearly million dollar bonuses?

    The reason why you wont see more individual songs available for download is that if the record companies can make 15 bucks off the consumer, versus 4-5 for the purchase of the decent songs, they will bleed that vein until its dry.

    Everything pure gets more and more tainted when its turned into a business. Thats what happened to the music industry.

    Comment by Dan -

  76. Mark

    The radio industry tried to keep the television industry from taking a piece of their pie back in the 50’s.

    The recording industry is far too blinded by greed to see how to increase profits.

    You make excellent points, and you always have great ideas. I think the overall point that you make best is the fact that the entire entertainment industry lacks vision, and eventually will suffer huge defeats to relitively simple concepts.

    Comment by Phil -

  77. my poor eyes.

    Comment by yeat -

  78. I agree with point #1, the artists do deserve a far larger share of the profits. However, when it comes to point #2, it is not a case of government officials falling prey to the RIAA, but rather a very pure case of “payees” rendering services to “payers”. (Which I believe you were insinuating to in point #1 but it wasn’t made apparent in point #2.)

    Yes, it’s still a crime, in an ethical sense of the term, but the crime is one of corruption rather than naiveté. One only has to look at Orin Hatch to gain insight into the “business” practices of the Recording, Music and Film industries.

    As for the RIAA changing distribution methods; It’s already much too late for any major re-organization of the record industry. They decided to fight tooth and nail rather than taking advantage of the boom in internet access and portable music devices when they had the chance. Believing they could quash the medium and insure their un-opposed dominance, they displayed an attitude of vehement disregard for their own clientele, which has left, and will continue to leave, a sour taste with all but the most naive of consumers.

    Unfortunately for them, and fortunate for us, without a physical medium to control they cannot re-enact the tariffs that were originally imposed on materials that “can be used for the purposes of stealing copyrighted materials”. All they can hope to do now is legislate their way out of a corner by enacting laws such as the DMCA and the INDUCE act as they know that the public will no longer react to a legal distribution method published by an industry that has literally become known as “the enemy”.

    Even partnering with companies such as Time Warner and the now separate AOL, who is still hemorrhaging users at an absolutely amazing rate, simply cannot change the minds of consumers who have come to believe that music should be available at cheaper rates, in larger quantities, and in any form factor they desire!

    There are two possibilities I can foresee at the moment:

    The first, a new comer to the industry starts up a conglomerate of independent artists and makes their primary distribution methods not only digital, but un-secured as well. Online revenue sources will be realized by a two-pronged approach. Either end-users will pay for the music when they actually download the song or they will have the option of retrieving it from another source and “donating” money via a web site interface. This will not only foster a “music is free” attitude in which consumers will believe they are part of a community, it will allow consumers to feel as if they are contributing something to their preferred artists.

    While this will definitely reduce the amount of revenue received by a rather large sum, the amount of profit earned without the problems and costs associated with physical distribution medias will make the venture worthwhile. It will also have the direct effect of eliminating the current artificially created “super-star” industry and spread the wealth more evenly throughout the industry. Those who will want to make more than just a living, many don’t even make that much, doing what they love will have to supplement their income using live concerts which will increase the occurrence of such events and also have the effect of forcing them to become much more reasonable in price.

    The RIAA dies a horrid death…..

    The second possibility is hardly as glamorous. Essentially, if the current situation continues much longer without someone stepping in to fill the void of “legitimate distribution” without being attached to the RIAA, a competent programmer will finally step up to the plate and make a P2P program. Unlike the mediocre networks that are currently out there, the network will be protected with a proper PKI system implementing cut & share transfers. This will make all share points and transfers un-traceable and the end result will be a system that absolutely cannot, and will not, be controlled, ever.

    The RIAA dies a horrid death…..
    We all lose out as there is no possibility for artists to gain profit from their works and therefore no incentive for them to create such works.

    Of course there is much more detail than just this overview, and many economics professors will argue about the merits of the current situation for years, but I believe I have more than taken up my share of your blog, =)

    Apologies for the long-windedness and the unwillingness to check this diatribe for grammatical and or syntactical errors,

    -Or-n (dash for google avoidance)

    Comment by Or-n -

  79. Mark, yes you are restating, but obviously it needs to be restated because it is not getting through. Could I politely suggest that you put your money where your mouth is. You’re the man to do this. Buy a small label and make it happen. You should do this business just to prove it can be done and force the rest of industry to follow or die. I’d love to see you taking artists and business from the “industry”. Make sure you sell cool t-shirts and hats for your label. I’ll buy ’em as well as the tunes.

    Comment by Tadd -

  80. Personally I quit buying music when albums started costing $18 – $20 each. That’s just ridiculous when most CDs only have three or four good songs on them. I’m a college student and I just don’t have that kind of money to spend per CD. The only CDs I buy know are mixtapes. On these you are guranteed to have atleast 15-16 new releases that are hot. Plus they usually range from $6 – $8. That’s the only way I’ll buy any music now.

    Comment by Rod -

  81. My thoughts exactly. I was going to post “Amen” as the first word of my post, but I see Tim beat me to it.

    Comment by Joe -

  82. Amen. Seriously, I quit buying CDs a few years ago when Napster was shut down. Before that I was buying more CDs than I ever had before. I now pay Blockbuster $25/month to rent as many movies as I can watch, 2 at a time. I say let the RIAA crash and burn and then when the whole music industry colapses and has to reorganize maybe they’ll do things right the second time. Put some money aside to start a record label Marc. It’ll be a fun and profitable venture for you.

    Comment by Tim -

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