2. March 2008 06:47
by Troy
0 Comments

Music Downloading - Good for Artists, Bad for Business

2. March 2008 06:47 by Troy | 0 Comments

Let me start by saying that I am not an audiophile.  I do not download alot of music.  I do not own an iPod.  Mostly I listen to the radio in the car on my way to work, or streaming music from the website of a local radio station when I am near the computer.  I am sure that this preference is due to my inherent inability to be a good DJ. 

Despite this, I am a consumer, and I think this entitles me to an opinion.

I recently read an article in the Toronto Star by Ben Rayner with great interest.  The basic ideas I got from the article were these:

  • The majority of bands make their money from touring, not from CD sales.
  • The record companies get rich from CD sales, in return for promoting the talents of their signed artist.
  • The record companies are now including a cut of the proceeds of touring, management and even merchandising in their contracts with new artists, due to reduced CD sales.

In the years before the internet and modern home computers, artists needed the record companies to record and promote their music.  Without the record companies, an artist would starve back in those days, but the technology of today has changed all of that.  The most unfortunate aspect of that recipe was that the record companies were essentially deciding for the public which artists would be stars because they would decide who would get a contract.  I have no doubt that a lot of dubious criteria was applied to new and upcoming artists and simply having talent was not enough.

In the world of today, it is much easier for artists to record and distribute their own music through the internet, reaching millions of people and building legions of fans worldwide.  The only requirement is talent.  Just the way it should be as far as I am concerned.

I believe the hoopla surrounding music downloading is largely the noise that is generated by the record companies realizing that their services are no longer required, and they are desperately trying to find a way to prove their continued worth and justify their continued collection of millions of dollars worth of fees from their artists.

Change can be difficult.  Being fired or getting dumped does not feel good, and coming to terms with the thought that you are not needed anymore kinda sucks.  On one hand, I don't blame them for trying to hang on to their cash cow.  Hanging on to the cow is easier than the alternative choice of changing your business model, or finding a new business altogether.

Nonetheless, this article helped to solidify what I already knew on some level.  It is time for the record companies to go away.  It is time to allow the market to dictate the price of a CD.  I find it interesting that the manufacturing cost for a CD has decreased over the years, and yet, the average price of a music CD is still what, $15?  It has been $15 ever since I can remember.  The price of HD televisions has dropped 50% or more in the last year or two, and yet the price of a CD hasn't changed in years?  Give me a break.

I also think the focus for artists SHOULD be on touring and performing live.  It is their job.  I get up every day and go to work to earn a living.  Touring is the job of a successful artist.  Especially in this world of technology, where a poor vocalist can be digitally enhanced in a recording to sound spectacular.  In my opinion, touring is required for an artist to demonstrate that they actually do have talent.

Talented artists can record the music and distribute the music for next to nothing.  Why shouldn't it be free?  Many artists have realized that the money is in touring and if you give out the music for free, you can build a huge fanbase.  A huge fanbase means sold out shows when touring.  Even popular artists like Madonna have realized this, opting to drop her record label of 25 years and instead sign agreements with a concert promotion company.

The record companies like to say that music downloading will kill the music industry.  It won't.  It will only kill them.  The artists will always do what they do, because they love it and because they can still make a good living at it.

Through the years, the evolution of technology has created new jobs/industries and killed others.  The record company of today is the blacksmith of yesterday.  In the end, I think the artists may be better off without them.