Sometimes I think the record industry is here for music lovers’ amusement. Not content with their usual paranoia about music piracy, and their eventual backtracking away from DRM, or with their attempt to squeeze more money out of artists by applying 360 degree deals, they’re now onto variable pricing at the iTunes Store.
To be fair to them, this was announced at Macworld in January 2009, but somehow the intervening two months have made it appear more ludicrous to me. From April 7, individual songs will be sold in the US at one of three prices: 69 cents, 99 cents (as is current) and $1.29. The lower price will be for unpopular songs; the higher price for more popular songs and (probably) new releases.
In most industries this pattern of pricing according to demand makes sense, but it doesn’t for music. Firstly, the labels are trying to fight piracy (which in itself is a sad case of self-delusional misdirection) so how is a 30% price hike on your most attractive product going to be received by listeners? Furthermore, the artists and bands who see the future of music realise that money is to be made only by acknowledging and embracing what their fans desire, and hence there’ll be a gradual move towards songs being given away for free, with everything else providing their income. Funnily enough this strategy kills music piracy immediately, because there is no longer anything to steal. There are a couple of hidden bonuses too: because the entry point becomes zero cost, it’s likely that more people become fans, and in turn, more fans become (un)official evangelists.
It must be terrifying for record company executives to see the value of their main product diminishing so rapidly in only a few years - that’s why they’re scrambling around for replacement revenue streams - but this is a natural consequence of digital technology. It started with home recordings, bedroom studios and DIY albums. Now with low cost content delivery networks (such as Amazon’s S3) and the maturity of social networks, most other aspects of a career can be handled and directly by musicians and their core fans. The introduction of variable pricing is merely additional proof that we’re getting closer to the demise of the industry.
free music, itunes
Last week, SpiralFrog, the allegedly pioneering ad-supported music service closed down. The New York-based company which started up in August 2006 managed to survive longer than I expected. Apparently its demise was due to “compression of the ad markets” and the oft-used global economic slowdown. Obviously, therefore, nothing to do with its restrictive DRM policy or that it failed to get two of the four major record companies to license music to its service.
Maybe it just failed to predict the future of the music industry: Apple’s iTunes Store, the most successful online service now sells music without DRM - I think exclusively, as of this month - which means little possibility of losing playback capability if it closes down. Then there’s the subscription aspect.
Until recently, I strongly felt that the subscription model was flawed. Speaking as one who wants to own music because I can choose to play what I want, where and when I want, the idea of renting (or borrowing) music seemed wrong. Especially given there’s always a risk of my musical companions being taken away from me. Now that I’m using Spotify (a music streaming service based in Sweden) I can see a benefit for me: it allows me to listen to or try music by new artists or those I wouldn’t usually buy, and in turn it benefits artists by increasing their exposure.
It doesn’t however give me any way to download music for off-line listening, but that doesn’t matter to me because there are other stores which already do it proficiently (as indeed they did back in 2006). SpiralFrog failed precisely because it overreached its ambitions, trying to corner the subscription market whilst holding onto the download market, just in case. It failed to do a single thing well.
Spotify still has a way to go before it becomes indispensable: firstly it needs to expand to more countries (particularly the US and Canada) and it needs to be more consistent across borders as to what music is offered. Ironically, both of these obstacles remain due to archaic music licensing issues and the fragmented way in which major labels are managed. It’s up to the labels to change their ways. The technology, and probably the audience, is already here.
itunes, spiralfrog, spotify
