The end is coming.<\/p>\n
Somehow, with the crash of the dot com era, the major labels thought they were safe.\u00c2\u00a0 The sky didn’t fall with Napster, and therefore they felt it never would.<\/p>\n
How many years have we heard about digital cameras replacing film ones?\u00c2\u00a0 Must be at least fifteen.\u00c2\u00a0 Turns out Konica Minolta wasn’t prepared.\u00c2\u00a0 Sure, they put out the Dimage digital cameras, but their business also encompassed film, and development laboratories, and suddenly those and the cameras used to shoot film had almost no demand.\u00c2\u00a0 They cut the plug.<\/p>\n
Oh, it’s not an anomaly.\u00c2\u00a0 Last week NIKON said it was ceasing the production of film cameras.<\/p>\n
I ask you, WHAT is the music industry doing to prepare for the INEVITABLE death of the CD.\u00c2\u00a0 And, in addition, WHAT is it doing to prepare for new paradigms of acquisition and usage?<\/p>\n
Last night I spoke at a class at Loyola Marymount University.\u00c2\u00a0 I asked TWO people in the front row how many tracks they had in their iTunes libraries.\u00c2\u00a0 One girl said 5,000 another said 4,000.\u00c2\u00a0 Considering there to be ten tracks on a CD, that’s the equivalent of 500 and 400 discs.\u00c2\u00a0 I ask you.\u00c2\u00a0 When YOU went to college did ANYBODY have that many CDs\/vinyl records?\u00c2\u00a0 NO FUCKING WAY!\u00c2\u00a0 Because they COULDN’T AFFORD THEM!\u00c2\u00a0 In my day, if you had a collection of 20 albums, you had a reasonably-sized collection.\u00c2\u00a0 Can you imagine someone with TWO HUNDRED TRACKS in their iTunes library saying they’re a big music fan?<\/p>\n
But the record labels will point to subscription.\u00c2\u00a0 Rental.<\/p>\n
But Napster only has 500,000 subscribers.\u00c2\u00a0 And Rhapsody a million.\u00c2\u00a0 When Apple sold FOURTEEN MILLION incompatible iPods.\u00c2\u00a0 Now really, if people thought rental\/subscription was so attractive, wouldn’t they be signing up for these two services and purchasing compatible players?<\/p>\n
Maybe it’s like everything else tech.\u00c2\u00a0 Timing is key.<\/p>\n
But, timing is crippled by licensing issues.\u00c2\u00a0 Despite the vast plethora of material on Napster and Rhapsody many people won’t sign up because of WHAT’S NOT THERE!\u00c2\u00a0 In an era where all your personal information is available on the Web, where you can Google potential dates, where you can find out information from the arcane to the worldly instantly, not only can you not get Led Zeppelin and the Beatles, you can’t get many obscure tracks from the past, nor key tracks on albums they DO make available.\u00c2\u00a0 Because somehow the labels still want you to buy the CD.\u00c2\u00a0 Shit, how backward can you BE?<\/p>\n
But it’s not important to analyze the rental subscription services.\u00c2\u00a0 It’s important to look at the parallel acquisition market.\u00c2\u00a0 P2P.\u00c2\u00a0 Sneakernet ripping.\u00c2\u00a0 Hard drive swapping.\u00c2\u00a0 IM.\u00c2\u00a0 There’s no way in HELL that these can be stopped.\u00c2\u00a0 They’re becoming EASIER!\u00c2\u00a0 What is the major labels’ answer?\u00c2\u00a0 Lawsuits and copy-protected discs.\u00c2\u00a0 File-trading has INCREASED in the lawsuit era.\u00c2\u00a0 And talk to Sony BMG about copy-protected discs.\u00c2\u00a0 THAT was a good idea…<\/p>\n
But it’s worse.\u00c2\u00a0 The major labels’ paradigm is based on MTV and terrestrial radio exposure.\u00c2\u00a0 And MTV plays no music and terrestrial radio’s listenership is declining while they play fewer and fewer songs.\u00c2\u00a0 People are now exposed to music on the INTERNET and satellite radio.\u00c2\u00a0 So what do the major labels do?\u00c2\u00a0 Try to stop Internet radio and ask for more money from satellite.\u00c2\u00a0 Talk about shooting yourself in the foot.<\/p>\n
Let’s say you’re a FAN of a major label band.<\/p>\n
You can’t put their music on YOUR Website.\u00c2\u00a0 You don’t have PERMISSION!<\/p>\n
But new era acts say P2P is fine, put the songs ANYWHERE, because they know this is now how you get the word out.\u00c2\u00a0 That the odds of music being heard the traditional way is low.\u00c2\u00a0 And you have articles like "The Long Tail" saying that selling of less than platinum material is VERY profitable, that there’s a demand for EVERYTHING!<\/p>\n
But the majors sign fewer and fewer acts.\u00c2\u00a0 And tightly control distribution of said acts.\u00c2\u00a0 When, if they were smart, they would be signing EVERY ACT!\u00c2\u00a0 Yes, all those acts putting out records themselves, they should have a major label deal.\u00c2\u00a0 But the majors won’t do this.\u00c2\u00a0 Because they’d have to change their contracts.\u00c2\u00a0 To pay less in advance and give more in return upon sales.\u00c2\u00a0 And THIS ISN’T HOW THEY DO IT!\u00c2\u00a0 So they keep signing wannabe superstars for big bucks and spend a fortune marketing them.\u00c2\u00a0 Talk to a major label A&R guy.\u00c2\u00a0 He signs almost nothing and he wants it to go gold IMMEDIATELY!\u00c2\u00a0 And, if something only sells a couple of hundred thousand copies, IT’S DROPPED!\u00c2\u00a0 That’s the FUTURE!\u00c2\u00a0 In the future, 200,000 copies will be BEYOND respectable!\u00c2\u00a0 And they’re ceding the business to NEW OPERATORS!<\/p>\n
Don’t tell me about the iTunes Music Store.\u00c2\u00a0 If that CD replacement paradigm worked, those two students at Loyola Marymount would have paid $5,000 and $4,000 to put music on their computers.\u00c2\u00a0 Yeah, that’s gonna happen.<\/p>\n
We’ve been talking for YEARS about the major labels’ war on P2P.\u00c2\u00a0 But that’s been the wrong perspective.\u00c2\u00a0 It SHOULD be the Internet’s war on the major labels’ business model.<\/p>\n
The tide has been turned.\u00c2\u00a0 The major labels have started to slide into irrelevancy and marginalization.\u00c2\u00a0 They’re irrelevant because in trying to placate what they believe to be the mainstream, they’re creating blander and more irrelevant two-dimensional crap that most people can’t relate to.\u00c2\u00a0 And they’re becoming marginalized because they’re not selling their wares in a way the public wants to consume them.<\/p>\n
I see no indication that the majors are changing course.<\/p>\n
It’s utterly astounding.\u00c2\u00a0 They’re running their business into the ground.<\/p>\n
It may already be too late.\u00c2\u00a0 They’ve allowed upstarts to get a toehold.\u00c2\u00a0 True fans now believe if it’s on a major label it sucks, only indie stuff is good.\u00c2\u00a0 The mainstream press respects indie stuff.\u00c2\u00a0 Indies use the new marketing tools.\u00c2\u00a0 Majors try to put a drag on new systems.\u00c2\u00a0 The majors are heading towards becoming licensing houses.\u00c2\u00a0 Sure, there will be a demand for their catalog, but their new music departments…\u00c2\u00a0 They may only survive to purvey mainstream tripe.\u00c2\u00a0 Even Sears became marginalized, downsized and finally had to sell out.<\/p>\n
Isn’t ANYBODY in the rarefied air of the major label executive suite aware of this movie?\u00c2\u00a0 It’s not like they don’t have a projector.\u00c2\u00a0 It’s called a computer screen.\u00c2\u00a0 Just forgo lunch and turn it on.\u00c2\u00a0 You’ll be horrified and excited.\u00c2\u00a0 THAT’S why you should download P2P and swap hard drives and read pitchforkmedia.com.\u00c2\u00a0 Because you’ll see how the rest of the world thinks and acts.\u00c2\u00a0 And hopefully realize YOU’RE COMPLETELY OUT OF TOUCH AND YOUR BUSINESS IS THREATENED!<\/p>\n
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