The Decline and Fall of the Music Industry

[Lemur]

Rolling Stone has briefly flared into relevance, with a good article about the bed the music labels made for themselves. Sample quote:

So who killed the record industry as we knew it? "The record companies have created this situation themselves," says Simon Wright, CEO of Virgin Entertainment Group, which operates Virgin Megastores. While there are factors outside of the labels' control -- from the rise of the Internet to the popularity of video games and DVDs -- many in the industry see the last seven years as a series of botched opportunities. And among the biggest, they say, was the labels' failure to address online piracy at the beginning by making peace with the first file-sharing service, Napster. "They left billions and billions of dollars on the table by suing Napster -- that was the moment that the labels killed themselves," says Jeff Kwatinetz, CEO of management company the Firm. "The record business had an unbelievable opportunity there. They were all using the same service. It was as if everybody was listening to the same radio station. Then Napster shut down, and all those 30 or 40 million people went to other [file-sharing services]."

I think it will be very interesting to see what emerges from the ashes of the old studio system. Thousands of little self-made artist labels, perhaps? Almost anything would be an improvement over the Ancien Régime.

[Xiahou]

So true about Napster. They could've easily bought it out and made it for profit. Instead, like the luddites they are, they sued it and shut it down. Pretty sure that suing and intimidation tactics are their knee-jerk responses to just about everything.

Rolling Stone has briefly flared into relevance

Let's not go overboard- it's just 1 article.

[InsaneApache]

This is something that Bowie commented on about a decade ago. IIRC it's called the Bowie Factor. He was one of the first, if not the first, to see where t'interweb was heading. He said that music was going to be like water or electricity and the recording companies had better get ready for that eventuality.

Remember this, when all this 'broke' so to speak, the execs at RCA, VIRGIN etc. had to get their secretaries to open their E-mails for them.

Luddites indeed.

[Lemur]

Insane Apache, I managed to find the Bowie article. It's from '02. Here it is.

''I don't even know why I would want to be on a label in a few years, because I don't think it's going to work by labels and by distribution systems in the same way,'' he said. ''The absolute transformation of everything that we ever thought about music will take place within 10 years, and nothing is going to be able to stop it. I see absolutely no point in pretending that it's not going to happen. I'm fully confident that copyright, for instance, will no longer exist in 10 years, and authorship and intellectual property is in for such a bashing.''

''Music itself is going to become like running water or electricity,'' he added. ''So it's like, just take advantage of these last few years because none of this is ever going to happen again. You'd better be prepared for doing a lot of touring because that's really the only unique situation that's going to be left. It's terribly exciting. But on the other hand it doesn't matter if you think it's exciting or not; it's what's going to happen.''

[InsaneApache]

I was out by a few years, senility I reckon.

Nice find Lemur, thanks.

[Seamus Fermanagh]

It is a tough thing to perceive changeon the horizon. Compound this with a knowledge of how tough it is to accept that this change cannot be exploited in the manner you are accustomed to, and to accept that your power and importance must diminish. Add in that the napster-ites were quite purposefully breaking copyright and thieving and it is not too hard to see how the record industry missed this.

BTW, as a side note, Bowie has always seemed to be a pretty bright chap. Scary to think how smart he would be if he hadn't chemically decerebrated himself for years (I recall an interview wherein he claimed to be unable to remember...entirely...one of the years in the first half of the 1970s).

[Lemur]

It is a tough thing to perceive changeon the horizon. Compound this with a knowledge of how tough it is to accept that this change cannot be exploited in the manner you are accustomed to, and to accept that your power and importance must diminish.

I think you're going way too easy on the labels. I have a buddy who joined EMI in 1999, and he reported that they were already in a tizzy about what the internet would mean for them. Are you seriously suggesting that all through the dot-com boom, the music industry was just kind of looking to the horizon, saying, "Golly, I wonder if these interwebs are going to impact us?" Absurd.

They knew change was coming, and they fully understood that they were facing a threat to their very existence. All of the measures they took were half-baked and half-hearted. The fundamental reason they refused to change was that meaningful transformation would have cannibalized their core business, which was selling plastic discs in square cases. That's the long and the short of it.

Apple Computer made the exact same mistake in 1985 -- they refused to license their OS because they thought they were in the business of selling boxes, as opposed to software.

Remember 1998? 1999? Remember Pets.com and every other silly internet start-up? Remember Wired hyperventilating about the never-ending boom, and how futurist shills were declaring that the age of physical commerce were over? The record labels lived through that, too. Ironically, it was during that period of hype and hope when they could have salvaged their businesses, if not their business model.

[Gawain of Orkeny]

At work the other day, my job at the cd distributer's we weressaying the album format will probably also go away. Why work on a whole album if people can just cherry pick what they like. As soon as you get a song you think is good done release it. I suppose the only way they can detirmine awards is by the number of downloads. Were pretty much done for. We are one of the last small disrtibuters still hanging on. he record store on the main floor only stays in buissiness because of the wholesale dept in the basement. But even that wont last much longer I afraid. Were selling great used cds for a dollar each now.

[doc_bean]

their core business, which was selling plastic discs in square cases. That's the long and the short of it.

This is exactly the reason, the 'music industry' as you refer to it is actually the recording industry and is not about making music, it's about recording that music on a solid medium and selling it. Music has been made for centuries without major labels, and it will be made for centuries with our without them, the recording industry is based on those little solid discs, it's not that they can't adapt, it's that any adaptation would require such a fundamental change that they would not be the same company. A major label giving up cds is like Exxon giving up refining, the companies simply aren't meant for such a change.

And really, it's not necessarily a bad thing that companies outlive their usefulness and disappear. It's the very nature of our capitalistic society, companies exist because they provide a service or product that is profitable. Recording music on solid media has arguably outlived its usefulness to the general public (I still love cd's though, and anyone who wants to convince me to switch to another medium better offer me decent quality and convenient use, not like mp3s, certainly not with DRM).

EDIT: Gawain does raise a point, the real victims are not the big corporations, the shareholders will find other investments and the executives and most employees should find other jobs, but the small retailer who has invested a lot of money in his store stands to lose a lot more.

[Reverend Joe]

Small-time record companies are still hanging on, from what I can see. All of the modern bands I currently listen to work with small-time companies, and it's impossible to find their music anywhere on the internet for download. That's the only option for monopoly on one's music: stay small-time and independent.

[Geoffrey S]

Local recording is becoming increasingly possible for amateurs. In many cases they are capable of distributing it themselves. In a number of ways the process reminds me of decline the putting-out system preceding the industrial revolution (ie. the use of middlemen providing materials for the labourers out in the countryside, and in the end the decline of said middlemen), only in this case with the opposite outcome: lots of smaller producers rather than largescale manufacturing. In the case of art, a good thing in my opinion.

[drone]

If Anderson wins her malicious prosecution suit against the RIAA, et al., they are cooked. Couldn't happen to a nicer bunch.

[InsaneApache]

At work the other day, my job at the cd distributer's we weressaying the album format will probably also go away. Why work on a whole album if people can just cherry pick what they like. As soon as you get a song you think is good done release it. I suppose the only way they can detirmine awards is by the number of downloads. Were pretty much done for. We are one of the last small disrtibuters still hanging on. he record store on the main floor only stays in buissiness because of the wholesale dept in the basement. But even that wont last much longer I afraid. Were selling great used cds for a dollar each now.

Kudos my brother capitalist.

That's the reason I got out of the rag trade. I saw it coming 5/6 years ago.

I sold a thriving business, because I knew that it wasn't going to last. The new owners gave it a good go, alas it is now a nail bar.

The supermarkets did for us, what the t'interweb has done for music/movies....

Makes you look at capitalism in a new light. (Well it did for me)



EDIT: Just read this, what an enlightened chap.

EDIT: Gawain does raise a point, the real victims are not the big corporations, the shareholders will find other investments and the executives and most employees should find other jobs, but the small retailer who has invested a lot of money in his store stands to lose a lot more.

[Gawain of Orkeny]

EDIT: Gawain does raise a point, the real victims are not the big corporations, the shareholders will find other investments and the executives and most employees should find other jobs, but the small retailer who has invested a lot of money in his store stands to lose a lot more.

The same thing is now also happening in the movie and video buissiness. People dl and bootleg movies. Net flix and BlockBuster deilver to your home by mail, Cable has IO and movies and games on demand. It wont be long until all your entertainment can be had by simply requesting it from the little box from your cable or satelite company. I hate theaters nowdays. Their just so blah. Id rather watch it at home an a big screen and again I can see any movie I want in any theater for free. Only the really big things Like LOTR or Star wars do I even bother.

Its always the little guy who suffers and pays in the end.

Like InsaneApache however we saw it coming and slowly sold off all our 7 video stores about 4 years ago while you coud still get a decent dollar back on your investment.

[Lemur]

I still love cd's though, and anyone who wants to convince me to switch to another medium better offer me decent quality and convenient use, not like mp3s, certainly not with DRM.

I'm more than adequately pleased with the new no-DRM high-bitrate downloads from the iTunes "plus" store. Finally, I can legally download (relatively) high-quality music and play it where I like, without reporting back to any mothership for permission whatsoever. Frankly, it's what I have been waiting for.

I understand Amazon's new download music shop will also offer DRM-free music; no word on what bitrate or codec, however. It had better be at least MP4, and 192 or better.

[Gawain of Orkeny]

I still love cd's though, and anyone who wants to convince me to switch to another medium better offer me decent quality and convenient use, not like mp3s, certainly not with DRM.

The best quality is still an actual record or the original master tapes. CDs were invented so the average joe could afford to listen to good sound. It can never however reproduce an actual performance as well as analog . It just cost you a few thousand dollars for a real good set up . The cost of a good cartridge can cost more than the best cd players.

[Lemur]

Audiophilia is a dangerous condition, which can lead to empty bank accounts and monoblock amplifiers that weigh more than a moped. Walk that path with caution.

Getting back to the "last throes, if you will" of the music labels, Prince is giving away his next CD in Great Britain with copies of the Mail, a newspaper. Label goes ballistic, refuses to distribute same album in the U.K., withdraws from participating in his tour, etc.

Total nuclear meltdown. What a strange development. Thoughts?

Music industry attacks Sunday newspaper's free Prince CD

Katie Allen, media business correspondent
Friday June 29, 2007, The Guardian

The eagerly awaited new album by Prince is being launched as a free CD with a national Sunday newspaper in a move that has drawn widespread criticism from music retailers.

The Mail on Sunday revealed yesterday that the 10-track Planet Earth CD will be available with an "imminent" edition, making it the first place in the world to get the album. Planet Earth will go on sale on July 24.

"It's all about giving music for the masses and he believes in spreading the music he produces to as many people as possible," said Mail on Sunday managing director Stephen Miron. "This is the biggest innovation in newspaper promotions in recent times."

The paper, which sells more than 2m copies a week, will be ramping up its print run in anticipation of a huge spike in circulation but would not reveal how much the deal with Prince would cost.

One music store executive described the plan as "madness" while others said it was a huge insult to an industry battling fierce competition from supermarkets and online stores. Prince's label has cut its ties with the album in the UK to try to appease music stores.

The Entertainment Retailers Association said the giveaway "beggars belief". "It would be an insult to all those record stores who have supported Prince throughout his career," ERA co-chairman Paul Quirk told a music conference. "It would be yet another example of the damaging covermount culture which is destroying any perception of value around recorded music.

"The Artist Formerly Known as Prince should know that with behaviour like this he will soon be the Artist Formerly Available in Record Stores. And I say that to all the other artists who may be tempted to dally with the Mail on Sunday."

High street music giant HMV was similarly scathing about the plans. Speaking before rumours of a giveaway were confirmed, HMV chief executive Simon Fox said: "I think it would be absolutely nuts. I can't believe the music industry would do it to itself. I simply can't believe it would happen; it would be absolute madness."

Prince, whose Purple Rain sold more than 11m copies, also plans to give away a free copy of his latest album with tickets for his forthcoming concerts in London. The singer had signed a global deal for the promotion and distribution of Planet Earth in partnership with Columbia Records, a division of music company Sony BMG. A spokesman for the group said last night that the UK arm of Sony BMG had withdrawn from Prince's global deal and would not distribute the album to UK stores.

[Xiahou]

"The Artist Formerly Known as Prince should know that with behaviour like this he will soon be the Artist Formerly Available in Record Stores. And I say that to all the other artists who may be tempted to dally with the Mail on Sunday."

Classy.

"It would be an insult to all those record stores who have supported Prince throughout his career,"

That quote gave me a little chuckle. How nice of those stores to support Prince. I'm sure they only did so for purely philanthropic reasons- certainly it wasn't the millions of dollars they made by selling his music.

[InsaneApache]

Has he still got 'slave' written in biro on his cheek?

Or was that another nutcase?

[doc_bean]

The best quality is still an actual record or the original master tapes. CDs were invented so the average joe could afford to listen to good sound. It can never however reproduce an actual performance as well as analog . It just cost you a few thousand dollars for a real good set up . The cost of a good cartridge can cost more than the best cd players.

I still like my music affordable, I'm not an audiophile, I'm just not a big fan of mp3s. But your comment does show that the cd is doomed, people who just want cheap music with little regards to the quality will download, people who want high quality will still go for actual records, the 'niche' market left over for cds will be tiny.

Total nuclear meltdown. What a strange development. Thoughts?

It's not too weird if you know the (recent) history. Prince had given up on major labels a few years ago and wanted most of his new material through his website (don't know if it was for download or mailed cds). It apparently didn't work out too well since the first album he wanted to release 'only on the net' had gotten a regular release a few months later (Rainbow Children, not too bad, but i wouldn't recommend it). He then released a live album and another regular new album on his own, small label and eventually (5 years later) teamed up with a major again for another new album (Musicology, which is terribly bleh imo), he apparently released another album on a major after that (of which I know nothing until I checked Allmusic so i wouldn't write too many factual errors here). And now he decides to 'give away' the music. He had worked with major labels out of necessity, but now seems to have found another way to distribute his music to the masses.

Now do keep in mind that the years he tours he's still one of the best earning artists around (I beleive the best with his last major tour, and the Stones were touring then too). He's one of those people who doesn't need the record sales to make money, so he can afford to do whatever he wants with his music.

Has he still got 'slave' written in biro on his cheek?

While completely over the top, he was protesting that the label owned every piece of music he had written and decided when it could get published, and could even alter (remix or whatever) the album if they so pleased.

In Radiohead's OK Computer in the cd booklet there is the standard comment 'All songs property of [insert label]' but they added 'even though we *bleeping* wrote them', more subtle perhaps, but the same message.

[Beirut]

The best quality is still an actual record or the original master tapes.

Dark Side of The Moon on vinyl. Ahhhhh...

Back in the late 70s, hanging out at my buddy's house, he had a great setup. A nice Technics turntable (the top choice back then amongst teenagers), a good amp and big fat speakers. And, just to make you happy, he was a huge fan of Zappa, must have had about a dozen albums. I used to drive him nuts getting him the play Child in Time over and over.

As for the music industry, for me it died a long time ago when Micheal Jackson came to Montreal to do a concert and you could only buy the tickets through the mail, you had to buy four, and they were expensive. It's not like I wanted to go, but it really stank to treat the fan base so callously. And now the industry who did things like that is crying because people are downloading music? Shmucks.

[R'as al Ghul]

I remember well how betrayed I felt when the whole industry changed from vinyl LP's to ugly cheapo CD's and charged you the equivalent of 10 € more for a smaller booklet, a smaller cover, usually no extras etc. Pay more, get less. Then when the first online stores opened it was the same all over again. Buy a full album of MP3's for a higher price then the CD by the same artist. Pay more, get less. Now they sell DRM free MP3's for a few cents more.....This time it will work. I'm certain.

[Gawain of Orkeny]

And you cant use CD covers to clean you weed on. What were they thinking Music and pot were made for eachother.

I loved the huge rolling paper in Cheech and Chongs Big Bambu album. The night before my company left for westpac we took on and put about an ounce of weed in it and like 20 of us sat there and passed it around.

[InsaneApache]

And you cant use CD covers to clean you weed on. What were they thinking Music and pot were made for eachother.

I loved the huge rolling paper in Cheech and Chongs Big Bambu album. The night before my company left for westpac we took on and put about an ounce of weed in it and like 20 of us sat there and passed it around.

My mates and I had this gripe when CDs first came out in the 80s. A 12" vinyl disc was indeed essential. Bloody Philistines.

[Gawain of Orkeny]

Especially the ones that opened up as you could use the other side to catch all those damn seeds. Like Tommy

Live at Leeds had lots of neat things inside as did SGT Peppers and many others.