Tag Archives: RIAA

The Music Industry Just Doesn’t Get It…They Lied to Us

Economics, Music, , , , , , , , , ,

You would think with the amount of money that goes into music studios that they would have actually hired someone who is capable of telling the executives what is really going on. Instead, we have a bunch of studio heads that are so convinced they understand the pulse of the consuming public that they don’t have to listen to anyone, and for some reason they’re losing more and more money every year.

The problem emerged in the beginning when music went from albums to CDs and then online. The old paradigm consisted of music studios finding talent, packaging it and then filtering it out to radio stations that then opened the doors for people to rush to record stores to purchase the brand new content. Well, somewhere down the line that model fell apart, mainly because a few little promises made never came through, and then the industry changed overnight as a result.

What I’m talking about was a promise that the music industry made to consumers when albums were on the out and CDs were coming in. The simple promise was that CDs, which were cheaper to make than albums, were going to be cheaper for customers. This was the selling point to get people to give up their vinyl albums and welcome CDs. The promise was that CDs would cost $9.99 all of the time. Well, when CDs first came out, that WAS the price, and then quickly they started to increase to $13.99 and other such prices. Now, if you’re lucky, a CD can be found “on sale” for $9.99 off of the retail price of much more.

We were lied to. Oh, the naysayers will claim such a promise was never made, but for those of us who were paying close attention back then, the promise definitely was made. Instead of following the plan, executives realized that consumers are stupid, or so they thought, so they just went back on their word and sold CDs for what they figured they could get, rather than for how much it was promised.

A funny thing happened right after that. The Internet showed up. You see, if that never happened, the music industry would still be the major entity it was a few decades ago. But no one anticipated that a couple of geeks at universities wanting to talk to each other would lead to something so powerful and so overwhelming. But the Internet happened, and the music industry was in the wrong place at the right time.

The consumer population was kind of pissed at the music industry at this time because of the whole lie thing, and then when the next generation realized that it could get all of this expensive technology for free, they jumped on it. So two things happened at once. The music industry cheated the older customers by lying to them while the younger customers grew up with a new paradigm where they got everything for free. You see, if the music industry hadn’t lied to the older generation, they might have actually had powerful allies on their side. Instead, they had a bunch of pissed off customers who decided to just let the music industry fend for itself. Where these people could have been the “moral” guides to the younger generation, who wants to be the moral guides to people who are doing something you figure the bad guys deserve anyway?

Well, the music industry sat it out, thinking things would fall back in place, but their real ally, musicians jumped ship on them as well. Oh sure, the established musicians were in their corner, but consumers are a fickle sort, dumping old artists for new ones because music really doesn’t have standards that are controlled by executives. Music is music and people will seek it wherever it can be found.

And a lot of future musicians realized that if they wanted to make it in the industry, there was a new direction to take, one that required they take their music directly to the people. This opened up the industry to everyone, and as more and more independent artists showed up, the music industry had less and less control over the content.

That’s kind of where we are today. The music industry is trying to save itself by reestablishing the controls, but no one really cares anymore. There was an attempt to force streaming content under draconian rules, but music executives are starting to realize that this isn’t leading to sales. What the music industry never realized was that the future was going to be somewhat of a free for all because if you can’t trust the industry to do what they promise, then you look elsewhere for results.

Recently, I bought a CD for the first time in about a year. Yeah, it’s been that long. I’m still pissed. It was Taylor Swift’s new album, and it was on sale for $9.99. Imagine that. Anyway, it’s a great CD, but it’s probably the only one I’ll buy for at least another year. I’m one of their solid customers, and it’s taken a long time to bring me back to the market. Before I stopped buying music, I used to buy three or four albums a week. They’ll never regain the market share they had before. It’s just not going to happen.

Like I said, the music industry lied back when it needed to win over its customer base. So, hopefully as these executives find new jobs mowing lawns, or whatever it is unemployed music executives are capable of doing, they’ll remember it was really their fault. And they should keep in mind that if they promise to mow someone’s lawn and then go back on their promise, they’re probably not going to get paid. The real world is kind of mean that way.

Independent Productions and How They May Be the Survival of the Future

Computer Games, Movies, Writing, , , , , , , , ,

Over the years, there has been a tendency to avoid the big budget productions of numerous fields and focus on independent producers. This has helped us find some really innovative creators out there in numerous areas, including film, writing, software development and music. But part of the problem has always been twofold: First, an independent producer has very little money to draw upon, limiting the outcome of the product being produced, and second, because the production has little marketability due to a lack of a budget to handle that, almost no one knows the production is happening in the first place.

But several little productions have managed to go big time regardless of the obstacles placed in their way. Although we know that the big studios make the big bucks, every now and then a little guy creates something so good with almost no budget that that person becomes one of the big guys almost overnight. We saw that with Kevin Smith and Clerks. With music, it’s happening every day with overnight sensations showing up and overwhelming the studio produced big names. What’s so cool about it is that it happens so fast that the big guys can’t do anything about it, and it’s always nice when the underdog wins big time.

But this isn’t about underdogs becoming big. There’s enough of that in every Slumdog Millionaire story out there. What I do want to talk abut is how we’ve sort of forgotten that a lot of these big studios that control everything really were nobodies a short time ago, yet because they managed to rise to the top, they want to control pretty much everything else in their realm of creativity. Let’s talk about a few of them.

Apple and Microsoft. Go back twenty years, and they were both essentially operations created in someone’s garage. While they may or may not have made their mark stealing technology from other people, discounting that as significant, what is important to point out is that they are now the big boys on the block, and they are doing everything physically possible to control the marketshare when it comes to their corners of the software and hardware universes. Think about it for a moment. These guys started from nothing and are huge colossus behemoths now. Why can’t someone else come along and replace them? Well, aside from patent control by these entities, there’s really nothing stopping anyone else from rising up just as well.

The big book companies appear to have been around forever, but they haven’t been. They rose up not that long ago, and they’ve been trying to control the market ever since. Amazon is probably the biggest book seller in the world right now, and it came along after Apple and Microsoft, and is competing against them. I still remember Amazon’s first ads where they tried to play like they were this really, really big bookstore and were looking to lease space to hold all of their books. It was a cute joke, but they have become nothing but massive since those days. But why can’t someone else show up and do it again?

Game software development is probably the one area I know the most about because I was in this business from the beginning, and surprisingly a second generation is now on the scene that doesn’t remember how things actually took place. In the 1980s, software developers were creating games on floppy disks, copying them, and then selling them in little plastic sandwich bags. I’m not kidding. That’s how the gaming software industry was created. Some of the largest companies of today were doing that sort of thing, including Electronic Arts and a whole group of others that have risen and fallen (and quite a few have been bought by EA). But what’s interesting is that as more and more of these software behemoths keep announcing that PC gaming is dead. what I don’t think they realize is that as they do more and more to piss off their customers (which they are doing a lot of these days), the more likely they are going to make it that people are going to go back to the beginning and start creating their own games and distributing them much like we used to do before (although probably through easier online distribution). Look at Zynga. This is a company that came out of nowhere, and now is one of the big boys.

The point of this post is that I don’t think the big guys realize how vulnerable they still are, even as they try to completely control the market they currently dominate. A friend of mine recently made a full length movie for about $20,000. I was watching a special on independent movies, and some small studio guy said that it was impossible to make a movie for less than a few million these days. Even the guy who made the $20,000 movie keeps saying almost the same thing. But people are doing it. And I think that’s what’s going to completely change the industry because what we’re seeing is a lot of studio people who don’t know anything different. They’ve been taught that you have to have millions to make a movie, or it can’t be done. But then someone comes along and makes one for thousands, and everyone just shakes their heads and says, “wow, never saw that happening.” That’s what happens with revolutionary change. No one ever sees it happening.

And I suspect that this is going to be happening a lot more soon. Book companies are about to be hit big time by e-readers, and innovative people with little money are going to see a way to get rid of the producer middlemen and make the industries brand new again. But no one will see it coming because they’ll be so focused on RIAA lawsuits and maintaining control over their little fiefdoms, that they’ll never realize how insignificant they’ve become.

So keep your eyes open, or start producing independently, because it’s going to happen. Unfortunately, everyone is so tied into the current paradigm that they’ll never believe it until they’ve become completely replaced and discarded.