This is a copy of an article that was published in NewsScan.com back on June 27, 2003. As it turns out, my opinions have stood the test of time. I am republishing this article here because NewsScan is gone – gone forever from the web.
The Internet has made is possible, and easy, for almost anyone to realize their fondest dreams. Want to be a writer – well here I am – a writer. Want to be any on-line merchant – again, not a problem. Want to be a published musician – do you really even need to be signed to a recording contract? If your band is getting steady work and has a loyal following, you can sell your own recording and merchandise on-line at a very low cost of entry.
My contention in the article below was that as much as the RIAA was trying to stamp out illegal and free music downloading, what they really should be worrying about is not losing these sales, but losing the artists the drive the music machine. Do musicians really need the recording industry any more? We shall see.
John Gehl and Suzanne Douglas published their on-line technology news sheet before blogging was even a concept. They ceased publication 2 or 3 (or 4) years ago, and it is a loss. So my apologies to John and Suzanne for reprising my contributions here.
A Summary of Technology-Related News
Sponsored by RLG
And Written by John Gehl & Suzanne Douglas
Read it! read it!
June 27, 2003
THE RIAA AND MP3 MUSIC FILE SHARING: A GUEST COLUMN
[This is a guest column by NewsScan subscriber Bob Weiss of WyzGuys.com.]
The first point to be made is that the music industry leaders are failing to adjust to major fundamental changes in the music distribution model. Years ago, WalMart, Target, Office Max, Home Depot and the like changed the retail distribution model forever by providing more variety and convenience at lower prices. This drove countless small retailers out of business. File sharing has also provided more variety and choice at lower (albeit free) prices. But it doesn’t have to be free, and Apple Computer and the supporting record companies "get it" with iTunes. I predict this service will achieve remarkable successes, if they don’t screw it up by trying to improve it. If only it was available to Wintel owners. (sigh)
The second point is that what the music consumer is telling the record companies is basically a big GET REAL! Music fans are tired of paying $20 for the 2 songs they want on a 12 song disc, average price $10 each. Again, iTunes, with their $1 per song pricing is getting closer to what the marketplace wants. I think this model will eventually support prices in the twenty five to fifty cent range. The major record labels are used to soaking the public with high priced CDs from derivative bands loaded with songs of no consequence, and the consumer is refusing to continue with this business model now that something better is available.
The third issue is that the people they are pursuing for file sharing for the most part are the biggest purchasers of legal music CDs. It is always bad policy to punish your best customers with law suits.
The fourth issue is getting short shrift in all this, and that is the precedent of Fair Use. If I buy the CD, I should be able to burn a copy to save as a back up, and rip it to MP3 so I can play it on my portable player, computer, cell phone or PDA. The music industry appears to be trying to abolish this principle as well.
But I believe what really is keeping these music-industry guys awake at night is this: the consumer of their product has already abandoned their traditional business model in favor of something less expensive and more convenient. What happens to the record labels if the CREATORS of their product abandon them as well. It is a small thing to set up an e-commerce web site and sell your product directly, and thousands of small computer software producers are doing this already, and evidently with some reasonable success. The bands are beginning to get into direct distribution already on their own web sites, and it is only a matter of time before this will be the way of things. Then the record labels will really be in trouble, much more so than today. Basically they are the "middleman" of this industry, and we have all seen what happens to middleman businesses who stop adding value to BOTH the producers and the consumers they serve.
If I were in a major band, I would be asking my business manager exactly how much I am getting per song for every song sold through the major label. I bet it is way under a buck, in fact I bet it is under a quarter. If you consider that my album had only two songs anyone really wanted on it, and you adjust your calculations, maybe it gets close to a buck for the good songs, and the other songs were "free." These guys are smart enough to figure out that they can make more money selling their songs directly to fans for a dollar or less. What the music industry needs to become, if it wants to survive, is the hosting platform and marketing arm for this type of distribution. The attempts of music-industry leaders to force people back to the old model will fail, even with the vast sums of cash they have to throw at it. it failed 30 years ago when people started making cassette tapes from the vinyl albums they already owned. (Does anyone remember?) They can no more stop the changing marketplace by force, fear, intimidation, and the courts anymore than the small retailers could stand against Wal-Mart and Target.
They need to quit wasting their time and resources on lawyers, and start developing a vision of their business that can still include them. If they don’t, others will, and they will be gone.
What follows is a couple of comments on my article that followed in the July 7th edition of NewsScan
RIAA SUICIDE BOMBING
Major league kudos to Bob Weiss for explaining the impending RIAA suicide bombing. He offered the clearest, most prescient argument of reality that I’ve read on the subject to date. RIAA is about to take themselves out of the picture and will only take a handful of their best customers with them!!?? Beautiful, just beautiful. (H.S. "Chip" Vanture, Jr.)
FAT CAT MUSIC COMPANIES
One thing that was not mentioned in Mr. Weiss’s article, but is worth mentioning, is the promises made by the record companies when they were trying to convince consumers to switch from vinyl (and cassette) to CD. I remember watching a lunch hour news show many years ago, when they were interviewing an official from a large record company. At the time there was a lot of controversy over the movement to CDs from cassettes and record players. This official told the interviewer that the cost to make cassettes (for example) was far more than to make a CD. He mentioned it cost about $1-$2 (Cdn) to manufacture a cassette, and $0.10 to manufacture a CD. Of course he touted the perennial corporate lie "we will pass these savings on to the consumer" (yeah right!). Before CDs came onto the scene a cassette tape typically cost from $7.99 to $12.99. CD’s can now cost anywhere from $13 or $14 to the $30 range.
I am completely in agreement with Mr. Weiss on the idea of ‘fair use’ and my annoyance with the fact that companies want to fundamentally "change the rules" or deviate from the precedent that I can make a copy for my own personal use (if I own an original recording). We as consumers should be screaming our heads off at these fat-cats in the record industry. To quote a famous musician "The times… they are a changin’…" Hopefully record executives will eventually "clue in". (Phil Lindsay)