What we've learned in this decade is the major labels are becoming ever
more irrelevant. Not only do they not create what so many are
listening to, they've lost their power to dictate the future, progress in the
marketplace has been wrested from them.

DRM is a red herring. As is sale by track. Most people with hand-held
music players are listening to vast quantities of music sans copy
protection. The fact that it's taken this long for the major labels to
come to grips with this reality is evidence of their sideshow nature.
They just don't get it, and seemingly never will.

Now that the DRM war is finally over, the labels have got to fight the
value war. Yes, people today think music has no value, they need to be
sued into submission, they need to be taught that CDs are worth every
dollar of their inflated price, that digital tracks should cost the
aliquot share price of a CD. This is utterly hysterical, because it too
goes against reality.

People own a lot of tracks. It's not relevant whether they actually
listen to them, they want to own them. And they're easily acquired. Not
only via Net P2P, but hard drive swapping, CD ripping...techniques
that cannot be quashed. Where is the major labels' answer to this?
Nonexistent.

The future is already here. The old CD paradigm, the old scarcity
construct, is gone. If people want to hear music, they're not forced to
sit by their stereos, listening to the radio for an aural glimpse, they
just go online and take what they want. This behavior must be
monetized, but the labels won't even make a reasonable streaming deal. Their
numbers are so heinous that iMeem can't make money. Is this a way to
guarantee your future?

I'm not sure the major labels have much of a future. They've
squandered it. And although they've got deep pockets compared to indie
musicians, they've got no one working at their labels anymore, they don't have
the manpower to dominate in the coming years. Winners will develop and
market acts. Whether they be by 360 or conventional deals. Where is
the major label infrastructure that's going to get people to sign with
them?

It's not like the TV and radio airplay majors may deliver has the
impact it used to. It's almost impossible to gain a large share of the
public's attention. Never mind get them to pay for music.

You could say the system is broken, I'd say it broke a long time ago
and we're now in the healing process. It looks like chaos from afar,
kind of like a forest after a fire. But fires are necessary, to
reinvigorate the land, seedlings develop, which grow into new trees. We're in
this phase now.

You can't see the acts of the future. And you can't see those who are
building them. And when they grow, there might not be a hundred
dominant trees, but thousands. A veritable forest of acts. This is a game
the majors are not prepared for. In order to dominate the new music
sphere majors must sign and develop a PLETHORA of acts at a very cheap
price, making pennies at a time. This, of course, does not support the
incredible overhead of today's companies. Where the worker bees have
been laid off and those left are making a fortune. You need a zillion
worker bees and chiefs with only upside. But those in power at the majors
don't want to give up their salaries, their old Tommy Mottola
lifestyles. But did you notice that Tommy Mottola has never come back?

This is not complicated. It's about facing reality and monetizing it.
Selling buckets of tracks cheaply and trying to hook people on
credible acts, not evanescent crap. Lower the price and sell more. And
rental ain't in the immediate future, this dropping of DRM proves it.
People want freedom, if you're putting on locks, you're driving people
away.

Sale by track is economic death. Whether they be wrapped in DRM or
not. You can't have everybody making a 99 cent decision. You've got to
get ten bucks from everyone. Just like the cable systems won't sell
their channels a la carte. The science is not new, it's just that those
in the record business have been so busying bullying and paying people
off that they've neglected to study economics in general.

Mobile phones blew up when the price came down. Everyone over the age
of twelve has now got a device. Everybody should own music. The way
this happens is to forge reasonable plans, which are cheap,
incentivizing people to partake. Ripping off the DRM is a nice start, but it's a
small part of the equation. Allow people to hear whatever they want
when they want. Instead of putting up walls, send out invitations. Get
in bed with the customer. You can't sell music to people who are not
friends. The war must end, music must be monetized. So far the majors
have only succeeded in making music free. Their efforts are needed in
order to get everyone to pay. But this requires a reasonable business
proposition. But as seen in the last eight years, this business
proposition is not needed for music to survive, just the major labels.
Music's doing just fine, healthier than ever. People are writing and playing
and the audience is listening. Meanwhile, the majors are cutting
staff and reporting horrific numbers. This disconnect won't go on forever.
At some point, the business will be run by people who understand the
new world. Based on how long it's taken three of the four majors to
realize DRM is not the answer, I doubt these companies will be in charge
of the game in the future.



--
Visit the archive: http://lefsetz.com/wordpress/

"Sale by track is economic death. Whether they be wrapped in DRM or not, you can't have everybody making a 99 cent decision."

And just how would Lefsetz propose to prevent that?

"You've got to get ten bucks from everyone."

Sorry, Bob, but I don't see that idea flying.

You could say the system is broken, I'd say it broke a long time ago and we're now in the healing process.

Healing process? It's not going to heal. We're not finished killing it yet and they're still suing people.

The labels (and Lefsetz) seem to think that somehow, everything will be better for them. It'll all turn around, the little trees will regrow, blah, blah, blah.

Ain't gonna happen. They've ruined the soil. Nothing's going to grow there anymore.

We don't need no stinking system.

I've always found Lefsetz to be somewhat of a tool - spouting the buzzwords of the day. He never has concrete ideas, just broad generalizations that sound all warm and cozy. He sounds like he uses a music industry version of the Bullshit Generator:

http://dack.com/web/bullshit.html

And he's wrong. Tommy Mottola did come back, resurrecting Casablanca Records (Parliament, Donna Summer, Kiss) in a joint venture with Universal. Although they haven't done much, at least that I'm aware of, I think Mika was a big hit in the UK, the song was called "Grace Kelly". I found it to be very ghey and a Freddie Mercury ripoff.

Casablanca web site:

http://www.casablanca-music.com/

I remember when many months ago I'd predict just how badly the RIAA will be screwing itself in the next year and a lot of you were kind of like "oh well they're too huge and powerful we can't win this battle we can only try to help as many people as we can not get screwed by them and tell people to boycott and listen to only independent music" lol ... but, it doesn't take prophecy for me (or anyone else) to have realized all this shit was going to go down.

The RIAA is a bunch of fucktards that can't let go of the past. In life, you either adapt or die. The world is forever changing. The RIAA could have embraced the times and made so much more money and had domination over the industry with the blessings of the fans. But instead -- they reject change, sue their fans, make stupid mistakes and throw temper tantrums --all starting with the Napster incident and becoming even more fucked up from there.

Yes -- the RIAA is indeed irrelevant. The only reason that POS org hasn't died YET is because they're so sickly rich they can afford to make $0 in profit for over a decade and still have more than enough money to piss, moan and wage legal battles. This giant can only die a SLOW death. It's too big to die quickly and painlessly.

-Dave

Oh and PROPS to the RIAA artists who've managed to break their shackles and fly free! More power to you!

-Dave

Agreed. Blessed be the unshackled RIAA artists.
(And the indies who never signed with a major label
in the first place.)


BTW:
I got a kick out of the Bullshit Generator.
Thanks, mroop.

I think I'll write a short pseudo-memo with the assistance of the bullshit generator...

To: Members of the Board
Subject: grow open-source e-business

Here at XYZ Corporation it is imperative that we benchmark next-generation solutions by reinventing synergistic communities and empowering revolutionary metrics.

We take delivering enterprise web-readiness very seriously because in order to adapt to the growing markets, we must always realize that to visualize seamless systems is a very important part of any corporate mandate.

It has been an on going problem that most entities have been unable to synthesize open-source web services to the necessary scale of scale integrated e-markets.

To that end, we need to make it our mission to evolve compelling portals and streamline B2B portals to have any hope of ever driving impactful e-commerce.

[end complete horse shit]

"I've always found Lefsetz to be somewhat of a tool"

Sure he is Mroop. But so what? Bob is an INSIDER. But he is still WIDELY read by the enemy insiders (and many others who are currently ENSLAVED) for the very reason that he sometimes can smell (if not CLEARLY see) what is WRONG with that whole industry.

I post his stuff from time to time for several reasons.

(Sometimes he makes a point or 2 that is RIGHT.)

(Sometimes he simply WAILS on the RIAA and industry right or wrongly so in such a fashion that I cant resist.)

------------------------------

Believe me, I do NOT "take as gospel" his ...nor much of ANYBODY'S words that I post. (Neither should YOU, nor the folk!)

But, it IS info. And BOB'S words DO get paid some heed.

The more you know...

Oh...

The title is: "Lefsetz Hits a Home Run"

My bad. (It was after all just a quick c&p after skimming.)

I shoulda said "Lefsetz gets Some Things Right." (Gets to 1st or 2nd base.)

Better?

lol.

I only just POST a bunch of stuff after all. (I tend to leave things to the readers to sort out.)

Don't have time/money to make this a damn always-able-to-be editorially responsible JOB anymore.

lol (Just do it when I can.)

And, Mr. Lefsetz's stuff usually comes from an e-mailed NEWSLETTER instead of a news-site.

I usually have to make up my own quicky headline that pertains to OUR readers for whatever he has said.

I am sure it is not the first time I have "gotten it wrong".

Re: TWarrior's pseudo-memo using the B.S. Generator

That was hilarious to me!

Re: Bob sounding like he uses a music industry version of the Bullshit Generator

Clever!


Re: "I shoulda said "Lefsetz gets Some Things Right." (Gets to 1st or 2nd base.)

Better?"


Yep.

"Sure he is Mroop. But so what? ... I post his stuff from time to time for several reasons."

I wasn't criticizing you. And I suppose my opinion of Bob is colored by his postings on the Velvet Rope, where he really acts like a dick. He does sometimes have something worthwhile to say, I will agree. Happy New Year!