Music. Marketing. Social Media.

There’s been a lot of hand-wringing ever since this whole Internets thing started to pick up steam in the music industry. Namely, the recording industry has been fretting over what to do, and how to monetize this whole digital thing.

Ed note: The recording industry is a piece of the music industry – if you’re confused, go look here.

At first the Internets didn’t affect CD sales enough to actually bother anyone, so the strategy was “ignore, ignore, ignore”. The RIAA got all put bull and started bringing people to court over illegal downloading, screaming that the people who were doing the illegal downloading (or rather, sharing songs for others to illegally download) were  responsible for the current state of the recording industry.

Jump forward a few years and nothing really changed. The recording industry was still for the most part refusing to provide legal options to people who wanted to download music, so the public was still downloading illegally, delivering the Internets equivalent of a middle finger to the big bad RIAA, as well as the recording industry.

Then iTunes happened. Suddenly there was a very popular was to legally download music, and people started doing so. Voila, problem not yet solved, but hey – it was a start.

The thing is, the recording industry and the RIAA were now playing two sides, so to speak.  They were getting the revenues from the iTunes downloads, yet still screaming and suing.  The theme as it appeared to consumers was “You’re consuming music in the way you want to, and we’re starting to allow you to do that, but we really want our old way back as we made more money, so we’re still going to whine and complain.”

Businesses have to make money, I get it. Everyone gets it.

What many companies in the recording industry fail to realize though, is that their refusal to innovate and adopt new technologies was effectively a huge middle finger in the face of the consumer. That pissed consumers off.

At the end of the day the consumer wants the music – and we don’t necessarily care about the medium it comes on.  The limitation of choice is what really pisses people off, and that was a choice made by inaction within the recording industry.

Hello to a problem the recording industry helped create.

So today I ran across his gem of a quote on brand dna, and it got me thinking.

“I think records were just a little bubble through time and those who made a living from them for a while were lucky.

There is no reason why anyone should have made so much money from selling records except that everything was right for this period of time.

I always knew it would run out sooner or later. It couldn’t last, and now it’s running out. I don’t particularly care that it is and like the way things are going.

The record age was just a blip. It was a bit like if you had a source of whale blubber in the 1840s and it could be used as fuel.

Before gas came along, if you traded in whale blubber, you were the richest man on Earth.

Then gas came along and you’d be stuck with your whale blubber. Sorry mate – history’s moving along.

Recorded music equals whale blubber. Eventually, something else will replace it.”

The quote started me thinking about everything I wrote above. How if the THING you trade or sell suddenly is made obsolete, you need to figure out a new thing, a new product, or in this case, a new transportation method (from CDs to fiber optic cables).

Directly below the article was an “Open Letter from OK Go, Regarding Non-Embeddable YouTube Videos”.

Do yourself a favor and go read the entire article. It will take you a few minutes, but the letter is wonderfully written and really shows the evolution and struggle of many to monetize this whole Internets thing, while still delivering what fans want.

I’ve included a few excerpts below (emphasis mine), but really, you should go and read the entire article.

Believe us, we want you to pass our videos around more than you do, but, crazy as it may seem, it’s now far harder for bands to make videos accessible online than it was four years ago

The label fronts the money for us to make recordings – for this album they paid for us to spend a few months with one of the world’s best producers in a converted barn in Amish country wringing our souls and playing tympani and twiddling knobs – and they put up most of the cash that it takes to distribute and promote our albums, including the costs of pressing CDs, advertising, and making videos. We make our videos ourselves, and we keep them dirt cheap, but still, it all adds up, and it adds up to a great deal more than we have in our bank account, which is why we have a record label in the first place.

Let’s take a wider view for a second. What we’re really talking about here is the shift in the way we think about music. We’re stuck between two worlds: the world of ten years ago, where music was privately owned in discreet little chunks (CDs), and a new one that seems to be emerging, where music is universally publicly accessible. The thing is, only one of these worlds has a (somewhat) stable system in place for funding music and all of its associated nuts-and-bolts logistics, and, even if it were possible, none of us would willingly return to that world. Aside from the smug assholes who ran labels, who’d want a system where a handful of corporate overlords shove crap down our throats? All the same, if music is going to be more than a hobby, someone, literally, has to pay the piper. So we’ve got this ridiculous situation where the machinery of the old system is frantically trying to contort and reshape and rewire itself to run without actually selling music. It’s like a car trying to figure out how to run without gas, or a fish trying to learn to breath air.

So, for now, here’s the bottom line: EMI won’t let us let you embed our YouTube videos. It’s a decision that bums us out. We’ve argued with them a lot about it, but we also understand why they’re doing it. They’re aware that their rules make it harder for people to watch and share our videos, but, while our duty is to our music and our fans, theirs is to their shareholders, and they believe they’re doing the right thing.

Let me say it again – go read the entire article.

OK Go (or Gizmodo, I’m not sure which) then included the Vimeo video you can see below, and me being a blogger of course put it on this very blog (I dig the song and love the video, so go forth and view).

OK Go – This Too Shall Pass from OK Go on Vimeo.

What’s the conclusion? Well, I’d say right now we’re all in agreement on something at least. There’s far less money to be made from selling CD’s then there was 10 years ago, or even 5 years ago. This Internets thing has thrown a major wrench in the recording industry operations, and labels are suffering.

Is there a solution? That remains to be seen. Companies like Topspin,  TuneCore, Involver, Kickstarter, ArtistData and others are coming out and helping artists (and labels!) better manage things in this whole Internet-driven economy, but these companies are still few and far between in the grand scheme of things. It’s progress, but is it the solution? I don’t think it is, at least not yet.

I’d love to hear your thoughts on things. Do you still buy CD’s? Do you download music from legal online sources? What trends do you see (for better or worse) in the recording industry??

Tags: artistdata, EMI, fans, involver, kickstarter, OK Go, recording industry, release format, RIAA, topspin

Yes, really.

This post is a direct result of a dubstepforum.com thread about a certain big-name Dubstep label removing their tracks from being sold online.

This argument can be broken down into two sides.

Side 1 – Labels should release content in one (or a limited # of) format(s)

Side 2 – Labels should release content in multiple formats

This is one of the most heated debates happening around music right now. Feel free to comment and tell me how wrong I am if you disagree with my viewpoints!

To the arguments!

Side 1 – Labels should release content in one (or a limited # of) format(s)

The “pro” argument for this side really comes down to two points:

1. By releasing in a select # of formats you preserve the value of the music (i.e. – if it’s on vinyl, those pieces could become collectors items eventually)
2. By only releasing a select # of formats you make it harder for people to illegally share your music (ex: if you want to illegally share your vinyl you have to rip it to your computer first, then share it – it’s much harder than just sharing a digital release)

The “pro” arguments of this make sense, and while I’m not saying they’re false, I do disagree with the implications of these arguments.

Supply and demand ” concludes that in a competitive market, price will function to equalize the quantity demanded by consumers, and the quantity supplied by producers, resulting in an economic equilibrium of price and quantity. An increase in the quantity produced or supplied will typically result in a reduction in price and vice-versa.”

In other words, the more something is wanted and the less resources of that “something” available, the higher the value of that “something” will be.  See below for the pretty picture. (the above quote and below photo are all from the Wikipedia page linked above)

The implication of this supply and demand argument (#1) is that you should produce a small quantity of an item, and certainly smaller than you anticipate demand to be for this particular item. That, in turn, creates incentive for people to pre-order or stand in line (for example) to purchase your music.  The format will preserve it’s “value” because your item is now a limited resource. Think “collectors item” as far as the consumer is concerned.

That’s all well and good, but not every piece of music is going to be a collector’s item.

I’m getting ahead of myself…

On to Argument #2 – “By only releasing a select # of formats you make it harder for people to illegally share your music”

Here’s where I really have my beef with limited format releases. I’m willing to buy your music. I may not buy a lot of it these days because I can find what I like in other formats (i.e. – mix sets), but if I like a piece of music I’m absolutely willing to go to your store (whether it be a website or a physical store) to buy your music.

What really upsets me as a consumer is when I’m ready and willing to buy your music, and you put barriers in my way.  Let’s stick with the electronic genre for a moment, and consider that their target audience usually owns a record player. It makes sense, if I’m trying to prevent people from sharing my music illegally, to limit my release to a format that makes it harder for people to do just that.  For the vinyl example I’d have to play the track, record a high-quality version on to my computer, then upload that to a filesharing program somewhere and distribute. That’s harder than just sticking a CD in my computer and clicking “copy”… but not by much.

Here I am, willing consumer ready, able and wanting to part with my money, and I can’t. Why can’t I? I don’t own a record player. If you offered your music on CD or in a digital format I could play it, but as it happens, I don’t have the resources to play your music.

What do I do instead? I go search for it online.

Lost money for you, and I’m now helping to perpetuate exactly what you don’t want – illegal download of your music.

Side 2 – Labels should release content in multiple formats

On the flip side of this argument you have the “go forth and prosper” folks, or, as they can be called, the consumers.

This side comes down to a few simple arguments as well:

1. If I’m ready to part with my money to buy your music, I want to purchase your music in a format I can enjoy.
2. If you put barriers in my way, there are easy ways I can overcome them. Very few of these ways equal money in your pocket.

I stated this above, but it’s worth repeating.

Here I am, willing consumer ready, able and wanting to part with my money, and I can’t. Why can’t I? I don’t own a record player. If you offered your music on CD or in a digital format I could play it, but as it happens, I don’t have the resources to play your music.

What do I do instead? I go search for it online.

Lost money for you, and I’m now helping to perpetuate exactly what you don’t want – illegal download of your music.

I’m a consumer. I want to consumer your music. I may prefer the richness of a track on vinyl, or I may be riding a subway for an hour a day and really want something new for my MP3 player. Either way, I want you to cater to my wants and needs. I’m giving my money to you and in this day and age, I’m used to getting what I want, how I want it, when I want it.

Please me, please.

As a music producer or label, you can probably guesstimate what % of your target audience consumes music in which format. You can base this off of previous sales or market trends/statistics, for example. That’s smart. What’s not smart is saying “So 70% of our audience consumes our music in this format, so we’re going to ignore the other 30% and just cater to this 70%.”

Using the vinyl example (again), how do you know that I’m not a traveling DJ who really prefers DJ’ing with actual records when at home, but prefers using Serato or CDJ’s when I’m on the road? Sure, I could follow the example above and rip your music to my computer without spending any extra money, but that requires time and I think my time is worth coughing up the extra cash to also download a digital version.

I may be in your 70% that consumes your music on vinyl, but how do you know I’m not also in the 30% contributing to consumption in another way??

You don’t.

This brings me to the second argument. “If you put barriers in my way, there are easy ways I can overcome them. Very few of these ways equal money in your pocket.”

I’ll, again, re-iterate what I said above:

Here I am, willing consumer ready, able and wanting to part with my money, and I can’t. Why can’t I? I don’t own a record player. If you offered your music on CD or in a digital format I could play it, but as it happens, I don’t have the resources to play your music.

What do I do instead? I go search for it online.

Lost money for you, and I’m now helping to perpetuate exactly what you don’t want – illegal download of your music.

I’m an honest consumer who is ready and willing to part with my money to buy your music. Please, let me!

A forum member stated this exact thought pretty well, saying that they were searching online for tunes to buy but couldn’t find any of them, and since the label didn’t release in a digital format and he didn’t own a record player, he couldn’t buy their music. The post has since been moved or deleted, preventing me from quoting.

Summary: Perhaps “idiot” is a harsh term to some, but I think it’s fitting. Consumers have more power now than they ever had before, and the companies that are succeeding are companies that are keeping this power in mind. My suggestion isn’t to bend over backwards and do whatever the consumer wants, but my suggestion is to keep their needs and preferences in mind, and see how you, as a music producer, can modify your actions to accomodate their needs/wants.  Gone are the days of “consumers will do as the company commands” – and the quicker companies realize this, the better off they’ll be.

A suggestion, if I may.  Encourage people to buy your music in multiple formats by offering discounted pricing on these items. If I purchase your music in a store, give me a discount to buy it digitally too. You can track this to figure out where/when I bought, as well as end up with more money in your pocket in the end. I don’t expect things for free, but I do want to feel like you actually care for my preferences. Show me that and not only get my money, but begin to win my loyalty.

On with the controversy. I’m eager to hear your thoughts!

Tags: dubstep, record labels, release format, vinyl