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Recording industry to force consumers to buy music!


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November 07, 2005

Recording industry to force consumers to buy music!

Steve Rosenbush

The recording industry won an undisputed victory today, with the announcement that Grokster would shut down. (link.) This is just the beginning of a broader legal offensive. As Deal Flow reported several months ago, the recording industry already intends to sue people who "play" songs in their head without buying a CD or a legal digital version. Now the recording industry is considering filing a landmark suit that would charge people for a minimum amount of music every month, regardless of whether they want the music or not. The theory is that everyone absorbs a certain amount of music in their daily life, listening to other people hum on the elevator, or in line at the local coffee shop. Now the recording and media industry is about to crack down on those "freeloaders" by making it illegal not to buy music.

04:53 PM

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Your post is a bit snarky and ignores the fact that most file-swapping of copyrighted material is illegal. I wonder how your parent company would feel if its propreitary and premium content were made freely available to everyone. Maybe a hacker should open Standard & Poor's Advisor Insight product and make it freely available to any registered adviser who wants it for free. I'm sure the business that funds your paycheck would love that strategy.

Posted by: TechTrader at November 8, 2005 01:55 PM

I'm the writer of the post in question. Thanks for your reply. Yes, as you point out, most file-sharing is illegal. But I fear the entertainment industry, in its zeal to prosecute file sharers, is winning the final battle of the last war. It should be focusing on building new business models that are designed for online distribution, not transfering business models from the old environment to the new. This requires more imagination than suing middle school students. But it can be done. I interviewed former Smashing Pumpkins frontman Billy Corgan last year, and he addressed the need for new ideas.

Here are his thoughts on the subject:

Q: How is MySpace changing the music business?

A: It's creating a new paradigm. Right now, music labels are concerned about their ability to stay in business. MTV has moved into entertainment, but it has kept other people from trying to go into the music business. It has slowed down the progress of the video music industry and the music industry. And that's fine. They have their own self-interests. And God bless them, that's what they're there for.

But MySpace throws a wrench into all that. Now that MySpace is here, bands don't necessarily need a label to be heard. So maybe music will be available for free online. But artists will make money by attracting more people to their concerts. Or they'll make money from personal appearances or commercial endorsements.

MySpace is hinting at the idea that there are other ways to generate energy. And the world is all about energy. If you can generate energy, it will eventually translate into business. MySpace is on the forefront of shifting the idea of what is worth money. It's just the beginning. It's just starting to work itself out.

the story can be found here:

http://www.businessweek.com/technology/content/may2005/tc20050531_9750_tc121.htm

By the way, your're the first person to respond to anything I've ever written on this blog. So thanks. A little snark can be a good thing, perhaps.

Posted by: Steve Rosenbush at November 8, 2005 02:18 PM

Maybe the recording industry should win the war. Maybe all of the people who have been downloading music files have been enjoying a free ride that is about to end. I agree that the new world of digital media opens up innovative marketing avenues for the recording industry and I also agree that they've been deficient in using them. However, it's not mine or anyone else's right to co-opt their material and force them to do so. The music industry might be stupid, but it's not the public's right to enforce intelligence. Granted, the market will often do so instead. But the market (should) follow rules, that's what makes good markets.

Consumers deciding to ignore valuable copyrights is not following the rules and actually hurt the market. Apple, the first company to create an application and device compelling within the rules of the market demonstrates what happens when you really put thought and effort to create a societal good.

As for Billy Corgan, he is basically saying that myspace allows for disintermediation of the labels, which is a real threat to the labels, but that still doesn't mean that people should steal music. It does support the concept that there are alternatives to the 'label' system, but those alternatives still have a long way to go to prove themselves in the market and become the force that the labels are today.

I'm sure you noticed that myspace has now created a label as well.

Meet the new boss, it looks a lot like the old boss.

Posted by: TechTrader at November 10, 2005 05:02 PM

lol

Posted by: fgh at December 12, 2005 03:04 PM


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