Music In The New Millennium: A Model For The Digital Age
Friday, March 18, 2011 | Jacke Karashae 
- San Francisco, California - Music is a deeply ingrained part of modern American culture. Americans encounter music in television shows, movies, and even supermarkets. Regardless of the state of the economy and regardless of the state of the nation, music seems to always exist. Music is the canvas upon which we paint ourselves with better brushes than those we own; we hum melodies we did not concoct and sing enigmatic stanzas we did not invent. In this sense, musical talent is irrelevant in our connection with music. By expressing previously inexpressible thoughts and emotions, music becomes a deeply-ingrained part of all of us.
Ideally, music involves a continuous interaction between the artists that create music and the listeners that experience it. The “music industry” serves as the bridge between artists and listeners that allows them to communicate. Artists use their creativity to build an experience for the listener. They utilize the tools provided by the music industry to produce and distribute this music and maximize their listeners. The listener provides support for the artist through purchases, donations, or word-of-mouth. Listener support through the undergirding of the music industry allows artists to create increasingly excellent and explorative musical productions.
With the advent of digital audio file formats and online distribution, however, the music industry’s model of selling audio became obsolete, and artists today are caught in the crossfire on a battleground between uncompromising music labels and unethical music listeners. On one side, many music labels do not pay musicians a reasonable proportion of the profit from album sales, if the labels pay them at all, causing many musicians to be unable to continue in their musical careers. On the other side, listeners involved in music piracy force those musicians who do receive some royalty from their label to resort to desperate measures in order to earn more money and continue to survive as artists. Many adopt second jobs, which force them to spend less time on their musical talents and causes listeners to receive substandard musical experiences. Others attempt to grab the largest listening audience possible by mimicking the current musical flavor of the month. While these artists may have momentary success, when the entire industry becomes fixated upon finding the “hot sound” and making all bands adapt to it, the quality of music suffers because individuals do not risk the financial uncertainty of musical innovation. Many musicians are caught between equally irreconcilable situations of being unpaid by labels and being unpaid by listeners.
To find a solution to this issue, we must first address the state of the current system and the reasons that it is failing. After this, we will consider a new model for the music industry that takes advantage of the digital age rather than waging war against it. As with many cases of dysfunctional systems, there are those among both labels and listeners that do not exhibit the behaviors that we will analyze. However, the number of unjust labels and music pirates are great enough for the current system to be worthy of reform.
Generally, when an artist enters into a contract with a label, the label gives the artist an “advance”. In effect, this is a loan from the label to the artist to fund the costs of recording an album. Many music labels require that artists pay back this advance before giving them any cut of album sales (Masnick “RIAA Accounting”). Depending upon the contract signed between the media label and the musician, the repayment for the advance might come out of album sales, concert profits, or a combination of the two. Bands that cannot earn enough money to repay this advance carry their debt into the next album project with the label. Meanwhile, the album could earn the label millions of dollars in revenue (Masnick “EMI/Virgin Records”).
A supporter of music piracy might respond to this data by claiming that there is no point in paying for music because the money really goes to the media labels. A common argument of music piracy advocates is that the true means of supporting artists is through purchases at concerts. This claim, while convenient, is inaccurate on two counts. First, if the label forces the artist to pay back their advance through concert sales, buying merchandise at a concert would have the same effect of purchasing an album online. Even if an artist were to have the proceeds from their own concert sales, as does the metalcore band Oh, Sleeper, the costs of touring are taxing on low- and mid-level bands, including those funded by a major label. According to Shane Bly, a member of the Tooth and Nail Records-signed band Oh, Sleeper, a gross income of $600 per night on tour breaks down to about $13.12 of net income per band member per day due to such “hidden” costs as manager fees, venue merchandise fees, merchandise manufacturing costs, and gas costs. This estimate did not include any accommodations, periodic costs, such as vehicle maintenance, or state or Federal taxes (Bly). Thirteen dollars per day is barely enough to live on while on the road, let alone enough to support a band when it finishes its tour. While artists cannot depend upon album sales from their labels, they also cannot expect to earn enough money to support themselves on tours. Many artists who can find the means to pay off their advances and earn royalties from their albums desperately need the money from those sales because the unseen costs of touring heavily cut away at the money earned by artists.
Traditionally, individuals concerned for artists’ well-being have argued that we should battle against music piracy. According to these individuals, cutting away at music piracy would lead those artists who do earn royalties from their music to be able to support themselves through song and album sales. Methods for “ending” online music piracy have consisted of increasing awareness of the effects of internet piracy and legally pursuing both the companies that make piracy-enabled programs and the individuals who pirate music. However, the injustice of media labels’ legal actions against listeners has caused many to turn a deaf ear to their pleas for sympathy. Cases such as the Recording Industry Association of America’s lawsuit against Jamie Thomas-Rasset, which ended with Thomas-Rasset owing the RIAA $1.5 million dollars in damages for downloading twenty-four songs in 2008, have put a bad taste in the mouth of consumers concerning the integrity of the music industry (Borzykowski).
Because of failures of the music industry in enforcing the law, music pirates have nearly gained the status of Internet mavericks, and, in the minds of many, they are stealing not from artists, but from the “rich” labels for the sake of the “poor” consumers. This view appears even in credible technology magazines. When Lime Group disabled its LimeWire service in response to the court order, PC Magazine promptly published an article outlining six alternative file-sharing programs, and, while it stated that “all these services should be used for legal downloads”, the overwhelming reputation of file-sharing protocols for music piracy render this thin disclaimer meaningless (Albanesius). In November of this year, about a month after LimeWire’s official shutdown, an anonymous group hacked the LimeWire program and removed all of the software-disabling mechanisms, essentially reversing the Lime Group’s actions to stop the service. PC World heralded this news relatively cheekily in an article titled “LimeWire Is Quietly Resurrected: It's Baaack!” The article took a step further than many web news and forum sites by providing a direct link to the software download and encouraging readers to download it and try it if they were curious about it (Purewal). PC Magazine and PC World, both widely-published computing magazines, represent the lack of concern that many modern music listeners have concerning music piracy.
The overarching flaw in the traditional approaches of prosecution and education is that they do not fix the essential issue in the music industry today. Music piracy is not killing music; it is merely revealing the flaws in the prevalent feudalistic system of struggling artists and profit-seeking labels that creates jaded listeners. We must institute a new system, one that reinstitutes the important role of the artist in the music industry.
The model that I propose stands upon two essential facts: first, since music piracy cannot be undone, the age of selling audio is coming to an end; second, listeners are much more willing to support an artist when they feel that they have a personal connection with him or her. From these foundations, I suggest that artists and the music industry should change their primary goal from making sales to making fans. These fans will have more profitable and longer-lasting loyalty than one-time consumers will, making an investment in the artist’s future. Once these concepts become widely accepted, the creativity of marketing models will be allowed to soar, and we will see a radical shift in the meaning of music in modern society. Let us now consider three of these models and their advantages to the audio-based sales model.
The first model, “pay-what-you-want”, is the closest of the Fan-based models to the current audio-sale model. Under this model, artists “sell” music to their listeners at whatever price the listeners wish, even if that price is $0. Even though this seems very similar to the current system, where a music label or service sets the price, it falls under the fan model because it removes a level of abstraction between the listener and the artist; rather than requiring the listener to pay a price determined by some separate entity for the musical experience, the listener, in effect, pays what he or she believes the experience to be worth. This reinstates a part of the artist-listener “conversation” by causing the listener to feel that he can communicate to the artist the “value” of the experience through the price that the listener pays.
The second model, premium content, generally consists of an artist giving away the music of an album for free while selling the album in a box set with exclusive content or some other creative incentive not available in the free download. This has the potential of creating a strong connection between the artist and the listener because it compensates listeners for investing in the artist with extra features that the free edition does not provide. A significant difference between this type of sale with the traditional sale of CDs or audio files is that it is essentially selling the packaging or extra features, rather than the actual music.
The fan model has the potential for many more creative options for products that the current music sales model could implement. One such option is personal interaction. This model involves the artist selling directly to the listener the opportunity for a personal experience with the artist, whether it be through a phone call to the individual, a song written about the individual, or an opportunity for the individual to become a part of the recording process. As with the premium content model, this model depends upon the music itself being given away as a promotional tool in order to develop listener interest and participation. This model strikes at the very heart of the separation between listener and artist, and is the quintessential example of the fan model.
Radiohead's "In Rainbows" album coverExamples of artists from all brackets of notoriety successfully utilizing these models abound. One of the most recognized recent applications of the pay-what-you-want model was Radiohead’s online independent release of their album In Rainbows. The publicity gained by Radiohead for this model was unbelievable; the controversy over the previously signed band’s decision with their first independent record placed them squarely in the focus of the online media. Trent Reznor, a former member of Nine Inch Nails, used the “premium content” model, releasing his music for free on his website and selling deluxe editions of the albums at the same time. He was able to sell box sets based around music he provided for free on his website for $300 each, making $750,000 in a little more than a day (Masnick “The Future”). Even artists with very little public exposure have used this model to gain fans and financial support. Corey Smith, a former high school teacher, gave away music for free on his website, but provided behind-the-scenes pre-sale tickets to his shows and grossed nearly $4 million dollars (Masnick “The Future”). Jonathon Coulton, a computer programmer, committed to releasing one free song per week for an entire year. His project became a viral hit, causing fans to request live shows. Coulton used Internet tools to track the cities listeners wanted him to visit, and he was able to make a profit from his concerts by scheduling performances in those cities that had enough fans to make a concert profitable (Masnick “The Future”). From stars like Radiohead to unknown musicians such as Corey Smith and Jonathon Coulton, the fan model has shown that giving away free music pays unforeseen dividends by creating dedicated fans.
One might ask whether this model is merely exchanging apples for apples by selling one product to music listeners rather than another. The significant factor in all of these models is that they utilize the artist’s most marketable commodity—music—to “hook” the users and make them into fans. Additionally, these models render the issue of music piracy irrelevant and remove it from between listeners and artists. The fan model simultaneously establishes the desire for reciprocation and eliminates the feeling of guilt in the listener, creating a powerful potential for a lasting and supportive fan base.
The “music industry,” as it is today, is nearing its end. Label self-interest and internet piracy have left many musicians struggling to survive. The solution to this issue is not a quick fix, and may take some time to be popularly accepted. Music labels scoff at the idea of the fan model, and many musicians still believe the music label model to be the most secure option. It is our job as music listeners to let the musicians know that we will support this new model. You can do this by signing the online petition, Free Music Pays, on the iPetitions website. This petition states that we as music listeners support artists who wish to make fans rather than customers, and it declares that we will help the artists that we enjoy to succeed through this model. To a musician, the fan model can seem extremely risky, especially if he or she has the option of signing to a music label. However, the fan model can repay artists in much greater dividends than the traditional model, based in advances and royalties, ever will. It is a fact of humanity that individuals can be extremely loyal and generous supporters of those individuals or projects for which they are passionate. It is time that musicians took full advantage of the power of their music and reestablished the connection between the artist and the fan.
JK
Reader Comments (2)
Great article! I was actually considering writing one along these lines, but they cover a few different things. I think you touched on a lot of good issues and I also believe that the music industry as we know it is coming to an end. With the internet working for the artists, record labels aren't really needed like they used to be.
Have you been to the website bandcamp.com? It's a growing site and is a really easy way for artists to get their stuff heard and payed for. Seems like one of the frontrunners for making this new music model happen.
Radiohead's most recent album The King of Limbs was distributed a little differently than In Rainbows was. This time you can get the digital album for $10 and then $50 for a deluxe version of the album with extra artwork and a vinyl copy and such.
I have just recently discovered bandcamp.com (and felt remorse for paying double for Sufjan Stevens albums on iTunes), and I am very much interested in it. I am seriously considering using the site for my own free releases, because I have noticed that you can post stuff to be free for download (example: Monk Turner's three albums - http://monkturner.bandcamp.com/) as well as charging $5-10. Also, the high fidelity of the audio files (320kpbs MP3!) is much better than what "big-name" stores like iTunes and Amazon MP3 currently offer.
What I really like about bandcamp is the fact that the listener can easily stream the whole album before buying it, even on an iPhone browser. It's a great marketing decision for the Internet, where speed and convenience rule; I'm far more likely to end up buying an album if the store page lets me listen to whole the album first.