Sun Nov 18, 2007 07:33
Too bad it's 9 years and billions of dollars too late.
Benjamin Franklin once said that "The definition of insanity is doing the same thing over and over and expecting different results." This accurately describes what the music industry has done for more than 8 years so it was surprising to read recently that Warner Music CEO Edgar Bronfman had finally come to his senses and realized that battling it customers at every turn, and suing anybody who got out of line, was just plain bad for business.
In a speech at the GSMA Mobile Asia Congress in Macau, he told attendees how it would be wise of them not to make the same mistakes that his industry has so infamously made over the years.
"We used to fool ourselves,' he said. "We used to think our content was perfect just exactly as it was. We expected our business would remain blissfully unaffected even as the world of interactivity, constant connection and file sharing was exploding. And of course we were wrong. How were we wrong? By standing still or moving at a glacial pace, we inadvertently went to war with consumers by denying them what they wanted and could otherwise find and as a result of course, consumers won."
How's this for a mea culpa?
A recent article called "When Pigs Fly: The Death of Oink, the Birth of Dissent, and a Brief History of Record Industry Suicide." by Rob on the blog DemonBaby is a must read for those who want a sort of first-hand view of the excesses of the record industry and why they refused to adapt to the new social networking and file-sharing age that Bronfman now belatedly acknowledges.
They had a chance to move forward, to evolve with technology and address the changing needs of consumers - and they didn't. Instead, they panicked - they showed their hand as power-hungry dinosaurs, and they started to demonize their own customers, the people whose love of music had given them massive profits for decades. They used their unfair record contracts - the ones that allowed them to own all the music - and went after children, grandparents, single moms, even deceased great grandmothers - alongside many other common people who did nothing more than download some songs and leave them in a shared folder - something that has become the cultural norm to the iPod generation. Joining together in what has been referred to as an illegal cartel and using the RIAA as their attack dogs, the record labels have spent billions of dollars attempting to scare people away from downloading music. And it's simply not working. The pirating community continues to out-smart and out-innovate the dated methods of the record companies, and CD sales continue to plummet while exchange of digital music on the internet continues to skyrocket. Why? Because freely-available music in large quantities is the new cultural norm, and the industry has given consumers no fair alternative. They didn't jump in when the new technologies were emerging and think, "how can we capitalize on this to ensure that we're able to stay afloat while providing the customer what they've come to expect?" They didn't band together and create a flat monthly fee for downloading all the music you want. They didn't respond by drastically lowering the prices of CDs (which have been ludicrously overpriced since day one, and actually increased in price during the '90's), or by offering low-cost DRM-free legal MP3 purchases. Their entry into the digital marketplace was too little too late - a precedent of free, high-quality, DRM-free music had already been set.
There seem to be a lot of reasons why the record companies blew it. One is that they're really not very smart. They know how to do one thing, which is sell records in a traditional retail environment. From personal experience I can tell you that the big labels are beyond clueless in the digital world - their ideas are out-dated, their methods make no sense, and every decision is hampered by miles and miles of legal tape, copyright restrictions, and corporate interests. Trying to innovate with a major label is like trying to teach your Grandmother how to play Halo 3: frustrating and ultimately futile. The easiest example of this is how much of a fight it's been to get record companies to sell MP3s DRM-free. You're trying to explain a new technology to an old guy who made his fortune in the hair metal days. You're trying to tell him that when someone buys a CD, it has no DRM - people can encode it into their computer as DRM-free MP3s within seconds, and send it to all their friends. So why insult the consumer by making them pay the same price for copy-protected MP3s? It doesn't make any sense! It just frustrates people and drives them to piracy! They don't get it: "It's an MP3, you have to protect it or they'll copy it." But they can do the same thing with the CDs you already sell!! Legal tape and lots of corporate bullshit. If these people weren't the ones who owned the music, it'd all be over already, and we'd be enjoying the real future of music. Because like with any new industry, it's not the people from the previous generation who are going to step in and be the innovators. It's a new batch.
Interestingly enough he even goes so far as to describe OiNK as "...unquestionably the most complete and most efficient music distribution model the world has ever known." I'd have to agree wholeheartedly. Even Trent Reznor, NIN frontman referred to OiNK as "The world's greatest music store."
"It was like the world's largest music store, whose vastly superior selection and distribution was entirely stocked, supplied, organized, and expanded upon by its own consumers," he continues. "If the music industry had found a way to capitalize on the power, devotion, and innovation of its own fans the way Oink did, it would be thriving right now instead of withering."
Was there ever a place that got people so jazzed up music (pardon the pun) than OiNK? I recall finding a rare bootleg recording of Jimi Hendrix and Jim Morrison playing, ranting, and seemingly "tripping" together in 1968 at the Scene Club in New York City. Calling it "awesome" seems like calling a red Ferrari "cool," but it's the only way I can describe it. OiNK was full of "awesome" music finds like this one and I firmly believe it made me a better music fan. With all the choices of things to do and see these days, music has got to become more convenient than a trek to a Wal-Mart or other CD retailer.
"If intellectual property laws didn't make Oink illegal, the site's creator would be the new Steve Jobs right now. He would have revolutionized music distribution. Instead, he's a criminal, simply for finding the best way to fill rising consumer demand," Rob goes on to write.
"I would have gladly paid a large monthly fee for a legal service as good as Oink - but none existed, because the music industry could never set aside their own greed and corporate bullshit to make it happen." Exactly.
If Bronfman and the rest of the music industry had just sat down with Napster's Shawn Fanning from the get go and collaborated on a subscription download service we wouldn't be here 8 years later still talking about the problem of illegal file-sharing. Instead they turned to their lawyers and they've had their hands full ever since.
The real question now is that since he's had such an epiphany does that mean his and other music labels plan to do things differently from now on? Will he continue the war against consumers or will we finally have "peace in our time?' Actions speak louder than words so I'm willing to bet it'll be business as usual, that is so long as there's any business left.