We are between two eras in the Music Business and like crossing from one side of a river to another, we are in the strange predicament of having left one side without clearly knowing what we will find on the other shore.
THE LONG STANDING MODEL OF THE MUSIC BUSINESS DIED A LONG TIME AGO.
There are certain things we do know: First, the long standing model of the music business that most of us grew up with, namely radio airplay leading to retail sales, died a long time ago. Second, the few glimpses we do have of the future are so alien to most of us that they not only don’t constitute a replacement of the old system, they don’t even look like a ‘business’ at all. One of the recurring themes I keep hearing from Music Industry insiders is the grim realization that an entire generation of younger fans now expect ‘their music’ for free. This, combined with recent articles claiming that record companies should applaud and encourage this trend of ‘freebee file-sharing websites’ has a lot of people shaking their heads. If songwriters, publishers, artists, and record companies can’t get paid for making music, what’s the point of making it.
TRADITIONAL RADIO IS NO LONGER A VIABLE PLAYER IN THIS NEW MAD MAX MUSIC BUSINESS.
We are told that artists should be happy about this free exposure of their new music especially since traditional radio is no longer a viable player in this new Mad Max music business, and besides, they can always make up the difference in concert tickets and merchandise. And even if some fans get it for free, many will still pay, so the record companies should look at free downloading as an investment.
This may sound good as 21st century digital logic, but throw in a good old-fashioned recession and fans with little to no disposable income and that business model sinks pretty quickly.
Ah, but don’t lose heart: There are some very interesting developments on the horizon that don’t get talked about very much but will likely ease the pain and could revolutionize what is left of the music business.
First, as we talked about in previous articles, Hi-Def TV will be in our face February 17, 2009 and I believe much if not most of the Music Industry will immediately start moving to television. The public has proven through programs like American Idol and The Country Music Talent Show that it is truly hungry for music shows. Plus, the magic of digital technology will allow your TV set to become interactive, like your computer, turning it into the ultimate IPod. Think of it – downloading your favorite songs directly to a detachable player on your cable box, which in all likelihood will be adaptable to your car, home stereo, or computer...for a price of course.
Next, the very nature of record companies or labels or whatever you want to call them in a diskless world is going to change. Their priority now will be selling the artist and the music rather than the widget on which the music used to be delivered. Of course the big corporate labels will still have the advantage because of their brand name and their vast catalog of masters.
However the playing field will be a lot more level between corporate and indie labels because both will be selling fans their music through the same digital providers and databases.
THE ROLE OF RECORD COMPANIES AND MUSIC PUBLISHERS WILL HAVE TO CHANGE.
Finally, the role of music publishers will also change by forming more direct alliances with record labels and songwriters due to the fact that the emphasis will be so totally on the music rather than a disk. At Roulette Records, where I grew up, this was already a given. I was keenly aware of the Morris Levy philosophy of the music business. Morris was not just the President of Roulette, he was also the head of Big 7 Music, a vast publishing empire that worked hand and hand with his labels. He knew that one of the main reasons to have a record company was to exploit your own publishing. The argument for this relationship is so compelling that we may actually see publishers forming record companies instead of the other way around.
All of this speaks well for the future. The new music business establishment will be a conglomeration of all these pieces of the puzzle. I am a tremendous believer in the collective greed of all of them to find a way to fit together. This is likely what awaits us on the other side of the river.
