Welcome to The Terrordome
February 2nd, 2010
Hello, and welcome to the inaugural edition of The Terrordome, in which yours truly will give you the rundown on the latest music business developments (and a little color commentary).
Paying attention to this stuff is actually part of my job, but if the CIA is letting their guys moonlight, why can’t I?
So here are some hot off-the-tubes headlines with a brief explanation about why you should care (or not).
- Is Streaming the Future of Music?
I say yes. Then again, I live in a Jetsons-style home with all of my media served digitally through specially-equipped speakers that also allow me to listen to massive catalogs of music, streamed in high-quality, on-demand – all for a nominal fee. (Like 12 bucks a month for basically all the records in the world). The only problems with schemes like this is that the payout to artists is still pretty damn low (I know because my music is on these services and there’s not even a major label taking a cut) and the licensing costs to the services themselves are prohibitive to sustainable business models. The entire concept would benefit tremendously from economics of scale — meaning, if more customers used streaming subscription sites, monthly fees would drop and artist payouts could conceivably increase. I got to live interview Dan Ek from Spotify (an incredibly popular “freemium” streaming service so far only available in Europe) at a major music conference last fall. He says there’s plenty of reason to think streaming is the future. Then again, he’s got a product to sell. All I know is that if Apple gets into this game, all the other companies might as well put up “closed for business” signs.
- Buzzword of the New Decade: Monetize
Back when I worked at Ye Olde Record Shop, I plenty got tired of hearing the words “where’s your jam section?” Well, now I’m tired of hearing “how can we monetize this?” This article is an inside-baseball account of Midem — an international music biz conference that seems to always include a lot of griping and crystal ball-gazing from industry heavyweights. Apparently, the theme this year was monetization. Some people think this means locking down the internet for the sole benefit of the major content providers and ISPs. Others (like me) believe in the idea that if you made licensing easier and kept the lanes open, we’d see a natural expansion of the legitimate digital music marketplace. None of this helps traditional retailers though. (Sorry, Crandall.)
- Ticketmaster and Live Nation Get Married
I’m not gonna get into what it means. The link above should help sort out all the Department of Justice hullaboo, though.
- Grandma Endures Wrongful ISP Piracy Suspension
Here we go again. The latest approach to unlawful filesharing by some in the content industry is to push ISPs (through Government mandates, if necessary) to adopt graduated response, or “three strikes” protocols. This means that if you’re suspected of infringing, your interwebs provider could cut your service after a few warnings (or none at all, in the above case). Currently, several European governments are in various stages of adoption, and there’s some rumbling about a US-led international copyright treaty that would make this a planetary remedy. Of course, there are a zillion questions that come up, from consumer recourse (what if you’re wrongly accused?) to the competitiveness of the broadband marketplace (like, is there even another ISP that you can go to?). Piracy is horrible and wrong, but I’m not sure our legal system is equipped to handle this. Stay tuned.
- Did You Watch the Grammys? Apparently, a Lot of People Did
A 35 percent spike in viewership is nothing to sneeze at for both the struggling networks and the struggling recording biz. Now we can sit back and watch as the entire industry touts Lady Gaga as the first superstar of the digital era. (Think about it: all the other massive acts snuck in either before or at the start of the Great Disruption.) So expect 360 degree deals to become the major label norm (if they aren’t already) and for the smaller and smaller number of new artists signed to sound like Cher singing over Ace of Base. Look, I’ve got nothing against Gaga — she’s got a cool art school/fashion project going on. Still, when the mainstream biz bets the farm on Taylor Swift’s pitchy live performances and Gaga’s costume changes, I get annoyed. But hey, you can’t argue with ratings. Unless your name is Jay Leno.
I could probably post more, but all of our heads would explode. See you next time inside The Terrordome!
Casey Rae-Hunter is a musician, producer, writer and music/media/tech/policy wonk in Washington, DC. This post does not necessarily reflect the views of his employer. You can harass Casey at his site, The Contrarian.
February 2nd, 2010 at 9:08 pm
The streaming model may have some traction in the future, but for music as a cultural commodity, it’s a deathknell. When we can have access to anything anytime, it’s not special anymore. There is something very important, and very lost, in placing a physical and limited item in context with your life’s moments. Playlists may be now and forever, but mixtapes you remember. It’s this watering-down of music as a cultural commodity that has further decreased the public’s interest in it, which again distances them from ownership. How does the industry respond? With hyper-compressed low bitrate delivery ’systems’ that further disenfranchise the consumer. It’s a shitty spiral.
TB
February 2nd, 2010 at 9:12 pm
And another thing, there’s no way that any service for 12 clams a month can provide unlimited tunes in anything that would have been considered ‘high quality’ before the iPod age. Maybe when we have gazillabit per second bandwidth, but all those Rhapsody/Pandors/Spotify/XM/etc services are streaming at what, 64, 128k?
TB
February 2nd, 2010 at 9:30 pm
Um, says you.
You can’t put the genie back in the bottle. People want content on-demand. Overpriced petrochemical discs and media consolidation was the death of music industry 1.0. These services could represent a new beginning, provided licensing reform allows for te lubrication of the marketplace as an alternative to piracy.
Oh, and Spotify is Ogg Vorbis using P2P-based delivery, so the sound is excellent and the architecture robust. My system (Sonos) sounds better than any CD player I’ve ever owned.
But I wouldn’t worry unnecessarily, Terry — there will always be a collectables market.
February 3rd, 2010 at 7:56 am
“There is something very important, and very lost, in placing a physical and limited item in context with your life’s moments.”
I personally agree completely…..I just don’t think that the majority of consumers too.
Most people have gotten used (and even prefer) the concept of digital music, and I think that a high-quality subscription service could succeed greatly. The only issue is still the elephant in the room—illegal downloads. Why buy a subscription when you can download for free?
It will take a two-front assault: first, dismantle the filesharing sites (Rapidshare already seems to be dying under the pressure from labels/production companies and are killing off millions of their own links) and then introduce a worry-free alternative that isn’t cost prohibitive.
If they could offer a service where you could download all of the uncompressed audio and HD-quality video you wanted for $20 a month, it would be hugely successful. Considering an unlimited Rapidshare account is $70 a year and you have to fight to find active links, even the illegal download set would be hard-pressed to not give in and just pay the extra cost for the convenience. Maybe just tack the cost on to your monthly ISP bill.
As for us vinyl fetishists and Criterion Collection types….as Casey said, they will be even more coveted as collectables.
February 3rd, 2010 at 9:41 am
I stand corrected on Spotify, but how many people are using a high-quality service/server? Itunes and iPod docks with tinny crappy speakers are the rule; I just listened to Pandora for awhile on an iTouch and the drums sound like someone whacking a wet towel. But as has been said, no one cares, it’s quantity over quality. Part of the decline in all of the music industry, downloads included, is that crap sound has caused people to listen less. Video has taken over audio as a primary home entertainment forum, but even this oversaturation is affecting DVD and Blueray sales. People are loaded up with tons of cheap/free media, and it all becomes disposable.
Sure, there’s the ‘collectors market’, but it’s sad that decent sound has to be a niche.
February 3rd, 2010 at 10:08 am
Look, you’re preaching to the choir on sound quality. I’m a producer, and I hate the fact that the consumer expects hi-def video, but is satisfied with lossy MP3 audio. But this isn’t the end of the line here. Spectrum usage/delivery will become more efficient and digital audio compression — for streaming or individual files — will be less corruptive.
Keep in mind that in the “good old days,” people listened to shitty AM broadcasts on transistor radios with one mono speaker and liked it just fine. 8-tracks weren’t exactly the pinnacle of fidelity, either, but the random access part was a significant enough advancement for tape that it helped usher a new way of thinking about compact audio. Cassettes? Don’t get me started.
Here’s my REAL point: You cannot re-graft the scarcity model on an an paradigm of abundance. You’d have better luck getting toothpaste back in the tube. I personally enjoy being able to consume media of all kinds on-demand without having to “own” a product. But that’s me. I never really cared much for artifacts anyway, and I’m hoping that tomorrow’s services and devices will make fuller use of the range of possibilities that the digital format can allow, from better artwork and liner notes to added value like video, tour dates, etc.
Am I a utopian? Perhaps. But I say all this with the fundamental recognition that the digital transition is by no means complete. Talk to me in five years. “Good” sound may very well again become the norm. I hope so. But I’ll tell you this — I wouldn’t go back. I enjoy my music MORE now that I’m not bound by physical limitations. I mean, I can fucking listen to the entire Alice Cooper catalog and RELIVE that romantic childhood without having to reinvest in physical product that I have no space/use for. My memories of this music is in no way tied to the artifact — it’s the music and peripheral experiences that bring the lasting richness.
Jay, I’d let you in on some top-secret piracy stuff, but I’d probably be targeted for assassination.
February 3rd, 2010 at 12:08 pm
I do expect that bandwidth will one day catch up and allow for better sound quality, as we have seen the trend from 128 to 256 mp3s from the early 00’s to now (that doesn’t address hyper-compressed mastering, another yet related story altogether). Unfortunately the development of mp3’s and streaming services to date have exhibited arguably the first intentional quality backslide of in the history format development. Yes, there were cassettes, but being a portable medium, they were truly a separate entity from standard home formats.
Digital has certainly come a long way but high-quality servers, outboard DACs, and the like, will remain the interest of a limited audiophile group.
I still contend that the move towards unlimited access diminishes the sanctity of individual works, however. Yeah, the cat’s out of the bag, and I probably need to get with the program (although I am a user of Pandora, and have a 17,000-song hard drive library). Still, there’s something special about holding that cd/record that someone gave you long ago, or that ‘Bat Out of Hell’ tape that was playing in the car when you lost your virginity.
TB, modern Luddite
February 3rd, 2010 at 12:43 pm
Mastering for MP3 is Satanic. I can’t even listen to the new Mastodon record because of the ear burn, even though I love the music. So yeah, full agreement there.
But I think file formats and delivery standards will improve. There’s already a next-gen MP3 on the way that uses metatagging to add refreshable enhancements to the file while considerably improving the compression ratio. I hate discrete digital files though, which is why I prefer the idea of streaming on demand. Better results, however, will depend on better broadband infrastructure, and as long as its a duopoly, there’s no incentive for the ISP (at the middle and last mile) to provide better service. No competition = no innovation. The “trunks” of the internet are fine — pletny of bandwith. I’d like to go to South Korea or Japan and see if they have a better hi-bandwith music delivery protocol that takes advantage of their more robust networks.
But I digress. For you, that Meatloaf tape is important. For me, it’s the song itself. I prefer the celestial jukebox and its virtual limitlessness to the fetish object. I get your point, though. I just think that calling novel digital music delivery systems “a death spiral” to be somewhat disingenuous.
February 3rd, 2010 at 2:54 pm
Okay, maybe I’m dragging out this little discussion, but it’s good to find someone who even feels it worth discussing. There’s two things we’re talking about here, the decline in SQ of mainstream music delivery today, and the masses’ connection to that music.
First point, I do hope that improving SQ becomes a relatively standard norm. Not that everyone will spin virgin vinyl with exquisite Japanese moving coil cartridges, but I’d like to hear music in a restaurant that isn’t obviously heavily compressed, dynamic and bitrate-wise. And it would be nice if reasonably-priced music components were available and used, rather than ipod speaker docks. But even in this ‘vinyl renaissance’, where presumably SQ has found new meaning, look at one of the best, if not the best, selling turntables today- the plastic crap that is the ION usb turntable. We have a chance for a better connection to music and this is what the shops foist upon the doe-eyed consumer. Kinda makes me lose faith in the vision of better SQ expected by the masses.
As for personal/cultural relevance of music in the streaming age, maybe my ‘deathknell’ comment was a tad hasty, the grumblings of a too-young old man. But I can say that of the streamed digital media I have partaken in, little has ’stuck’. I just looked through my bookmarked songs on Pandora, and frankly, I hardly remember most of them. It’s just too easy to click and move on, rather than let them sink in. When we ‘like’ things so easily, it’s hard to single out something precious to love.
For the record, there’s no Meatloaf tape in my life, I was all filled up on Southern Comfort that fateful night and haven’t a clue what was playing, probably Poison or Cinderella.
Thanks for the chat.
TB
February 3rd, 2010 at 4:36 pm
Yeah, I’ve enjoyed this discussion, too.
I don’t think you’re wrong. There isn’t actually a “right” or “wrong” here. And a personal preference for better sounding audio is clearly something we share.
I’m not convinced, however, that there’s a reason to go back to the era of scarcity to preserve the tactile/emotional response we get from physical objects. Those items will still exist in some form or another and some may still be (peripherally, at least), tethered to music.
I find it somewhat telling/tragic that we’re having this discussion at the website of a physical retailer, however. It’s a grim irony that’s not lost on me — especially since I spent five years or more working there!
At the end of the day, though, I think that music and the industries that sprung up around it — from sheet music to iPods — have undergone a paradigm shift whose full impact has yet to be revealed. This may be bad for some traditional businesses, but I hardly think it’s the death knell for music. On the contrary, I think it could put the focus back where it should be: on the art itself.
Again, I can see all sides of this argument. Particularly because I’m a musician and I work with artists, managers and engineers at all levels of “success.” There is no monolithic perspective, trust me. But a lot of the creators I know (including myself) are happier to have the ability to directly engage with potential audiences around the world at a nominal cost and without having to ask permission from an industry gatekeeper. What’s missing is the engine of investment. Which is why there needs to be the constant reinforcement that the art you like comes from somewhere and has value (what the actual dollar amount should be is an open question). Maybe physical product helps here. But I don’t think we can bank on that.
Like it or not, we are all broadcasters now. We can tunnel into our niches as deeply as we want to go. There is no limit on discovery, but there may be a premium on time. And I think that’s what you’re really annoyed by: the fact that there is too much media and not enough time to properly appreciate it.
I feel ya.
But on the other hand, I enjoy being able to get into Vivaldi at age 35. I mean, I always hated baroque, but this stuff is aces. And I’d have figured that out if I hadn’t heard his music in a Kenneth Anger movie and immediately “dialed it up.” And then I went further… and further….
What I like even more is when I discover an independent artist and know that there’s a monetization structure behind my listening. Not much of one at the moment. But hopefully that will change, and not require the artist to give up their copyrights as a condition of entering the marketplace, like in the old days.