Who Really Changed The Perceived Value Of Music : Labels or Filesharers?

I find this topic fascinating, as it is at the crux of any argument regarding where the music industry is headed. Please be aware that in the below rant, I am largely discussing the masses’ interaction with pop music, i.e music that finds itself towards the top of the sales charts.

I’ll start with the current state of affairs we find ourselves in. Those young scamps in playgrounds with the world at their fingertips, often referred to as the first generation of ‘Digital Natives,’ will not think twice about sending a picture message to a friend for 40p, or buying a T-​​shirt for £1 in virtual worlds so that their avatar can look cool. They would however, be hesitant to spend 79p on a track on iTunes. It appears that they do not value music as previous generations did, as they seem willing to invest less money in it. However, they interact with it for more hours a day than their parents did, they talk about it more than anything else and are obsessed with sharing it. One way of tracking these conversations is using that trumped up ‘look at me I’m cool’ Twittery thing that is all the rage these days, where #musicmonday was the most used hashtag in 2009, beating discussions about the Iran Election, Swine Flu, and Michael Jackson. As I write this, the current top topic is #nowplaying, another music based hashtag.

So how did we get here? Since the 1960′s, western consumers across many markets have been pushed to a state of hyper-​​consumption – “Don’t repair or dwell on your older products, the new ones are so cheap just replace them as soon as you can (almost) afford it”. In the UK music industry this reached a peak with Britpop, the first decade defining musical fad to be a complete rehash of a previous cultural peak. Labels realised that it was easier and cheaper to promote and sell an album by a brand new artist, than it was to convince fans to stick with an established act. This was definitely not a new sales approach, but the degree to which it worked was startling even to those in control. BBC Radio 1 began their campaign to play more ‘New Music’, a style of broadcasting they are still obsessed by today. Though originally a refreshing idea, soon we were being told that what we liked 6 months ago was shit, and that something far better had come along for us to invest in if we could afford to keep up (which I DEFINITELY couldn’t). By the late 90′s, singles were used to ‘upsell’ albums, which at the time had a Recommended Retail Price of £16.99 and contained little more than 3 singles and 9 filler tracks (warning – broad assumption!). B-​​Sides were now being spread across multiple formats costing £4 each, and so not surprisingly the once cherished single began to die. All this was frickin’ awesome for the labels, as the consumer had no choice of how to consume their product, and were shelling out £16 for the 3 songs they liked. Lots of people got very rich, and had a great time. I just got angry.

Of course we all know what happens next ….. the labels lost control of their distribution. The birth of Napster, p2p filesharing, and other untraceable and forgotten forms of piracy for non-​​computer geeks (burning CD’s, swapping hard drives, bluetoothing tracks from one mobile to another) meant that the public could finally afford to consume the amount of music they’d been told to consume over the past decade, and the record labels started to hemorrhage cash. Hyper-​​consumption was finally possible regardless of how much money we had. It was gloriously satisfying, and for a music fan that first visit to Napster was as exciting and memorable as the first time I heard ‘Kid A’. Now, we didn’t have to buy the full album to get the three songs we wanted, we just downloaded them on their own. We could try albums before we bought them. We could get our friends into the music we loved, putting an end to the days of going to see your favourite band on your own. Yet simultaneously, labels began to criminalize and fight the demand they had spent so much time and money encouraging. And they’re still doing it now.

After spending the last decade suing their customers and defending the use of DRM (software that prevents files being shared), they are now lobbying government to pass laws that will force ISP’s to threaten users with disconnection from the web if they are caught file sharing. 3 warnings, then BAM, no more porn for you. However, there is no point telling people not to do something if you offer them no alternative. Labels have helped to launch some fantastic services recently, particularly the streaming sites Pandora and Spotify. Though they are still to offer an alternative to file sharing, and THAT is the important problem. Why? Because after receiving the first threat of disconnection from their ISP, many users will be alarmed enough to change their habits. If they are determined enough they will simply find ways to not be caught, as there will always be a way to file share anonymously (just google ‘darknet’ or ‘hiding ip address’ to see how). If they are not determined and have no legal alternative, they will simply spend their time pursuing another interest. Such as Curling, or egg carving perhaps?

I wholeheartedly agree with lobbying government to sort out our out-​​dated laws, though I do also believe that for consumers such as myself, file sharing does enable and encourage me to spend more money on music. However, that is not the case for everyone, and as a whole illegal file-​​sharing is wrong, immoral, and if left unchecked will mean there is less financial support for those artists who are capable of producing music that can change your life, if given the chance. Personally speaking, I have now been waiting 10 years, TEN YEARS, for a service that generates the excitement of Napster and gives me what I want. The one service that would go a long way to satisfying my needs and beating piracy is a model of continuous consumption, an ‘all you can eat’ package akin to what the recently launched Sky Songs was supposed to be, and what Virgin Media claim they will be offering soon. The plan is/​was to launch a service that comes bundled with your TV, phone and broadband, and that would offer unlimited music to stream and to download. In April, Virgin announced that they would launch the service before the end of the year, though this of course hasn’t happened.

Labels are also working on short ‘messages’ that will be viewable on all legal download sites, which highlight music’s importance throughout history and promote the idea that it should be valued. I have seen early versions of these and they do look very impressive, but when current stars such as Susan Boyle or N-​​Dubz probably won’t be around by the time I finish this rant, is there really any point trying to convince people that this music has longevity and value? We all know it doesn’t, but there’s no need to be ashamed of it, the disposability of pop music is part of it’s charm. Is Engelbert Humperdinck’s ‘Release Me’ more memorable than ‘Penny Lane?’ Of course not, but we all know it was the former song that got to #1 over the latter. If labels don’t match their marketing tactics with their forms of distribution soon, they will be in real trouble. Indie labels have the opportunity to prosper, as they market releases less aggressively and over a long period of time, meaning consumers are not spun confusing messages and are more likely to invest in deluxe products, as demonstrated by the fact that sales of vinyl doubled in 2008 and continue to rise.

Labels have switched from an industry of rights holders who profit from exploiting these rights, to becoming a service industry monetizing the act of distributing their content. The first rule of the service industry is that the customer is always right, and the sooner labels start placing the customers needs at the heart of every business decision, the better. It’s a common saying that the major record labels make their millions by selling to the people that only buy 4 CD’s a year, approximately £40 in total per year. Taken as a family of four, this would be £160 per year. It’s difficult to prove this, but there’s no denying that these individuals do make up a large proportion of pop sales. If Virgin were to launch a smooth, seamless ’all you can eat’ service at £15 per month, with added paid services built around that (such as streaming to mobiles and sales of physical products, bonus content and merchandise), surely that basic revenue of £180 per year per household is enough to build an industry on, and would be attractive enough for those consumers to embrace?

As time goes on, I have less faith that this service will launch with the premium package of ‘all you can eat’ available. Yet this is the service that can allow people to follow the marketing messages they are being spun. So, major labels, I PLEAD with you, spend less money and effort (and believe me it’s been a LOT) on lobbying government and more on getting a great service up and running that the people want. Once it’s there, THEN get the laws changed. Stop claiming that deluxe £100 box sets for throwaway pop music will save the day, and realise that you do not make music to obsess over. Build a service that allows fans to constantly and rapidly consume and dispose of your music, it’s what you’ve conditioned them to do. Make the service intuitive, smooth, and a pleasure to use so that consumers want to use it, making it easier to sell products around it.

Do what the service industry has been doing since the dawn of time, it’s really not that difficult. Give the customer what they want.


  • I disagree on many levels.

    1) It’s not up to music companies to create a service. It’s up to Apple, Google, Yahoo or whoever. We make software. That software is music. Other software are movies, audiobooks, user generated videos, tv shows, ringtones etc.

    Someone has to come up with a solution we can be part of. A music store run by record companies will be outdated by tomorrow.

    2) Fuck the consumer. To some degree we have to protect the brand of music and set the trends. Otherwise we are gocompare.com and just doing whatever we can to attract customers. We need people to buy into being a music fan.

    The 5 million people who only own Alanis Morrisette’s first album can fuck off. Those sales are a bonus, and they don’t happen anymore anyway. I loved the hooha regarding Neil Young archives, how that was almost not going to be on CD, and how it made people think about how they could hear this music.

  • Mike Benns wrote:

    Interesting thoughts Chris… though I doubt a lot of casual music buyers (‘3 CDs a year’) would be willing to shell out a standing order of more than £5 a month… I certainly wouldn’t.
    As you know, I’m an Apple fan and I do think that iTunes was the original game-​​changer in making music downloading legal. Sure, Jobs had to drag the record companies kicking and screaming to the table but the choice and cost effectiveness of iTunes makes its offering compelling to me. Having said that, there is a rumour that Apple is to launch an ‘all you can eat’ subscription service (http://tinyurl.com/ykntbjr) soon so we’ll see what effect that has. Good blog!

  • Hmmmm, both very sound comments.

    Mike – I completely agree that it was Apple who were the original game changer. However, from a record label’s perspective it really isn’t healthy to have one retailer with such a high market share, and so labels are actively trying to introduce services that give the consumer more choice. iTunes are probably moving into ‘cloud’ based streamed services akin to Spotify, especially with this ( http://bit.ly/80fG5s ) move and the acquisition of Lala (interestingly previously part owned by Warners Music Group), but I doubt they will be offering ‘all you can eat’ download services as this will affect their current ‘a la carte’ iTunes store too much.

    Agreed, I don’t think the casual buyers would pay for this service individually. But if your kids were teenagers illegally consuming music (in all the ways stated above, just like everyone else their age), and you received a warning letter from your ISP – would you then consider a monthly charge for a great music service for the whole family?

    Danny – 1) It is up to them to make the service. But it is up to the labels to work with them to allow these services to work without ridiculously high licensing costs. If they do not license their music, the service won’t launch. Companies are so keen to launch these services that they will spend a lot to do it. If the rumours are true, Nokia have lost an insane amount of money since the failure of ‘Comes With Music’ and Universal have not, due to the deal that was signed. There is no way a label can ‘run’ the store as that is not what they do, but they must work with those that do to make the store as good as possible.

    2) As sad as it is, most people who consume music aren’t actively consuming music they love, they are consuming a disposable part of culture. They have been convinced over the last 2 decades to constantly buy into the latest fad, and I can’t see this marketing approach changing. Unless it does change, the public’s perception of music won’t change. I really don’t think that those huge frontline albums that sell millions are a ‘bonus’. They are the lifeblood of a company releasing new pop music. Several of Universal’s heavy hitters failed to perform in Q4 ’09, and the impact will resonate through the company. They can’t rely on catalogue to get them through as they did in the 80’s and the arrival of the CD, that was a one off and will not be repeated.

    The days of ‘protecting’ the rights to the music are over and are not coming back. The more we try and protect them, the more we will lose control over them. I also loved the Neil Young thing, but his fans will always want to invest time and money in his music as they will keep listening to him even when the marketing messages stop coming. There’s no point trying to convince a fan of N-​​Dubz to do the same.

  • 2 cont) Then we aren’t creating something lasting. And yes, the majors are going there. But what about the artists? We are all here because some guy wrote a song. And that guy probably wants to wrote a few more over the next few years.

    You’re saying if we don’t support the consumer, they will go elsewhere.

    The other side is, if we don’t protect the artists, they will do the same. And then where will we be?

  • Stoneyman, thanks for your comment on my blog. You’ve said a lot of what I wanted to say here, but with more lucidity and forethought. We diverge on a couple of points.
    1) The current licensing laws are just not up-​​to-​​date enough to make ‘all you can eat/​music like water-​​style packages attractive to musicians or their representatives. By ‘attractive’ I mean, ultimately, something with which we can pay our rent with and feed our kids. Honestly, what Nokia make from their ‘comes with music’ compared to what artists get makes the worst excesses of major-​​label exploitation look like Fabianism.
    b) Whilst thestrum is possibly overstating the case with ‘fuck the consumer’, he echoes the feelings of many, many musical artists and acts. Everyone loves their fans, that’s not the issue. But pandering to their every whim is not a sustainable way to progress. There are very, very few businesses that manage to survive by giving the customer what they want. Because frankly, what the consumer really wants is everything, personalised, for free. I’ve written elsewhere about the dilemma over whether music is art or craft, and whether it should react to the market or dictate to it. X-​​Factor crap reacts, good music does not. You mention being excited by Kid A. That album, if the market had been consulted as to what it wanted, would not have sounded anything like it does. This is concentrating on the music, but the business has to do the same thing too. Giving people too much of what they want, pandering to the market, emasculates and castrates your business. I am reminded of Homer Simpson being asked to design a car for his long-​​lost brother’s company, which proved too expensive to make and bankrupted the business. A facile analogy, but applicable.

  • i read it
    i READ it
    the whole thing!

    and i completely disagree on everything you said

    no im joking, it was a good read

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