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The Necessity of Willing and Able Buyers
R. Alex Whitlock
A lot of people are pooh-poohing record industry complaints about piracy. I'm no fan of the record industry and so don't have that much a problem with it. However, in the interest of fairness and general anal-retentiveness, I do feel the need for pirates and their supporters from getting
too high on their horses. To wit,
Rebecca Blood:
There is exactly one secret to thriving in the marketplace: offer a product that consumers really, really want to have.
It actually requires two things: People have to want it and they have to be willing and able to pay you for it.
One of the prime errors of the record industry over the last decade is that they had no mechanism for online music sales. If someone wanted a music file, they had to buy the CD and then rip it themselves. That made getting the song illegal
easier than getting it legally. The industry actually believed (and to an extent believes) that this would not backfire. They paid and continue to pay people that believe this. Even if willing to pay for it, they were unable to. They had to do it for themselves.
On the other hand, having the most compelling product in the world makes no difference if no one has to pay for it. If you are a musician and you give away CDs at a show, you are not likely to sell many CDs. You may make some sales, but you will not "thrive." As such, the record industry has a vested interest in making sure that people don't excessively easy access to free (or near-free) music. Their methods may borderline on crazy at times, but their motives are purely rational.
It's not really honest to state otherwise.
 
Observations
 
It always amazes me when companies fight progession. The same thing happened several years ago with VHS and Beta. The MPAA thought it was be a horrible situation. Turned out to be the biggest boom they ever saw.
Some day the consumers and industry will play nice again. Until then I will continue to "sample" music online and purchase what I like.
It'll be interesting to see how DRM plays in all of this.
 
The problem for the MPAA/RIAA (moreso for RIAA) is simply this: they let the ball drop and are now playing catch-up.
If, at the moment that broadband became achievable, they had offered up realistic ways to buy your stuff online, people would have done so. Perhaps not in tremendously large numbers, but they would have established it as "the way you do things."
If, at the moment that MP3's came out, they had gotten in and started selling them relatively cheaply, people would have bought in. Of this I have no doubt.
The problem with the MPAA is that they ignored the marketplace. You're right when you say that they made it EASIER to get the product illegally than legally. It's not just that, though. When it came to Napster and the rest, they didn't even BOTHER to compete with them.
And it's not for lack of trying, either. Napster, and many of the other filesharing ventures, made overtures to the MPAA to try to work out joint advertising and sales schemes.
The MPAA's response was essentially "fuck you, we're going to sue you out of existence so we can get back to business as usual."
Except that, once Napster was sued out of existence, the customers had found a better way. And it didn't matter how hard the MPAA tried, the customers would continue to find a better way.
So now they're "competing", but they don't really compete. Because the way they price things, it's still cheaper to buy the damned CD.
Something's wrong with that picture. What's wrong is that it's STILL cheaper to take the CD, rip the MP3's yourself, and cart them around in whatever device (iPod, what have you) than it is to buy the songs online, buy your own set of CD-R's, and do it that way.
And thus the customers, when they go looking online and realize this, feel cheated. They are expected to pay MORE to get LESS. The convenience of a digital file isn't convenient at all when you have DRM stuck into the picture.
The other problem is that the customers are jaded after hearing about how the MPAA's losses are "all" because of Piracy when (a) they have pushed nothing but crap bands and teenie-pop crap in recent years, (b) they have shipped less new albums, year for year, in recent years expecting that people will all buy them anyways, (c) the economy is (let's face it) not what it used to be in their heyday, and (d) alternative forms of entertainment (movies, DVDs, and video games mostly) have been taking up the entertainment dollars because it's actually cheaper to buy the movie than it is to buy the soundtrack!
So while, on principle, I will agree that the "pirates" aren't on the up and up I have to wonder how much damage it actually causes (answer: I haven't bought a single CD without first hearing the MP3's) and I really, REALLY get tired of the MPAA trying to use "piracy" as a scapegoat when 90% of their problems are their own intransigence and their own mistakes.
 
Kavey, agreed.
Mike, I disagree with a few points:
1. iTunes and Rhapsody are on par with buying the CD, except that you don't have to buy songs you don't want. They were late coming, but by-and-large I consider their offerings now to be pretty reasonable.
2. It's unlikely that they will ever get cheap enough that it'll be cheaper to buy their package than to create our own. I don't think that's a fair expectation as the pirate is duplicating the product but not everything that went in to the product.
3. You're right that the record company are putting out a lot of the tired stuff, but they're putting out a lot of not-tired stuff, too. The enemy there, in my mind, is ClearChannel because all they're giving us is the most polished, "safe" materia. If they weren't putting out stuff that people like, people would not be pirating it.
4. To the extent that the record companies are indeed playing it too safe, piracy makes that worse and not better. The more investment it requires to get an artist "out there," the more conservative they're going to be. In other words, it's my theory that not only has Napster thrived because record companies have faltered, but record companies have faltered because of Napster.
5) This actually isn't a point of disagreement, just something I want to add:
At the end of the day, people have to pay for stuff. The record companies have screwed up royally by making people get it for free the easier option. It's gotten people used to the concept of music being free. But people themselves need to snap out of it unless they are ready to face all of the repercussions of a demolished music industry. That'd be okay by me, actually, but more people than not like people to find and collect music for them.
 
RAW,
1: iTunes/Rhapsody are fine and good but they both come bundled with crap that I *DON'T* want (e.g. they're tied down with DRM and I can't easily toss them into whatever device I feel like such as my PSP).
2: If you are buying an entire album online - and thus NOT getting the physical CD, NOT getting the packaging/notes liner (though they have not bothered doing much with those recently anyways), NOT getting the artwork or anything - then it should cost you less than buying the CD. End of discussion. At MOST, an album in electronic form ought to run around 10-12 bucks. It doesn't.
3: the VAST vast majority of what's out there being pirated is stuff that's 4+ years old. My point.
As for Clear Channel, that's another debate entirely. You know my view (e.g. that the WORST thing Congress ever did for the market was to deregulate ownership rules so that we went from 5,000 station owners to a mere 5 in the span of half a decade and the idea of competition went down the shitter).
4: Sorry, but I have to disagree. Napster and other services have helped more independent artists than any other recent innovation. Getting artists "out there" is easier than the companies would think, IF they could get radio stations out of Top-40 playlist and Payola modes.
The bigger problem is simply this: the RIAA companies expect us to buy things sight unseen, expect us to purchase their wares without adequate knowledge. It doesn't work that way.
Very few people buy a DVD without having seen the movie first. They rent, or they saw it in the theater.
The same with music. I got burned a couple times by one-hit wonders whose CD I bought only to find out the rest of the CD was crap. I want to check out the entire CD first, at least until I know I like a wide variety of what the group does (I'd probably buy a new Aerosmith album without worry, but they're the exception).
However, the music industry execs have deemed that this is not how it works. We don't get to hear whole albums any more. We don't even get multiple songs from one album: one group, one song, PERIOD, is how they work. And it doesn't have to be that way.
So for the last 8 years the only music CD's that I've bought are either video game soundtracks, movie soundtracks, or CD's I've been able to completely check in some form before purchasing.
THIS is the reality the music execs don't accept.
 
1. The DRM would not be necessary if there wasn't the quite legitimate fear that without any protection of that sort, everyone would have a copy of everything at their disposal without paying for it. People would not be willing to purchase what they can get easily for free. So that leaves them the choice, make it difficult or make it unfree. They gotta do one or the other and they have. I can't exactly fault them for that. Like I said in the post, for all their paranoia and poor decisions, it's based on the quite true assumption that people will not pay for what they can get for free no matter *how* good or bad their product is.
2. Buying things in bulk is always cheaper than buying them individually. Besides, 12 songs (the length of the typical album at $.79 (the price at Rhapsody, I believe) falls in the $10-12 range you seek. Even if it didn't, buying things individually always costs more than buying them in bulk or in a set. Or, in the case of CDs, you get extras for buying in bulk.
3. The vast majority of all material is more than four years old. I don't disagree with you that the record companies have found a lot of crap, but they've found a lot of good stuff, too. It just doesn't make the radio. My point there stands. I didn't fully appreciate all the stuff that the major record labels have until I got Rhapsody. A year ago I would have completely agreed with you here.
4. Enlighten me on this one since I'm a bit out of the loop. Who are the big-name artists who made their name through Napster and the like? I can tell you that I found a lot of artists I otherwise wouldn't through Napster and AudioGalaxy, but then again I sought the stuff out moreso than does the average listener.
Regardless, if tallies were kept on what was being illegally downloaded, I'd be willing to bet that most of it belongs to a label now or belonged to a label when said song was released. I'd like to be wrong on this, but most people seem to like to be fed small varieties, that's why radio stations with the smallest playlists win.
As far as sampling goes, I agree with you and that's my biggest beef with the record industries. They were dragged kicking and screaming to the point that they are and had Napster and the like not existed, they never would have done it.
One of the reasons I prefer Rhapsody to iTunes is that it gives me the ability to do just that. With some (though rare) exception, I can sample to my heart's content.
But there's a legitimate conflict between letting people sample music versus giving it away. It doesn't do the discussion any good to say otherwise and to pretend that if we could just get mp3's then we would go out and buy the music we like. But that's what a lot of the RIAA's critics seem to be saying. That runs contrary to economics and human nature.
The RIAA is lazy and wasteful. I deeply, deeply resent their footdragging and there's no point in arguing that with me because I largely agree with you. However, I also believe that some of their paranoia is not entirely crazy and that they are correct in their assessment that if they give it away (or allow others to give it away, en masse) that they will go down regardless of how good or bad their product is. They go too far in the other direction, for the most part, but then again it is they, not us, that gamble their existence by not being protective enough of their product.
 
One last thing to throw in to the mix: eMusic. At one time, you could download as much as you wanted from them in mp3 format. No DRM, no strings attached. Now they limit the number that you can download, but at last check it came to $.25 per song.
So why aren't people flocking to it?
Cause it is largely music that people aren't already familiar with (ie fed by the major record labels). People don't want to do record label's jobs (seek out music to present to the general population), but they really do tend to like to take advantage of that job once it has been done even while resenting those that did it.
Anyway, that's largely where I'm coming from on the matter: the belief that most people take advantage of what the record labels have done and yet do not want to pay for it.
Now I could go on for just as long as to why the RIAA is wrong-headed and why the record labels piss me off, but for the most part no one is challenging me for the negative things I've said about them. Where's Owen Courreges when you need him? :)
 
"If you are a musician and you give away CDs at a show, you are not likely to sell many CDs."
Good theory, but there's a lot of practical evidence showing this isn't so. Check out, say, Cory Doctorow and Charlie Stross's experience. Or any of the other writers who have found that allowing free download of their novels makes for far more people buying the same work for money. Because this way far more people learn about your work, and to like it, and then they want to get a nicer copy for themselves.
This appears to work the same for music.
 
I didn't say anything about giving away the music (or the written works), I was talking about giving away the CDs themselves. My point is that if there is no difference between what you can give away and what they can get for free, then no one is going to buy your stuff.
That is, of course, not the same as CDs versus MP3s, but it is analogous between say MP3s and iTunes. The iTunes have little added value as far as I know.
But regardless, my point was to rebut Rebecca's claim that all you need is a good product, which is quite false because you need both buyers that can purchase your product (ie a distribution system) and you need buyers willing to (which means that what your selling has to have added value in comparison to what they're getting for free.
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