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In Reply to: RE: Not so much, IMO. posted by rbolaw on June 19, 2012 at 11:44:00
"Both consistently act in accordance with the basic laws of supply and demand, profit and loss, cost, efficiency, and utility."
I disagree, it wouldn't be that hard to swipe someone's iPhone, but my guess is you haven't gotten one that way because your ethics prevent you.
"neither the musicians nor the end consumers needed an industry for these replication and distribution functions any longer."
Well, while technically true musicians DO need a music industry for music to be anything but a hobby.
"Even the third traditional function of the record labels -- promotion -- is being rendered increasingly obsolete by the internet."
Well, no, any large-scale promotional campaign still requires large scale promotional machinery. Weakened record companies simply have to direct their efforts and resources to their best hopes of "sure bets" rather than waste any money on anything that isn't.
"So low, in fact, that most recorded music literally isn't worth selling."
How you come up with that statement I don't know, I imagine you aren't aware what it costs to make a professional recording.
"And complaining about Emily's ethics isn't going to change things very much."
Well, the point of the article was not to complain about her ethics, but rather to point out that it IS quite simply a matter of ethics. She speaks of convenience, there are plenty of legal avenues that are every bit as convenient as the black market ones. When it comes down to it, ethically, she (and the people she represents) does not choose to steal her computer, her internet service, her cell phone, her headphones or her monthly cell phone plan, and pays significant sums of money on a regular basis for them. But ethically she feels comfortable taking the music for free and thinks that it's not worth spending $8.99 once for unlimited plays of an entire album which probably cost anywhere from $10k to over $100k to make. She also feels it's ethically acceptable that the musician that is the reason she spends all that money receives $0.00, while the large corporations receive many thousands of dollars from her over her lifetime so she can enjoy that music. The point is not to deride her for it, but to point out that it IS in fact a matter of ethics and nothing else.
First, those corporations that provide Emily with her internet and cell phone service, or other enterprises working closely with them, will take over music distribution as well. Second, those service providers will distribute music in a way that prevents unlimited uses or redistribution. Copies of recordings will no longer be sold. Rather, a limited right to listen to music, perhaps for a limited time, will be sold, or more accurately, licensed, to the end consumer. Third, prices will fall until the illegal black market is no longer a significant threat.
IMO the industry is gradually moving in that direction already. Look at Napster. First, the industry ignored it, being unwilling to move to a distribution system vastly more efficient and convenient for consumers but less profitable for them. Then it became wildly popular, and the industry was forced to go to court and shut it down. Finally, the industry bought it, and began offering downloads for a price. But those prices are apparently still too high if consumers like Emily still prefer the black market. (BTW, I do no illegal downloading.)
Even the classical music biz is trying to play this game. The Berlin Philharmonic now "sells" online videos of its concerts (directly, of course -- so much for DG). Not only can paying customers not copy these videos, they can only watch them for a limited time. The key question is, how much will classical music lovers be willing to pay for this?
I'm not in the professional recording business, but I have friends and clients who are. As you say, it is still costly to make a true professional quality recording, but replication and distribution have become much cheaper, as I said before.
None of this is good news for the musicians, who are and will continue to be, "screwed, blued and tattooed", as one of my law school professors was fond of saying. Rather than being enslaved by a handful of record companies, they will be enslaved by a handful of internet and cell phone service providers. I feel as badly for them as you do, but I don't blame Emily.
"First, those corporations that provide Emily with her internet and cell phone service, or other enterprises working closely with them, will take over music distribution as well."
Why would they when they would be undercut by her illegal sharing anyway? They profit from the existing structure, there is little incentive for that to happen.
"Third, prices will fall until the illegal black market is no longer a significant threat."
Well, this is getting into a separate topic, but prices are already that low (see Spotify). As long as people are habitually disregarding the value of music a penny a decade for Emily's dream access to all music always would not be attractive. It's not about the price.
"But those prices are apparently still too high if consumers like Emily still prefer the black market."
It's not about the price. The reason Emily pays $2500 for her Macbook instead of swiping one from the table at Starbucks is not because that is the price point where she doesn't steal, it's because to her stealing a physical item like that is unethical. She doesn't feel the same about music.
"The Berlin Philharmonic now "sells" online videos of its concerts (directly, of course -- so much for DG). Not only can paying customers not copy these videos, they can only watch them for a limited time. The key question is, how much will classical music lovers be willing to pay for this?"
To clarify, they've become a record company themselves, doing the same things that DG does. They don't just do it in their spare time. I suspect customers would be willing to pay more to be able to own it and not be limited, but I don't see anything wrong with ventures like that - people in the music industry should be using the internet to find new ways to succeed.
"None of this is good news for the musicians, who are and will continue to be, "screwed, blued and tattooed", as one of my law school professors was fond of saying."
Well, there are different levels of "screwing". To have to payback $200k of a $1M advance because of "slow" sales is one thing, to get $0 because an entire generation (and naturally those that follow) has never paid a penny for a sound recording, that's something entirely different. And it's one thing for the people doing the screwing to be execs at a big record company penny-pinching, it's another for it to be Emily and people like her, and I think it's important that she know that that's what she's doing.
"Rather than being enslaved by a handful of record companies, they will be enslaved by a handful of internet and cell phone service providers."
Not if Emily doesn't pay anything for music.
You may be well aware or you may not be, but this is a generational issue. I invite you or anyone to take your own survey of young adults under the age of 22. I expect you will find many if not the vast majority has never spent a penny for a song, even once. I refer to Emily because of a couple things. I'm a little disturbed that something like this shows up on NPR of all places, but I think her frankness is quite representative of her generation and shows the issues. She is not an internet pirater, I'm quite sure she doesn't think she is doing anything wrong (and I'm quite sure she thinks swiping an iPhone or Macbook is wrong), and this comes from a lack of awareness on her part about the ethical implications of her practices.
Alas, I guess we just won't see eye to eye on this. Music isn't drugs or prostitution, where a large amount of black market activity is inevitable because a legal market isn't available. Music is an industry where the value-adding function, and therefore the profit center, has shifted too quickly and too dramatically for companies to immediately adjust. But in time they will adjust.
If Emily doesn't see value in her music downloads, it's not because they aren't tangible physical products. Neither are her internet and cell phone services, and her Mac and iPhone would be worthless if she didn't pay big money for those services each month.
She doesn't see much value because she's right -- there is little value added in mere replication and distribution any more. The value added is now in internet, cell phone, cable and satellite communications. That is why those industries have begun to take over, and IMO will completely take over, music and video distribution. And when they've done that job properly, believe me, Emily will be happily paying for all of her music, whether directly or indirectly, explicitly or implicitly.
I'm not saying Emily is being ethical in using pirated downloads. I'm saying that were are in an odd transition period where a dying, increasingly obsolete industry is unsuccessfully trying to defend its old turf when inevitably, the game is already moving to the turf where today's profits are to be made. Blaming the consumer and trying to defend an old and now inefficient and obsolete mode of distribution only delays and increases the cost of transition.
I agree that we won't see eye to eye. I don't agree that we are in the transitional period you describe, there are plenty of legal and convenient avenues available to her for downloading and listening to music on her phone or whatever.
"She doesn't see much value because she's right -- there is little value added in mere replication and distribution any more. The value added is now in internet, cell phone, cable and satellite communications."
No, the value added is when the recording is made in the first place. The distribution means are an additional issue, again, that she is perfectly comfortable paying for. $2500 for her Macbook to store her music? No problem. 1/4 the cost of a moccachino to own the results of several people's life's work and many many thousands of dollars of production? No way, she'd rather steal it. That is a matter of ethics, and specifically her ethics. Ditto for the rest of her generation, and they just don't know.
"Blaming the consumer and trying to defend an old and now inefficient and obsolete mode of distribution only delays and increases the cost of transition. "
I don't think this has anything to do with anything said in this thread or in the original articles. Tell me what is inefficient about itunes.
The funny thing is, I understand your point completely. Illegal downloads are unethical, whether Emily and the rest of her generation understands it or not. But they will continue until the music industry gets its act together, whether you understand that or not.
There's no point in continuing this endlessly, but I'll respond briefly.
You say, "No, the value added is when the recording is made in the first place." Not so, my friend. A recording is worthless unless and until you get it to the audience that wants to listen to it.
You say, "Tell me what is inefficient about iTunes." Well, iTunes may be a big step up in efficiency from LPs and CDs in a lot of ways, but the ease (i.e. relatively low cost) of pirating and illegal copying and downloading makes it inefficient. If iTunes is able to reduce its price for downloads to one-tenth of a cent each rather than 99 cents each and still make a healthy profit, the pirates might have a tougher time of it.
If not, and the pirates flourish, the industry will turn to a more efficient model, probably direct streaming. The consumer will no longer be able to buy and own a copy of the recording, rather, she will have to buy a limited right to listen, perhaps only for a limited time. As I said before, but you seemed not to notice, I agreed with you that Emily is used to paying high monthly fees for internet access on her Mac and cell phone access on her iPhone. This will be another such access fee, or will be folded into the ones she already pays.
If you don't see what this has to do with this thread, maybe it's because your focus is on the evil ways of the younger generation, something older generations always complain about, rather than on the effect of rapid changes in technology in the music industry, which to me is the root cause of all this illegal downloading. I have trouble seeing how time cannot prove me right in this debate -- the profit motive is simply too strong, as are the laws of supply and demand that I mentioned in my first post.
"A recording is worthless unless and until you get it to the audience that wants to listen to it."
This is factually and legally incorrect. You probably mean to say that a recording will not generate revenue until... which is a rather different thing. Regardless, it is the property of the copyright owner and obtaining it through illegal means is stealing regardless of how much you or Emily or anyone else "thinks" it's worth.
"If iTunes is able to reduce its price for downloads to one-tenth of a cent each rather than 99 cents each and still make a healthy profit, the pirates might have a tougher time of it."
No, she gets it for free. You have not established an incentive for her to pay 1/10 of a penny for it.
Think for a second about the math of what you're suggesting though. I mean, I think a Macbook should be $3.99 but that math doesn't add up. At 1/10 of a cent per download, 10k downloads adds up to $10. I'll refer you to the link in the OP about how many records sell more than 10k. 1M downloads equals $1k. Gross. What portion of that do you think should go to the artist? What is the basis of concluding that worth for a recording?
It's worth noting that she didn't download her music.
"The consumer will no longer be able to buy and own a copy of the recording, rather, she will have to buy a limited right to listen, perhaps only for a limited time."
Again, no she won't because she gets her music for free and it's not limited.
"As I said before, but you seemed not to notice, I agreed with you that Emily is used to paying high monthly fees for internet access on her Mac and cell phone access on her iPhone. This will be another such access fee, or will be folded into the ones she already pays."
I did notice and as I responded the first time, this will not happen because she gets her music for free.
"If you don't see what this has to do with this thread, maybe it's because your focus is on the evil ways of the younger generation, something older generations always complain about, rather than on the effect of rapid changes in technology in the music industry, which to me is the root cause of all this illegal downloading"
Again, she does not download. As long as she is getting her music for free she is not part of the industry regardless of what the industry model is, it won't matter. As long as she feels what she is doing is ethically acceptable, she will continue doing what she's doing. If you are listening to what I am saying, I am not "focusing on the evil ways of the younger generation", in fact I am quite sure most are entirely unaware of the reality of what they are doing. My concern is making them (and others) aware of what the situation actually is, that sharing/downloading/whatever is ACTUALLY stealing and the ethical equivalent of swiping a Macbook from a table at Starbucks. I am quite certain if they properly understood this they would realize it and make better ethical choices as far as purchasing music. But they have people like yourself putting forth arguments that "it's the industry's fault for not changing" and "it's just the way it is now" and "people just won't pay for that", as evidenced by comparing your posts to hers, and so she thinks it's "ok" and doesn't give it a whole lot more thought than that. If she wants to own up to the ethics of what she's doing, ok, there are crooks in every society. My guess is she (and most others) doesn't.
You want to talk about the inevitable future, wait till another generation goes by of people that have literally never spent a cent for music. Do you really think there will be such thing as a professional musician? That will be a CEO with focus group trying to understand the musical genius of the Black Eyed Peas...
that as soon as the music industry fully adjusts to the new realities, unauthorized free music downloads will be a thing of the past. End consumers owning copies of their music recordings will probably also be a thing of the past. Emily will be paying for her music, no cheating.
Now, a CEO or a focus group analyzing the Black Eyed Peas? That sounds like fun.
You do realize that anything streamed can be recorded, don't you? Limiting to streaming will do nothing. They are outside the system, it does not matter what the system is. Emily will not pay for her music because she sees no reason to. As you say, it's worthless.
to eliminate illegal downloads. I guess that's where we don't see eye to eye. The music suppliers don't have to let their customers download the music at all. That's what the Berlin Philharmonic is doing with its concert videos. You pay, you can see them for a while, then you can never see them again. You never get a downloaded file you can share with your friends. If piracy becomes too big a problem, that's the future, IMO.
I guess there will always be hackers who can crack the code and beat the system. But as long as it is difficult and expensive to do that, pirates shouldn't be able to beat the industry.
Edit: Also, good luck to you and GEO in "educating" the younger generation. I respectfully suggest it's a hopeless task for the two of you. But once the companies that control our internet, satellite, cable and cell phone access focus on taking over the music distribution business, they will learn a major lesson in Economics 101.
I could make a DVD of the Berlin Philharmonic stuff no problem. If it can be viewed/heard it can be digitally reproduced ad infinitum.
Even with the sophisticated encryption system now being used with HD DVD and Blu-ray, hackers are hard at work trying to beat the system. But the industry doesn't have to defeat the hackers completely, which might be a nearly impossible task. They just have to slow them down.
I remember discovering as a kid that not only could I make my own cassette tapes of LPs and radio broadcasts, they were vastly superior to the far more expensive commercial cassettes. (I'm guessing you figured that out, too.) I didn't want to cheat, but I did want and felt I deserved the best possible product. A lot of us became home tapers until the industry came up with something much better than the cassette -- the CD. After that, my copying days pretty much ended, though the counterfeit CD factories in China were just getting started.
Kids today aren't much different, nor are the pirates. The industry can and will come up with something better than iTunes, and kids will buy it the way we bought CDs. The hackers will try to keep hacking, but high quality, reasonably priced, legal products will sell.
There is nothing "difficult" or "expensive" about it.
"Kids today aren't much different, nor are the pirates."
Yes, they are quite different. Rather than making a cassette copy of an lp, in less than two minutes they are making an exact copy of the entire store which can be replicated and distributed ad infinitum. That impacts the picture quite differently. As a friend said, it's the difference between grabbing an apple off the pile at the supermarket and getting a bunch of friends together to back a semi up to the supermaket and clean the whole place out, for about the same cost/time/effort. It's a different result.
And to clarify, I don't think the "pirates" are the biggest problem. As you say, they will exist regardless. No doubt there is a black market for Macbooks. The difference is how Emily feels about buying a stolen Macbook compared to copying a hard drive of music.
As for the "two of us" educating a generation, I'll do my part. You'll notice that the article has now had over half a million views, and you might read some of the comments to get an idea of other people's views on the subject.
Looks like the hackers who had found a way in to the Berlin Phil's Digital Concert Hall for free have recently run up against some encryption barriers. Some encryption beating will be necessary, though some hacker will no doubt succeed soon enough. My point was that if the product is good enough and low priced enough, the pirates are a lot less relevant.
"My point was that if the product is good enough and low priced enough, the pirates are a lot less relevant."
And this is where we disagree, if $.99 is too expensive for someone, the price isn't the issue.
I would have to agree. This is not about price. I told that to a friend of mine a few years ago. I told him he would steal music as long a he could because he has no ethics.....because it is easy to do, he believes there is nothing wrong with it.....his argument, if they don't want me to get it for free then THEY should figure out a way to prevent it....a whole generation of kids think that way....
It comes down to a matter of ethics and principles.
With the younger generation I really don't think they have any clue that ethics have anything to do with it. In conversations I've had, they clearly have never given it much thought. They think "yeah, I'm not really supposed to do that" but don't think deeper about the consequences and who exactly it is affecting, as well how it compares to their other actions and the decisions they make in those cases. I can understand how it got that way, but I think it is extremely important to make them think about it and educate them about exactly how it is a matter of ethics.
Doctors, lawyers, stock brokers, bankers, real estate agents, priests, teachers, coaches, building contractors, music contractors, union officials, press billionaires --- its damn near impossible to think of a segment of society that isn't fubar.
I see no hope of eliminating illegal downloading due to inculcation of ethics or morals.
But where someone like Emily doesn't really want to admit that she's doing something wrong, if forced to realize/admit that it is wrong she might change her practices. Given that it is generation-wide pretty much, eliminating it wouldn't be necessary. But failing to eliminate the tacit stamp of approval / look the other way that prevails at the moment couldn't be anything but disastrous for music as an industry, as once those "ethics" get passed to the following generation there is certainly no going back. As he says in the article, people have been shown to support ethical causes buying free-trade coffee, environmentally-friendly businesses etc., the problem is that she thinks a musician's work isn't worth $.99.
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