It’s a dark era for music fans. Can we find hope?

August 25th, 2008Music

For years now, the Recording Industry Association of America has been battling with music fans over illegal distribution and royalties. A few of my friends from Drexel were sued in 2005 over illegal downloading. I’m sure at some point in your life you’ve heard about how evil these assholes are.

Last week, the Washington Post ran a story about Pandora Radio and how increasing royalty fees might force the service to shutdown. Basically, conventional FM radio stations pay no royalties at all per song due to the fact that they are owned by giant corporations who own rights to the songs anyway. XM/Sirius radio pays about 6% of their revenues to SoundExchange (the RIAA’s copyright royalty arm) and Internet radio pays an exorbitantly higher amount per song, per listener. Why do webcasts pay so much more? It’s politics.

Both FM radio stations and XM/Sirius pay lobbyists to pull weight around in D.C. Currently SoundExchange is fighting to charge royalties to traditional radio and increase those paid by satellite. Pandora’s founder Tim Westergren not only strongly disagrees with the fees charge but admits that the company just won’t survive as rates increase.

If the news about Pandora wasn’t hard hitting enough, another favorite site of music enthusiasts, Muxtape was recently shutdown by the RIAA this week. I wrote about Muxtape when the site first launched, but the basic gist is a service that lets users upload MP3s and arrange them as a web 2.0 mixtape to share with friends. Controversy started to surround the site the site when a developer released a Greasemonkey plugin for Firefox that allowed you to download songs from anyone’s Muxtape - music piracy at it’s finest. The RIAA obviously wasn’t happy and currently the site has been shutdown with the message: “Muxtape will be unavailable for a brief period while we sort out a problem with the RIAA.”

As expected, fans aren’t taking this without a fight. Just launched today, Opentape is a self-hosted verison of Muxtape. Simply download the files, upload to your webserver with your MP3s and you’re ready to go. You can check out a completely random sampling of music I’ve recently downloaded in my mixtape here. Another site, I <3 Pandora has created a widget to place on your site or blog to get the word out and unite people to help out the service.

With the current state of the industry it seems that issues surrounding music rights, distribution and piracy will be a controversial and debated topic for a long time to come. I clearly believe that artists deserve royalties and acknowledgment for their work, but the RIAA and SoundExchange are simply asking too much. Music is a fundamental part of life, it inspires and moves us, and most importantly it brings us together. Raising restrictions, removing DRM and allowing people to enjoy their music instead of fighting them over it will make legal purchasing and downloading that much more appealing.

One Response to “It’s a dark era for music fans. Can we find hope?”

  1. Lee Says:
    August 26th, 2008 at 4:52 am

    Hey Ben,

    I just wanted to chime in here since I have some experience, purely from the outside, with this issue, a rather complicated one. See, the gist of it is, unless you are a Madonna or Kanye you’re really not making any money off your songs in any direct fashion, 7 cents a song on Itunes, for instance. So, most medium size and smaller artists can make their money two ways.

    1. Merchandise sold on their tours.
    2. Licensing their songs to TV/Radio/Film etc etc. This is obviously the most lucrative (mailbox money!)

    The era of gold and platinum singles and records is all but gone now, as any artist will tell you. The interesting thing is a group like the Rolling Stones will sign a multi-bilion dollar deal with their record label for three new albums. The albums will come out, they won’t sell, leaving the record company with a huge bar bill. Plus, to add insult to injury, groups like The Rolling Stones, U2, etc. are so big that in their contract they have total control of all profits from their touring and merchandising, plus they own their catalogue for licensing, and don’t have to give one penny of those profits to the record company (100’s of millions of dollars.) The Rolling Stones had the biggest tour of, was it last summer? The record company went busto on their record. See what I’m getting at.

    In any case, my point is the record companies are pissed. So now, even with smaller artists, they won’t sign a deal unless “touring and merch” is included since the albums are looked at as nothing more than advertisements for the tour and a possible tv spot during a love scene on Grey’s Anatomy, etc. etc. They want it all. So how do you survive as an artist? It’s a good question. Not like you once did, that’s for sure.

    It’s interesting because while I agree wholeheartedly that music is a part of our life, the fact is the investment these big corporations make into their artists is no small thing; it can be millions of dollars to break an artist. Sure, there’s a lot of crap out there, but the industry still does break interesting new artists, and has the publicity and distribution machinery to do it. As bad as the corporations can be, without them the music business would be a distribution mess, even more cacaphonious madness then it is already. So what I’m saying is they are within their right to want to collect on their time and investment in every feasible and fair way. That’s just basic economics whether you are a multi-national corporation or a mom and pop lemonade stand.

    On the other hand, innovation is the breeder of revenue, and when innovation is halted, revenue too halts, or it filters into “black market” sources. Let me give you an example: When online poker first came about the casinos were completely in fear that this would end casino gambling as we know it. People could play in the comfort of their own home and never set foot out of the house. That was the fear, none of the profits would come to them. What’s happened? Well, I don’t know what the percentage is, but a lot more people go to casinos now to play than ever before. Why? Because they have so much easier access to the game, people who normally wouldn’t dare try to play in a casino now can get their seasoning and confidence at home before going to a casino, then they storm the place thinking their going to take it for all its worth…which never happens. People who never would have had the guts are now going and spending their money. So in this case, no matter how the powers that be tried to put the kibosh on the technology, the technology still found a way to help them through its innovation and access.

    So obviously you need innovation to create revenue (see the city of Detroit dying because the UAW refused to innovate, thus all hybrid technology being developed overseas by cheaper labor,) See, the problem is when the innovation is so far ahead of the powers that be. It’s not that they don’t want it, they just want to continue to control the profits of it. For instance, eventually we will be on alternative fuel cells…we could be now. The technology is there, the problem is the infrastructure is not, and it’s not going to change for another decade because of this, until the big oil and motor companies that own it all now have everything in place to own the future fuel cells as well…dig? They don’t want to destroy the Earth…there’s no money to be made off a destroyed Earth, but they want to continue to have power and influence and big, big vacation homes.

    So the fear by the record companies, who from my bird’s eye view are truly a mess, is warranted because they don’t have, nor can they afford any control of the new innovations. This fact is why their approach to the technology is wrongheaded. They can’t adapt quickly enough and so they are living off the old paradigm until they can find a way to do so. Stone-walling, if you will, making as much trouble as possible.

    Why? Because you have a lot of very uncreative people running companies who went to business schools and learned the old fashioned way and have formulas and understand revenue and ancilliary in the most basic, connect the dots Wharton Businnes School kind of way. They’re not set up for technological innovation that can be uploaded from a home computer and passed among friends.

    One looks at Prince or Radiohead and countless others, how effectively they run their businesses, and one wonders if people who want to go into business shouldn’t all be sent to music and art schools.

    Later, brother.

    L

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