I know I am late to the game on commenting on things related to music and the interwebs, during the Piratebay trials would have been more appropriate, but hey, better late than never.
This (the spark that caused me to want to write this) was all influenced by Pandora Radio (another great waste of your time, if you enjoy listening to music) posting a video responding to viewer mail. The conversation quickly turned to some Facebook users voicing their discontent over their new micro-transaction and subscription options.
For those unfamiliar with micro-transactions or "MTs" as they are sometimes abbreviated to, are basically small fees, usually ranging from 1¢ all the way up to around $5-$10 that provide a small amount of content. To my knowledge, the video game industry uses them, for example: you pay $3.50 and purchase some armor for your avatar. With Pandora however, you can either pay 99¢ and the 40 hour hard cap (free users can't listen to any more music after using the service for 40 hours in one month) is removed for the rest of the month OR you can pay got s $36 annual subscription and have no limits ever, all the ads are removed, and you get a bunch more features. So to put it in simple terms, free gets you the basics, MTs get you a little more, and the subscription unlocks the whole thing.
So I guess the rumbling in my mind is coming down to one question: Are the ideals of capitalism failing with the advent of the internet in the context of intellectual property and music sales or is it all just penny-pinching teens?
I've been told at least a few times that if a company or companies wish to remain in business, they should cater to the needs of their customers (It may be a tad naive of me to this that, but I do believe the customer comes first). But, I have to admit, this seems to be the last thing anyone in the business wishes to do. What are the customers doing? Apparently, as one teenage facebooker suggested "just download albums :)" or what I like to call the "limewire hurr hurr hurr" approach. Teenagers with limited amounts of money, don't want to or can't borrow their parents' credit/debit card, so they just download them off the internet.
Well if I am correct, the record companies should respond by working with the consumers, trying to figure out why they aren't paying 89¢-$1.29 per song. But I'm clearly wrong. Instead the industry has taken to the "if they aren't purchasing your product, beat them into doing it" method and the "YOU WOULDN'T DOWNLOAD A CAR" campaign (which I might add is ironically plastered all over legally purchased DVDs).
At the same time, their methods aren't working. You can't strong-arm all these small time users who don't intend to seed, and they aren't going to catch the majority of users. Then factor in how each generation is more technologically literate than the previous (I.E. the age of downloaders is just going to fall as time progresses), as well as the fact that you can't stamp out Torrent clients because they do have legitimate purposes the problem is that people use them for illegal purposes.
So what should they do?
Well they could just do a "pay-what-you-want" system similar to Radiohead's In Rainbows album which gave away the album for free requesting that fans pay whatever they feel like for the album.
- The good: there are reports the band collected over $3,000,000 almost instantaneously.
- The bad: According to one study 62% of downloaders paid not a penny, nickel, dime, nor quarter. Of the 32% who did, the average was $2.26, well below the $10 per album they get off itunes. Radiohead maintains the report is inaccurate, but hasn't provided data suggesting otherwise. It must not have been very profitable overall, as they eventually threw in the towel. I mean if this was truly the revolutionary movement to change the industry, and at the same time was profitable, they wouldn't have stopped. They even got a little opposition from their fellow artists saying that Radiohead could only afford to do a promotion like that because of their popularity, that smaller artists would just end up broke if they tried it.
Full stats on the givers:
62% - $0.00
17% - between 1¢ and $4.00
12% - between $8.000 and $12.00
6% - between $4.01 and $8.00
4% - between $12.01 and $20.00
(figures add up to 101%, but they were probably rounded)
1 company reportedly paid $1,000 for one album
This approach has found success in other attempts.
On the table of options, Apple’s attempted solution still exists. They talked to the record companies and reached a deal over the Digital Rights Management (DRM) locking of music. DRM locking prevents people from just blatantly plugging their iPod into a friend’s computer and giving them all their music. DRM locking is also one of the reasons people download music. A problem occurs and they are no longer able to use the file, under fair use it may be acceptable. Apple remedied this problem by listing your purchases and allowing you to recall any interrupted downloads, but that doesn’t solve every occasion. Speaking on a person term, I have an older iPod connected to a previously shared iTunes account. That account has reached the max number of accounts, but a few years later I obtained a new iPod and laptop. Should I not be allowed to listen to my music because of an arbitrary limit? That doesn’t justify downloading music though, and Fair Use is always a sticky situation; it is much easier to leave it alone rather than enter into the grey area of copyright infringement. How did Apple work to solve this problem? Well they began to sell some DRM-free music, or you could pay $1.00 per song and $3.00 per video and you can have your entire library unlocked. Not exactly the most accommodating policy for consumers.
What did the companies get in return? They demanded variable pricing, meaning new (and therefore popular) songs cost $1.29, semi-new songs stay at 99¢, and then the older/unpopular ones may be priced for 89¢. Again, I’m not so sure this was done with the consumer in mind, nor with the aim as being a major step in combating music piracy. If people would rather risk lawsuit instead of paying 99¢ per song, what (other than profit) would cause any normal music supplier to raise price and act like they are solving the problem? I think, even though they fixed the complaints of their current userbase, this isn’t the magic bullet that finally ends filesharing, nor will it pull a majority of those people away.
The last attempt I have is the Pandora approach, which is to talk to the record companies and make a deal allowing people to listen (not own) to music, and have a decent amount of control over what music they hear, all for free. People are generally happy with it; some people voiced their problems with their 40 hour limit. After 40 hours per month (I believe most people don’t hit this cap) you can pay 99¢, the cost of owning one song on iTunes, and listen to unlimited amounts of music. The alternative is a $36 dollar a year subscription that gives a ton of unique features and the streamed music is higher quality than that of most terrestrial radio stations. Speaking from person experience, not only has Pandora gotten me away from downloading music, but I’ve purchased way more music than I have in a long time. Every Christmas I get a few iTunes cards, and thanks to Pandora, I have a list of at least 20 songs to buy. I think this is a step in the right direction for the music industry. You are giving music fans free music, which is always enjoyable and wanted, without actually having artists (or record companies) lose money, nor are copyrights being infringed upon. It isn’t the magic bullet either, because the system is designed to prevent you from listening to one band (which people do enjoy doing). It gives more towards what the userbase wants, instead of what the companies have done in previous cases.
Apple appears to be trying to compete with their “Genius” system. The major flaw is that you can’t listen to any of the music before you buy it, the little 10-15 second clip is rarely time enough to decide if you like an entire song, not to mention how many songs don’t rely on the same sound/lyrics the entire time. Why waste money on a song you may not like? With Pandora, you know if you like the song, and can buy it when you are sure you like it.
So what is my point? I’m saying that if recording companies ever want to end the illegal problem in the United States (American’s aren’t and can’t be responsible for changing other countries inability to control their copyright infringement, I’m looking at you Russia) than these companies need to actually start conceding to the users and consumers. They aren’t going to win by bringing the hammer of justice down on some 20 year old financially strapped college students, or by bringing 15 year olds into the court to defend themselves against a multi-thousand dollar lawsuit for eternity.
They are going to have to start to listen.
They are going to have to adhere to the basics of Capitalism, supplying the demand.
I ‘ll leave you with two quotes, the first by a Facebooker, the second by a hacker.
“Support what you like, or it might disappear.”
“This is a war you can never win. The people always win one way or another. The people will always have their freedom.”
And if you are wondering about the title, the words are the lyrics to the song The Ghost of Saint Valentine by Bayside, they just sort of came into my mind as a good image of the entire situation.
