Articles
Changing mindsets in the music industry
Paul Jacobson · Johannesburg Gauteng (South Africa)
There is a constant tension between activists who agitate for a relaxation of copyright and a reduction (or even elimination) of copyright terms in the interests of open access to knowledge as well as cultural and artistic expression and the music industry, broadly speaking, which has a vested interest in controlling the content it holds rights to with a view to exploiting that content and earning an acceptable return on its investment. The problem with this perspective is that the balance of power is shifting towards the people who actually consume the content and who want that content to be made available to them in far more flexible and permissive ways. The emphasis on sharing and collaboration which forms such a strong part of the new media (and social media in particular) ethos only reinforces this desire and the music industry is largely missing the point.
While there may be elements within the music industry that would see music made more freely available, by far the dominant perspective seems to be that music should be made available in fairly restrictive formats to a very limited number of people - traditionally a single CD available for purchase by a single private individual who may play the CD for his or her personal entertainment. Unfortunately for the music industry more and more consumers want to be able to buy the music they enjoy in a variety of formats, only one of which is a CD. With the growing adoption and availability of broadband Internet access, music downloads become more feasible and eventually the preferred means of obtaining music. While the music industry does acknowledge that music downloads are in demand, it refuses to pave the way for widescale adoption by limited sources of legal music downloads and then the format of those downloads and the acceptable uses of that content. In practical terms this often means that Windows users may purchase a limited selection of music in a music format that supports stringent digital rights management (for example, Microsoft's Windows Media Audio format) at with a relatively low quality level compared to CD audio.
The end result is a frustrated consumer who can't purchase high quality music of her choice online to consume in a way that suits her. Consumers are further backed into a corner through high prices of music on CD and can be forgiven for thinking the music industry's primary concerns are not about what consumers may want but rather about protecting existing revenue streams. This is unfortunate because what is clear is that the music industry just doesn't get it. Although a desire to maximise an investment in an artist is understandable, giving consumers what they want in a format that also works for the music industry can be very rewarding. It just requires a change in perspective.
Nine Inch Nails' recent release of the Ghost albums is an excellent example of where giving consumers what they want can be very lucrative, despite being almost counter-intuitive. NIN took the bold step of releasing four full-length instrumental albums under a Creative Commons license that permits non-commercial sharing and the right to create derivative works of the original music. The four albums are available for free on the Internet under this license and can also be purchased from the NIN website in various formats ranging from high quality, DRM-free music downloads to combination packages that include DVDs, CDs and the downloads. With the exception of a small number of free downloads from the Ghost albums, the albums are avalailable for sale on the NIN website. The model was a tremendous success with NIN earning around $1.6 million in the first week of sales, of which a premium package priced at $300 sold out in a matter of days contributing $750 000 to NIN's back pocket.
NIN's experience is an example of a potentially successful model for not just the mainstream music industry but also artists themselves. There is a growing number of artists who prefer to license their music under a more permissive license like one of the Creative Commons licenses because they recognise the value of giving consumers what they want and of the value of word-of-mouth marketing that often happens when consumers can share the music with their friends and family legitimately and flexibly (all Creative Commons licenses permit licensees to share the works concerned freely, for non-commercial purposes and otherwise in accordance with other license elements). This model should also be a clear illustration of how a different approach to music production and sales can work to the benefit of both the artists and labels as well as consumers if only the music industry would step outside its comfort zone, discover what its customers want and explore ways to give that to them and still maintain a viable business model.
While there may be elements within the music industry that would see music made more freely available, by far the dominant perspective seems to be that music should be made available in fairly restrictive formats to a very limited number of people - traditionally a single CD available for purchase by a single private individual who may play the CD for his or her personal entertainment. Unfortunately for the music industry more and more consumers want to be able to buy the music they enjoy in a variety of formats, only one of which is a CD. With the growing adoption and availability of broadband Internet access, music downloads become more feasible and eventually the preferred means of obtaining music. While the music industry does acknowledge that music downloads are in demand, it refuses to pave the way for widescale adoption by limited sources of legal music downloads and then the format of those downloads and the acceptable uses of that content. In practical terms this often means that Windows users may purchase a limited selection of music in a music format that supports stringent digital rights management (for example, Microsoft's Windows Media Audio format) at with a relatively low quality level compared to CD audio.
The end result is a frustrated consumer who can't purchase high quality music of her choice online to consume in a way that suits her. Consumers are further backed into a corner through high prices of music on CD and can be forgiven for thinking the music industry's primary concerns are not about what consumers may want but rather about protecting existing revenue streams. This is unfortunate because what is clear is that the music industry just doesn't get it. Although a desire to maximise an investment in an artist is understandable, giving consumers what they want in a format that also works for the music industry can be very rewarding. It just requires a change in perspective.
Nine Inch Nails' recent release of the Ghost albums is an excellent example of where giving consumers what they want can be very lucrative, despite being almost counter-intuitive. NIN took the bold step of releasing four full-length instrumental albums under a Creative Commons license that permits non-commercial sharing and the right to create derivative works of the original music. The four albums are available for free on the Internet under this license and can also be purchased from the NIN website in various formats ranging from high quality, DRM-free music downloads to combination packages that include DVDs, CDs and the downloads. With the exception of a small number of free downloads from the Ghost albums, the albums are avalailable for sale on the NIN website. The model was a tremendous success with NIN earning around $1.6 million in the first week of sales, of which a premium package priced at $300 sold out in a matter of days contributing $750 000 to NIN's back pocket.
NIN's experience is an example of a potentially successful model for not just the mainstream music industry but also artists themselves. There is a growing number of artists who prefer to license their music under a more permissive license like one of the Creative Commons licenses because they recognise the value of giving consumers what they want and of the value of word-of-mouth marketing that often happens when consumers can share the music with their friends and family legitimately and flexibly (all Creative Commons licenses permit licensees to share the works concerned freely, for non-commercial purposes and otherwise in accordance with other license elements). This model should also be a clear illustration of how a different approach to music production and sales can work to the benefit of both the artists and labels as well as consumers if only the music industry would step outside its comfort zone, discover what its customers want and explore ways to give that to them and still maintain a viable business model.
tags: Johannesburg South Africa policy-law music-industry licensing perspectives mindsets alternatives alternative-models
extracted from:Creative Commons
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