Danny Goldberg on the Digital Music Revolution
Posted on Jun 26, 2009
This litany of real and imagined insults to the consumer ignores the central reality of what caused the decline of record sales: the ability of fans to get albums free. The problem wasn’t the price. In the eyes of many consumers, it is simply impossible to compete with free. Many of the same people who won’t pay $15 for a CD will fork over $20 for a T-shirt or $30 to $200 per ticket for a concert by the same artist. This is not because the IQ or moral compass of concert promoters or merchandising companies is higher than that of record executives, but because it is infinitely more difficult to get into a concert without a ticket or to shoplift a T-shirt than it is to burn a copy of a CD. Security guys at arenas are not particularly empathetic to people who try to sneak in without paying, but that hasn’t hurt the concert business.
Missing from Knopper’s narrative is the story of the incredible wealth that was accrued by a few hundred computer and software entrepreneurs and executives who fueled and exploited the cynical notion that music “should be free,” that music was a “killer app” that drove traffic, computer sales, etc., at the expense of artists and the people who worked with and invested in them. The fact that many record company executives were inept at PR, wildly outspent in Washington and in some cases personally unappealing did not mean that the society’s swift capitulation to the devaluation of intellectual property was a good idea.
Knopper is a good writer with a keen sense of some of the comic hubris that record companies produced. He correctly identifies a number of Internet marketers at record companies who had to overcome roadblocks within their own companies in order to use the Internet as a positive promotional tool. They faced embattled salesmen and lawyers who were trying vainly to stop the deterioration of sales and CEOs who had to deal with pressures from their boards and Wall Street analysts. However, Knopper errs in conflating conscious promotional tactics with an “anything goes” mentality that many Internet companies adopted. There is no question that in certain situations, artists and record companies and other content owners can benefit by making some material available free in order to bond an artist with fans in the hope of selling to them in the future. But there is a huge difference between the Grateful Dead choosing to let their fans tape and disseminate their live shows and those same fans deciding they have the right to take any music they want regardless of whether the artists want them to or not.
Knopper makes much of the record companies’ seemingly pyrrhic victory in shutting down the original version of Napster through lawsuits. Various disgruntled former executives claim that if the companies had bought Napster instead, they could have communicated directly with their tens of millions of fans and somehow short-circuited the migration of those fans to other, more-elusive systems where they got free music illegally, almost always with impunity. But as long as the technology made free music possible, why would any fee system, whether subscription, discounted or artist-friendly, have made more of a dent than i-Tunes has?
There is no question that many aspects of the digital explosion have been good for music fans and musicians. Recording and video costs are a fraction of what they were in former times, and niche artists have the ability to identify and bond with fans in a way that was impossible in the pre-digital world. Select superstars such as Radiohead and Nine Inch Nails can make previously unheard-of profits by cutting out the middlemen. The larger music business (as distinguished from the record industry) allows musicians and the people who work with them to make good money from concerts and licensing. But overall the music business has been very badly damaged, especially in the critical area of artist development, where literally thousands of jobs have been lost that cannot be easily replaced by cottage-industry efforts of artists and their managers.
Near the end of “Appetite for Self-Destruction,” Knopper suggests that record companies could fix themselves by hiring as bosses “digital music executives trained to build the next Napster.” That might be good advice for AOL (or it might not—AOL didn’t do so well when the company controlled Warner Music), but it makes no more sense for record companies than suggesting that book publishers could fix their business problems by marginalizing the power of editors and giving the reins to techies who would create the “next Kindle.”
Retailers such as Napster or, in a previous generation, Tower Records, are not and never were a replacement for risk-taking on individual artists. There have always been plenty of businesses that will market artists after they become successful and that make their decisions based on research of what is already popular. The particular role of record companies (or book publishers) has been to choose a few artists to support among hundreds of talented aspirants before they have a measurable sales base that justifies the risk. The nature of those positions invites criticism. When Bob Dylan’s debut album didn’t sell, he was famously called “Hammond’s folly” in the halls of CBS Records, a reference to John Hammond, who also took early risks on Billie Holiday and Bruce Springsteen. Technologists have many virtues, but replacing people like Hammond is not among them. And by the way, Hammond and his bosses were not the equivalent of Martin Luther King either.
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