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Solving The Record Industry Dilemma

19 March 2004 619 Views One Comment

This isn’t about software per-se, but I want to propose my solution for this whole music industry copyright quagmire.

Record labels have traditionally had several purposes. They find musicians, they advertise/promote on behalf of the musicians, they record music, they put the recorded music on the latest-greatest tangible media (audio tape, CD, DVD, video tape, etc.), and they distribute the tangible media to a store to be sold.

But today, two things are very different. First, tangible media is becoming unnecessary. We are rapidly moving away from obtaining information on tangible media. Tapes, CDs, video tapes, and DVDs are prone to loss, theft, and damage. With hard-drive and internet-based storage becoming so cheap, why would anybody want to deal with tangible media in the next 5-10 years. Second, the market demands the free distribution of digital content. Whether information distributors want to admit it or not, the market views the distribution of content as a commodity. Without selling a tangible product, the record industry cannot expect to make a huge profit from distribution.

It seems to me that the RIAA (and friends) are having a hard time adapting to these changes. Its especially difficult for the record industry because they are used to overcharging people, and now they can’t charge $17.00 USD for $0.03 USD CD with 10 songs on it…. 7 of which suck.

IMHO, the record industry needs to quit its whining and start adapting these changes. They will never (ever) be able to control the distribution aspect of the market again, and they just need to face it. It seems to me that they are wasting time and money by trying to regain something that they will never be able to.

But, just because distribution is a commodity, that doesn’t mean that people are not willing to pay for the content itself. I still think that people are willing to pay for music that they like. How can money be made off of freely distributed music? Commissioning.

In a commissioning model, the record label does everything that it used to do, except it is no longer making a huge markup on the distribution of music. They would promote artists, and the listeners that enjoy the music would (as a community) commission the artist to release more music. The music would be freely distributed to the benefit of everybody. The more people that listen to it, the greater the potential commission for the artists next release.

There are numerous ways one could implement the commissioning model. A popular implementation of this model would probably be releasing songs only after a certain amount of money is collected.

I think the same model would work for digital art, movies, and any other type of digitally transferable art form.

One Comment »

  • Steve said:

    Or artists just make music, movies, etc because they love to, and make as much as regular joe. Or they have concerts and make their money that way. A big band could record their own album (for pennies, in their home studio), market it on the net, get everyone into it, and then tour and play the songs, and people will pay to see them (if you build it, they will come)

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