Why Starting a Legal Online Music Vendor Is Tough 214
Hodejo1 writes "Former MP3.com CEO Michael Robertson offers commentary at The Register saying any attempts to build a sanctioned digital music site today is doomed from the outset. 'The internet companies I talk to don't mind giving some direct benefit to music companies. What torpedoes that possibility is the big financial requests from labels for "past infringement," plus a hefty fee for future usage. Any company agreeing to these demands is signing their own financial death sentence. The root cause is not the labels — chances are if you were running a label you would make the same demands, since the law permits it."
Horsepucky. (Score:5, Insightful)
Irrelevant, whether or not the law "allows" it.
As various legacy-media industries (and I don't mean just the RIAA here) slowly waste away to nothing, they have two choices - Find a way to make their product available on terms we can all agree to (and do so knowing how easily we can choose to simply pirate their content)... Or cease to exist.
The right to "past damages" doesn't matter if you have no future. These industries have a wide assortment of 3rd parties all but begging to solve their current problems for them with various forms of modern online distribution; Only stubbornness, and a near-suicidal insistance on maintaining some mythical "control" they lost over a decade ago, have kept such ventures from any chance of success.
So before you absolve the labels of blame in this matter - Ask yourself, would you, starving in the gutter, turn down a lifetime supply of Big Macs because you think the world "owes" you a home-cooked steak dinner?
Re:Business logic or monopolistic cartel? (Score:5, Insightful)
Excuse me but the summary is wrong (Score:4, Insightful)
if they are making the same demands if the law permits it, they are the root cause.
Re:Maybe I missed it ... (Score:5, Insightful)
iTunes doesn't come close to what MP3.com wanted to do.
I don't want to start a debate about how much they had available or how lax their DRM; Put simply, they do have DRM, and they don't offer everything, therefore fall woefully short of the ideal.
That said, you make a good point... iTunes has done quite well, and I would call it a good start. Even so, keep in mind that every few months we hear rumblings about how the major labels want to "renegotiate" with Apple to charge more and use more restrictive DRM - They just don't "get" it, even when offered a viable model on a silver platter.
Re:I tried and failed (Score:1, Insightful)
First, I'm not sure why you posted as anonymous coward. It is an interesting story and I have deep sympathy for your plight. But I don't think your blacklist will be successful in saving your business. If it is true that piracy is destroying your business, then refusal to sell to pirates only hurts you more. Pirates can find music anywhere. I'm sure you've heard people here explaining that most of the time you can pirate things even before they are released. And as we all know, one copy might as well be a million copies given the internet.
So, your refusal to sell to someone who wanted to buy an album means that you will go out of business faster. It means that you will have less time to find some other way to make your living.
I'm really sorry, but if what you say is true, you are already on borrowed time. Why not use your favorable position as a respected business operator to springboard you into the next venture? If you alienate those around you, will it not be more difficult to create your new business?
I wish you all the best and hope you reconsider your tactics. Life is rarely fair, but sometimes new opportunities are created when old ones fail. This is the essence of being an entrepreneur.
Re:I tried and failed (Score:2, Insightful)
Re:I tried and failed (Score:1, Insightful)
lol wut?
Re:I tried and failed (Score:5, Insightful)
Are you... joking?
Or are you a RIAA marketing consultant?
This is a stellar piece of propaganda. Even the part about the kids wearing shabby clothing. Priceless.
Of course, if it's true, you need to get out of that business immediately.
I don't give a flying rats ass about piracy. The entire concept of purchasing information that is tied to a small piece of plastic is silly in the digital age, prima facie.
Your grandchildren will look at you funny when you suggest that one day, music could only be purchased on round pieces of plastic. They simply won't understand why something so trivial as "data" had to be purchased by means of a physical medium.
If you want to blame the decline of your business on digital music distribution, you would be accurate, but blaming it on piracy falls somewhere between a straw man and a red herring.
Lets look at reality.
Physical CD sales declined by 88 million from 2006 to 2007. (from 588 million to 500 million)
At the same time (2007), the iTunes music store sold about 1.8 billion tracks. They were thought to have about 60% of the market, indicating that there are about 3 billion tracks sold LEGALLY online.
So, a decline in 88 million plastic thingies sold... however, 3 billion tracks legally sold (for cash-money) online during the same period.
No, it is not really a piracy issue, it's merely a change in the distribution method of music.
You're on the wrong end of it.
Get out now.
Starting anything legal is tough (Score:3, Insightful)
As most huxsters have worked out, even if they do something illegal or border line illegal for a while and make a killing then, having no moral conscience it pays off. Unfortunately that's what's wrong with the world today. Look at the sub-prime mortgage crisis for example, how many lenders knew they were handing out bad debt? Do they care now? Probably not, they got their commission, as for everyone else, hasta la vista.
Re:Business logic or monopolistic cartel? (Score:5, Insightful)
Any label is not a monopoly. The collective bargaining put together by the RIAA cartel may be, however.
I would regard it akin to... All 4 of the airlines that service my city getting together and deciding collectively to triple the price of tickets out of my city.
Yes, there are other, less desirable means of transport. The bus still runs.
Yes, it is possible to start a new airline (or a new major record label), but the barrier to entry is astoundingly high (so much as to make it almost impossible).
If all 4 carriers at my local airport were colluding to set prices artificially high, they would be slapped down HARD.
Because the RIAA labels deal in slightly more nebulous items with slightly less cohesive boundaries, they're allowed to collude all they want and nobody bats and eye.
Comment removed (Score:4, Insightful)
They might be "making" the laws, also, eh? (Score:2, Insightful)
The summary also ignores the fact that the content industries have been gaming the legislative system, to their benefit, for quite a while....
Re:Business logic or monopolistic cartel? (Score:3, Insightful)
However, the RIAA represents something like 90% of the music sales in the country.
The RIAA members engage in collusion to set pricing that is detrimental to their consumers.
Since music is not a necessity like fuel or food, this won't come to light in quite the same way, but imagine all of the gasoline companies with half-decent quality gasoline, all making a cartel through which they collude to set prices at their whim?
Price collusion is one of those practices which IS highly illegal when the consumer is offered little other choice.
Possibly if a record label required you to purchase some specific device from a specific manufacturer in order to listen to their music they'd be doing something illegal
Actually, no, that's not illegal. A company can could have chosen to only release their music on Mini-Disc, for example (which would have required purchase of a Sony Mini-Disc player). That's not illegal.
What would be illegal is for 90% of the record companies to collude in making the mini-disc the only outlet for music, and then collecting a premium from vastly overpriced MD players that are now required to listen to all music in the world.
Of course, this is almost exactly what TFA describes the RIAA trying to do, but in digital medium, rather than physical.
Excuse me? (Score:3, Insightful)
I'm sorry, but just because I'm *permitted* to do something doesn't mean that I would or should.
Hand someone a right (or rather, neglect to disallow them some power) and you most certainly can still blame them for exercising it.
Re:I tried and failed (Score:4, Insightful)
Well, I think you have some good points, but the fundamental shift I see is not in how music is distributed, but how it is consumed
The LP album is, essentially, a concert piece. Thirty years ago, singles from an album were what hooked people into buying, but people sat down and listened to a whole album, all of the A side then all the B side. They didn't play one track, hop up and take the needle off, remove the disk and put it in its sleeve, remove another record put it on the platter, then carefully set the needle down on a specific track.
CDs are the same.
With digital music players, they can and do play a jumbled sequence of single tracks. It's a kind of return to the day when wealthy patrons had musician servants that composed short pieces like "Fanfare as Lord So and So Sits Down to Dinner". People use music players to provide that kind of soundtrack to things they do in their lives, like working out on a Stair Master.
The LP or CD is more like a symphony, a longer work that makes sense in the context of middle class people making an evening of going to the concert hall.
If the labels want to sell CDs, then they have to sell CDs that are more than random collections of mediocre songs tied to one or two song that the consumer wants. It's not the mediocrity of the filler material that's the problem, it's that it is filler material in the first place. I happen to like opera, but there a plenty of bits in even the best opera nobody is going to put on their play list unless they're listening to the whole thing through.
Comment removed (Score:3, Insightful)
Re:Business logic or monopolistic cartel? (Score:3, Insightful)
Re:Business logic or monopolistic cartel? (Score:5, Insightful)
Then there is also the problem of perception associated with the source. I could pay to self-publish a volume of my poems, but it'll be ignored by critics, unavailable to most readers and, ultimately, be a waste of money on my part.
Huh? are you going to self publish and then hide the books in a closet? Because I have self published 2 photo books and even have them on the shelves at Barnes and Noble. It's not hard to self publish and get your stuff out to the public.
If you self publish, then you have to self promote, self market, and self sell your books. I get maximum profits from that instead of making $0.75(max) a book sold by letting a publisher get all the money by doing all the work. If you want to sit there wishing, go ahead. It's what most writers and photographers do they make something and send it to some publishers and use the hope method.
The successful ones don't hope, they do. They push themselves, and work to get their stuff out there and in people's faces. If you wrote a poetry book, how many public readings are you doing a month? did you travel to Chicago last month for a public poetry reading at the Library? how have you marketed yourself?
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Re:Business logic or monopolistic cartel? (Score:3, Insightful)
The root cause is overly long copyrights (Score:4, Insightful)
Back before there were lawns, copyright ran for 14 years. In 1790, it was extended to 28 years. From there, it slowly got extended until 1998 when Congress saw plenty of donations and all of a sudden, it shot up to the author's life plus 70 years.
Revert copyrights to the original 14 years and you'd see all kinds of music and art. Pandora.com (an outstanding music delivery idea) wouldn't be talking about pulling the plug and people would be exposed to so much outstanding music and video that we'd see a resurgence in creativity in this country.
Re:I tried and failed (Score:4, Insightful)
This phenomenon is not unique to CDs either. Watching a movie on TV has got to be a pain these days due to the incessant ad breaks. You can't build an atmosphere and immerse the viewer in a situation when the dialogue switches to overly loud irrelevant material every 20 minutes. That's why I record things I want to see and rip the ads out - to restore the natural flow of the original work. I no longer have to keep the remote in my hand so I can rapidly turn the sound down to reasonable levels, I can sit back and absorb. Can you imagine a book where every 20 pages a loudspeaker erupts telling you that you're paying too much for car insurance ?
Re:I tried and failed (Score:3, Insightful)
I did this with Dark Side of the Moon with Audacity. Ripped it to FLAC, edited out the dead spots carefully matching the waveform tails and saved the result. My Album now has 2 tracks, side A and Side B. Awesome. I need to take the time to do the rest.
Watching a movie on TV has got to be a pain these days due to the incessant ad breaks.
Agreed, which is why I won't miss TV when they switch off analog. I almost never watch it now.