Music's lost decade: Sales cut in half

[100th Monkey]

Originally Posted by Dean Roddey

So Youtube makes money by the boatload, and forces the copyright holder to do all the work, and they know that someone will put it right back up so they'll continue making money by the boatload. They copyright holder cannot just say, NEVER allow this song to be posted. Clearly Youtube actively removes porn before it even gets seen as far as I can tell, so you know they have people monitoring all new posts, therefore they cannot claim they don't watch them all.

Almost 30,000 hours of video is uploaded to youtube per day, I doubt they have people watching it all. It's more likely they're relying on keyword searches, statistics, user reports, and random sampling.

And yes, porn has made it onto youtube many a time. 4chan even dedicated an entire day to it.

[Dean Roddey]

Originally Posted by 100th Monkey

Almost 30,000 hours of video is uploaded to youtube per day, I doubt they have people watching it all. It's more likely they're relying on keyword searches, statistics, user reports, and random sampling.

And yes, porn has made it onto youtube many a time. 4chan even dedicated an entire day to it.

Well, they could use the same things for copyrighted material as well. If they aren't named correctly folks can't find them, so they tend to have the names of the songs. Though, they don't allow user reports for copyrighted material. It has to be the copyright owner, even if you know for a fact it's not supposed to be there.

Either way, I guarantee you you'll find WAY more illegal music than porn there, because they make no effort to remove any of it themselves, though they know it's been requested to be removed numerous times before. All they have to do is make it so onerous for copyright holders to police it themselves, and enough time for the reporting process to be carried out, that there's always a copy of whatever anyone wants up there, and so people come there by the bazzillions and they rake in the dough.

[rack gear]

Originally Posted by lagavulin16

I brought up the same facts to him in the piracy forum. He absolutely thinks the industry would have grown by that degree without piracy.

so now you can think for me - impressive...

the point being, again... this isn't about 100% of anything.

not 100% of piracy, and not 100% the elimination of it.

the point is AGAIN looking at "good enough" solutions - the kind we have that govern everything from murder, parking tickets, shoplifting, grand theft auto, etc.

no law, crime/punishment system is 100%. the point here is that up till now this cat/mouse game has had pretty much no cat... that's changing.

so 96 billion without piracy when the previous peak was 16 billion... probably not... but run the numbers just to see what a "good enough" solution represents and it's surprisingly modest just to meet those good ol' 16 billion domestic number...

throw in a little growth for the unprecedented expansion of distribution via more computers, ipods, phones w/ memory, etc (as has been noted repeatedly) and we start to see what a world with "good enough" manageability looks like...

wow... look at that... there can be legitimate new models built around return on investment if say piracy is managed to 70%... holly shit... does that sound like I've got my head in the sand that it's not going away? does that sound like I believe there's a 90 billion dollar payday... no.

as we drill down into more numbers the truth will out - there is a margin where legitimate models can exist - we're not really there now, but we're going to get there.

how much can be earned once there are legitimate new models that can not be stolen wholesale - well we'll see, but I believe the numbers are big enough that there will be substantial enough investment to anti-piracy to reduce the liability to manageable levels.

you can't stop people from stealing who want to steal - people go to great lengths to either defend or justify stealing in these very forums.

the larger part of the population can be deterred with broad stroke policies, and enforcement - that's how most laws work... hell, we can't stop murder how are we going to stop piracy...

so the solution is in the margin of acceptability... not in absolutes, as either extreme is probably, just that...

[rack gear]

Originally Posted by lagavulin16

The need to pay in order to access music is gone, because you can access it for free.

this will change. the content providers are learning. spotify is a radio model not a retail one. so are all streaming sites.

streaming is not the answer:

my prediction is content providers are getting wise to this - expect to see free content "polluted" in the near future with embedded advertising, front/back announced band/artist announcements.

if we're truly moving to Ad Rev models, than more traditional Ad Rev models will be adopted. A lot of ideas have been tried - but content holders are finally waking up.

expect to see some crafty spins on the way artists make their content available for free, especially on sites like MySpace and YouTube...

don't give away the EXACT thing you are trying to sell... it's a bad idea.

but don't take my word for it...

here's more on the subject:
Can Spotify Cross the Atlantic? WMG Splashes Cold Water On Free... — Digital Music News

Ultimately, according to Bronfman, the number of people accessing on-demand models simply 'dwarfs' iTunes, though analysts were left wondering how the monetization riddle gets resolved.

oh yeah... that nagging return on investment part keeps getting in the way of the new media fantasy... the only business models that work for new media, are for new media... not content providers... not artists, not bands...

[initialsBB]

Originally Posted by lagavulin16

I brought up the same facts to him in the piracy forum. He absolutely thinks the industry would have grown by that degree without piracy.

Well, that's not what he said. And I don't actually disagree with him, I was just trying to wade through all of the different numbers and make sense of what is a pretty complex issue.

[initialsBB]

Originally Posted by redvelvetstudios

streaming is not the answer:

I don't agree with that. Streaming is the way forward, and it's inevitable. It may not be a one size fits all approach though. Why not try free, ad supported streaming of the vast chunks of slow selling back catalog and obscure little things that never get reissued, to attempt the long tail strategy for that stuff. Then maybe paid subscription services for the middle range of consistently selling back catalog. And finally a premium, pay-for-the-download tier for new releases.

Maybe the music industry needs to do something along the lines of Hollywood's release "windows" for these different segments of the market. Sort of a spotify+emusic+itunes approach.

[100th Monkey]

Originally Posted by Dean Roddey

Well, they could use the same things for copyrighted material as well. If they aren't named correctly folks can't find them, so they tend to have the names of the songs. Though, they don't allow user reports for copyrighted material. It has to be the copyright owner, even if you know for a fact it's not supposed to be there.

Either way, I guarantee you you'll find WAY more illegal music than porn there, because they make no effort to remove any of it themselves, though they know it's been requested to be removed numerous times before. All they have to do is make it so onerous for copyright holders to police it themselves, and enough time for the reporting process to be carried out, that there's always a copy of whatever anyone wants up there, and so people come there by the bazzillions and they rake in the dough.

True, but you're nitpicking. There's plenty of music available on youtube which is there legally, and it's only one of many avenues a person can use to listen for free without being a pirate.

I think you're also greatly underestimating the difficulty of tracking copyright and banned material based on text searches, especially when you take into account the prevalence of live performances, covers, and interviews/discussions by and about the artists.

[lagavulin16]

Originally Posted by redvelvetstudios

so now you can think for me - impressive...

the point being, again... this isn't about 100% of anything.

not 100% of piracy, and not 100% the elimination of it.

the point is AGAIN looking at "good enough" solutions - the kind we have that govern everything from murder, parking tickets, shoplifting, grand theft auto, etc.

no law, crime/punishment system is 100%. the point here is that up till now this cat/mouse game has had pretty much no cat... that's changing.

so 96 billion without piracy when the previous peak was 16 billion... probably not... but run the numbers just to see what a "good enough" solution represents and it's surprisingly modest just to meet those good ol' 16 billion domestic number...

throw in a little growth for the unprecedented expansion of distribution via more computers, ipods, phones w/ memory, etc (as has been noted repeatedly) and we start to see what a world with "good enough" manageability looks like...

wow... look at that... there can be legitimate new models built around return on investment if say piracy is managed to 70%... holly shit... does that sound like I've got my head in the sand that it's not going away? does that sound like I believe there's a 90 billion dollar payday... no.

as we drill down into more numbers the truth will out - there is a margin where legitimate models can exist - we're not really there now, but we're going to get there.

how much can be earned once there are legitimate new models that can not be stolen wholesale - well we'll see, but I believe the numbers are big enough that there will be substantial enough investment to anti-piracy to reduce the liability to manageable levels.

you can't stop people from stealing who want to steal - people go to great lengths to either defend or justify stealing in these very forums.

the larger part of the population can be deterred with broad stroke policies, and enforcement - that's how most laws work... hell, we can't stop murder how are we going to stop piracy...

so the solution is in the margin of acceptability... not in absolutes, as either extreme is probably, just that...

1) You're sort of dodging the question. In your own estimation, if the previous peak was 16 billion, and counting all downloads as sales would point to 96 billion, where do you think the industry would be in annual revenue without piracy currently?

2) Your premise that we'll ever know "how much can be earned once there are legitimate new models that can not be stolen wholesale" may or may not become reality, but we've argued the feasibility of putting the genie back in the bottle ad nauseam so I'll just wait until May 2011 and we'll see where we are.

[lagavulin16]

Originally Posted by 100th Monkey

True, but you're nitpicking. There's plenty of music available on youtube which is there legally, and it's only one of many avenues a person can use to listen for free without being a pirate.

I think you're also greatly underestimating the difficulty of tracking copyright and banned material based on text searches, especially when you take into account the prevalence of live performances, covers, and interviews/discussions by and about the artists.

The other factor regarding availability is that there are plenty of free and legal sources. VH1.com, on demand through your cable provider, the record company website, not to mention the ease of using a DVR to capture 12 hours of MTV versus 6 VHS tapes in the past, it's simply a lot easier to hear the song you need to hear for free than it was 20 years ago.

Originally Posted by initialsBB

I don't agree with that. Streaming is the way forward, and it's inevitable. It may not be a one size fits all approach though. Why not try free, ad supported streaming of the vast chunks of slow selling back catalog and obscure little things that never get reissued, to attempt the long tail strategy for that stuff. Then maybe paid subscription services for the middle range of consistently selling back catalog. And finally a premium, pay-for-the-download tier for new releases.

Maybe the music industry needs to do something along the lines of Hollywood's release "windows" for these different segments of the market. Sort of a spotify+emusic+itunes approach.

Most industry types aren't interested in free streaming due to the revenue it can provide.

Currently, you'd have to charge more than consumers are willing to pay to satisfy the monetary demands of the artists and labels.

[rack gear]

Originally Posted by lagavulin16

1) You're sort of dodging the question. In your own estimation, if the previous peak was 16 billion, and counting all downloads as sales would point to 96 billion, where do you think the industry would be in annual revenue without piracy currently?

I'm not sort of dodging anything. I just don't agree with your defeatism or your particular view of reality.

I believe with "good enough" anti-piracy in place that at minimum digital sales will multiply by a factor or 2 - 4 x's - double to quadruple what they are now. On the high end that reduces piracy to 75%... seventy five percent. I believe that a reduction of 30% is achievable via many of the first tier deterrents that are being explored.

Seeing a legitimate digital sales increase (albums and songs) of 2-4 x's of what they are now would be more than enough capital infusion to create the incentive for more legitimate business models, artists development, etc.

I do not believe in any way that these are unrealistic goals, that I have my head in the sand, am anti-progress. I'm all for progress and workable solutions that restore fairness and balance to the marketplace.

Originally Posted by lagavulin16

2) Your premise that we'll ever know "how much can be earned once there are legitimate new models that can not be stolen wholesale" may or may not become reality, but we've argued the feasibility of putting the genie back in the bottle ad nauseam so I'll just wait until May 2011 and we'll see where we are.

dude - I don't know what your extremist bend is here... did your band not get signed? Did someone tell you your songs suck? You band get dropped? Are you hating life in an IT cubical somewhere?

I just don't get it. Really. I understand your version of reality... cool, that's your version of reality. I know where we are, I know what's been done.

But unlike you, I'm also under NDA and on the front lines of what is happening on many levels - technologically, politically, legislatively.

Maybe, possibly in the end you will be right... but if you are... and we're already at 95% piracy where do you think that ends? 97%? 99%? 99.9% 100%?

For God's sake we're only at 7% broadband connectivity...

The music industry boned it from the gate - no doubt it could have been handled better - but the past is the past and I'm looking to the future. The heavy lifting in the battle is coming from the largest corporate players - don't make me post the biden attendee's list... Paramount, Sony, Universal, Warner Bros, Viacom, the major networks, all the major content creators, owners, providers are getting into the ring.

And AGAIN many of the solutions are "good enough" for a viable reduction in piracy to maintain sustainable legitimate revenue.

[rack gear]

Originally Posted by lagavulin16

Most industry types aren't interested in free streaming due to the revenue it can provide.

Currently, you'd have to charge more than consumers are willing to pay to satisfy the monetary demands of the artists and labels.

there's no more revenue in streaming than there was in radio. Spotify is a Radio model, not a retail model - and as the numbers get published, everyone is seeing this.

The model could evolve to either be more like radio (embedded advertising and polluted content) or more like retail (better per unit economics). But as it stands now it's neither one right now... but pretending to be a retail solution (which it's not) while functioning more like radio (but very poorly).

[Dean Roddey]

And of course the same issues that plague sales will plague any attempt at ad based systems. You can see why in this thread:

Anybody else tired of the Sonalksis banner screwing up browsing?

The self entitlement culture has reached a new peak on the internet.

[joelpatterson]

AND it's only really just getting started....

[rack gear]

Originally Posted by Dean Roddey

And of course the same issues that plague sales will plague any attempt at ad based systems. You can see why in this thread:

Anybody else tired of the Sonalksis banner screwing up browsing?

The self entitlement culture has reached a new peak on the internet.

looks like that thread is gone... I guess it's not good to criticize the advertisers.

[Alv]

Originally Posted by Dean Roddey

But, you also have to ask, where perhaps did that extra money come from to buy those games? You may want the music more, but if you don't have to spend any money on it, then that money flows down the priority list to those things that are harder to rip off. So, as always, when people stop playing by the rules of capitalism, it becomes impossible to assign values. You can't tell if they like games more, or just that they can now buy more games because they never had to make the decision whether to buy a game or buy some music.

I don't agree. Everyone sitting in front of a flat screen playing halo and every house wife with a Wii Fit fell in love with those gaming systems because they got the Kings of Leon cd for free?

This thread kind of bothers me for a couple reasons. 1) The anti-piracy-ers are more monday morning quarterbacking than anything else and then claiming intellect. If someone came into my room day after day beating the anti-piracy drum I would seriously ask them to turn in their keys. Too emotional to change and innovate is right! I wouldn't want to work with or give my money to anyone who couldn't recognize the paradigm shift and choose to work with an optimistic, evolving vision for the future instead only being able to offer the grand idea of just saying "stop those people!".

Those links that are "supporting" the 50% loss are from CNN and a Princeton blog that doesn't even protect the copyrights of the authors posting and I'm pretty sure that CNN has been known for telling me some pretty silly s*.

The last paradigm shift was the one that got more than just the chosen few and Rick James into their own studios. There are people here entering the new paradigm shift, the one shifting towards ethics, with the archaic "good old strong-arm-of-the-law solutions". If you embrace this with ethics and respect for listener, you just might be able to pry more than $9.99 out of their wallets.

There are innovative solutions out there somewhere and not too far away. The more you cry and complain that there isn't a new business model the more it's better for everyone else out there with the brave eye to find one. There are people with the ability to fund a good progressive cause if you look towards community building, embrace the situation we are ALL in and provide instead of protect.

[Dean Roddey]

Originally Posted by Alv

I don't agree. Everyone sitting in front of a flat screen playing halo and every house wife with a Wii Fit fell in love with those gaming systems because they got the Kings of Leon cd for free?

NO, obviously not. But, they like music. They like games. If they have to pay for both music and games, and they have X amount of dollars to spend, then they have to divide that money between the two. If they don't have to pay for one of them, then they are free to spend the money on the other.

As is usually the case, people like you just wave their hands and say you have to innovate and that people who can't make money in this new scheme are dinosaurs. But, of course, if you had such ideas when no one else did, you could be the rich one. Given that you aren't, then probably you don't have any better ideas than anyone else.

As to treating customers, that's a joke. The record labels put their product out there with zero protections, and they got screwed. You are deluding yourself if you think that any of this has to do with not treating their customers fairly.

[lagavulin16]

Originally Posted by redvelvetstudios

I'm not sort of dodging anything. I just don't agree with your defeatism or your particular view of reality.

I believe with "good enough" anti-piracy in place that at minimum digital sales will multiply by a factor or 2 - 4 x's - double to quadruple what they are now. On the high end that reduces piracy to 75%... seventy five percent. I believe that a reduction of 30% is achievable via many of the first tier deterrents that are being explored.

Seeing a legitimate digital sales increase (albums and songs) of 2-4 x's of what they are now would be more than enough capital infusion to create the incentive for more legitimate business models, artists development, etc.

I do not believe in any way that these are unrealistic goals, that I have my head in the sand, am anti-progress. I'm all for progress and workable solutions that restore fairness and balance to the marketplace.

I appreciate the answer. Let's see how things play out.

dude - I don't know what your extremist bend is here... did your band not get signed? Did someone tell you your songs suck? You band get dropped? Are you hating life in an IT cubical somewhere?

To answer your questions...

1) yes, we never got signed.
2) I tell myself my songs suck all the time.
3) I wish!
4) I actually enjoy my life and my job.

I just don't get it. Really. I understand your version of reality... cool, that's your version of reality. I know where we are, I know what's been done.

My version of reality and your version of reality is identical: Piracy runs rampant. Our versions of the future is where we differ.

But unlike you, I'm also under NDA and on the front lines of what is happening on many levels - technologically, politically, legislatively.

Maybe, possibly in the end you will be right... but if you are... and we're already at 95% piracy where do you think that ends? 97%? 99%? 99.9% 100%?

And we'll see how those approaches work in the future. I think the piracy rate will stay about the same, but I think online music sales (and piracy) will both grow significantly in the future.

For God's sake we're only at 7% broadband connectivity...

The music industry boned it from the gate - no doubt it could have been handled better - but the past is the past and I'm looking to the future. The heavy lifting in the battle is coming from the largest corporate players - don't make me post the biden attendee's list... Paramount, Sony, Universal, Warner Bros, Viacom, the major networks, all the major content creators, owners, providers are getting into the ring.

And AGAIN many of the solutions are "good enough" for a viable reduction in piracy to maintain sustainable legitimate revenue.

We'll see. You already read my thread about how I hope you're right. There is no need to reiterate my stance anymore. Let's see where we are in May 2011 and review the landscape then.

[rack gear]

here we go again...

Originally Posted by Alv

This thread kind of bothers me for a couple reasons. 1) The anti-piracy-ers are more monday morning quarterbacking than anything else and then claiming intellect.

how do you know? and what do you do? musician, producer, engineer, label owner? what qualifies you in the discussion?

Originally Posted by Alv

If someone came into my room day after day beating the anti-piracy drum I would seriously ask them to turn in their keys. Too emotional to change and innovate is right! I wouldn't want to work with or give my money to anyone who couldn't recognize the paradigm shift and choose to work with an optimistic, evolving vision for the future instead only being able to offer the grand idea of just saying "stop those people!".

great - what's your new change and innovation that is optimistic and evolving? let's have it - because thus far in everyone of these threads the all basically end up back at:

- the old model, except take away money from recorded music sales

- streaming, which has no revenue and is really a radio model at best

but I'm open minded to hearing your solution that actually has a revenue model that supports return on investment for recorded music sales.

Originally Posted by Alv

Those links that are "supporting" the 50% loss are from CNN and a Princeton blog that doesn't even protect the copyrights of the authors posting and I'm pretty sure that CNN has been known for telling me some pretty silly s*.

great - in the face of the facts, just simply refer to it as silly shit... hmmmm... what else ya got?

Originally Posted by Alv

The last paradigm shift was the one that got more than just the chosen few and Rick James into their own studios. There are people here entering the new paradigm shift, the one shifting towards ethics, with the archaic "good old strong-arm-of-the-law solutions". If you embrace this with ethics and respect for listener, you just might be able to pry more than $9.99 out of their wallets.

I don't really understand what you're trying to say here - so how about you break that down into something that makes sense. What "paradigm shift" are you specifically referring too? And what "ethics" are there in piracy?

I hate to break it to you, but new media doesn't have ethics. New media exists for content creators to give away their content and creations so that new media can profit. It's that simple. What's myspace paying these days?

Record labels shared the profit... you know those evil record labels making rich rock stars that don't need money... yeah... those evil labels capable of creating rock stars and supporting countless careers of creative musical people like producers, engineers, studio musicians, etc...

did you have a point?

Originally Posted by Alv

There are innovative solutions out there somewhere and not too far away.

really? where? Show me. Educate me. Where is the sustainable return on investment for recorded music sales?

Originally Posted by Alv

The more you cry and complain that there isn't a new business model the more it's better for everyone else out there with the brave eye to find one.

really? how? explain that to me. no one is making money. piracy crosses all lines. show it to me working...

Originally Posted by Alv

There are people with the ability to fund a good progressive cause if you look towards community building, embrace the situation we are ALL in and provide instead of protect.

Really? Like who? Like what? I'm willing to be wrong. Show me the numbers.

[FFTT]

Please do tell us how much the average signed major label band or song writer receives from the sale of each full album CD and each single in actual royalties?
Averages are good enough.

Also please do tell us why the Eagles decided to go direct to Walmart for their
last release?

[rack gear]

Originally Posted by FFTT

Please do tell us how much the average signed major label band or song writer receives from the sale of each full album CD and each single in actual royalties?
Averages are good enough.

Sure - between $1.25 and $2.50 for the masters and between another $1.00 to $1.50 on publishing... so that's about $2.25 to $4.00 per unit. New artists at the low end, established "hit" artists at the end.

is there any new model out there that even comes close to these numbers? Nada... zippo, nothing... find me one "new media" outlet that pays an artist up to $4.00 per unit... There's only two... Itunes and Amazon mp3... and they're seen as "old school"...

I'm glad that artist can go direct to itunes. They can learn fist hand the economics of return on investment.

Originally Posted by FFTT

Also please do tell us why the Eagles decided to go direct to Walmart for their last release?

sure - because walmart could make a more competitive offer on a one off album than any label could. walmart has a completely different structure than a record label. it was a smart win/win for both.

walmart paid less to the band then they would have paid a label per unit, and the band got paid more per unit than they would have on the label.

that's what happens when you do a direct deal - there's more margin to split between the two principle parties. simple math, less people involved = more to go around.

but let me know when walmart starts signing unknown bands, then invests in marketing and developing them... hmmmmm.... crickets...

comparing the eagles/walmart deal to a label deal is the same as comparing the Radiohead/Nine Inch Nails deals to a label deal.

So let me know when walmart starts signing and developing bands cause it looks like their direct deals are with multi-platinum hit artists who had the benefit of decades and millions of dollars of investments by major labels - same goes for radiohead and nine inch nails...

[Dean Roddey]

This thread may get moved here anyway, but in the meantime, it's a pretty interesting (and quick) read:

http://www.gearslutz.com/board/so-mu...his-reply.html