On Tuesday, Don Henley, yes that Don Henley, wrote an opinion piece for the Washington Post called Killing the Music. While he's certainly right that the music business is in trouble, I don't think he truly understands why. I suppose he could be forgiven for getting it wrong. The music business certainly gets it wrong. From the article:
Music stores used to be magical places offering wide variety. Today the three largest music retailers are Best Buy, Wal-Mart and Target. In those stores shelf space is limited, making it harder for new artists to emerge. Even established artists are troubled by stores using music as a loss leader. Smaller, more personalized record stores are closing all over the country -- some because of rampant P2P piracy but many others because of competition from department stores that traditionally have no connection whatsoever with artists.
Wal-Mart, et al did not kill independent record stores. Amazon and EBay's half.com killed independent record stores, and they were aided and abetted by the record companies themselves. The prices they charge for new CDs are simply ludicrous. I had all but stopped buying new CDs more than ten years ago because in Chicago, I could always find what I wanted used. There was a huge market for used CDs there, and they were always sold by independent record stores. I had no reason at all to shop at Tower or Sound Warehouse, except to rent movies.
I never found a decent used store here. The stock was always a huge disappointment. I bought some things at Tower, but was horrified at how much I paid. I think this is what it's like for folks who don't live in a big city. Once I discovered half.com, I started buying records again and the selection was exponentially bigger than it had been at Reckless in Chicago. Amazon's lack of a physical location has pushed down the margins on CDs to the point that they are a bit more reasonable new, but they also have people selling "used" that are actually selling new merchandise at an even cheaper price. This is also true for books.
When an industry blames it's customers for it's demise instead of it's own crappy business model, you know they've reached the nadir. Piracy is not the huge problem the record companies make it out to be. Most piracy (not all, I know), and I think this is true for movies too, is committed by people who wouldn't buy anyway. In some cases, it's kids who don't have credit cards and can't buy from Amazon and Half. Systematic piracy operations occur when foreigners who can't obtain media legally obtain it from pirates. I think this is most of the movie piracy, but that's a discussion for another day.
P2P is the modern day equivalent of people who make tapes for their friends. The quality is similar, and no matter what you may read in the media, like making tapes, it takes time to find and download what you want. I know for a fact that some people download a few songs and then buy a used copy. When I can, I use iTunes to get the material because it's much, much faster than messing about with LimeWire. This is the same set of steps I went through when friends made me tapes. The huge disadvantage for the record companies is that now, I don't need physical proximity to get that tape. I don't even need to know the person making it. I don't need a physical record store at all, and the used stock is infinite. This is a huge change in the market place, and it's one they have simply ignored in favor of whining about piracy.
So, how should they make money? I don't know, and I don't care. I'm the customer, and that's not my problem. Some artists are going around them, and more power to them. It would be easier for them if the record companies would get the hell out of the way. Until the "industry" gets it's collective head out of it's collective ass, it certainly won't figure it out.
Posted by nicole at February 20, 2004 09:30 AMWay back in '90, when CD’s were just starting to kill LP’s, my friends had a band. They made a CD. I was in the “thanks” section. Of course I had to buy one. Small release CD’s were still a novelty back then, and they were able to sell theirs for $6 each. Most CD’s were going for $11-12 in the stores and my friends assured me that if they sold all 100 of the intro pressings they would make a (small) profit, and the next 100 copies made would be cheaper, because they had already paid for the master. I already had an inkling that I was being fisted by the record companies but now I knew how bad it was.
Keep in mind back then, there were no burners, media, or mp3. Sound cards were still a pretty neat idea.
Sure, the big bands that sold millions of CD’s had other expenses, but the economy of scale should drive down the production cost to at least half of what my friends were paying. And the cost of advertising, touring and cocaine gets spread over millions of CD’s. How much each, do you think those AOL CD’s cost?
I came to the realization that music wasn’t that important to me that I’d be willing to be robbed like that. I also should let you know I’m quite frugal. Aside from a few Foetus CD’s (pure unobtainium) I’ve bought nothing in 10+ years. I have paid that audio tape tax a bit, though.
I’ve never been a big CD buyer and I’ve never done p2p, but I did “re-buy” an old CD of my ex’s, which departed with the ex, a few months ago. CD’s have gone up (and 486 with sound cards have gone way down) I had to make a copy of the brand new CD to get it to play in my work pc. Probably not what they had in mind when they encoded the copy protection.
I really had liked the band, years ago. I enjoyed how they had carefully crafted the music and lyrics of each of their songs on the album. They were all good. Unfortunately, it was their zenith CD. I stumbled on a 3 pack of their later stuff on ebay for less than one new album in a record store and bought them. Aside from the fact that I got the song “Least Complicated” perpetually stuck in my head, the rest of the tracks sucked. Maybe it was the contractual obligation to produce. Now I know why “buy one track” iTunes is popular.
“Nadir” isn’t a word you see everyday, I had to look it up. I guess that’s where the “Astro” comes from.
Posted by steel at February 20, 2004 10:05 PMSpeakiing of independant record store the NY Times has and article today (26 Feb 2004) on the subject:
Waiting for the Other Record to Drop
Posted by Paul M Johnson at February 26, 2004 12:29 PM