“E-Book Sales Fall After New Amazon Contracts”

Beware of your dream coming true.

For years we’ve heard that music is undervalued, that people must pay more. But maybe the consumer doesn’t want to. That seems to be the case with e-books.

When Amazon launched the Kindle no e-book was over ten bucks. A business burgeoned. Early adopters were ecstatic. But the old guard said they loved paper and the writers and publishers were wary of giving Amazon too much power.

So, after agitating in the press, Amazon gave them some of what they wanted, including the right to set prices.

And then they fell.

Now don’t tell me paper is where it’s at. If you read the story on backpacks in the “New York Times” you’ll see that college students no longer carry books, their courses are online. This is the trend, and to deny the trend is death.

“Backpack Makers Rethink a Student Staple”

So CDs are never coming back and track sales are decreasing, -5% for Universal in the last quarter, and streaming adoption is slow.

Why is it slow?

Because tracks are free on YouTube and Apple Music is nearly indecipherable and maybe $9.99 a month is just too much.

Forget about the fans, they’ll pay no matter what. But to really succeed you have to get the casual users, the looky-loos. And the larger the barrier, the less they’re interested.

Music has completely changed. Used to be tracks were parceled out on the radio with the hope that people would go to the store and buy singles. Now, the track is available instantly online and those who care check it out in droves. Which is how Justin Bieber broke the Spotify record this week. This is a good thing. Monetization comes last in today’s marketplace. First comes attention, you want people to check something out, and if it sticks…it’s forevermore. Hell, Major Lazer’s “Lean On” is still one of Spotify’s top tracks. As is One Direction’s “Drag Me Down,” which held the streaming record before Bieber.

So why is everybody agitating against the new model? Universal Music reported that streaming revenue grew significantly, by 34%, it overcame the decline in physical and downloads, it helped the company’s bottom line. But we’ve got the unwashed uneducated and the marginal protesting that they just can’t win in the new world.

Welcome to the twenty first century. That’s what I hate about America. No one can move backward, no one can lose. It’s like we’re dying to become Europe, where jobs are protected. Only they aren’t. Industry lays people off in droves and no matter what the musicians say their revenues are not returning, unless they’re stars or adjust their model.

We need to get more people paying for streaming.

And first we must expose them to it.

It’s hard to get someone to pay $9.99 a month if they don’t know what it is, how to use it. And most people still don’t. And Apple Music is a bad beginning. I still can’t figure it out completely. And if I can’t, what about the wannabe?

So freemium must exist. And family plans are a good thing. As is Spotify’s reduced student price.

The key is to get people hooked and then raise the price.

Not enough people were hooked on e-books. They’re only 24% of the market at Hachette. Writers and publishers will be healthiest when the physical book dies. I know you’re screaming, but I’m right. Physical stores and physical books and physical distribution are an antiquated model that wastes money. And the public knows this, which is why it’s balking at paying the same price for an e-book as it does for a hardcover, which is oftentimes the case these days.

Which means the value of an album is no longer ten or fifteen dollars. People think that’s a rip-off.

But they’ll blindly play the same damn track over and over again for decades, putting cash in the pockets of providers under the new model.

This is what I love about the internet, this is what I love about modern life. The old gatekeepers, the people who had control and thought they still did do not. Turns out the public is in control, the public decides what is of value and what it wants to pay for something. And your only hope is to get ahead of people and corral them into a new system. Trying to take away the goodies they already have, that’s death.

So, once again, the enemy is not Google or Amazon or Spotify or Apple. Rather, the enemy is you. You refuse to take a risk. You continue to hold on to the old model, as it dies, dies, dies. I guarantee you the people who won in the past won’t necessarily win in the future. But if you don’t think people are already winning in today’s world you don’t know Bieber, who would have been a nonstarter without YouTube, you don’t know the Weeknd, who started out giving his music away for free, you don’t know Diplo, who’s used the internet to spread the word on tracks so infectious that he’s getting rich.

There’s plenty of money to go around.

Please don’t hold back the tide of progress.

Take chances.

Laud streaming.

Keep freemium.

Agitate for Apple to simplify its user interface.

Luxuriate in the new golden age.

Or be left behind.

P.S. If you’re frustrated that the above WSJ article is behind a paywall you’re testimony to the fact that sometimes the price is too high. The WSJ has decided to leave readers behind, which I believe is a mistake. One thing we know for sure, leaving listeners behind is a huge blunder, obscurity is your enemy in today’s world, and it’s so easy to achieve.

What can I tell you, I didn’t start buying every Kinks album until their hits were done. I owned the “Greatest Hits,” but with limited cash it wasn’t until I was a senior in high school that I purchased “Arthur,” I loved hearing “Victoria.”

And then I bought every one thereafter, including “Lola Versus Powerman and the Moneygoround, Part One” from the cut-out bin. An incredible LP, completely forgotten to the sands of time.

Kind of like “Preservation Act 2.”

That’s right, when rock became bombastic, when corporate rock was rearing its ugly head, Ray Davies retreated into musical theatre, with concept albums telling stories you had to listen to to understand, and even then it wasn’t always so easy. And “Preservation Act 1” was a hitless dud, but its follow-up, “Preservation Act 2,” is pure genius. With a story containing English references that will have you running to your dictionary, suddenly “Preservation Act 1” made sense!

Not that the story was completely realistic. But there were bad guys and good guys and right smack dab in the middle of side one of “Preservation Act 2” is a song so accurate, it still rings true today, it’s the best expression of the money culture we’ve been living in for decades.

Show me a man who says he can live without bread
And I’ll show you a man who’s a liar and in debt

Yes, it’s always the poor claiming they can live without money. The rich, not so much. It’s as if the underclass rationalizes its position, since it’s got no direction home to the pot of gold controlled by the richies.

There’s no man alive who can’t be purchased or enticed
There’s no man alive who wouldn’t sell for a price

Everything’s for sale. It’s just a matter of the number.

Want that house on the corner? The owner might not be eager to sell, but if you ratchet up the price he starts thinking…with the money he can now buy TWO houses…it’s YOURS!

And this is why today’s stars do privates for corporations and despicable people, they can’t say no to the price. Oftentimes they’ve spent it before the date’s even played. You can pay your alimony and child support and…

Money talks and we’re the living proof
There ain’t no limit to what money can do
Money talks, money talks

It’s why we revere the icons. It’s why the unsuccessful have contempt for those in the black. Would they hate the popsters so much if they were broke? OF COURSE NOT!

Money can’t breathe and money can’t see
But when I pull out a fiver people listen to me

Try it. My dad taught me this lesson. You’ve got to grease the skids. The maitre d’, the mechanic, the police… That’s right, the guy who shuttles my mother around parks right in front of the theatre by dropping a fiver whenever he’s told to move on by a blue coat, he says…”I think you dropped something…” Problem solved.

Money can’t run and money can’t walk
But when I write out a check I swear to God I hear money talk

Ah, what doors cash opens.

Money talks and baby when you’ve been bought
You pay attention every time money talks
Money talks, money talks

A few years later Bob Dylan sang  that we “gotta serve somebody.” Ain’t that the truth. We all have a boss, and it all comes down to cash. You’re being paid it, you want it, you can’t say no. Stuff you’d never do in a million years, choices you abhor, you go down the path when someone is lording money over your head.

Money talks and there’s no doubt about it
Money talks and we can’t live without it

Try it. I did. You can’t function. All you can think about is cash. How you’re gonna get it, how you’re gonna evade the bills. You’re just one disaster away from crapping out. If you think you can live without money, you’ve never tried it.

What’s the point of living unless you’ve got money
I just couldn’t function without money
Money talks, money talks
Money talks, money talks

Wait a minute. Ray Davies is an artist. He’s supposed to be above money, he’s supposed to be doing it for the love. But in “Money Talks” he’s exposing all the hypocrisy. Joni Mitchell might play if you’re a friend of hers, otherwise she needs cold hard cash. The sooner you learn this, the sooner you’re on the road to success.

Show me an upright respected man
And I’ll have him licking my boots when I put money in his hand

Behind every great fortune lies a great crime. If you wanna be rich you’ve got to throw your morals out the window. It’s what’s happening in D.C. right now, with the politicians groveling at the feet of the billionaires. Just try getting rid of the puny hedge fund tax rate…can’t be done when they donate, when they schlepp you around in their private jets.

It rots your heart, it gets to your soul
Before you know where you are you’re a slave to the green gold

That idealist who sat next to you at college… He or she is now wearing a multi-thousand dollar suit and working around the clock for nothing other than money, they’ve barely got time to spend it. They’re slaves to the cash.

Money talks and we’re the living proof

And there you have it.

There ain’t no limit to what money can do

Want change? Start with a big bank account.

Money talks you out of your self-respect

Would you really be friends with that jerk if he weren’t rich and throwing you perks? Being a court jester for people whose values you hate?

The more you crave it the cheaper you get

Cheap isn’t only about refusing to leave a tip, about hoarding cash, it’s a whole attitude, and if you’re cheap you can never get ahead in this world, you’re stuck where you are. Loosen the purse strings if you want progress. But you’ll end up a slave to the green gold, because the truth is we’re all just rats in the same cage.

Money buys you time and people listen

Would anybody be paying attention to Donald Trump if he were broke?

Money can buy a smile and make life worth living

Look at the nerdy hedge funders with the babealicious wives, who get smiles from everybody on the payroll. That’s the power of money. And we can criticize it all day long, but it’s better than living without it.

If you’re ugly money can improve you

Talk to the plastic surgeons. It’s amazing what cash can buy you.

I just couldn’t face the world without mazuma

The sooner you learn this lesson, the better off you are.

I’ve learned when someone says money doesn’t matter they need to be ignored, they don’t understand how the game is played, even worse, they don’t understand people. Sure, some people will stand up to money now and again, but that’s just until those with cash find their weak point, or these same people go broke.

The truth is money talks. Maybe silently. Maybe impliedly. But it’s more vocal and more important than most of the drivel you hear every day, that you see on reality TV and even hear on the news.

Hell, there’s not an anchor who won’t jump ship for a check.

And networks protect their advertisers.

And if people let go HBO heads roll.

Money makes the world go-round.

And you probably won’t learn this at school.

And too often you’ll hear that money is dirty.

But if you want power, if you want to get ahead…follow the dollar.

Eventually Ray Davies did. Clive Davis got him to give up the album-length concepts, and go back to cutting individual songs. Clive did this by paying him. And the end result was success, suddenly the Kinks were playing arenas.

So even Ray Davies is a slave to the green gold. But in this one song he points out the truth of society better than anybody else.

That’s the job of an artist.

To pursue truth.

But only if someone is paying you.

Only if you’re getting rich.

Money talks, money talks

Rhinofy-Money Talks

Re: Narcos

Hey Bob,

Great post. It’s truly an exciting time for television. Always appreciate when you give HOC a shout-out. Loved how you traced back the last 30 years of TV to where this current era began. And you’re right – “Sopranos” was a game-changer. But to give credit where credit is due, Tom Fontana’s “Oz” really got the ball rolling. It was the first one-hour drama that HBO ever produced.

Tom is a friend and mentor of mine, so I have to admit some bias, but I think it’s fair to objectively state that “Oz” – which aired two years before “Sopranos” in 1997 – paved the way for the “Sopranos” and everything to follow. Tom was a big part of the revolution-before-the-revolution – working on shows like “St. Elsewhere” and “Homicide: Life on the Street” – complex, sophisticated network shows that created an appetite for the premium cables dramas that succeeded them. “Oz” showed what was possible. HBO basically said to Tom: “Here’s the resources, make something interesting.” And he did. And television changed as a result.

Yes, “Sopranos” took it all mainstream. Its impact is gargantuan. But let’s not forget David Simon’s “The Wire” either, arguably the best television show in the last half century. Tom Fontana was a mentor to Simon. In Simon’s own words from this Salon interview: (http://www.salon.com/2011/07/04/treme_season_2_david_simon_interview/)

“(“Homicide: Life on the Street” writer-producer) Tom Fontana took me on when I was looking at television as kind of a lark, as something I might do for a couple of years for money as I finished my second book. I had no intention of making a home in that medium. It was years before I looked up and realized that I had. Tom was incredibly gracious and open about sharing everything he knew about how to make television shows.”

“The Wire” may not have had the viewership of “The Sopranos” when it first aired, but its reputation and impact continues to grow. It’s sort of like the Velvet Underground of 21st Century TV – only a few thousand people saw it when it first aired, but they all started TV shows. Its influence on the mainstream can’t be denied. Tom Fontana and David Simon’s contribution to everything all of us are watching is profound and indelible.

All my best,
Beau Willimon

Are you watching this??

Somehow the TV industry has leveraged the power of the internet to hit a new high in quality. It’s as if after Napster we had the Beatles and the Stones, with Yes and Genesis to follow.

That’s right, forget the Rock & Roll Hall of Fame. That’s long after the fact. If you lived in the late sixties and early seventies you were exposed to a cornucopia of experimentation, musicians owned the world and we were whipsawed and whiplashed and we liked it. We couldn’t figure out how they came up with this stuff, only that we needed more.

And the whole world was watching.

The whole world is now watching TV.

So Reed Hastings harnesses the power of the internet to create Netflix. And unlike the music industry, he moves one step ahead of his customers, he goes to streaming before the public even knows it wants it. Hastings sees broadband adoption and licenses content and even the content providers have no idea what’s going on, they’re just happy he’s paying them now that the DVD is cratering.

And then Jeff Bezos moves in. Knowing that if you don’t crash the party right away, you can’t get in later.

Have you watched “Transparent”? Starts off slowly, and then is a weird mish-mash of sitcom and “Seinfeld,” mirroring the American family to the point you want to tell everybody about it.

But the granddaddy was “House of Cards.”

And the reason “House of Cards” was so good was because of Kevin Spacey and Beau Willimon and Netflix’s refusal to meddle. It’s as if Mo Ostin was cloned to run TV, knowing that art is best when you let the creatives run free. You see artists want to pierce the sky and leave their mark, and once unrestrained they’ll surprise you.

Oh, they’ll fail too.

But when they succeed you can only marvel.

Can you say “Sopranos”?

That’s where it all began. When suddenly HBO was not only better than network, but better than movies. Anybody with a brain now wanted to stay home as opposed to go out.

Now we’re enthralled by the flat screen.

But HBO is no longer alone. If you’ve got the bona fides, the track record, it’s a bidding war out there, multiple outlets want to let you make your dream product. And your dream product could be…ANYTHING!

Before you watch “Narcos,” pull up Netflix’s show “Chef’s Table,” the very first one, about Massimo Bottura. I need to do a whole piece about it, it’s so riveting. The kind of documentary that used to run in the theatre, before every adult abandoned them.

And loving that so much I pulled up “Narcos”…

WHEW!

How many people are going to become gangsters after watching this series? Yup, those with smarts but no education, who refuse to be held down by society. Like those who revolutionized the music business.

Rules didn’t apply to them. Your heroes not only made it up as they went along, they didn’t take no for an answer. And there’s as much illegality in the history of the music business as there is in “Narcos,” with as much sex and drugs and nearly as much money. But music is legal and cocaine is not.

Don’t believe the press release. You’ve got to be in the room to know what’s going on. And when you are, the stories will make your hair stand on end.

But that music business book will never be written.

But the story of the Medellin Cartel is public.

Yet despite there being so many books, we live in a visual society. And when you watch “Narcos”…

Some of the dialogue is cheesy. But the story and the lessons…they get you thinking.

Suddenly you understand Miami, how the modern city was built upon a sea of coke. And having been to Bogota, getting to know some residents, I learned that the Florida metropolis is nearly a suburb. People buy houses, they live there…

Colombia. Most are clueless and those who know are too scared to go.

But I did. And it was the most exciting place I’ve been to in years.

Everybody had a relative who’d been assassinated. I was driven around in a bulletproof car. It’s safe, but it’s not. And the economy is limited, the currency is challenged, to the point where it’s all about lifestyle.

That’s right, in America you work all day to get ahead.

In Colombia, you’re living your life right away, talking, partying and…

Out of this mix comes people like Pablo Escobar.

Sure, he made it in drugs. But he could have succeeded in real life, in a more regulated country, where it wasn’t a free-for-all. Because he knows when to hold ’em and he knows when to fold ’em.

That’s what they don’t tell you about the winners, that they’re charismatic, that they don’t extract every last ounce, that they’re fun to hang with.

And they’re ruthless.

Most people never figure out how the world works. They’re drones in society who think they are free but are far from it.

But if you’re curious and you want a bit more, you peel back the curtain, you get to know a few people, you put the pieces together, and you realize…

There are two Americas. The one they tell you about, and then the real one, the true underbelly of this country.

And if you watch “House of Cards,” you’ll learn more lessons than in a year of college.

And if you watch “Narcos,” you’ll suddenly become aware of the possibilities. Of not only career and wealth, but life. We’re so inured to the way it is, our creature comforts, our safety, that we’re rarely alive. See the images from the streets of Colombia in “Narcos” and your heart will start to beat, you’ll see that everything is up for grabs, and the truth is the sands are constantly shifting, you feel safe, but you’re not.

But not everybody wants to be part of the action. Many are observers.

Well, it’s never been a better time to watch. Because those in the visual industries are testing limits. Forget the talentless YouTube stars. They’re not where the action is. Look to scripted series. Look to what’s on pay outlets, where there are no commercials but quality product. There you will find insight, stimulation and knowledge.

Want to get everybody to pay for streaming music services?

Create content as good as Netflix’s, cutting edge stuff you can’t live without. That which you did not think you needed, but now hold dear.

It’s an amazing time to be alive.