just follow my ten easy steps to fix the music business, and i'll never write about it again

Sometimes an idea can come to you when you least expect it. Such as this one. It seems almost too simple to work, and it's not really what I would consider a well thought out plan. Maybe it'll get a little better when I start banging on the keyboard. Or more likely, other people much smarter than I will poke, prod, add, subtract and run with this ball. I might enjoy sitting on the sidelines and watching.

I was going to outline what's wrong with the music business model before I told you how I'd fix it, but that's pretty stupid. We all know. This business was really never that great anyway, and the transition from compact disc to digital file (along with greed) has killed it. So here we go kids....

1)Make all digital downloads and streaming 100% absolutely FREE:
Hear me out before you moan. We're now on the second generation of kids who can search and download an album in less than a minute from the comfort of their home. I know it's illegal and so is jaywalking. Both are unenforceable. So use the bottled water model. If you're thirsty, you can drink for free (in the abstract) from a water fountain or hose. But if you want quality, you'll spend a few bucks for a bottle of fresh cold mountain spring water. The same with music.

2)Decrease digital quality:
Make it worse, not better. Instead of offering high quality digital music, make it something like 128 kbs only. It'll sound ok on a portable device, but not really all that good. It'll still allows all artists an equalized distribution channel to allow their music to be heard. And by eliminating the revenue stream (those pennies that come in every month or so now) you end the need for digital distribution methods. So you record it, upload it and it's all DIY.

3)Immediately eliminate production of the compact disc: With sales going down year after year, it's time to pull the plug on this non-green piece of plastic. By doing so, and with carefully keeping your master recordings under lock and key, you now can control the quality factor. And in the stores, you'll fill the space up pretty quickly because...

4)Designate the vinyl album as the one and only configuration: It has served us well, we need it back in our lives and kids love them. It won't be so easy to convert into a digital file as with a CD but even if it was, it's a tangible item that can be held, touched and played with. And more important, bought. People crave the tactile experience. And yes...it sounds damn better. I'll finally admit it. (A friend just noted that we should also include a free download with purchase to solve the portability issue.)

5)Develop a new pricing and royalty structure:
Music needs to be affordable. A compact disc with a suggested retail price of $18.98 makes me want to throw up. It costs less than ninety cents to make the disc, another ninety or so for songwriting royalties. We don't need to send anyone to Bermuda or the Riviera to record, and you keep both recording and marketing costs down by utilizing technology. Kill off the red carpet new release parties in Beverly Hills and you can strip out large costs by changing your supply chain and the way it's structured. Good quality vinyl albums should be available to consumers for less than ten bucks, and maybe even lower. And the artist and composer should get the biggest chuck of that and not a small percentage. (Jazz pianist Vince Guaraldi's deal with Fantasy Records was that he received 5% of sales; they got 95%.)

6)Restructure the supply chain:
Let's call the current major label and distribution structure for what it is: a monopoly that victimizes artists and consumers. It should be either eliminated completely or at the very least re-structured as a stand alone entity; separate from management, booking, marketing, publishing, merchandise and media functions that operate against the best interests of the creative community. Let them manufacture records and ship boxes. That's it.

7)Restructure the client base: Eliminate the need to charge for digital, and you've just taken out iTunes as the dominant player in that market. Go a few steps further: no longer sell to major chains or big box retail. Say goodbye to Walmart, Target, Best Buy, Trans World, Barnes and Noble and Borders. We'll sell records at record stores. Period. You can be a retail chain, and you can sell other product lines. But at least 50% of your floor space needs to be designated for record albums.

8)Redistribute the wealth:
I gather I'll lose some of you here, but tough. We need to put more money back into the hands of the songwriters, vocalists and musicians, and take it out of the pockets of the business people. Can you tell me why the executives at SONY, Universal, Warners or EMI need to be paid millions each for making poor decisions, lining their pockets with the work of others and the general systematic rape and pillage of an art form? Get rid of just one executive at Universal and you can hire probably a hundred bright young folks who will bring new ideas, creativity and expert market knowledge to the table.

9)Offer tax incentives to small business:
Let's create an environment that allows small boutique record labels to grow, or maybe help put a business loan into the hands of some kids who want to open a new record store. Let's support new distribution models that keep the power in the hands of many companies and not just the three or four we have today.

10)Subsidize the arts:
Insure that the creative community...from musicians to film makers to fiber artists to whatever...has access to basic necessities at an affordable cost so that they can do what they do. And while we're at it, we need to insure that our schools are getting funding to keep music and art programs alive, and that we encourage craft as career option.

I know...I can blow as many holes into this plan as you can. But you got to start somewhere. Maybe some of these ideas will take root, or hopefully you'll come up with better ones. I know one thing... I'm sick and tired lately of writing about what's wrong with the music business. And it all comes down to the last word in that sentence.

Views: 173

Comment by Henry Jasen on September 22, 2010 at 1:32pm
If this is such a great idea, why did vinyl fall out of favor in the first place? The big sellers took the business away from Main Street record stores because they could sell for less. They lost out because, Amazon and Apple could sell for even less.
Costs matter, prices matter, know how matters. Those kids you want to open record shops don't know how to do it. Most of them will go out of business before they figure it out.
How do you get people to refrain form using an existing technology that is readily available? It is as unenforceable as jay walking. Otherwise you have some great ideas.
Comment by Easy Ed on September 22, 2010 at 2:26pm
@Henry: Vinyl fell out of favor for a number of reasons. First off, the promise of better sound quality. Second, lower costs of goods. That doesn't mean that the consumer paid less, and in fact they paid much more, but the cost of manufacturing, packaging, shipping and handling went down. Which they hoped would equal more profits. And the most important reason vinyl went away: by coming up with a new configuration, the record companies could (and did) sell you what you already owned. Wow. Brilliant. The big boxes (the Best Buys and Walmarts) didn't take the business away...they were given the business on a silver platter from major labels and distributors. They were and still are subsidized under the guise of "marketing costs". For example, you have a CD with a ten dollar cost that should sell for around fourteen or fifteen. Label X gives Walmart five dollars for each unit that they purchase so they can "market" it. That translates to Walmart a cost of goods of only five bucks, and they can sell it for nine at full profit. Undercutting the traditional store by six. That's just one way the business was killed off.

@Craig: Paul McGuinness comes from the place we should run from. Despite him talking about how the old guard has left the building, the reality is that they're still there calling shots, and raking in huge dollars. And he has become their mouthpiece of sorts, pointing to others (the tech crowd) to solve the problems he, his band and their fellow travelers have created.
Comment by SoCalBert on September 22, 2010 at 9:26pm
Fix the music biz? I think we just need to put the 20th century entities out of their misery. That century was but a blib in the entire history of music and it did far more harm than good-- directly the opposite of what the RIAA will tell you. The deeper into this so called digital age we go, the better it gets, imo. 2010 started out slow but as of now I am almost overwhelmed with all the interesting stuff happening. You are proposing top-down rules? That's is exactly what we are finally being freed of. Yeah its tough now but it was only cushy for a chosen few while it lasted.

Limiting online music to 128kb/s? Uh if they could control that, we would not be having this discussion.
Comment by Henry Jasen on September 23, 2010 at 5:51am
Ed,
I don't dispute any of your facts. My point is that businesses will do whatever makes them profitable. Those that don't, won't last very long. People will buy what appeals to them, at prices that appeal to them. There will be a smallish audiophile market that will pay up for quality sound. that market won't be any bigger percentage-wise than it was in the 1950's or any other time since then. Almost everyone else will accept radio quality sound to hear the music they want to listen to at the lowest price. There usually isn't much middle. For better or worse, that's the way it works.
That's why, despite the appeal of your proposal, I doubt that it will come to pass. Nonetheless, please don't give up because I am skeptic.
Comment by Easy Ed on September 23, 2010 at 7:04am
@SoCalBert: You sound exactly like I did up until a week or two ago. And who knows, I could get back to your position again tomorrow. I think one of things that's fueling my view at the moment is in regards to a those chosen few you mention. It's still cushy for them and will remain so as those multi-national corps are working overtime to land grab the digital marketplace. Let me share an email I received yesterday:

Dear Ed,
Last June I sent an e-mail urging the music community to become more engaged in the fight against online theft. The result -- over 16,000 e-mails imploring Congress to pass aggressive laws to combat piracy.

It looks like Washington heard our call. A bipartisan group of Senators has introduced legislation that would give the Justice Department an expedited process for cracking down on rogue websites that are dedicated to making unauthorized copies of music available to internet users around the world. The Justice Department would target the most egregious pirate websites, go to a federal court with the evidence, and then seize the domain name. Once a site has been seized, the Court would issue an order to intermediaries -- such as ISPs, payment processors, Internet registries and registrars, advertisers, etc. -- prohibiting them from doing business with such rogue sites.

CNET called S. 3804, “one of the most ambitious attempts yet from the U.S. government to fight online piracy” and observed that “if the bill passes, it could mark the most significant antipiracy victory for the film and music industries in quite a while.”

Each and every one of us needs to act NOW if we expect the legislation to gain momentum. Our community has never matched the noise created by those on the “copyleft” – we need to be louder than ever to drown out those who don’t care about our art, our jobs and the difference between right and wrong.

Please click HERE to send an e-mail to your Senators and Representative and ask that they support this unprecedented legislation. Take the time to ask your colleagues and friends to send a message as well. It’s quick and easy – just enter your home address and click “send.”

Sincerely,
Jim Urie
www.musicrightsnow.org

Could Jim Urie be the new Ralph Nader of consumer protection? I doubt it, because Jim's full time gig is being the president of Universal's music distribution arm. He's fighting hard to convince you and me to join his fight against piracy so that his corporation and others can stay in business and and enhance the status quo. His antipiracy consumerism and pressure on the government to do something is laughable since it's akin to the fox asking for a new gate around the chicken coop.
Comment by Richard Skanse on September 24, 2010 at 11:35am
So, reinforce the mindset that music should essentially should be free and not worth paying for by making it all completely free online, albeit at low quality (though at a level the average listener wouldn't necessarily notice or care about), and then make it a hassle to actually BUY and listen to music by making the high quality versions exclusively available on vinyl, sold only at little record stores? And kill all legitimate pay download sites in the bargain, so independent artists once again have to rely on national distributors or seek label deals in order to get their music heard?
I'll pass on all of the above.
Comment by Easy Ed on September 24, 2010 at 12:16pm
@Richard Skanse: I know....it's like a tube of toothpaste. You try to address one area of concern and another one pops up. This morning I woke up and re-read Paul McGuinness' plan for the third time and thought...yeah...maybe he's right. It goes back to my opinion of last week about putting everything on a cloud, selling subscriptions and downloads, and having on-demand physical goods for those who want to touch something. The problem is, that's a major corporation game, and I don't think they'll play very nice given their history. So I don't know....like I said...I'm hoping others have better ideas than mine. I'm open to hearing yours.
Comment by Marybeth D'Amico on September 28, 2010 at 5:42am
How can serious musicians give up on CDs when radio stations and reviewers for the most part insist on receiving them? And, no, I don't and never will believe in giving away my music for free. That tells my audience that my music has no value.
Comment by Alan Sax on September 28, 2010 at 6:18am
Whoa, there Easy. I don't agree at all that "terrestrial radio is dead for music". I hope the big investors feel that way and sell their stations. And, we, meaning local, music focused folks who want to hear something different get together and put up the funds and get the stations back . In the mean time there are lots of local, collage,public, community and LP stations that are pushing from the edges of the dial and not playing the same old got to fit my very limited format style. With todays technology the local station can also run much of its content on line so we can all enjoy the great regional programing that is out there. Radio built much of what people love to listen too and it is now, if you can find the right station. Of course it needs reform but it aint dead and people still have radio's...not so many of us have turntables.
Comment by OkieWolf on September 28, 2010 at 6:51am
I agree with you 100%. The music "business" should never be about execs and labels. It should be about the artists and that's all! We are the ones making the music. We are the ones spending countless days on the road away from our families. We are the ones sacrificing ourselves for the art. The record companies do absolutely nothing. They sit in their plush offices and just watch their bank accounts grow at our expense.

I think we should take the Waylon Jennings approach. He, along with a few others, started their own record label. They said screw the establishment, we're going to do this our way or else. After many successes, Nashville had to listen. He eventually got hooked up with a business manager from New York City, named Neil Reshen. They negotiated a record deal with RCA which gave him a $75,000 advance and near-complete artistic control. Re-negotiations of his touring contracts had similar results and he started turning a profit from his touring (almost unheard-of in Nashville at that time). This was around 1972 or 73. The point is that Waylon could do this because of where he was in his career. By this time he was the hottest thing going in country music so he had a lot of leverage. The rest of us don't have that kind of leverage. But many of us do have that kind of determination. Sometimes that's all it takes.

I think if all of us stick together on this a one united front, we could actually bring the record companies to their knees. But it's not an easy thing to do when today's artists that have "made it" make millions. People need to stand their ground. Is your integrity, and possibly your very soul, worth a shiny new Cadillac? Not to me it isn't. What about you?

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Created by No Depression Feb 17, 2009 at 9:06pm. Last updated by No Depression Sep 24, 2012.