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Mi2N - Music Industry News Network
Business News (more headlines) 04-20-2001

What Is The Single Greatest Impact Napster Has Had Or Will Have On The Music Industry?

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Email: editor@mi2n.com

April 16

In an unprecedented way, Napster fueled the notion that we can, in a very efficient way, access entertainment for free via the Internet. Millions of people are very much accustomed to this newfound "freedom". This phenomenon will continue to grow exponentially.

Don't expect tens or hundreds of millions of music & entertainment lovers to all the sudden start buying downloaded digital copies of music and movies like they USED to buy CDs and videotapes. That's not gonna happen unless the costs are cut into drastically, like 80% or 90%.

Ergo, the current entrenched business models for distributing entertainment will eventually become extinct. It might take a generation, but it's coming.

You thought the Internet stock bubble burst was something to behold? Wait 'til you see the Hollywood bubble finally go "kaboom".

Major distributors will have to adopt to this "free for all" mentality in order to remain viable businesses. So-called "digital rights management" solutions will ultimately prove to be a worthless, meaningless waste of time.

Virtually all recorded entertainment will be free to the consumer, ad-supported and on-demand, or, EXTREMELY cheap with MUCH more product being distributed. What you want, when you want it, and the way you want it.

Pay-per-view live events will flourish. But we will be paying a lot more to attend concerts, movie theatres, sporting events, etc., in order to compensate for the loss in unit sales of product. And if movie theatres are smart, they will make their venues far more comfortable and enjoyable, so people won't mind paying $15-20 per ticket.

Voluntary contributions from the fans directly to the artists is another potential avenue for revenue.

Copyright laws will be revamped and loosened. So will royalty and residual payment structures. Enforcing today's copyright laws will be deemed impractical and unenforcable. Creative people will simply have to concentrate on other ways to get compensated.

Eventually, artists/entertainers will adjust to this new economy. (They won't have any choice) Some artists will perform/create more for the sake of the art, and won't spend a lotta time worrying about sales of units.

More profit-driven artists will make deals with companies like Mountain Dew or Nike to sponsor their next set of music collections, replete with product placements within the songs themselves. Same concept applies to filmmakers. This is how tomorrow's artists will be paid.

The major record labels/movie studios, if they still exist in any veritable way, will more than likely serve as intermediaries within this structure, like ad agencies, selling demographics to major advertisers.

It might take 20 years or so for this overhaul of the economic infrastructure of the entertainment industry. But without question, the history books will record Napster as that watershed killer app that caused the public at large to view entertainment as a free commodity.

Charles Locke, PhatView

Napster reminded artist of the fact that they are the ones providing content. That the recording industry has been encouraging learned helplessness among artists. Any artist really knows how to promote themselves. The recording industry has been packaging those activities and has been pursuading artists that they need their help.
Napster distroyed this illusion and brought back the focus on the original relationship between artist and consumer.

Philip Horvath, Nextera

It has forced recording artists to reexamine exactly how they expect to have a career in the music business under the commercial structure established by the industry. Several important movements currently underway support this. First, Courtney Love's initiative, and second, the formation of the recording artists' guild. Both espouse to use strength in numbers to effect a more "artist friendly" commercial structure.

Glenn C. Romano, Attorney

April 17

My heart tells me the debate between "intellectual property" and "free expression" is just beginning but the REAL development is the kick in the ass to the record companies by artists. A wake up call is at hand. The subterfuge that consumers are stealing from music industry is the pot calling the kettle black. A new paradigm must be developed to afford entreprenurial artists a method of equitable distribution of their product. If the majors want to stay majors, they must rescind their draconion contract requirements and partner with their artists. Indentured servitude went the way of the Dodo bird a long, long time ago.

Alan, Too Much Fun Productions

The greatest impact Napster has had is that it has created a new social awareness regarding the idea of "recording artist's rights." Before the Napster controversy, music fans were, for the most part, ambivilent regarding ideas about copyrights and artists. Now, no matter their opinion on "FREE downloading of songs," the ideas of "copyrights" and "artist retribution" are
present in the minds of fans. In this way, Napster has brought artists and fans closer together--a direct link that will forever come back to haunt the so-called "major" labels. That is, unless they find a way to become a part of that link.

Rob Gonzalez, Tons O' Fun Records

April 18

I'd like to respond to Charles Locke's depressing vision of the future of the music business in your April 17th newsletter. Yes, Napster may have given millions of naive and greedy fans the idea that music was their God-given right to enjoy free of charge. But the reality is that, like any quality product, music - good music - does not come free. Does Mr. Locke really believe that people who sweated and starved for years to hone their skills to the point that they could call themselves professional musicians are going to be content with "voluntary contributions from the fans," or being told that they will "simply have to concentrate on other ways to get compensated"? How about they just stop making music altogether? Then what are you going to download, Mr. Locke? Kill the goose that lays the golden eggs, and you'll be left with tofu for breakfast.

And why should this concept of God-given, free entertainment stop with music? What about films and novels? Soon Digital technology will be capable of digitizing and compressing anybody's intellectual property into a neat little package that we will be able to download off the Internet. If we accept Mr. Locke's vision, all writers, artists and filmmakers will also have the fruits of their labors ripped off and universally distributed without a thought to compensate the creators.

Why not instead devise a system now to give these artists equity and do what is not only the legal thing, but the right thing. If there's one thing I've learned from this whole Napster debacle, it's that, if they want to, a Napster-like entity can not only track and account for every single download, but also limit the user's ability to burn it onto a CD or any other playback device. Napster offered to do just that in its recent settlement proposal to the music industry. So, then, if peer-to-peer file sharing and digital downloads are the future media of entertainment delivery, why not simply charge a nominal fee for each download? Maybe I'm being naive, but I believe that most music fans, as well as consumers of any other art or entertainment medium, will see the intrinsic fairness of this and not object to paying for what they get. We gladly fork up unreasonable sums of money for far more inferior products every day, so why not pay a little for something that literally makes life livable?

He who does not learn from history is doomed to repeat it. In a fascinating article in Time magazine last fall I read that, shortly after the French Revolution, the French did away with copyright laws. But after a few years of the quality and quantity of art and literature steadily eroding, they reinstated them. Mr. Locke proposes that artists can compensate them selves by making deals with "companies like Mountain Dew or Nike" and then write songs with "product placements within the songs"! Is this what we really want? Courtney Love & Hole singing the praises of Mountain Dew? Chuck D & Public Enemy rapping about their new Nikes? Jeez, Charlie, you sure know how to kill an art form!

Ted Myers, Artist Advocate

April 19

Eric, I just read Mr. Ted Myers' response to Mr. Charles Locke's obvious belief that music should be given away freely, and that musicians should find other ways to earn an income in order to support their livelihood, even though they've, most likely, spent far more time training in their respective field than any doctor, lawyer or, for that matter, rocket scientist. And, as such, here's my support of Mr. Myers' response.

I believe that, whatever Mr. Locke's vocation is that he has trained extensively for and, thus, utilizes to earn an income in order to feed, clothe, and shelter himself, should be immediately taken away from him, with him, subsequently, taken away to the paradise existence of a heat-challenged August in Death Valley, California, or the utopian existence of a wintry January outback Alaska (complete with moose droppings) where, in either location, he should be forced to endure and exist for 1 week sans food, water, or shelter.

Only then, will he even begin to understand why musicians should be duly compensated for their work, and of which I am sure he will quickly become a staunch Ralph-Nader-like supporter afterward. Idiotic-non-thinkers, such as Mr. Locke, should be invited over to certain Sunday dinners, which come complete with desserts of arsenic.

- Kenny Love, http://www.kennylove.net

Without knowing if I am infringing on any copyright issues here, I enclose a 'readers reply' in regard to the Napster 'debate'. [below]

However, this past w/e I had a lengthy 'warm' discussion with a young man who understood copyright etc., [to a degree], but made a very good point in regard to being foisted with unwanted product. His point was, if he didn't want all the tracks on a CD, didn't want the text, didn't want the case, why should he pay for it? He could choose what he wanted via Napster instead of having some marketing exec stiff him for $18.oo for data he had no use for. The analogy he used was strange but useful in a 'street' sense.... if you go to a tailor to buy a tie and the tailor will only sell you a tie if you buy a suit, shirt, shoes etc. then you wont buy the tie from him. Someone who will sell just the tie, perhaps even give it away, is where one will conduct business.

My point to him that 'taking' music is stealing and no different than removing a can of Coke from a store or $100M via a bank robbery was met with a blank stare.... copyright is not enforced therefore the public do not see 'borrowing' as stealing or breaking the law.

How many people reading this email have lent or borrowed a book?? Naughty naughty.

As ever, it is the industry which is to blame, not the creator. The salaried folk are still getting paid, the creators are not. Our leaders have not supported nor enforced copyright in the public arena and the lack of solid management in some areas is coming home to roost. Hmmm

I hear the clamour, but times they are a changing and the genie is long gone from the bottle.

Wait until 'our' music is sent via 00's & 111's and we are left with no income because we have no contracted papertrail rights... look out !

Les

I'm a musician, and I have been for a lifetime. This is how I feel about that guys statement about Napster, and peer to peer, playing for Nike, and Mountain Dew etc.

Ok first let me say this, is your house for sale? No?... well tough crap, I feel like I should be able to come in and check it out without asking you, 'just in case' I ever feel like buying it, that means I'll just hang out for as long as I want, lounging on your couch all day, and watching your tv. And when I leave, I think I should be able to take whatever in the heck I feel like, your couch, bed, toilet seat, tables, chairs, microwaves, maybe your wife? and if you dont like it, then go get Nike and Mountain Dew to Sponsor your complaint. and maybe you'll be able to afford to get new furniture.

Ok what is the difference between ownership of an item? wether it be a song, or a house and accessories? please let me know, because if we are going to pass new laws here, I'm going to make sure it's to my benefit as well. So if you are going to rob me and call it "legal" and a "way of the future" then I would like to say ok fine, Does your wife cook very well? are the sofa's Italian leather or basic? do you have one of those nice little self timed toaster ovens? Remember the true and wise statement "nothing is for free", well it's true, and if you want to play with it go ahead, I'm looking forward to moving in.

Here's an idea, why dont all of us musicians get together, and decide what kinda things WE should be able to take for free! If they can target us, we can target them as well, just think of all the nice new crap we'll have! Hey I like Porshe's who has one of them, I got a song for ya!

Anonymous

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