The Warner Stock Drop

Now the financial community thinks the labels suck too.

The public has known it for years. Ever since Tommy Mottola rammed his high concept crap down our throats in the nineties. That’s what the business became. One note "superstars", who either rapped about bitches and ho’s or believed melisma was the highest form of vocalization. What’s worse, the albums contained were made up of filler rivaling that of the pre-Beatle days, when it was truly a singles business. Only one problem! You couldn’t buy the single! Ha! Fuck you customer!

Until Napster and CD burning, when the public took the music business back.

How could people do this? Didn’t they know that music was a controlled environment? That it couldn’t exist without major labels run by titans? You’d think Warner, et al, had a deal with Guitar Center, disallowing purchases unless you had a deal. But this was and is untrue. Anybody can make music. And now, more than ever before in the modern era, they don’t want to make it for a major label.

Many people believe the owners are not going to fix radio. They’re just gonna consolidate and add commercials, withdrawing cash until nobody listens anymore and the stations have been devalued to next to nothing. But the head honchos at labels are not that cynical. They believe they can pull a rabbit out of the hat. Rather than cutting new music production and blowing out their catalogs, they’re making like it’s 1996, and one of these evanescent no-talents is gonna sell ten million copies of his vapid album.

Yup, they truly believe. It’s astounding the crap being thrown by the major labels. We’ve just got to stop P2P. Digital’s gonna replace discs. It’s kinda like the Administration and Iraq, EVERYTHING they’ve said is wrong, exactly the opposite, in fact.

Let’s start with the fallacy that without them, there will be no music. That if people don’t pay for music, people will stop making it. But instrument sales are through the roof. Seemingly everybody’s making music. And everybody can record it in GarageBand, if not Pro Tools. And distribute it on MySpace. Oh, all of this is for free, but it can be done! What is the labels’ answer to this?

Buy a disc. It’s of higher quality.

But they only know how to sell the discs of people with Top Forty hits. And Top Forty is airheads and rappers. Stuff MOST people ARE NOT INTERESTED IN!

Think about this. They’re trying to sustain their business by selling narrowcasted crap in a world where you can steal all of these wares instantly on the Net. Talk about a failed strategy!

And now the Street knows it. As represented by the stock of Warner Music. EMI? It was so bad, they had to blow it out to private equity. People know there’s no future in recorded music, because the labels MADE IT SO! Rather than stroking their chins and trying to figure out the new world, they’re just repeating what they used to do in the now gone twentieth century. It would be as if Smith Corona was telling everybody the typewriter was gonna make a comeback.

But lately, the labels haven’t even been saying THIS! They’re shrugging their shoulders and stating that music is a bad business, and they need a piece of management/touring. Huh? Isn’t that like GM saying they need a piece of Exxon Mobil?

Gasoline works fine in Toyotas. People don’t have to listen to major label releases. You can’t get a gig only if you have a major label deal. Actually, many of the new touring bands are making it without a major label! Their fans are happier, and whatever music they can sell…they get to keep the lion’s share and NOBODY TELLS THEM WHAT TO DO!

What do we need the major labels for if they can’t sell music?

It’s not like we’ve got a dearth of managers, and we need the wisdom of the majors. It’s not like so much of today’s music can get on the radio, where labels have their relationships. As for TV? TV kills acts! Ask everybody from Buck Owens to Vanilla Ice. Buck felt his appearances on "Hee-Haw" made it so nobody took him seriously, it was in all the obits. Vanilla Ice? All he’s got is TV, making appearances based on his coming out of the backwoods/where is he now factor.

And it’s not like labels can HELP with touring. They’re not licensed agents, and they’re not interested in careers. And there are plenty of merch companies out there.

What CAN the major labels provide? MONEY! That’s all! But the deal is so heinous, that many musicians now say no. Not only the newbies, but the stars, who can get paid from Starbucks to newspapers.

The labels can double-talk all they want, but their only solution is to figure out a way to get paid for music. That’s their business. But they’ve devalued music, and refused to license just about anybody with a reasonable digital distribution model. So, until they can figure out a way to monetize the way people now get music, from their friends, they’re fucked. And no amount of spin can help them.

Music Needs To Be Paid For

It’s all fine and dandy that labels now want a piece of touring and merch, utilizing Sanctuary’s "famed" 360 model. But what if you’re a songwriter? What if you don’t tour? THEN WHAT?

Don’t tell these people to go it alone. To get a MySpace page and generate friends. They can’t monetize their efforts. BECAUSE OF THE MAJOR LABELS!

People need to pay for music. And the major labels have done their best, through shortsightedness, through ineptitude, to assure the contrary.

Looking out for the artists? Insuring that great music is produced in the future? That’s all hogwash, the inane ravings of fat cats fearful they’re going to lose their cash cow, CD sales.

CD sales are going to continue to deflate. And it’s got very little to do with file-trading, and a lot to do with iPod penetration. Seems that once someone gets a hand-held device, he no longer has a need for the disc. It’s incongruous. I buy this to employ it once? To get the tracks onto my computer? And prices at the iTunes Store are equivalent to those for CDs, unless maybe you buy the complete album, but most people don’t want the complete album. So you’re paying a buck a track for LESS than what you used to get. Shitty sound, impermanent format, and no packaging. That’s not a deal, that’s an impulse item.

The business got people to replace their vinyl and cassette collections with CDs because the plastic discs were perceived to be better, and a cost premium could be charged for this. NO ONE believes AACs/MP3s/WMAs are better. They’re just convenient.

But stealing an MP3 is like stealing a couch!

No Lars. It’s just a bunch of replaceable bits. That can be replenished at will. Assuming the cost of replacement is de minimis.

People should pay less for less. The key is to lower file prices and sell more. Not only BECAUSE the price is lower, but because you can only buy in bulk. Via some form of subscription.

I’m not talking rental here. I’m talking a file-trading fee. Some kind of LARGE commitment for music access.

And the funny thing about it is, as broadband speeds increase, and the price of storage drops, we can sell these same people the same music all over again, AT A HIGHER QUALITY!

Who gives a shit if you trash all your iTunes files if they didn’t cost you as much as CDs. CDs were theoretically forever, the medium of record. The file is evanescent. Ever try to open a Microsoft Word document from 1986 in today’s Office? You wouldn’t even think of it, and can’t, because you don’t have the original floppy disc it was stored on!

People hoarding MP3s? That’s like hoarding M&M’s. They’re cheap, plentiful, you can always replace them, you want a new bag, with the BLUE ONES!

The way to encourage quality composition, recording and distribution is to get people to pay for music. Suing traders didn’t stop P2P, it’s still increasing.

Online music piracy hits record levels

The iTunes Store has sold 3 billion tracks in more than four years. That’s like 300 million albums. Or less than 1 billion dollars a year. That’s truly a drop in the bucket. That’s not a solution.

Nor is rental today.

Tomorrow? There’s a very good chance people won’t want to own their music, if they can get it delivered instantly, for a low price.

But what about TODAY? What about the seven years since Napster? What about the lack of a solution? What about failed strategies?

Blame the labels. They could have sold music to the people the way they consumed it, BUT THEY DIDN’T WANT TO! And people had options, P2P and disc-burning. And you can’t kill these processes unless you’re about to monitor everybody’s IM’s. And THAT’S not gonna fly in Washington, D.C.

So if you’re Steely Dan today, you’ve got to break up, you’ve got to get a day job.

Steely Dan didn’t tour after "Countdown To Ecstasy". But some of their biggest hits, and some of their most rewarding work, including the legendary "Aja", came AFTER that. The reason they didn’t need to tour? RECORD SALES! We’re gonna take that out of the equation? We’re going to make people go on the road to make a living in music?

That’s fucked up.

The exec can turn his operation into a marketing company. The songwriter…can count on BMI or ASCAP and the occasional license. But he’s throwing away most of his income, mechanical royalties. Did he want to give these up? No, the label FORCED HIM TO!

If Napster had been licensed, writers would have been paid for every trade. As would have labels. And acts.

But they’re not. Because bullies who believe they can win through sheer intimidation, that they can rig the game in their favor, wouldn’t acknowledge that people wanted their music in a new way, and that we live in a land of transparency.

It’s not too late. Issue a file-trading license. Or charge at the ISP level. A good portion of the public will pay voluntarily, to avoid being sued.

And those who still want CDs? Well, I hope they’ll be able to find a place to buy them. God, the inventory online eclipses EVERY store. You can find OUT OF PRINT stuff online. This is bad?

According to the labels.

It’s like we’re living in a third world country, ruled by iron-fisted fascists, whose way of dealing with public unrest is through force and violence. Yup, a college student getting sued for file-trading faces violent upheaval in his life. But the copyright bullies don’t care. But those copyright bullies won’t continue to rule. How do I know? Because they’ve been cutting off their nose to spite their face. Trying to get everybody to pay CD prices, they’ve made music free. Good business model guys! Great way to incentivize your raw materials, writers and players. Yup, labels are NOTHING without composers and musicians. But they don’t seem to know this. Certainly the execs’ behavior evidences a belief that THEY’RE first. Whereas we all know the music comes first. Oh, the execs pay lip service. But it’s like Mafia Don going to church. It’s worthless.

Just Roll Tape

The two biggest releases for Christmas 1970 were George Harrison’s "All Things Must Pass" and "Stephen Stills". That’s how big the southern balladeer was back then, a superstar. Over time he squandered his capital. Oh, he came back eventually, in 1977, with a CSN reunion. But it’s funny how Neil Young is seen as a legendary iconoclast, and Stephen Stills has almost been forgotten.

They don’t come any more difficult than Neil Young. But somehow Stephen Stills is seen as the asshole. Even though it was Neil who canceled their joint tour in ’76 with a telegram.

Sure, Neil’s gone on to reinvent himself a number of times. And for this he gets, and deserves, our respect. But that doesn’t mean Stephen has to be forgotten. Playing "Just Roll Tape" will illustrate why he should be remembered.

You’ll dial it up to hear demo takes of "Suite: Judy Blue Eyes" and "Wooden Ships", but it’s the opening track, the almost unheard "All I Know Is What You Tell Me", that will make an impression. It’s like discovering a Dead Sea Scroll. That exact magic that riveted you so three and a half decades ago, you’re still susceptible, you still desire another hit.

Funny thing, one’s first listen to "Just Roll Tape" is a bit of a disappointment. You know the slick studio takes so well, that the original demos pale in comparison. But as you listen, you warm up to them, you re-enter a past phase of your life, when you still had your youthful dreams. Right after Kent State and before disillusionment set in. From which we only recovered briefly, in the nineties, during the booming economy. Still, these takes pre-date those days, by a couple of years, they were cut in ’68. But we forever date these tracks to the time of their public release.

I don’t know if a teenager will understand "Just Roll Tape". It’s rough. Just a young bluesman and his guitar. Akin to Robert Johnson on that double CD package. Yes, there’s an essence here. This is the music that changed a million lives, even more than that of Mr. Young. Or at least accompanied one’s losing one’s virginity, graduating from college and facing the big bad world. We had confidence on the outside, but inside, we were a bundle of nerves, we were confused, we relied on our music to keep us together. Stephen Stills kept us together.

All these years later, that solo debut is just shy of a masterpiece, with some of Jimi’s last playing. So, the single, "Love The One You’re With" wasn’t as good as "Suite: Judy Blue Eyes" or "Carry On". "Black Queen" had the darkness of the era, it’s a quintessential album track from when you skipped the single and ONLY played the cuts not featured on the radio.

"Black Queen" is here. In a take you’d hear an unknown musician working out in a bar while you were quaffing a beer in the middle of nowhere. This guy is going to make it, you just don’t know yet.

We didn’t know Stephen Stills was going to make it. "For What It’s Worth" was an anthem, but Buffalo Springfield was a faceless band, we didn’t know who was in it until AFTER the CSN explosion.

It’s just amazing how many of these tracks were written years before their commercial release. "Change Partners", from "Stephen Stills 2". "So Begins The Task" from MANASSAS!

That was the pinnacle. When not enough people were paying attention anymore. That double record set, with a band containing Chris Hillman and Al Perkins, if that band were on the road today…

Well, most people wouldn’t care. Unless they were dedicated fans. And that’s all that’s left, dedicated fans. Who need to own "Just Roll Tape", if they can find out it exists. They need to own this to prove to themselves it wasn’t just nostalgia, the music of those days of yore was as innovative and vital as they remember it.

But, if "Just Roll Tape" had been released back then, at the height of CSN mania, it would have gone platinum. That’s how big a star Stephen Stills was.

And I guess the lesson is one of transparency. Don’t hold back, don’t only release what’s marketable, salable. At the height of one’s fame, the public wants EVERYTHING you do. Then again, too many of today’s "musicians" don’t do much…

Go to StephenStills.com The player starts straight up with "All I Know Is What You Tell Me". Turn it up. It won’t bother the neighbors. It’s wooden music.

And maybe you want to fast-forward to hear the classics (you can do this by dragging the slider to the end in any tune, it brings you to the next), but when you start from the top again, and hear the "new" track, you’ll suddenly be in the groove, you’ll feel at home, you’ll tell yourself this is where you once belonged.

Catalogue Chart Factoids

Clive Davis/Arista/J/RCA albums in the Top 200:

#6 – Kelly Clarkson "Breakaway" – 5,813,208

#177 – Barry Manilow "Ultimate Manilow" – 2,069,502

Oh, do you want to credit him with Maroon 5? I’m not down with that, but if you throw that in we’ve got a grand total of 3 continuous sellers in the history of SoundScan. And you wonder why the business is fucked. Keep chasing those singles!

Rap Albums in the Top 200:

#92 – Bone Thugs-N-Harmony "Greatest Hits" – 779,828

#120 – 50 Cent "Get Rich Or Die Tryin’" – 7,692,252

#170 – Beastie Boys "License To Ill" – 5,213,423

#171 – 50 Cent "Massacre" – 5,100,068

Guess they won’t be playing rap at weddings in the twenty teens. At least not by acts of the past.
If Eminem put out an album today the only people who would really care are those in the media.

Christian acts in the Top 200 that you’ve never heard of:

#64 – Casting Crowns "Lifesong" – 636,192

#165 – Mercy Me "Almost There" – 1,352,476

So, in the eyes of Wall Street, should Christian music labels be worth more than rap labels?

Biggest selling album in the Top 200:

#13 – Metallica "Metallica (Black Album)" – 14,962,918

Guess they’re just a great album away from a comeback. And is the new record, produced by Rick Rubin, gonna be it? Can they finally leave the Napster fiasco behind?

Meanwhile, "…And Justice For All" has sold 5,013,393.

As for "Dark Side Of The Moon"? It had the injustice of being released prior to the SoundScan era. But it’s moved another 8,165,843 copies in the modern, almost twenty year old era. And "The Wall" and "Wish You Were Here" are on this chart too.

Why Usher is in the gossip pages:

#65 – "Confessions" – 9,420,016

Turns out a lot of people do care whether he marries the mother of his baby.

As for the label… Do we credit L.A. Reid or Clive Davis? Clive made the deal, but L.A. made the record. Mmm… Then again, did Clive have anything to do with L.A. losing his job, after succeeding him at Arista?

That’s for back room rumor-mongering. All we know is, L.A.’s quieter than Clive, but seems to have just as good a track record, if not better. Then again, not a single Mariah Carey album is in this Top 200 Catalogue Chart, not even the one containing the "song of the summer" from two short years ago. Guess we don’t belong together.

Number one:

Tim McGraw "Greatest Hits" – 5,612,149

Other country records on the chart:

#24 – Rascal Flatts "Feels Like Today" – 4,867,722

#26 – Jason Aldean "Jason Aldean" – 1,033,529

#44 – Toby Keith " Greatest Hits 2" – 3,545,134

#47 – Kenny Chesney "Greatest Hits" – 3,596,403

#53 – George Strait "50 Number Ones" – 3,009,584

#54 – Martina McBride "Greatest Hits" – 2,994,097

#56 – Sugarland "Twice The Speed Of Life" – 2,371,251

#61 – LeAnn Rimes "Greatest Hits" – 1,022,620

#73 – Alan Jackson "Greatest Hits 2" – 1,519,081

#80 – Shania Twain "Greatest Hits" – 3,636,743

#93 – Hank Williams, Jr. " Greatest Hits, Vol. 1" – 2,504,759

And another ten in the bottom 100.
So I ask you, Madison Avenue, do we live in a HIP-HOP nation or a COUNTRY nation?

Only act with two records in the Top Ten:

#2 – Michael Buble "It’s Time" – 2,457,811

#10 – Michael Buble "Michael Buble" 1,800,648

One good thing about music, when it hits you feel no pain:

#17 – Bob Marley & the Wailers "Legend" – 9,195,798

Fat-bottomed girls dancing to a bohemian rhapsody:

#23 – Queen "Greatest Hits" – 6,177,044

All you need to own to go to the show:

#67 – Jimmy Buffett "Songs You Know By Heart" – 6,11,082

How did that old Bette Midler tune go…you’ve got to have friends? No, you’ve got to have fans. Friends are people looking to use and abuse you on MySpace as they climb the ladder to nowhere, forgetting you along the way. Fans stay with you forever. What Letterman says about Oprah could also apply to Jimmy Buffett… "He’s got ALL the money!"

Not really gone, certainly not forgotten:

#81 – Doobie Brothers "Greatest Hits" – 2,069,457

People remember their time on Toulouse Street, they still want to listen to the music.

The Doobies’ last album of original material, "Sibling Rivalry", was actually good. If it had been today rather than the turn of the century, they would have given the CD away free with the AARP magazine and further invigorated their live business.