Here are some questions:

  • Is there a future for the business of selling recorded music?

  • What is the right business structure for a band?

  • How should concert tickets be sold?

  • Is the natural unit of music consumption a song, an album, or a mix?

  • What kind of relationship should musicians and music-lovers expect to have with each other?

I tried to tear this essay into fragments of a more digestible size, but failed; sorry ’bout that.

Context: For four decades now I’ve loved music deeply; had I any real talent, I’d have long since abandoned the technology trade in its favor. My tastes cover lots of the great river-delta waterfront of music, but lie mostly in the mainstream of each of those many channels. I depart from the average in preferring the raw to the cooked, the spontaneous to the rehearsed, in caring a lot about audio quality, and being an unreformed child of the Seventies. Which will prejudice this discourse; you’ve been warned.

Paying For Music · How many ways are there? Here are the ones I can think of:

  • Purchase a recording. Does it matter whether delivery is on a disk or over a wire? I think not.

  • Buy a ticket for a performance.

  • Subscribe to a provider of music.

  • Listen to commercial ad-supported radio; which means you’re paying with your attention.

  • Become a patron, in the traditional sense.

Let’s walk through these for context then return to those questions up above.

Recorded Music · Here’s the problem, and I apologize for cliché-wielding, but the following remains true: Information wants to be free.

The facts are these: people very much enjoy music, and the cost of copying it is about zero, and giving others pleasure is always a good thing, particularly when you can give something and still have it. Given these facts, music will be widely copied and distributed.

The legions of lawyers and legislators and lobbyists may even really believe that what they’re doing is sane, but in fact the legal notion of “property” has long since ceased to have utility in the context of interchanging of musical recordings.

Legislation aimed at controlling the manner in which friends exchange music has approximately the same future as that which tries to govern what lovers do with each others’ bodies behind closed doors.

Having said that, content is a service business. There are a lot of people out there like me who, because we have more money than time, or because we like listening to whole albums, or because we value audio quality, or because we like hanging out in music stores listening to what the pimply kid behind the counter is playing, will go on buying recordings.

Every time someone figures out how to make it simpler and quicker and cheaper to buy, more people will. It doesn’t have to be (and shouldn’t be) anything like the status quo, in which silver disks are manufactured at a cost of pennies and sold for ten to twenty dollars, the vast majority of that money consumed by the sprawling and deeply corrupt music business. Do some smart disintermediation and there is a huge amount of room for slashing the cost of music while routing more money to those who actually, you know, make it.

So I don’t think the recorded-music business need die; although its current intermediaries deserve to, even as their pathetic and terribly expensive legal flailings increasingly come to look like a bad joke in the rear-view mirror.

Me, I still buy recordings, both on shiny disks (most recently Potato Hole) and via the Net, and I don’t see any reason to stop doing this.

The Concert Experience · It can’t be bootlegged because it can’t be reproduced. There will always be a place for live recordings, but nothing can replace the shared experience of a great musician taking the existential risk of walking on stage and committing to entertain for a few score minutes.

That said, anyone who actually loves popular-music concerts knows that, at least in North America, there is a malignant cancer eating away both at the musicians and their fans, and it’s called Ticketmaster/Live Nation.

This problem is urgent because we can’t afford to be blowing up and re-creating the recorded-music business while we simultaneously tolerate this gigantic multi-tentacled leech sucking the blood and profits from the vital business of touring.

Subscriptions · This is the slice of the music business that I would personally most like to see succeed. It’s so simple and easy to understand: you pay a monthly bill in exchange for which some party engages to supply you with enough musical pleasure to make you keep paying the monthly bill.

The parties offering subscriptions could be primary producers (i.e. musicians) or aggregators; I’m thinking everything from XM radio to an Internet-based streaming music service.

I’ve been trying this myself, and the results are mixed.

Being an Internet kind of guy, I’d prefer to disintermediate and deal direct with the artist. And recently some website I hit pitched me on subscribing to U2. I know that Nick Hornby says that after the revolution they’re one of the first bands up against the wall, but I like ’em, I can’t help it; mostly that guitar sound, and the one time I saw them the performance was great.

I checked it out: they wanted $50/year to become a member of U2.com. I knew the band was coming to Vancouver in October (this is back in April) and thought getting a better angle on that might be worth it.

So I signed up, and it sucks; unless something changes, I won’t be re-upping. What did I get? A 2-CD package called Medium, Rare & Unreleased and yeah, it’s got some good tunes, but $50 is pricey. I also have a login that gives me a slightly different view of the U2.com site, with advance looks at some concert videos. I also could have watched the Aug. 20th Sheffield concert streamed live, but I was busy. Also, if I wanted to I could move my email to timbray@u2.com, but don’t hold your breath.

What I was hoping for was an advance shot at Vancouver-show tickets, but when I hit that part of the site in April, the pre-sales for the late-October show were gone.

U2.com had a buy-tickets link, but that just led me to Ticketmaster Hell; only singles available, and at a price of C$250. Bah.

On a more pleasant note, I’m a serious fan of Patricia Barber. Here’s how serious: In early August, I spent some airline miles to fly down to Chicago and catch her regular Monday-evening gig at the Green Mill; the second time I’ve been there in the last couple of years. I’ve written here before about her, and praised her Web site, which is responsive and intelligent.

I’m on her mailing list too, and in June I got a nice, chatty email talking about how good the Green Mill had been to her over the years, and announcing that she’s going to start selling downloads from her site, starting with a live Green Mill set from 2006. Fifty minutes of music, $9.99 for MP3 or $12.99 for FLAC. I bought it (FLAC of course) and it’s just absolutely delicious.

Ms Barber’s business approach is a little weird. Start with this: at the Green Mill, there’s a $7 cover charge and the drinks are pretty cheap. The whole front of the room is packed with out-of-town fans including lots of Europeans and Asians, who, it would seem, like me got on a plane and came a long way just to be there. I think the Green Mill could up the prices quite a bit and the people would still go away happy.

If she could commit to doing two or three downloads a year and the occasional letter about what’s going on, I’d subscribe in a flash.

Radio · I like radio. I like finding a station that plays good music for me that I don’t know. I’d prefer not to pay for it so I don’t mind listening to some ads and hey, we all gotta buy stuff so the ads might even be useful.

The problem is, most radio is terrible; vapid hardwired playlists aimed at reducing risk to zero, and on-air personalities aimed at the militant-airhead demographic.

Never ascribe to malice that which can be explained by incompetence. I would still like to believe that there is room for quality pop-music radio, given some management brains and innovation.

In Vancouver, as in most places I suppose, there is intermittently a radio station that is good for a while (currently The Peak), but it usually doesn’t last.

Patronage · Don’t be too quick to diss it, patronage was good enough for more or less every musician between J.S. Bach and Richard Wagner inclusive. And people are trying to innovate in this space.

I’ve written before about Maria Schneider and her Net-centric business model. I don’t subscribe, but I’m on the mailing list, and the other day I was invited to become a patron of the arts, via The Commision (sic) Project; $2500 buys you a bunch of benefits that I think would make the heart of a serious Schneider fan go pitter-pat. I’m not one of those, but I wonder how this will work out. The model doesn’t seem very scalable to me, but who knows?


Now, those questions I opened with deserve some answers. Here are mine.

Is there a future for the business of selling recorded music? · Yes, but not for the current so-called music business.

What is the right business structure for a band? · A central thrust of the industry has always been to inflict business rape on musicians; Courtney Love’s brilliant rant from 2000 is a good place to start getting the picture.

It’s simple: The right business structure for a band is to be a business. Thus, I’m been paying close attention to the “Polyphonic” project, which is aimed at trying to move in this direction. The New York Times covered this back in July and it’s worth watching Terry McBride’s blog; he’s one of the Polyphonic principals.

How should concert tickets be sold? · Not by Ticketmaster/Live Nation. The facts of the matter were laid out in nauseating detail in The Price of the Ticket, a terrific piece by John Seabrook in the New Yorker. You have to pay to read it, but yep, ticket sales are in the grip of an exploitative monopoly, and some smart politicians ought to get together and rip it to quivering shreds starting tomorrow.

Is the natural unit of music consumption a song, an album, or a mix? · Both; but let’s take this together with the next question.

What kind of relationship should musicians and music-lovers expect to have with each other? · See the previous question. There are some musicians I care enough about to respect their feelings about how songs should be sequenced; not coincidentally, they are the same ones I’m apt to subscribe to. It’s a win-win for those musicians and me to have a direct business relationship.

On the other hand, there are other musicians who put out a great song now and then but I don’t really have a “fan” connection to. In which case my relationship with them needs some sort of intermediary or aggregator.

Now, this is a vexed question, especially since Radiohead’s Thom Yorke has recently decreed that “None of us wants to go into that creative hoo-ha of a long-play record again” — also read Emily Bobrow and friends on the issue.

I think Thom will probably feel the urge to crank out another album or two before he’s done with music; as with writing, long-form and short-form both have their places. Elvis Costello’s Mystery Dance doesn’t need to be a second longer, and Brahms’ Variations on a Theme of Haydn needs every one of its ten parts and twenty or so minutes.

The Future · I think there’s scope to build a few outstandingly great music business models even while we’re still engaged in dynamiting the pathetic failures we have now.



Contributions

Comment feed for ongoing:Comments feed

From: JulesLt (Sep 06 2009, at 04:01)

It's something that occupies my mind, too, as most of the answers people suggest strike me as trite, or failing to grapple with the problem.

i.e. people like me and you will continue to buy physical recordings, but we do not represent a real long term model - we're a way to defer engaging with the digital revolution.

I do rather loathe the stupid maths than engages in dividing by zero - ignoring the fact that this is a good sign you have your sums wrong, or in fact have completely the wrong picture - that giving away things that cost to produce, for free, is called promotion, and belongs in the costs column.

Free is not a business revolution, although it is causing one.

Some further thoughts :

The reason the major labels have power is because they really can promote and sell music. That is why, as an artist, you give up the 50/50 profit share you might have with an independent, or 100% as a DIY, and instead take a far smaller share of global millions.

This is little different from any other business - the difference is that big musicians tend to look at those millions and start thinking that they are the sole contributor to them - that it's their songs that are making the money, not actually a well-oiled publicity machine.

(I think most of in software tend to perhaps have a healthier or more realistic idea of our place in the business - sure, without the code there would be no business, but code on it's own is not a business).

Now a lot of people want to see the major labels die, as if we'll somehow end up in a world where people have some direct relationship with artists.

To which you have to ask the question - why isn't that the case already? Why do talented musicians, in control of their own private labels sell tiny amounts?

Why do people talk about cutting out the middle man as if it was something we were waiting to happen, rather than something we could do already? (And have been able to for years).

Because my feeling is that if people are not ready to really grip with that question, the future will be more of the same, if not possibly worse i.e. commercial radio and television do not fill me with hope towards sponsorship and advertising as a model for creativity, nor does Madonna turning to LiveNation (now merged with TicketMaster) rather than a record company.

In our new fresh world, I suspect the same rats will be there, because there will still be a demand for their skills - offering marketing deals for a cut of total profits. Faust is, after all, a very old story.

What could change that is - if - people change their listening habits. If something like last.fm or Spotify or music blogs becomes the main means through which people discover music, rather than through TV and Radio.

Lastly - on the idea of structuring a band as a business - that implies that being good at business, rather than music, is the key skill. History suggests this is rarely the case.

And if Courtney's piece is from experience, she really has no excuse, given her background in 80s independent rock.

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From: David Semeria (Sep 06 2009, at 05:00)

Hi Tim, I believe people will still want to own music files even in the face of more streaming options becoming available.

I also believe people will be willing to pay for the files. The problem is the price. People will start paying for music again when the 'total cost' of legally obtaining a file (time+price) is judged to be inferior to the hassle involved in nicking it.

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From: Nicola Larosa (Sep 06 2009, at 05:35)

One of the modern forms of patronage is the Street Performer Protocol:

http://en.wikipedia.org/wiki/Threshold_pledge_system

Here's one implementation (I worked on it for a few months last year):

http://www.buskerlabel.com/

Once enough money is raised, music is released, first to the paying fans for a little while, then to the world under Creative Commons licensing.

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From: Chris Sutton (Sep 06 2009, at 07:26)

In the last tour, a U2.com subscription did get you rights to purchase tickets in advance (which I took advantage of). Too bad they didn't do the same for this tour.

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From: David Magda (Sep 06 2009, at 08:18)

David Byrne (of Talking Heads fame) had an article on Wired a while ago on the seven functions that record labels used to be historically responsible for:

. Fund recording sessions

. Manufacture product

. Distribute product

. Market product

. Loan and advance money for expenses (tours, videos, hair and makeup)

. Advise and guide artists on their careers and recordings

. Handle the accounting

Nowadays if a band signs a contract they can handle certain aspects of the above for a bigger cut (for more work on your end), or let the label do it (for a cut on their end):

http://www.wired.com/entertainment/music/magazine/16-01/ff_byrne?currentPage=all

While a lot of the labels (and the RIAA/CRIA) may act like scum, bands have more options now.

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From: glen brammel (Sep 06 2009, at 10:29)

There is another way for many of the smaller bands. Often you can buy thier CDs directly from the band at their shows. This way, they get the money!

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From: hawkse (Sep 06 2009, at 12:04)

Excellent piece!

I totally agree with the idea that a lot of people will still want to own their music rather than stream it.

Thus, I checked out Patricia Barber and found it to my liking. Immediately wanted to buy the FLAC version you mentioned and... it wasn't easy enough!

I don't want to have to register my details just to buy a music recording.

So, no sale here.

Listening using Spotify instead even though the ads drive me nuts. Paying for Spotify? At €10 a month I'd expect a bit more than 10% of my top ten last.fm artists to be available.

Like JulesLt writes, I too believe the change will come about when services like last.fm & Spotify get their acts together. Unfortunately it seems they are being severely constrained by the music industry of old.

A good music discovery service should allow full streams, downloads, buying of physical goods, tickets, merchandise - even fan clubs for artist and more. Why isn't this happening?

Last.fm recently closed down free streaming to all but three countries in the world (US, UK & DE).

Spotify is only available in select countries around the globe and even then, all music is not available in all countries. Both services cite complex licensing agreements as the cause for this. It's a sad state of affairs that the music industry hasn't come further in simplifying the way music is licensed. After all, the Napster wake-up call came TEN YEARS ago.

Give it another twenty years?

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From: Puffer (Sep 06 2009, at 12:50)

Kristin Hersh, of Throwing Muses fame, is another established artist who has really taken control of her music and its distribution, and is leveraging the internet superbly. She's built a great network, with online pay-what-you-will donations for downloads, subscriptions, patronage, and great use of Twitter and fan boards to interact with her fans daily. Plus her music is fantastic!

http://www.kristinhersh.com/

I do think that more and more bands/artists will gravitate towards this model, and that in a sense 'record-companies' will be more like web masters who manage all of this stuff.

Great read.

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From: len (Sep 07 2009, at 10:27)

The challenge for the artists is the same: access to capital. That is the basis of the power hierarchy of the music business. Ignore it and be a big talent in a small circuit.

There are many opinions such as this piece represents but insufficient professional knowledge of the industry that produces the top selling merchandise. Artists make up possibly ten percent of the business and seldom support the RIAA tactics but they don't care to starve the other 90 percent on which they rely.

The music business reformation is already well underway. The web is factored into that and there are no real mysteries there.

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From: Derek K. Miller (Sep 07 2009, at 12:27)

I was a full-time musician for awhile about 15 years ago, and in my continued music sideline I work with a number of people who still are.

It has been, and remains, feasible to make your living from music. For most people who do that, it's always been an actual job: a fair amount of work for not a huge amount of money. The rich and famous recording superstars of the last, oh, 70 or 75 years were an anomaly, and I think changing business models will mean there are fewer of them.

The players I work with diversify to keep food on the table: they create and record and sell their own music (if possible), they play in sessions for others, they tour with ABBA tributes or funk bands who travel to Singapore, they teach students. While I was full-time at it and worked in a bar band, we busked on the street sometimes.

As with any independent business, with enough talent and perseverance and luck, you can make a decent if not spectacular living. However, I think the "big break" is becoming a thing of the past.

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From: Alan Hargreaves (Sep 07 2009, at 17:58)

Tim, I can highly recommend that you have a read of "The Indie Band Survival Guide" ISBN-10: 0-312-37768-1 by Randy Chertkow and Jason Feehan. It'll put oy back about ten bucks from Amazon. They also put a lot of useful stuff for people trying to make it as an Indie artist at http://www.indieguide.com/ Indeed the original book is released under Creative Commons and is also available on the web site.

Regards,

Alan.

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From: JulesLt (Sep 08 2009, at 11:52)

Something else to add (that I missed first time round) - there's an idea that songwriters should be able to make up the lost income caused by falling unit prices, by selling more.

Now certainly, the prices on music means that I've taken chances I would not at normal prices, or wouldn't have normally come across, meaning money has made its way to Finnish and Icelandic acts, who would never normally have been heard of outside their native markets, and the pages of The Wire.

That is definitely a case of lower prices causing me to take more chances - but where I have a concern is that falling unit prices tend to hurt the low-to-middle of the market a lot more than the top.

Madonna will still make a profit selling her records at 10% of the price, while The White Stripes proved a point that you could record a multi-platinum album on something like £1000 - but I'm aware that the numerical majority of recording artists are already operating on pretty thin margins.

I wonder if we will see a move towards a wider range of pricing?? After all, in the food sector, people pay more for organic or ethically produced food.

And a quick follow-up on why we're not seeing complete unified music services - I think as software people, we tend to see everything in engineering terms, and dislike 'politics' - but if you look at the 'music industry' it's very much about politics - about agreements between publishers and record labels and managers and songwriters and radio stations, and different systems in different countries.

On that last point alone, should we adopt a British, American or French or Chinese set of rules?

Technology out paces the law, because it's just a lot easier to do.

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From: Daniel (Sep 08 2009, at 15:01)

Not quite on topic, but you pulled a string... I've had the worst possible customer experience with U2's online offering (through Fanfire/LiveNation).

They advertise digital downloads, and although they are hard to find in the web shop, they are there. And it's not only MP3, they offer Flac format as well! That is the missing piece in my ambition to have a legal AND lossless archive of music, so ofcourse I purchased it.

Only this was in July, about a week before their Gothenburg consert I were going to attend. And I've still not seen a download link. I got a reply to one early question that they would look in to it, and get back to me in 24-48h. Then nothing. No replies on mail or through support form.

Until I tried to cancel my order. Then I got the quite amusing (but even more frustrating) response that my order had already shipped(!) and that I could claim a refund by returning "the package" at the nearest UPS office ...

I would probably save both time and health by looking into the current piracy options. The money is already spent though.

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From: Duncan Lock (Sep 08 2009, at 19:50)

This sounds like an idea who's time has come:

http://dbreunig.tumblr.com/post/183159459/tomorrows-apple-announcement-a-record-label-jay-z

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From: Vin78 (Sep 11 2009, at 06:50)

The bad thing is that in the last 15 years ticket prices have doubled or even tripled.

This way the music industry lets us pay for all the piracy.

Understandable but still annoying.

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From: len (Sep 11 2009, at 07:48)

The skyrocketing prices for concerts match the skyrocketing prices for other live venues outside of music so part of this is the payout for the economic woes. That said, at the very beginning of the Great Piracy Raids predictions were made as to the outcomes and so far these are right on track.

The naivete in this article and these comments is amazing. Too many still think in terms of the Lone Hacker or Joe WebPage meme and while yes there are those who can produce adequately well in their bedrooms, the truth is high quality music production requires high quality infrastructure and talent. The A-list game is a breeding game. Lone hackers make songwriter demos. They are listenable but they are not A-list.

There are some long threads at Jon Taplin's blog which include top music industry figures in open discussion. You might want to dig through those epics.

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From: Andrew (Sep 14 2009, at 13:00)

You said "Information wants to be free." Clearly information has no free will. Anthropomorphizing the concept of information like this just makes it easier to rationalize away the act of stealing it.

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From: Aristotle Pagaltzis (Sep 14 2009, at 16:19)

Rationalise away? Dramatic much? Fine, let’s phrase it accurately and without meaningless anthropomorphisms: “sharing information is what creates society” – and of course not to forget, “humans are compulsively social”.

I’m not sure the reformulation strengthens your case, but, there you go.

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From: Hernan (Sep 15 2009, at 10:40)

Maybe the "Internet tough guys" that laugh at the naivete of this essay are right, and we are doomed to be marketed to death by the "top talent" of the music industry. But one would like to think there is a better way to do things.

I'm from Argentina, I grew next to the River Plate, which since I can remember has been contaminated to the point of making it unfit for life. I'm sure the factories pouring their waste into the river were also staffed by "top talent" engineers, managers, what have you.

There is only so much attention to go around in our society, after all, and it's sad to think it will forever be filled with the garbage the music industry pumps out. The Internet has done a lot so far to encourage bottom-up creativity and community; let's hope this trend continues.

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From: len (Sep 16 2009, at 07:18)

@hernan: Just FYI, I'm an indie and not a tough guy. This isn't about domination by the top guys but about how much it actually costs to produce A-list work. The top performers aren't hurt because they can recoup it gigging. The songwriters who don't tour, the production engineers, even the front office help, these people get hurt.

What has to be exploded are the myths of solo production being competitive given the capital required. Yes, there are exceptions but the typical cost of an average record/CD is $250,000. A top of the line recording is about $750,000. This is spent before it ever goes to press so it doesn't factor in production costs for art, pressing, promotions, etc. That is the cost to get a master made with professional talent.

I can do that a lot cheaper but I can't touch the A-list quality and quality is what we're talking about. You call it 'garbage' and there is garbage at every level but more of it at the bottom. Sure, there are inequities. I personally can't fathom anyone buying kanye west or dr dre recordings because to my ears, they are drivel. That said, they sell a lot of music so perhaps it is the ears at the bottom that are driving the epidemic of bad music. Perhaps it is the fans who put the good music off the charts and not the industry because the industry sells what you are buying. It doesn't try to sell what you won't buy.

And that is something you and others here ought to stop and think about. The costs are high and the quality is low because those are your tastes and you wallets in action. The music industry is profoundly aware of the Internet and no longer sees it as revolutionary or even threatening. They make their deals with the companies that distribute and they move on.

As I said, nothing I'm reading here is new to me. Some seem to think they are at the edge of the change but the change has already happened. What you are seeing in those lawsuits are the RIAA and others building a body of precedent rulings in anticipation of supreme court cases and negotiations of international copyright laws.

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