Comments on: The music industry’s problems are bad relationships http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/ Your guide to discovering German music Sun, 01 Aug 2010 09:02:01 +0000 http://wordpress.org/?v=2.5 By: Charvolant » Blog Archive » The music industry’s problems are bad relationships http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-1084 Charvolant » Blog Archive » The music industry’s problems are bad relationships Wed, 13 Feb 2008 02:50:37 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-1084 [...] I wrote a few weeks ago on my Germaniac.com blog, but I thought it would be valuable here as well. Here is a link to the original post and lots of [...] […] I wrote a few weeks ago on my Germaniac.com blog, but I thought it would be valuable here as well. Here is a link to the original post and lots of […]

]]> By: Paul Gifford http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-992 Paul Gifford Mon, 28 Jan 2008 07:36:44 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-992 One satisfied customer at a time :P Well, suffice it to say there wil probably be a long reply at some point from me on that one as well :) One satisfied customer at a time :P
Well, suffice it to say there wil probably be a long reply at some point from me on that one as well :)

]]> By: Greg http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-991 Greg Mon, 28 Jan 2008 07:24:42 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-991 I'm glad our little discussion helped you at work. Clearly, that is proof that Germaniac.com is helping the world become a better place! ;) The next segment is about music fans and the value of music. It's not done yet, but I am aiming for right around Wednesday or so. I’m glad our little discussion helped you at work. Clearly, that is proof that Germaniac.com is helping the world become a better place! ;)

The next segment is about music fans and the value of music. It’s not done yet, but I am aiming for right around Wednesday or so.

]]> By: Paul Gifford http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-989 Paul Gifford Mon, 28 Jan 2008 06:05:25 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-989 What's funny is that I actually ended up in a conversation with a customer about this at work this evening, and actually sitting down and writing this really helped me out while dicussing it for a second time. Looking forward to your next post about this sort of thing Greg, this has been really enjoyable :) What’s funny is that I actually ended up in a conversation with a customer about this at work this evening, and actually sitting down and writing this really helped me out while dicussing it for a second time.
Looking forward to your next post about this sort of thing Greg, this has been really enjoyable :)

]]> By: Greg http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-987 Greg Mon, 28 Jan 2008 00:38:56 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-987 Yes, that's true. The individual discs are quite cheap, especially when you're a record label buying thousands and thousands at a time. Another good point you brought up, my question was kind of pointless because people do it already. What I meant was if the band themself offered the music in MP3 format for free, would people still buy, but I think the answer would be the same. If you're going to buy a CD, it's going to happen regardless of the cost of the MP3s. Yes, that’s true. The individual discs are quite cheap, especially when you’re a record label buying thousands and thousands at a time.

Another good point you brought up, my question was kind of pointless because people do it already. What I meant was if the band themself offered the music in MP3 format for free, would people still buy, but I think the answer would be the same. If you’re going to buy a CD, it’s going to happen regardless of the cost of the MP3s.

]]> By: Paul Gifford http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-984 Paul Gifford Sun, 27 Jan 2008 17:02:57 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-984 I must've misunderstood a few things in the past :P And one other bit of clarification on my part: I'm not talking about packaging when I said it was under a dollar, I meant solely the disc itself. If I remember right, a pack of those usually averages out to about a quarter per disc. Naturally, packaging will get more expensive past that :) And also, pretty much that whole comment was meant to be about North American bands trying to promote themselves in their own cities and communities, rather than German or other nationalities trying to promote themselves outside of their own country. I completely agree that a place like this site would be a much better place for a German band to promote themselves than trying to get it to radio stations. And I certainly have and will continue to buy $8 or $10 or $15 CDs despite having the MP3s for free, provided that I like the music. For me, the actual act of buying the album is my showing support for the band. I know of others who are like this, too :) I must’ve misunderstood a few things in the past :P
And one other bit of clarification on my part: I’m not talking about packaging when I said it was under a dollar, I meant solely the disc itself. If I remember right, a pack of those usually averages out to about a quarter per disc. Naturally, packaging will get more expensive past that :)
And also, pretty much that whole comment was meant to be about North American bands trying to promote themselves in their own cities and communities, rather than German or other nationalities trying to promote themselves outside of their own country. I completely agree that a place like this site would be a much better place for a German band to promote themselves than trying to get it to radio stations.
And I certainly have and will continue to buy $8 or $10 or $15 CDs despite having the MP3s for free, provided that I like the music. For me, the actual act of buying the album is my showing support for the band. I know of others who are like this, too :)

]]> By: Greg http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-981 Greg Sun, 27 Jan 2008 06:45:14 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-981 Wow, quite an impressive comment! What do we disagree about on music downloading? I think we are pretty close in opinion, actually. I have to say that I completely agree downloadable music is overpriced. The whole 99 cents per song idea is roughly based on the old model of selling CDs. But you know what, a download isn't a CD and costs far less to make, distribute, stock, etc. Individual songs aren't worth even 50 cents now... they're probably somewhere between 10 and 25 cents I would say. This isn't just me being pessimistic about the value of music. In reality, the value of music has actually decreased in real terms. Why? Anyone who has taken a basic Economics class can tell you that an onject's monetary value is derived from its scarcity. The objects that are most difficult to find and reproduce are the most expensive, and the things that anyone can make and trade with relative ease are cheaper. And now that the MP3 and the internet have made copying music just about the easiest thing in the world, music is no longer scarce. At all. There's nothing stopping someone from making a million digital copies of an album that otherwise would have only sold 100,000 copies. If each of those 100,000 copies sold for $15, then 1,000,000 are only going to be worth $1.50 each if you assume the total value remains the same. You can't fight technology, it can't be uninvented. When the game gets tough, you have to change the rules and take advantage of the problems, because fighting them is hopeless. For starters, bands need to sell more stuff that IS scarce, which does retain value, so they can focus making money on that. And use their music at a very fair, low price (perhaps even free) to stimulate sales of the money-making things. Another thing you mentioned... mailing CDs to local radio stations. In today's world, this is just stupid if you ask me. Bands should be mailing their CDs to the people who talk to the masses on the internet. For example, a CD sent to me would do a hell of a lot more for a band than sending one to their local station. With the radio, you might have 1 or 2 people who really get interested in it, but if a band is German and sends a CD to a site like this, and I write about it, they are reaching out to way more people than they could on the radio. The whole idea is that you send your promo stuff to the place where your fans are gathering, and usually that's not the listening to the radio. Especially because the radio exists in a single moment in time. The chance that a potential fan is listening to the exact radio station at the exact time when your song gets played is so tiny compared to the text of a blog or website which remains online basically forever. Just a little bit of clarification on one of the things you mentioned, the cost of producing a CD. You said it's well under a dollar, when really it is pretty close to a dollar (around 80 cents) for a major label which can produce the CDs and print the inserts in massive quantities for cheap. If a band were to go to a CD manufacturer themselves, the prices will easily be over $1, and can even reach $2 to $3 in some instances for fancy packaging like a multi-fold digipack with a large booklet and stuff like that. Another major cost is actually distribution, because shipping out tons of CDs to stores (and back, if they are not sold) can get very costly. So if we go back to our example of that CD which was valued at $1.50, it is unlikely that you could produce and distribute an album that cheaply and make any significant profit on it. Here's an interesting question... Would anyone buy a CD that was $8 or $10 when the band also offers MP3s to download for free? Wow, quite an impressive comment! What do we disagree about on music downloading? I think we are pretty close in opinion, actually. I have to say that I completely agree downloadable music is overpriced. The whole 99 cents per song idea is roughly based on the old model of selling CDs. But you know what, a download isn’t a CD and costs far less to make, distribute, stock, etc. Individual songs aren’t worth even 50 cents now… they’re probably somewhere between 10 and 25 cents I would say.

This isn’t just me being pessimistic about the value of music. In reality, the value of music has actually decreased in real terms. Why? Anyone who has taken a basic Economics class can tell you that an onject’s monetary value is derived from its scarcity. The objects that are most difficult to find and reproduce are the most expensive, and the things that anyone can make and trade with relative ease are cheaper. And now that the MP3 and the internet have made copying music just about the easiest thing in the world, music is no longer scarce. At all.

There’s nothing stopping someone from making a million digital copies of an album that otherwise would have only sold 100,000 copies. If each of those 100,000 copies sold for $15, then 1,000,000 are only going to be worth $1.50 each if you assume the total value remains the same.

You can’t fight technology, it can’t be uninvented. When the game gets tough, you have to change the rules and take advantage of the problems, because fighting them is hopeless. For starters, bands need to sell more stuff that IS scarce, which does retain value, so they can focus making money on that. And use their music at a very fair, low price (perhaps even free) to stimulate sales of the money-making things.

Another thing you mentioned… mailing CDs to local radio stations. In today’s world, this is just stupid if you ask me. Bands should be mailing their CDs to the people who talk to the masses on the internet. For example, a CD sent to me would do a hell of a lot more for a band than sending one to their local station. With the radio, you might have 1 or 2 people who really get interested in it, but if a band is German and sends a CD to a site like this, and I write about it, they are reaching out to way more people than they could on the radio. The whole idea is that you send your promo stuff to the place where your fans are gathering, and usually that’s not the listening to the radio. Especially because the radio exists in a single moment in time. The chance that a potential fan is listening to the exact radio station at the exact time when your song gets played is so tiny compared to the text of a blog or website which remains online basically forever.

Just a little bit of clarification on one of the things you mentioned, the cost of producing a CD. You said it’s well under a dollar, when really it is pretty close to a dollar (around 80 cents) for a major label which can produce the CDs and print the inserts in massive quantities for cheap. If a band were to go to a CD manufacturer themselves, the prices will easily be over $1, and can even reach $2 to $3 in some instances for fancy packaging like a multi-fold digipack with a large booklet and stuff like that. Another major cost is actually distribution, because shipping out tons of CDs to stores (and back, if they are not sold) can get very costly. So if we go back to our example of that CD which was valued at $1.50, it is unlikely that you could produce and distribute an album that cheaply and make any significant profit on it.

Here’s an interesting question… Would anyone buy a CD that was $8 or $10 when the band also offers MP3s to download for free?

]]> By: Paul Gifford http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-979 Paul Gifford Sun, 27 Jan 2008 04:48:47 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-979 Alright, let's see if I can put down a good summation here... Basically the problem lies on all sectors, to my mind. Here's how I see this break down... The companies suddenly have access to numerous new, cheap technologies for creating music. This music also becomes portable in a way that it never has been before. As a result, the companies can charge basically what they always have, but with the cost of a CD being well under a dollar, their profit increases exponentially. People start to realise they're being charged too much as personal computing technology advances, and access to programs which will put music onto blank CDs becomes readily accessible. To help out friends and share music they love, people start copying albums for friends and family members. As this becomes widespread, new technology is created which allows people to share music on their computer harddrives with others, thus dropping the overinflated profits companies have become used to, as less people buy albums, and instead just download the song(s) they really want. The companies and certain bands react too strongly and create a huge press storm over this, which in turn results in prosecution of the average music fan. This puts a huge wedge between music fans and those who create and distribute the music, and in the long run really only creates a horrible reaction among the average person to those trying to prevent sharing (which at this point is inevitable) with (in one extreme case) a child being sued for more than a million dollars for downloading music. Eventually companies start to realise that this technology is here to stay, and try to tap into the potential profit by legally selling music online, which while cheaper on average is still overcost. Now that I have that out of the way, what exactly would I propose to fix it? I understand very well that for the people involved in the creation of this music to be able to make a living off of it there has to be a fairly large cost, with mixing fees, producers, studio time, instruments, etc. Or do they? The technology now exists to create a professional quality recording in one's own home for much cheaper than some albums. Take a look at the higher profile bands or singers involved in popular music right now in the West, do you ever wonder just how much money is spent bringing in big name producers, buying time in the most well known studios, having it mixed multiple times? While this can result in a great sound, some of my favourite albums were mixed by the artist(s) themself, and for cheap. You don't need to fly to Hawaii and record in a famous studio with the best producer to have a great album, and often all this effort WON'T make a great album. The best of the new audio programs cost somewhere in the range of a few thousand dollars, which while expensive, can result in studio quality. I think I'm rambling a little, but the core of this argument is that the band should essentially be obliged ONLY to themselves. It's only really the bands that are starting out which need money, and I'm not honestly quite sure the best way get around the initial momentum problem, aside from the old fashioned method of recording some songs, playing live to gain a bit of an audience, and mail the music to the local radio stations. Beyond that, the band should sell the album directly. For the smaller bands, it will mean that the profit will go primarily towards them, and I suspect most people would be willing to pay a little extra to get a hard copy of the album to support the band if they're fairly new. To use an experience of my own, when I bought the band Treibhaus' two albums, I dealt directly with the singer Curt Doernberg, and when I did pay the $45 or so including shipping from Germany, I knew that everything outside of shipping went direct to Treibhaus. I enjoy their music, and I had such good service from Curt, that I had no problems with paying that extra money, ESPECIALLY knowing that the lion's share wouldn't be going to some producer or executive or..whatever. As a side note, Curt even wrote me a little note thanking me for the support. Basically I see the future of the music industry as being primarily run by the artists themselves. I think that the whole existence of major labels is unnecessary as the technology begins to be available for an artist to create fairly decent sounding recordings with cheap, readily available software. The Canadian artist Matthew Good (www.matthewgood.org) is a big fan of GarageBand, and will occasionally put up little demos of songs done entirely with it. While obviously not studio quality, they are certainly impressive in quality for the cost behind it. Okay, well, that was rambly, so I'll move on to the last point...downloading. I know Greg and I differ somewhat on our views about this, but I think it really needs to be addressed. Obviously, despite extensive efforts on the part of labels and other agencies, online trading of music is here to stay. And I really think that the industry has gone about this trading with the wrong attitude. Because they persecuted music fans so extensively for using this, they lost the oppurtunity to use it as an advertising tool. Think of radio stations. Essentially, they share music for free with the average person, or consumer. If the consumer likes what they hear, sometimes they will go out and buy a copy of the album the song is from. But what happens if they don't like the other songs? This just means that they will be less likely to buy an album the next time. Nobody likes wasting hard earned money. But, say, the consumer didn't hear the music from a radio station, but instead had it available to him on the band's website. And, not just the one song, but 5 or 6, full length? Suddenly, spending the money becomes a little more feasable, because the consumer is now assured of a return on his investment in the music. Now, the counterargument goes that it's more likely he'll just listen to the songs for free and never buy the album. Frankly, with some people, this is true. But these aren't people that are likely to go out and buy the album anyways. There will always be some way to get it for free, either from a friend, or from the internet, or..wherever. A way will be found. But then think of how many potential buyers are lost, who wouldn't have taken the chance without the samples? There will never be a way to completely remove the people who just take the music from the system, they've existed for as long as popular music has. It's time to accept this and stop letting them block up the whole works. I had something to say about music from other countries, but I need to take a breather... Alright, let’s see if I can put down a good summation here…
Basically the problem lies on all sectors, to my mind. Here’s how I see this break down…
The companies suddenly have access to numerous new, cheap technologies for creating music. This music also becomes portable in a way that it never has been before. As a result, the companies can charge basically what they always have, but with the cost of a CD being well under a dollar, their profit increases exponentially. People start to realise they’re being charged too much as personal computing technology advances, and access to programs which will put music onto blank CDs becomes readily accessible. To help out friends and share music they love, people start copying albums for friends and family members. As this becomes widespread, new technology is created which allows people to share music on their computer harddrives with others, thus dropping the overinflated profits companies have become used to, as less people buy albums, and instead just download the song(s) they really want. The companies and certain bands react too strongly and create a huge press storm over this, which in turn results in prosecution of the average music fan. This puts a huge wedge between music fans and those who create and distribute the music, and in the long run really only creates a horrible reaction among the average person to those trying to prevent sharing (which at this point is inevitable) with (in one extreme case) a child being sued for more than a million dollars for downloading music. Eventually companies start to realise that this technology is here to stay, and try to tap into the potential profit by legally selling music online, which while cheaper on average is still overcost.
Now that I have that out of the way, what exactly would I propose to fix it? I understand very well that for the people involved in the creation of this music to be able to make a living off of it there has to be a fairly large cost, with mixing fees, producers, studio time, instruments, etc. Or do they? The technology now exists to create a professional quality recording in one’s own home for much cheaper than some albums. Take a look at the higher profile bands or singers involved in popular music right now in the West, do you ever wonder just how much money is spent bringing in big name producers, buying time in the most well known studios, having it mixed multiple times? While this can result in a great sound, some of my favourite albums were mixed by the artist(s) themself, and for cheap. You don’t need to fly to Hawaii and record in a famous studio with the best producer to have a great album, and often all this effort WON’T make a great album. The best of the new audio programs cost somewhere in the range of a few thousand dollars, which while expensive, can result in studio quality. I think I’m rambling a little, but the core of this argument is that the band should essentially be obliged ONLY to themselves. It’s only really the bands that are starting out which need money, and I’m not honestly quite sure the best way get around the initial momentum problem, aside from the old fashioned method of recording some songs, playing live to gain a bit of an audience, and mail the music to the local radio stations. Beyond that, the band should sell the album directly. For the smaller bands, it will mean that the profit will go primarily towards them, and I suspect most people would be willing to pay a little extra to get a hard copy of the album to support the band if they’re fairly new. To use an experience of my own, when I bought the band Treibhaus’ two albums, I dealt directly with the singer Curt Doernberg, and when I did pay the $45 or so including shipping from Germany, I knew that everything outside of shipping went direct to Treibhaus. I enjoy their music, and I had such good service from Curt, that I had no problems with paying that extra money, ESPECIALLY knowing that the lion’s share wouldn’t be going to some producer or executive or..whatever. As a side note, Curt even wrote me a little note thanking me for the support.
Basically I see the future of the music industry as being primarily run by the artists themselves. I think that the whole existence of major labels is unnecessary as the technology begins to be available for an artist to create fairly decent sounding recordings with cheap, readily available software. The Canadian artist Matthew Good (www.matthewgood.org) is a big fan of GarageBand, and will occasionally put up little demos of songs done entirely with it. While obviously not studio quality, they are certainly impressive in quality for the cost behind it.
Okay, well, that was rambly, so I’ll move on to the last point…downloading. I know Greg and I differ somewhat on our views about this, but I think it really needs to be addressed. Obviously, despite extensive efforts on the part of labels and other agencies, online trading of music is here to stay. And I really think that the industry has gone about this trading with the wrong attitude. Because they persecuted music fans so extensively for using this, they lost the oppurtunity to use it as an advertising tool. Think of radio stations. Essentially, they share music for free with the average person, or consumer. If the consumer likes what they hear, sometimes they will go out and buy a copy of the album the song is from. But what happens if they don’t like the other songs? This just means that they will be less likely to buy an album the next time. Nobody likes wasting hard earned money. But, say, the consumer didn’t hear the music from a radio station, but instead had it available to him on the band’s website. And, not just the one song, but 5 or 6, full length? Suddenly, spending the money becomes a little more feasable, because the consumer is now assured of a return on his investment in the music.
Now, the counterargument goes that it’s more likely he’ll just listen to the songs for free and never buy the album. Frankly, with some people, this is true. But these aren’t people that are likely to go out and buy the album anyways. There will always be some way to get it for free, either from a friend, or from the internet, or..wherever. A way will be found. But then think of how many potential buyers are lost, who wouldn’t have taken the chance without the samples? There will never be a way to completely remove the people who just take the music from the system, they’ve existed for as long as popular music has. It’s time to accept this and stop letting them block up the whole works.
I had something to say about music from other countries, but I need to take a breather…

]]> By: Greg http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-974 Greg Sun, 27 Jan 2008 00:46:17 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-974 Mikki, I understand what you mean about the whole loan thing, that is somewhat similar to what happens now. The reason record labels currently take so much of a band's profits is because they are the ones who fund it to get made. Nobody is going to give a band money to make an album and then not want to get paid back. The label is a business, they make an investment, and they reap the rewards when it pays off. I think it is in any band's best interest to fund the album production themselves. The band in essence becomes a small business, they make the investment in themselves and they reap the rewards themselves, paying for help from a label just like any company pays for supplies and services. Thanks, Paul. I am eager to hear your thoughts. I am working on a proposal (which may or may not be related to Germaniac) that should be able to help bands in the way that I am envisioning, so all points of view are greatly appreciated. -Greg Mikki, I understand what you mean about the whole loan thing, that is somewhat similar to what happens now. The reason record labels currently take so much of a band’s profits is because they are the ones who fund it to get made. Nobody is going to give a band money to make an album and then not want to get paid back. The label is a business, they make an investment, and they reap the rewards when it pays off. I think it is in any band’s best interest to fund the album production themselves. The band in essence becomes a small business, they make the investment in themselves and they reap the rewards themselves, paying for help from a label just like any company pays for supplies and services.

Thanks, Paul. I am eager to hear your thoughts. I am working on a proposal (which may or may not be related to Germaniac) that should be able to help bands in the way that I am envisioning, so all points of view are greatly appreciated.

-Greg

]]> By: Mikki http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-973 Mikki Sat, 26 Jan 2008 13:54:49 +0000 http://www.germaniac.com/blog/2008/01/22/the-music-industrys-problems-are-bad-relationships/#comment-973 Well, first of all, I really admire what you wrote, awesome!! But, at the end: "Perhaps, since the lack of money is often a big issue for musicians before releasing an album, record labels will also be able to provide specialized loans to musicians so they can get themselves up and running." Well, I know that is slightly different from what is going on now but... I think there is still a large window for abuse there... the same that is going on now... though at least the band would have rights to their music anyway... I do think that is important... well, I don't know, but it's a good idea that probably just needs to be looked into more.. Well, first of all, I really admire what you wrote, awesome!! But, at the end: “Perhaps, since the lack of money is often a big issue for musicians before releasing an album, record labels will also be able to provide specialized loans to musicians so they can get themselves up and running.” Well, I know that is slightly different from what is going on now but… I think there is still a large window for abuse there… the same that is going on now… though at least the band would have rights to their music anyway… I do think that is important… well, I don’t know, but it’s a good idea that probably just needs to be looked into more..

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