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Let’s talk about music. Sure, I know “writing about music is like dancing about architecture”, but it’s fun nonetheless. Every article I read telling me that they’re struggling only makes me feel less bad for them. Industries change and businesses need to change with them. The choices are hold on to an outdated business model and die or evolve and survive (note I didn’t include sue customers as an option).
Anyway, the latest round of articles on the music industry’s woes has much to do with Prince’s latest move. Rather than releasing his album in stores, he made a deal with the Mail on Sunday in England to give away nearly 3 million copies of his new album with the paper. According to the Guardian, “Prince is estimated to be being paid between Ã‚Â£250,000 and Ã‚Â£300,000 by the newspaper, a far greater sum than he would receive as an advance from a record company.”
Of course, this makes the record stores and industry none-too-happy as evidenced by a quote from Paul Quirk, co-chairman of Britain’s Entertainment Retailers Association: “The Artist Formerly Known as Prince should know that with behavior like this he will soon be the Artist Formerly Available in Record Stores.” (Zing!) Funny enough, it’s Fake Steve Jobs who put it about as succinctly as I’ve seen:
Here’s the back story. The music companies are in a dying business, and they know it. Sure, they act all cool because they hang around with rock stars. But beneath all the glamour these guys are actually operating two very low-tech businesses. One is a form of loan-sharking: they put up money to make records, then force recording artists to pay the money back with exorbitant interest. The other business is distribution. TheyÃ¢â‚¬â„¢ve got big warehouses and they control the shipment of little plastic boxes that happen to have music in them.
Neither of those businesses are particularly relevant in today’s digital age. But that doesn’t mean they’re not still trying to make it happen. A recent Economist article mentions “360 degree contract”: “Instead of settling for a cut of CD sales, they increasingly offer artists broader contracts that encompass live music, merchandise and endorsement deals. Such deals, also known as multiple-rights or all-rights contracts, are particularly important in regions with rampant CD piracy, such as Africa, Asia and Latin America.” Not surprisingly, many artists are reluctant to sign deals like this.
I wish I had some incredible insight into how to fix this problem, but at the moment I don’t. What I do know, however, is that there’s got to be an answer. I also think this is an incredibly good case study in resistance to change. How long before the music industry realizes the world has passed them by and they take off the blindfold? People are out there doing clever things. Apparently RCRD LBL is going to seek out sponsorship/marketing deals as part of it’s association with Downtown Records. Or take a look at what Canadian folk-pop singer Jane Siberry has done: “she has a Ã¢â‚¬Å“pay what you canÃ¢â‚¬? policy with her downloadable songs, so fans can download them free Ã¢â‚¬â€ but her site also shows the average price her customers have paid for each track. This subtly creates a community standard, a generalized awareness of how much people think each track is really worth. The result? The average price is as much as $1.30 a track, more than her fans would pay at iTunes.”
There was a pretty good idea in this Slate article from a few years ago: “What we need is a system that will continue to pack the corporate coffers yet be fair to music lovers. The solution: a real-time commodities market that combines aspects of Apple’s iTunes, Nasdaq, the Chicago Mercantile Exchange, Priceline, and eBay.” All these require evolution of the current model, however, and the industry doesn’t seem so down on that.
So as not to throw out a lot of problems without any solutions, I turn the table to all of you (and myself . . . I will give it more thought): What would you do to fix music?