Music industry revenues will be a set size, regardless of the quality or type of music they release. Incentives to innovate will evaporate. There will only be competition for market share, with no attempt to build the size of market or serve less-popular niches. Forget labels building new brands and encouraging early artists to succeed - they’ll bleed existing big names for all they are worth and work hard to keep anything new - labels, artists, and songwriters - out of the market. New entrants just means more competition for a static amount of money. Collusion by existing players will run rampant.
One question we get a lot here at LearnOutLoud is why we've chosen to go DRM-free with our digital downloads. I've explained it to a number of people and written a number of posts aboutit but I've never summarized our reasons for going the DRM-free route in one post before. So here goes...
Few people know the music industry better than Peter Jenner. Pink Floyd's first manager, who subsequently managed Syd Barrett's solo career, Jenner has also looked after T.Rex, The Clash, Ian Dury, Disposable Heroes and Billy Bragg - who he manages today. He's also secretary general of the International Music Managers Forum.
The major four music labels today are "fucked", he says. Digital music pricing has been a scam where the consumer pays for manufacturing, distribution, and does all the work - and still has to pay more. Labels should outsource everything except finance and licensing.
The utopian dream of ubiquitous media access is on the verge of becoming a reality. Consumers can watch TV on their iPods, download sports highlights to their cell phones, and take vast libraries of music with them wherever they go. You would think that all of these new digital distribution systems would be a boon for consumers, but that isn’t necessarily the case.
What's got the head of the Consumer Electronics Association so upset? The state of copyright law, the set of rules that, among other things, governs what consumers can do with the books, music and movies they purchase and the radio and television shows they listen to.
Digital Rights Managements hurts paying customers, destroys Fair Use rights, renders customers' investments worthless, and can always be defeated. Why are consumers and publishers being forced to use DRM?
It’s no surprise that Apple holds the majority of the market considering the 80%+ share of the portable player market enjoyed by Apple’s iPod. The bottom three companies are are nearly statistically insignificant with sub-5% shares of the market. All of these companies are backed by major corporations with massive advertising budgets, boast over a million tracks to download, and carry all the major label artists. However, they also sell DRM-laden music and have not been able to offer customers any compelling advantages over the iTunes Music Store.
