I've subscribed to Seth Godin's blog for many months. However, just recently I've seen two of my music-related sources cite to Seth's Blog as an authority for commentary on our industry. I always read Seth's daily anecdotes as general guidance in business philosophy, not specific business policy. He is insightful and has many years' experience. Unfortunately, none of them are in music. While I have great respect for him, Seth Godin's comments are being taken out of context by those within the industry and, rather than being viewed broadly as food for thought, are being construed as a road map for the industry's future.
First, I acknowledge that a main thrust of (and allure to) Seth's P.O.V. is his position as an outsider. For whatever reason, it seems every otherwise intelligent businessperson throws logic out the window when it comes to our industry - no one would advise an insurance salesman to lead a car dealership, or a coal operator to open a flower shop. Yet for some reason everyone thinks that either (a) the music industry is so screwed up that anyone within the industry is necessarily tarnished, or (b) the music industry is so easy that anyone can do it.
I've seen countless otherwise successful business people pour millions into their music startups - mainly publishing and record companies. 99 out of 100 fail. It's worse than the restaurant business. Let's face it, you need to have a knowledge of the industry before you can set out to change it.
Seth's two industry-related blogs are here
. Admittedly, the latter is on film distribution, though it was discussed by a music-related news source, Digital Music News, and concerns digital media and copyrights, which is why I mention it here. I thought it shocking that Digital Music News picked it up due to the sheer impracticality of the primary suggestion - that movies be delivered for 50 cents a piece initially. The credit card fees alone would devour such a low fee. While I can't recall exactly what my processing fees were in my digital distribution days, I think it was a % of the transaction with a minimum of 26 cents. Our business model was to offer music "virtually for free," with a target price of $1.00 per live concert performance. After considering storage and bandwidth fees, as well as credit card fees, the least we could sell a show for was $5.00. While charging 50 cents per video is a nice idea in theory, it disregards reality and is a figure pulled out of thin air.
Seth's other post concerns the devaluation of recorded music through the digitization process, and is the position echoed by Gerd Leonhard, "Media Futurist."
My point here is more a venting of frustration than a counter-point to the arguments raised; I'm miffed that so many industry commentators are fixated on one particular narrow-minded view and only perpetuate theories and ideas that mirror their own perspective. I've noticed that Paul Resnikoff, editor at Digital Music News, is particularly guilty of this - the vast majority of his articles begin with some variation of, "As record sales continue to plummet . . ."
The truth is, recorded music is not as dead as it's made out to be. Talk to indie music distributors and independently owned record shops. They'll tell you that sales are UP and in some instances, WAY UP. Vinyl sales are steadily increasing and the more artists who release on vinyl, the higher go the sales.
One fact the doom-and-gloomers fail to recognize is that big box retailers are a recent phenomenon. They stole business away from the independent record shops by offering convenience. They thrived when top hit-makers sold gazillions of copies - the boxes could offer a modest selection but still generate huge revenue from a relatively small footprint in their stores. File-sharing allowed the less initiated to get these records for free so those consumers stopped buying from the boxes. The avid fans, the ones who have always made up the core of the business, are still as rabid of consumers as they once were, if not more so. That the market has sloughed the big box retailers and trend-of-the-minute consumers who frequented them was as much an industry correction as a sign of Armageddon.
The doom-and-gloomers are fixated on statistics that do not take into account the indie distributors, the indie stores, or the indie artists. As a result, their information is faulty and their judgments poor. They are calling for radical change in a corporate structure when the radical change would be instituted by the young and nimble entrepreneurs - the reason why the commentators aren't seeing the change disagree with the conclusion that recorded music as a revenue source is a thing of the past. Majors have been seriously injured by file sharing but their problems run far deeper than downloads, and those problems won't be corrected with the addition of a 360 clause in their record deals.
The argument that once something becomes digital its almost valueless is short-sighted. I earned a business degree before law, and while it doesn't qualify me for much, I appreciate the rule of supply and demand just as well as anyone. However, the economy doesn't operate in a vacuum. True, when supply is virtually limitless, demand is theoretically nonexistent. However, this ignores two key real-world pressures: legality and loyalty.
I wholeheartedly disagree with the RIAA's litigious nature and think suing consumers is the dumbest idea ever. Fear mongering is no way to do business. However, I also think that anyone making money off of their illegal enterprise is more loathsome than the major labels who've ripped off artists for decades. That the Bit Torrent trackers and file sharing destinations have made millions upon millions from distributing music for free is no moral crusade against the man. They are leaches and deserve to be punished. Legitimate file sharing can and should be distinguished from illegal activity. I am a huge advocate of technology and no innovation should be limited; I support open source and believe Creative Commons and other open-rights licenses are invaluable to society. Our focus should be on getting rid of the jerks.
This should not be an insurmountable task - technology should catch up and we should put our energies there. File sharing even of copyrighted content should be allowed between individuals. Yes, in our interconnected world, 6 degrees of separation could come into play and theoretically allow digital media to be distributed infinitely. However, that's unlikely. Friends sharing their music with one another should be no more punishable than a friend playing a CD at a party (a "public performance" specifically exempted under U.S. copyright law).
But, as Seth Godin argues and others have parroted, we should NOT throw up our hands and say that digital media has no value. We should not concede that selling music is a thing of the past. However, we should do so not for purely financial reasons. I say "not purely" because in order for high quality music to be made, artists must be able to earn a living and dedicate their lives to it; if they only do it part-time, you end up with part-time product.
Knowing that money must still be made in the music industry, commentators like Seth Godin, Gerd Leonard and Paul Resnikoff argue for alternative means of generating revenue. Ad-supported sites are an avenue, as are selling more merchandise.
The very grave problem with these models and others like them is that music quite literally ceases to be the product. When recorded music is ancillary to something else, that something else will take priority. Decisions will be made based on maintaining the health and viability of that something else and all other things, including the music, will necessarily be compromised as a result.
Artists should make music for music's sake, without influence and without agenda. If we are truly concerned about saving the music industry, we shouldn't lose sight of why it is worth saving in the first place. Any theory, any proposal that requires an artist to forfeit earning a living on his or her music alone is bound take this industry down a path that is doomed.