The music industry
this is probably not the right forum, but i found this about the time that oink.cd went offline. It's a true to the fact history of the music industry for the last 20 years. Ever wondered why CDs cost $15 or more? Now you'll know the truth and i hope you find this useful. Game over
this has to be the truth of the whole industry..
Amen to that brother.So the next question is, what now?
For the major labels, it's over. It's fucking over. You're going to burn to the fucking ground, and we're all going to dance around the fire. And it's your own fault. Surely, somewhere deep inside, you had to know this day was coming, right? Your very industry is founded on an unfair business model of owning art you didn't create in exchange for the services you provide. It's rigged so that you win every time - even if the artist does well, you do ten times better. It was able to exist because you controlled the distribution, but now that's back in the hands of the people, and you let the ball drop when you could have evolved.
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part one
The entire story if you don't want to go there and read it.
For quite a long time I've been intending to post some sort of commentary on the music industry - piracy, distribution, morality, those types of things. I've thought about it many times, but never gone through with it, because the issue is such a broad, messy one - such a difficult thing to address fairly and compactly. I knew it would result in a rambly, unfocused commentary, and my exact opinion has teetered back and forth quite a bit over the years anyway. But on Monday, when I woke up to the news that Oink, the world famous torrent site and mecca for music-lovers everywhere, had been shut down by international police and various anti-piracy groups, I knew it was finally time to try and organize my thoughts on this huge, sticky, important issue.
For the past eight years, I've worked on and off with major record labels as a designer ("Major" is an important distinction here, because major labels are an entirely different beast than many indie labels - they're the ones with the power, and they are the ones driving the industry-wide push against piracy). It was 1999 when I got my first taste of the inner-workings of a major record label - I was a young college student, and the inside of a New York label office seemed so vast and exciting. Dozens of worker bees hummed away at their desks on phones and computers. Music posters and stacks of CDs littered every surface. Everyone seemed to have an assistant, and the assistants had assistants, and you couldn't help but wonder "what the hell do all these people do?" I tagged along on $1500 artist dinners paid for by the labels. Massive bar tabs were regularly signed away by record label employees with company cards. You got used to people billing as many expenses back to the record company as they could. I met the type of jive, middle-aged, blazer-wearing, coke-snorting, cartoon character label bigwigs who you'd think were too cliche to exist outside the confines of Spinal Tap. It was all strange and exciting, but one thing that always resonated with me was the sheer volume of money that seemed to be spent without any great deal of concern. Whether it was excessive production budgets or "business lunches" that had nothing to do with business, one of my first reactions to it all was, "so this is why CDs cost $18..." An industry of excess. But that's kind of what you expected from the music business, right? It's where rock stars are made. It's where you get stretch limos with hot tubs in the back, where you get private jets and cocaine parties. Growing up in the '80's, with pop royalty and hair metal bands, you were kind of led to think, of course record labels blow money left and right - there's just so much of it to go around! Well, you know what they say: The bigger they are...
In those days, "piracy" was barely even a word in the music world. My friends and I traded MP3s in college over the local network, but they were scattered and low-quality. It felt like a novelty - like a digital version of duping a cassette tape - hardly a replacement for CDs. CDs sounded good and you could bring them with you in your DiscMan, and the only digital music you could get was as good as your friends' CD collections, anyway. It never occurred to any of us that digital files were the future. But as it turned out, lots of kids, in lots of colleges around the world, had the same idea of sharing MP3 files over their local networks, and eventually, someone paid attention to that idea and made Napster. Suddenly, it was like all those college networks were tied together, and you could find all this cool stuff online. It was easier and more efficient than record stores, it was powered by music fans, and, well, it was free. Suddenly you didn't have to pay 15 to 18 bucks for an album and hope it was good, you could download some tracks off the internet and check it out first. But you still always bought the CD if you liked it - I mean, who wants all their music to be on the computer? I sure didn't. But increasingly, more and more people did. For college kids, Napster was a Godsend, because you can all but guarantee two things about most college kids: They love music, and they're dirt poor. So it grew, and it grew, and it started to grow into the mainstream, and that's when the labels woke up and realized something important was happening. At that point they could have seen it as either a threat or an opportunity, and they, without hesitation, determined it to be a threat. It was a threat because essentially someone had come up with a better, free distribution method for the labels' product. To be fair, you can imagine how confusing this must have been for them - is there even a historical precedent for an industry's products suddenly being able to replicate and distribute on their own, without cost?
For quite a while - long after most tech-savvy music lovers - I resisted the idea of stealing music. Of course I would download MP3s - I downloaded a lot of stuff - but I would always make sure to buy the physical CD if it was something I liked. I knew a lot of musicians, a lot of them bewildered at what was happening to the industry they used to understand. People were downloading their music en masse, gorging on this new frontier like pigs at a troff - and worst of all, they felt entitled to do so. It was like it was okay simply because the technology existed that made it possible. But it wasn't okay - I mean, let's face it, no matter how you rationalized it, it was stealing, and because the technology existed to hotwire a car didn't make that okay, either. The artists lost control of distribution: They couldn't present albums the way they wanted to, in a package with nice artwork. They couldn't reveal it the way they wanted to, because music pirates got the albums online well before the actual release date. Control had been taken away from everyone who used to have it. It was a scary time in unfamiliar territory, where suddenly music fans became enemies to the artists and companies they had supported for years. It led to laughable hyperbole from bands like Metallica, instantly the poster-children of cry-baby rich rock stars, and the beginning of the image problem the industry has faced in its handling of the piracy issue. But still, at the time, I understood where they were coming from. Most musicians weren't rich like Metallica, and needed all the album sales they could get for both income and label support. Plus, it was their art, and they had created it - why shouldn't they be able to control how it's distributed, just because some snotty, acne-faced internet kids had found a way to cheat the system? And these entitled little internet brats, don't they realize that albums cost money to create, and to produce, and to promote? How is there going to be any new music if no one's paying for it?
On top of that, I couldn't get into the idea of an invisible music library that lives on my computer. Where's the artwork? Where's my collection? I want the booklet, the packaging... I want shelves and shelves of albums that I've spent years collecting, that I can pore over and impress my friends with... I want to flip through the pages, and hold the CD in my hand... Being a kid who got into music well past the days of vinyl, CDs were all I had, and they still felt important to me.
It's all changed.
In a few short years, the aggressive push of technology combined with the arrogant response from the record industry has rapidly worn away all of my noble intentions of clinging to the old system, and has now pushed me into full-on dissent. I find myself fully immersed in digital music, almost never buying CDs, and fully against the methods of the major record labels and the RIAA. And I think it would do the music industry a lot of good to pay attention to why - because I'm just one of millions, and there will be millions more in the years to come. And it could have happened very, very differently.
As the years have passed, and technology has made digital files the most convenient, efficient, and attractive method of listening to music for many people, the rules and cultural perceptions regarding music have changed drastically. We live in the iPod generation - where a "collection" of clunky CDs feels archaic - where the uniqueness of your music collection is limited only by how eclectic your taste is. Where it's embraced and expected that if you like an album, you send it to your friend to listen to. Whether this guy likes it or not, iPods have become synonymous with music - and if I filled my shiny new 160gb iPod up legally, buying each track online at the 99 cents price that the industry has determined, it would cost me about $32,226. How does that make sense? It's the ugly truth the record industry wants to ignore as they struggle to find ways to get people to pay for music in a culture that has already embraced the idea of music being something you collect in large volumes, and trade freely with your friends.
Already is the key word, because it didn't have to be this way, and that's become the main source of my utter lack of sympathy for the dying record industry: They had a chance to move forward, to evolve with technology and address the changing needs of consumers - and they didn't. Instead, they panicked - they showed their hand as power-hungry dinosaurs, and they started to demonize their own customers, the people whose love of music had given them massive profits for decades. They used their unfair record contracts - the ones that allowed them to own all the music - and went after children, grandparents, single moms, even deceased great grandmothers - alongside many other common people who did nothing more than download some songs and leave them in a shared folder - something that has become the cultural norm to the iPod generation. Joining together in what has been referred to as an illegal cartel and using the RIAA as their attack dogs, the record labels have spent billions of dollars attempting to scare people away from downloading music. And it's simply not working. The pirating community continues to out-smart and out-innovate the dated methods of the record companies, and CD sales continue to plummet while exchange of digital music on the internet continues to skyrocket. Why? Because freely-available music in large quantities is the new cultural norm, and the industry has given consumers no fair alternative. They didn't jump in when the new technologies were emerging and think, "how can we capitalize on this to ensure that we're able to stay afloat while providing the customer what they've come to expect?" They didn't band together and create a flat monthly fee for downloading all the music you want. They didn't respond by drastically lowering the prices of CDs (which have been ludicrously overpriced since day one, and actually increased in price during the '90's), or by offering low-cost DRM-free legal MP3 purchases. Their entry into the digital marketplace was too little too late - a precedent of free, high-quality, DRM-free music had already been set.
There seem to be a lot of reasons why the record companies blew it. One is that they're really not very smart. They know how to do one thing, which is sell records in a traditional retail environment. From personal experience I can tell you that the big labels are beyond clueless in the digital world - their ideas are out-dated, their methods make no sense, and every decision is hampered by miles and miles of legal tape, copyright restrictions, and corporate interests. Trying to innovate with a major label is like trying to teach your Grandmother how to play Halo 3: frustrating and ultimately futile. The easiest example of this is how much of a fight it's been to get record companies to sell MP3s DRM-free. You're trying to explain a new technology to an old guy who made his fortune in the hair metal days. You're trying to tell him that when someone buys a CD, it has no DRM - people can encode it into their computer as DRM-free MP3s within seconds, and send it to all their friends. So why insult the consumer by making them pay the same price for copy-protected MP3s? It doesn't make any sense! It just frustrates people and drives them to piracy! They don't get it: "It's an MP3, you have to protect it or they'll copy it." But they can do the same thing with the CDs you already sell!! Legal tape and lots of corporate bullshit. If these people weren't the ones who owned the music, it'd all be over already, and we'd be enjoying the real future of music. Because like with any new industry, it's not the people from the previous generation who are going to step in and be the innovators. It's a new batch.
Newspapers are a good example: It used to be that people read newspapers to get the news. That was the distribution method, and newspaper companies controlled it. You paid for a newspaper, and you got your news, that's how it worked. Until the internet came along, and a new generation of innovative people created websites, and suddenly anyone could distribute information, and they could distribute it faster, better, more efficiently, and for free. Obviously this hurt the newspaper industry, but there was nothing they could do about it, because they didn't own the information itself - only the distribution method. Their only choice was to innovate and find ways to compete in a new marketplace. And you know what? Now I can get live, up-to-the-minute news for free, on thousands of different sources across the internet - and The New York Times still exists. Free market capitalism at its finest. It's not a perfect example, but it is a part of how the internet is changing every form of traditional media. It happened with newspapers, it's happening now with music, and TV and cell phones are next on the chopping block. In all cases technology demands that change will happen, it's just a matter of who will find ways to take advantage of it, and who won't.
Unlike newspapers, record companies own the distribution and the product being distributed, so you can't just start your own website where you give out music that they own - and that's what this is all about: distribution. Lots of pro-piracy types argue that music can be free because people will always love music, and they'll pay for concert tickets, and merchandise, and the marketplace will shift and artists will survive. Well, yes, that might be an option for some artists, but that does nothing to help the record labels, because they don't make any money off of merchandise, or concert tickets. Distribution and ownership are what they control, and those are the two things piracy threatens. The few major labels left are parts of giant media conglomerations - owned by huge parent companies for whom artists and albums are just numbers on a piece of paper. It's why record companies shove disposable pop crap down your throat instead of nurturing career artists: because they have CEOs and shareholders to answer to, and those people don't give a shit if a really great band has the potential to get really successful, if given the right support over the next decade. They see that Gwen Stefani's latest musical turd sold millions, because parents of twelve year old girls still buy music for their kids, and the parent company demands more easy-money pop garbage that will be forgotten about next month. The only thing that matters to these corporations is profit - period. Music isn't thought of as an art form, as it was in the earlier days of the industry where labels were started by music-lovers - it's a product, pure and simple. And many of these corporations also own the manufacturing plants that create the CDs, so they make money on all sides - and lose money even from legal MP3s.
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