maandag 22 december 2008
donderdag 11 december 2008
EMI boss defends music industry
The state of the global music industry has sparked an impassioned debate in recent months, with many people criticising the industry itself for causing many of the problems.
Coldplay are one of EMI's biggest-selling bands
Here, the vice-chairman of EMI Music, David Munns, writes in response to BBC News Online users' views on the subject.
The music industry came in for quite a kicking from users in the BBC News Online article on UK record sales and prices.
The gap between the perception of how record companies like EMI work and the actual reality is now a chasm.
Investing in new artists and music is not a 100% science.
Thousands of new albums and singles are released every year in every conceivable genre. We use our best judgements on what we think people will like.
Scottish rockers Idlewild are signed to EMI
Sometimes we're right, sometimes we're wrong, but no one can force anybody to like or dislike something, and that includes us.
Various accusations of "greed" were thrown at record companies in the piece.
EMI is a business which means that yes, we are trying to make profits, but what business isn't?
Our financial statements are all publicly available for anyone who wants to look at them, and no one could say they show excessive profitability.
Is it okay to shoplift if you disagree with the prices a shop charges?
David Munns, EMI
Read the views which prompted Mr Munn's comments
When it comes to the internet, EMI has made the vast majority of its music available online, and we're working hard to add more all the time. We also now sell singles online as soon as they appear on the radio.
I sometimes wonder if it's because music is intangible that people forget that there are many more costs involved than merely manufacturing a piece of plastic.
There's a lot that goes into the retail price - VAT, retailer's cut, distribution costs, advertising and other marketing costs, producers' fees and studio time, not to mention the artists and songwriters who need to be paid.
Manufacturing a CD is only one very small part of the total cost yet that is the one that people focus on.
Blur are on EMI's Parlophone imprint
Who knows what it costs to manufacture perfume? Who cares?
And whatever any of us feel about the price of anything, that doesn't justify stealing.
Illegal file-sharing is theft under copyright law.
Is it okay to shoplift if you disagree with the prices a shop charges? Would you steal a Mercedes and justify it by saying it was because you couldn't afford one?
We love music too, but without some profits we won't be able to invest in more music in the future.
This debate is now closed. Please see below for a selection of your comments.
The following comments reflect the balance of views we have received:
I have a typical record deal with a major record company. They sell my album for £8.87 to the retailers, of which the band (the whole band) gets an 11% royalty. I have seen it in Virgin for £16.99. So it's both flattering and insulting when people copy our material, but look at the sums: it's not the artists who stand to lose the most from piracy.
DJ Oblong, England
Mr Munn compares internet downloading to stealing cars you cannot afford. This isn't the case at all. The music industry would like you to only download what they make available, and pay subscriptions even once you've paid for your track. The equivalent would be being told that you can only buy the car that the dealer wishes to sell you, and even once bought you must continue to pay fees for using it.
If that was the case, car crime would be as high as internet downloading and rightly so. Get a new argument Mr. Munn. Or better still, a new job, and let someone who's in touch with what the consumer wants take your job and actually make a difference.
G. Haman, UK
If CDs are not sold at inflated prices, then how come a couple of months after the release the price drops by anything up to a fiver?
Berwyn Davies, UK
As long as companies like EMI can afford to pay artists like Mariah Carey obscene sums of money to make records and then pay them again not to make them it's very hard to feel sorry for them.
Adam Gittins, England
The Merc comment is invalid - there are tons of cheaper cars to choose from if you can't afford a Merc. I am a music lover who rarely buys CDs. If they were cheaper (as in other countries) I would buy more. If you apply this train of thought to all the other similar-minded consumers out there more CDs would be sold and the manufacturing and distribution costs would fall, and artists would sell more music and be more profitable... as they used to be...
Daniel Stanley, UK
The other issue is the Retailers, HMV, Virgin and Tower are also to blame for inflating the price of CDs. If a CD becomes a cult classic, the price after the initial lauch can jump from say £15 to £20. Also you have a good few retailers who add on a small margin and look for volume business. Fopp, for example, in Scotland where cdss range from a fiver to 10-12 quid for a new release. The record companies need to set lower RRPs so the consumer is getting a fairer deal.
Bryan, Ireland
I own a CD and travel to England. I then download the contents of that CD off KaZaa in England. Am I guilty of stealing? Absolutely not, I OWN the CD and hence ACCESS to the contents of the CD regardless of space or time. Why then am I branded a pirate? Please Mr. Munns, you have your biases and I have mine but lets not regulate the technology like my.mp3.com to keep your old vested interests. The new will supplant the old, and I warn you to adapt or perish.
Pravin, US
Mr Munn's raises a couple of interesting points which are worth looking at:
First he asks: "Who knows what it costs to manufacture perfume? Who cares?"
An interesting parallel here. High-priced perfumes are boutique items, specifically priced high to retain an element of cache and exclusivity. Is this really the parallel he wants to draw with artists' music? If so I think this illustrates the problem.
He goes on to ask: "Is it okay to shoplift if you disagree with the prices a shop charges?"
No. But the record industry is taking it as axiomatic that its falling sales are being caused by piracy, whereas in fact falling sales probably being caused by disatisfaction with price and quality of the offering.
I wonder how much file-swapping is actually caused by people sharing tracks that have been deleted from the record companies' catalogues and which are not available through conventional means.
Chris, UK
Some good issues briught up here. But music is to be heard not sold. As a form of art "If you don't want it to be heard don't make it". Music is free and always will be. It's just some people have found a way to sell it.
Joenebula, UK
Quote: "There's a lot that goes into the retail price - VAT, retailer's cut, distribution costs, advertising and other marketing costs, producers' fees and studio time, not to mention the artists and songwriters who need to be paid."
While we would all agree that this is true, the actual record company takes a huge slice of the pie and this is what people are complaining about. You should take a smaller slice of the pie and you could also reduce your advertising costs and the production cost of the promotional videos - manyy people don't watch the video even if they do listen to MTV or VH1 - I know I don't.
So, reduce your costs and bring the prices down - maybe then you'll get more people buying your product. Over £10 for a CD, even a double CD isn't worth the plastic the music is on.
David B, UK
David Munns argues his case very well except for one glaring ommission. Why are albums sold in the UK considerably more expensive than those sold in the U.S. This question is even more valid today as Universal have announced they are cutting the price of their albums sold in the U.S. by 30%!
Kevin K, Scotland
David has made some valid points on the value of music and the business itself, but the music industry's reaction to file-sharing has hardly done them any favours. Making faulty copy-protected CDs is a daft idea which has annoyed many consumers. The music industry's business model is changing in this digital era and they don't seem to be able to cope.
S khan, UK
I was working for Sony for a few months and this was the argument put forward by them too. It's clear that as Mr Munns said, it's very easy to focus on one aspect of any one invidual business, in this case CD production, but the public will do this when they see what they perceive as a weakness and something to exploit for lower prices. Lower prices maybe great for the consumer but the pressure to reduce pricres means reduced costs which in turn inevitably leads to reduced quality.
I only ever buy what I really want and always buy original. If you have to follow fashion it will be expensive, but also in 5 years you'll wonder why the hell you bought what you did!
Steve, Spain
Mr Munns views are understandable and typical of a man in his position, he is trying to justify the stance corporate record companies take. His argument that not all bands are successful and that money is spent nurturing these bands is valid, but he fails to address issues such as albums and compilations that are 20plus years old which have no associated production costs that still cost a fortune.
Robert , Scotland
This argument starts with the assumption that anyone deserves to be incredibly rich for singing a few songs. This is a very recent (50-60 years) state of affairs, pop stars really being a related off-shoot of the Hollywood star system. The internet and other personal comunication systems will return us to where we were before the birth of the star, real musicians playing and selling their music to those who can appreciate it.
Darren Barratt, UK
Well done Mr Munns. His points against the theft of music are what I also raise with those who think music theft is okay. The justifications people use for stealing music are astounding. However, I still have issues with music sales. High street retailers are still making things worse by selling at high prices compared to supermarkets/online retailers. And file sharing is not all evil - I use it to sample music, then buy accordingly. Finally, if EMI does sell the "vast majority" of its music online, where is it? It's not very well marketed, I wouldn't know where to go. I still believe habits have to change from all parties: the record companies, retailers and consumers.
Tony, UK
Mr Munn fails to mention the massive difference in pricing between the USA and UK. Am I to believe this "slipped his mind" or is it a simple case of not being able to come up with even a lame excuse to explain it all away for us. Get real Mr Munn - the downloaders are taking away the excess you have charged since the beginning of your industry and you don't like it. My heart bleeds.
Jamie, UK
Mr Munn speaks as a businessman. Has he heard of the sell 'em cheap, stack' em high philosophy. I would gladly pay £7 for a CD but not £14. More people would buy if they were cheaper. I take no pleasure in downloading but at the prices the industry wants I would be a mug not to download.
Mark Thomas, Northern Ireland
He misses the point. The point of the whole argument was that people are fed up with how the price of CDs has never came down since they were launched. Therefore, we know we are being ripped off when a CD off the shelf still costs upwards of £12.
Ridiculous when you know the cost of burning a CD in such a mass scale comes down to less than £1 a copy. Piracy, inevitably, will carry on.
Johny, UK
Dave is missing the point, they should be using the internet to generate interest in their unknown bands. The record labels need to move away from a few high cost artists generating the profits to a high volume business where people can try lots and lots of different stuff without paying the earth.
Anon, UK
By comparing these 'infringers' with thieves/shoplifters/burglers we're missing the point by some distance I believe. These 'infringers' are mostly people with otherwise normal lifestyles - they are journalists and judges, lawyers and accountants. Their motivation is not always financial and there are a LOT of them - far too many to hunt down and prosecute individually.
So, I believe the music industry needs to recognise this isn't a simple case of "smash and grab" and adopt itself to working with its customers to better serve them.
The tactic of suing your own customers has no precedent in successful business to my knowledge.
John Peat, England
Bottled water is successful even though most people (in the first world) get it nearly free. Obviously there are markets running on a free vs. fee model and they work for everyone involved.
Ewan, UK
Mr Munn makes some good points, but piracy is not killing music. Most people I know download a song which they have heard and then go out and buy the album. There's no substitute for owning a CD. Whipping out the latest Travis album on mp3 doesn't have the same kudos as having the latest shiny spangly CD.
Steven Logan, Glasgow, UK
Music is over priced and it is evident in the over inflated payments to the stars. Consumers are not comfotable paying high prices for CD's when the money goes to pay for multi million pound contracts for the likes of Robbie Williams. He does not need $80m and we do not need to pay so much for CDs.
Jon Harris, England
One aspect of the file-sharing argument that is often overlooked is would the person that downloaded the file for free have gone out and bought it away? What with the loss in sound quality, the poor mixing when the file is compressed, what you get off the internet is second rate compared to the real thing. The real focus shouldn't be on internet downloads for personal use but on the professional pirates that distribute illegal CDs and DVD at car boot sales and markets the UK (and no doubt the world) over, as they are making a direct profit from an illegal activity.
Anthony Walmsley, UK
I myself run an independent record label and do sympathise with EMI. I say blame the middlemen. We only see back £4.90 for each full length album sold in the stores. Our albums are typically retailing at about £12 each. From that £4.90 we have to pay our staff, the government, the recording costs, the producers fees, the marketing and the distribution costs. We for one are suffering dearly because of Internet piracy and as we see our sales falling we may not be able to survive much longer. Everyone thinks it's affecting the majors. Keep in mind the majority of labels are small indies. There is no way to defend stealing.
Miles Chapman, London, UK
Mr Munn's comments are somewhat undermined by today's news that Universal Music are cutting the price of CDs by 30%.
Neil, UK
While I applaud EMI efforts to make more of its catalogue avaiable to download, they still have a long way to go to make the consumer happy. The consumer wants flexibility and to be able to listen to an MP3 on more than one device without having to pay for it more than once, after all we only buy a CD once.
Niki, UK
The Mercedes anaology just doesn't work - if the dealers went round offering people test drives in their cars 24 hours a day, on a rotating basis with the other car manufacturers it would be more accurate - after all, that's what the record companies do when their singles are played on the radio day in, day out. The volume of free music on radio has devalued music companies' product, and until they realise this and cut their product pricing accordingly, sales will continue to fall. Filesharing is a phantom meance.
Bob Apples, UK
Very interesting quote: "There's a lot that goes into the retail price - VAT, retailer's cut, distribution costs, advertising and other marketing costs, producers' fees and studio time, not to mention the artists and songwriters who need to be paid" - so apart from the non-negotiable VAT, Mr Munn fully accepts that the record industry's current business model is unsustainable, with (I am left to assume)inflated fees and profit margins. And, of course, he would like the consumer to subsidise this clearly flawed business structure.
Ant K, GB
The simple answer is to lower the price of CDs to something approaching what ordinary people can afford and enough profit will be made on the exponentially increased sales volume. The onus is on the music industry to restore sanity to its ludicrous pricing policy.
Jonathan Ewer, uk
I completely agree with what David Munns has to say, however, justifying the cost of a CD by talking about distribution and marketing costs (two of the largest costs involved in producing a CD) simply reinforces the file sharing argument. By sharing files on the web there are no distribution costs and there is no need to invest in paying marketeers to tell us what is "cool" and what isn't. Distribution and marketing add nothing to the end product, they are simply a way for record companies to increase market share. Dump these costs, stick it online at a decent price and surely everyone will be happy?
James Hirst, UK
Who are the majority of people downloading music? Teenagers who can't afford to buy new music that often. These are the people who are likely to buy their own albums when older and in jobs. As a youngster I copied tapes from friends or off the radio because I couldn't afford to buy any. Now I buy my music. Give the kids a break.
Steve, UK
I could perhaps have more sympathy for the position of executives such as Mr Munn if he and companies like his had not been engaged in extracting monopolistic profits from consumers for so long. The retail price of CDs contrasts very unfavourably with the actual price of production, not to mention the fact that CDs in this country cost so much more than in many other markets. We were warned in the '80s that "Home Taping Is Killing Music", yet we have a more vibrant market for music than ever before. Hasn't the industry recently reported the highest number of units ever sold? File-sharing can act as both a marketing tool for the music companies, and as a valuable preview tool for the consumer. To use Mr Munn's example, I don't think that many people would buy a Mercedes without taking it for a test drive first!
Alan Matthews, United Kingdom
If record labels want to stamp out file-sharing then they must band together to create a global solution (Apple's is US only) for offering music online at a reasonable price. The law may be on Mr Munn's side, and I may agree with his view of morality. But that doesn't mean that the music industry will have any success until they make a full-blown effort to provide a comprehensive download service that is available for all countries and formats for a reasonable fee.
Ben, UK
There is one particular point I must take exception to. Illegal file sharing is noh "theft" under copyright law. It is copyright "infringement". Theft deprives the owner of the goods. Copyright infringement potentially deprives the owner of revenue. That is all. Even worse is using the term 'piracy'. How can you compare piracy on the high seas (with its associated murder and pillage) with copright infringement? The record industry wishes us to think in these terms and you, the BBC, regularly assist in this Orwellian redefinition.
Dave, England
Why are tapes which cost more to make cheaper to buy than CDs?
Martin Imber, England
"..there are many more costs involved than merely manufacturing a piece of plastic. " Is he referring to Britney Spears?
Ollie Woodall, UK
I never download music from the internet. I buy 4 or 5 CDs a week on average, usually sale items or old back catalogue stuff for about £5. This is reasonable. What is not reasonable is having to pay £15 for new releases or even more sometimes for old stuff (eg Beatles, Pink Floyd). This is a joke, over £15 for a forty year old album. No wonder people "steal".
Michael Lancaster, England
I agree with him, as long as the music is available. I have shared, on Kazaa, some records that were issued in the mid 1970s, by a company that ceased trading within a year. I would not have done so if the tracks had been made available by some "legal" means.
Roger, UK
source:http://news.bbc.co.uk/2/hi/entertainment/3079908.stm
Coldplay are one of EMI's biggest-selling bands
Here, the vice-chairman of EMI Music, David Munns, writes in response to BBC News Online users' views on the subject.
The music industry came in for quite a kicking from users in the BBC News Online article on UK record sales and prices.
The gap between the perception of how record companies like EMI work and the actual reality is now a chasm.
Investing in new artists and music is not a 100% science.
Thousands of new albums and singles are released every year in every conceivable genre. We use our best judgements on what we think people will like.
Scottish rockers Idlewild are signed to EMI
Sometimes we're right, sometimes we're wrong, but no one can force anybody to like or dislike something, and that includes us.
Various accusations of "greed" were thrown at record companies in the piece.
EMI is a business which means that yes, we are trying to make profits, but what business isn't?
Our financial statements are all publicly available for anyone who wants to look at them, and no one could say they show excessive profitability.
Is it okay to shoplift if you disagree with the prices a shop charges?
David Munns, EMI
Read the views which prompted Mr Munn's comments
When it comes to the internet, EMI has made the vast majority of its music available online, and we're working hard to add more all the time. We also now sell singles online as soon as they appear on the radio.
I sometimes wonder if it's because music is intangible that people forget that there are many more costs involved than merely manufacturing a piece of plastic.
There's a lot that goes into the retail price - VAT, retailer's cut, distribution costs, advertising and other marketing costs, producers' fees and studio time, not to mention the artists and songwriters who need to be paid.
Manufacturing a CD is only one very small part of the total cost yet that is the one that people focus on.
Blur are on EMI's Parlophone imprint
Who knows what it costs to manufacture perfume? Who cares?
And whatever any of us feel about the price of anything, that doesn't justify stealing.
Illegal file-sharing is theft under copyright law.
Is it okay to shoplift if you disagree with the prices a shop charges? Would you steal a Mercedes and justify it by saying it was because you couldn't afford one?
We love music too, but without some profits we won't be able to invest in more music in the future.
This debate is now closed. Please see below for a selection of your comments.
The following comments reflect the balance of views we have received:
I have a typical record deal with a major record company. They sell my album for £8.87 to the retailers, of which the band (the whole band) gets an 11% royalty. I have seen it in Virgin for £16.99. So it's both flattering and insulting when people copy our material, but look at the sums: it's not the artists who stand to lose the most from piracy.
DJ Oblong, England
Mr Munn compares internet downloading to stealing cars you cannot afford. This isn't the case at all. The music industry would like you to only download what they make available, and pay subscriptions even once you've paid for your track. The equivalent would be being told that you can only buy the car that the dealer wishes to sell you, and even once bought you must continue to pay fees for using it.
If that was the case, car crime would be as high as internet downloading and rightly so. Get a new argument Mr. Munn. Or better still, a new job, and let someone who's in touch with what the consumer wants take your job and actually make a difference.
G. Haman, UK
If CDs are not sold at inflated prices, then how come a couple of months after the release the price drops by anything up to a fiver?
Berwyn Davies, UK
As long as companies like EMI can afford to pay artists like Mariah Carey obscene sums of money to make records and then pay them again not to make them it's very hard to feel sorry for them.
Adam Gittins, England
The Merc comment is invalid - there are tons of cheaper cars to choose from if you can't afford a Merc. I am a music lover who rarely buys CDs. If they were cheaper (as in other countries) I would buy more. If you apply this train of thought to all the other similar-minded consumers out there more CDs would be sold and the manufacturing and distribution costs would fall, and artists would sell more music and be more profitable... as they used to be...
Daniel Stanley, UK
The other issue is the Retailers, HMV, Virgin and Tower are also to blame for inflating the price of CDs. If a CD becomes a cult classic, the price after the initial lauch can jump from say £15 to £20. Also you have a good few retailers who add on a small margin and look for volume business. Fopp, for example, in Scotland where cdss range from a fiver to 10-12 quid for a new release. The record companies need to set lower RRPs so the consumer is getting a fairer deal.
Bryan, Ireland
I own a CD and travel to England. I then download the contents of that CD off KaZaa in England. Am I guilty of stealing? Absolutely not, I OWN the CD and hence ACCESS to the contents of the CD regardless of space or time. Why then am I branded a pirate? Please Mr. Munns, you have your biases and I have mine but lets not regulate the technology like my.mp3.com to keep your old vested interests. The new will supplant the old, and I warn you to adapt or perish.
Pravin, US
Mr Munn's raises a couple of interesting points which are worth looking at:
First he asks: "Who knows what it costs to manufacture perfume? Who cares?"
An interesting parallel here. High-priced perfumes are boutique items, specifically priced high to retain an element of cache and exclusivity. Is this really the parallel he wants to draw with artists' music? If so I think this illustrates the problem.
He goes on to ask: "Is it okay to shoplift if you disagree with the prices a shop charges?"
No. But the record industry is taking it as axiomatic that its falling sales are being caused by piracy, whereas in fact falling sales probably being caused by disatisfaction with price and quality of the offering.
I wonder how much file-swapping is actually caused by people sharing tracks that have been deleted from the record companies' catalogues and which are not available through conventional means.
Chris, UK
Some good issues briught up here. But music is to be heard not sold. As a form of art "If you don't want it to be heard don't make it". Music is free and always will be. It's just some people have found a way to sell it.
Joenebula, UK
Quote: "There's a lot that goes into the retail price - VAT, retailer's cut, distribution costs, advertising and other marketing costs, producers' fees and studio time, not to mention the artists and songwriters who need to be paid."
While we would all agree that this is true, the actual record company takes a huge slice of the pie and this is what people are complaining about. You should take a smaller slice of the pie and you could also reduce your advertising costs and the production cost of the promotional videos - manyy people don't watch the video even if they do listen to MTV or VH1 - I know I don't.
So, reduce your costs and bring the prices down - maybe then you'll get more people buying your product. Over £10 for a CD, even a double CD isn't worth the plastic the music is on.
David B, UK
David Munns argues his case very well except for one glaring ommission. Why are albums sold in the UK considerably more expensive than those sold in the U.S. This question is even more valid today as Universal have announced they are cutting the price of their albums sold in the U.S. by 30%!
Kevin K, Scotland
David has made some valid points on the value of music and the business itself, but the music industry's reaction to file-sharing has hardly done them any favours. Making faulty copy-protected CDs is a daft idea which has annoyed many consumers. The music industry's business model is changing in this digital era and they don't seem to be able to cope.
S khan, UK
I was working for Sony for a few months and this was the argument put forward by them too. It's clear that as Mr Munns said, it's very easy to focus on one aspect of any one invidual business, in this case CD production, but the public will do this when they see what they perceive as a weakness and something to exploit for lower prices. Lower prices maybe great for the consumer but the pressure to reduce pricres means reduced costs which in turn inevitably leads to reduced quality.
I only ever buy what I really want and always buy original. If you have to follow fashion it will be expensive, but also in 5 years you'll wonder why the hell you bought what you did!
Steve, Spain
Mr Munns views are understandable and typical of a man in his position, he is trying to justify the stance corporate record companies take. His argument that not all bands are successful and that money is spent nurturing these bands is valid, but he fails to address issues such as albums and compilations that are 20plus years old which have no associated production costs that still cost a fortune.
Robert , Scotland
This argument starts with the assumption that anyone deserves to be incredibly rich for singing a few songs. This is a very recent (50-60 years) state of affairs, pop stars really being a related off-shoot of the Hollywood star system. The internet and other personal comunication systems will return us to where we were before the birth of the star, real musicians playing and selling their music to those who can appreciate it.
Darren Barratt, UK
Well done Mr Munns. His points against the theft of music are what I also raise with those who think music theft is okay. The justifications people use for stealing music are astounding. However, I still have issues with music sales. High street retailers are still making things worse by selling at high prices compared to supermarkets/online retailers. And file sharing is not all evil - I use it to sample music, then buy accordingly. Finally, if EMI does sell the "vast majority" of its music online, where is it? It's not very well marketed, I wouldn't know where to go. I still believe habits have to change from all parties: the record companies, retailers and consumers.
Tony, UK
Mr Munn fails to mention the massive difference in pricing between the USA and UK. Am I to believe this "slipped his mind" or is it a simple case of not being able to come up with even a lame excuse to explain it all away for us. Get real Mr Munn - the downloaders are taking away the excess you have charged since the beginning of your industry and you don't like it. My heart bleeds.
Jamie, UK
Mr Munn speaks as a businessman. Has he heard of the sell 'em cheap, stack' em high philosophy. I would gladly pay £7 for a CD but not £14. More people would buy if they were cheaper. I take no pleasure in downloading but at the prices the industry wants I would be a mug not to download.
Mark Thomas, Northern Ireland
He misses the point. The point of the whole argument was that people are fed up with how the price of CDs has never came down since they were launched. Therefore, we know we are being ripped off when a CD off the shelf still costs upwards of £12.
Ridiculous when you know the cost of burning a CD in such a mass scale comes down to less than £1 a copy. Piracy, inevitably, will carry on.
Johny, UK
Dave is missing the point, they should be using the internet to generate interest in their unknown bands. The record labels need to move away from a few high cost artists generating the profits to a high volume business where people can try lots and lots of different stuff without paying the earth.
Anon, UK
By comparing these 'infringers' with thieves/shoplifters/burglers we're missing the point by some distance I believe. These 'infringers' are mostly people with otherwise normal lifestyles - they are journalists and judges, lawyers and accountants. Their motivation is not always financial and there are a LOT of them - far too many to hunt down and prosecute individually.
So, I believe the music industry needs to recognise this isn't a simple case of "smash and grab" and adopt itself to working with its customers to better serve them.
The tactic of suing your own customers has no precedent in successful business to my knowledge.
John Peat, England
Bottled water is successful even though most people (in the first world) get it nearly free. Obviously there are markets running on a free vs. fee model and they work for everyone involved.
Ewan, UK
Mr Munn makes some good points, but piracy is not killing music. Most people I know download a song which they have heard and then go out and buy the album. There's no substitute for owning a CD. Whipping out the latest Travis album on mp3 doesn't have the same kudos as having the latest shiny spangly CD.
Steven Logan, Glasgow, UK
Music is over priced and it is evident in the over inflated payments to the stars. Consumers are not comfotable paying high prices for CD's when the money goes to pay for multi million pound contracts for the likes of Robbie Williams. He does not need $80m and we do not need to pay so much for CDs.
Jon Harris, England
One aspect of the file-sharing argument that is often overlooked is would the person that downloaded the file for free have gone out and bought it away? What with the loss in sound quality, the poor mixing when the file is compressed, what you get off the internet is second rate compared to the real thing. The real focus shouldn't be on internet downloads for personal use but on the professional pirates that distribute illegal CDs and DVD at car boot sales and markets the UK (and no doubt the world) over, as they are making a direct profit from an illegal activity.
Anthony Walmsley, UK
I myself run an independent record label and do sympathise with EMI. I say blame the middlemen. We only see back £4.90 for each full length album sold in the stores. Our albums are typically retailing at about £12 each. From that £4.90 we have to pay our staff, the government, the recording costs, the producers fees, the marketing and the distribution costs. We for one are suffering dearly because of Internet piracy and as we see our sales falling we may not be able to survive much longer. Everyone thinks it's affecting the majors. Keep in mind the majority of labels are small indies. There is no way to defend stealing.
Miles Chapman, London, UK
Mr Munn's comments are somewhat undermined by today's news that Universal Music are cutting the price of CDs by 30%.
Neil, UK
While I applaud EMI efforts to make more of its catalogue avaiable to download, they still have a long way to go to make the consumer happy. The consumer wants flexibility and to be able to listen to an MP3 on more than one device without having to pay for it more than once, after all we only buy a CD once.
Niki, UK
The Mercedes anaology just doesn't work - if the dealers went round offering people test drives in their cars 24 hours a day, on a rotating basis with the other car manufacturers it would be more accurate - after all, that's what the record companies do when their singles are played on the radio day in, day out. The volume of free music on radio has devalued music companies' product, and until they realise this and cut their product pricing accordingly, sales will continue to fall. Filesharing is a phantom meance.
Bob Apples, UK
Very interesting quote: "There's a lot that goes into the retail price - VAT, retailer's cut, distribution costs, advertising and other marketing costs, producers' fees and studio time, not to mention the artists and songwriters who need to be paid" - so apart from the non-negotiable VAT, Mr Munn fully accepts that the record industry's current business model is unsustainable, with (I am left to assume)inflated fees and profit margins. And, of course, he would like the consumer to subsidise this clearly flawed business structure.
Ant K, GB
The simple answer is to lower the price of CDs to something approaching what ordinary people can afford and enough profit will be made on the exponentially increased sales volume. The onus is on the music industry to restore sanity to its ludicrous pricing policy.
Jonathan Ewer, uk
I completely agree with what David Munns has to say, however, justifying the cost of a CD by talking about distribution and marketing costs (two of the largest costs involved in producing a CD) simply reinforces the file sharing argument. By sharing files on the web there are no distribution costs and there is no need to invest in paying marketeers to tell us what is "cool" and what isn't. Distribution and marketing add nothing to the end product, they are simply a way for record companies to increase market share. Dump these costs, stick it online at a decent price and surely everyone will be happy?
James Hirst, UK
Who are the majority of people downloading music? Teenagers who can't afford to buy new music that often. These are the people who are likely to buy their own albums when older and in jobs. As a youngster I copied tapes from friends or off the radio because I couldn't afford to buy any. Now I buy my music. Give the kids a break.
Steve, UK
I could perhaps have more sympathy for the position of executives such as Mr Munn if he and companies like his had not been engaged in extracting monopolistic profits from consumers for so long. The retail price of CDs contrasts very unfavourably with the actual price of production, not to mention the fact that CDs in this country cost so much more than in many other markets. We were warned in the '80s that "Home Taping Is Killing Music", yet we have a more vibrant market for music than ever before. Hasn't the industry recently reported the highest number of units ever sold? File-sharing can act as both a marketing tool for the music companies, and as a valuable preview tool for the consumer. To use Mr Munn's example, I don't think that many people would buy a Mercedes without taking it for a test drive first!
Alan Matthews, United Kingdom
If record labels want to stamp out file-sharing then they must band together to create a global solution (Apple's is US only) for offering music online at a reasonable price. The law may be on Mr Munn's side, and I may agree with his view of morality. But that doesn't mean that the music industry will have any success until they make a full-blown effort to provide a comprehensive download service that is available for all countries and formats for a reasonable fee.
Ben, UK
There is one particular point I must take exception to. Illegal file sharing is noh "theft" under copyright law. It is copyright "infringement". Theft deprives the owner of the goods. Copyright infringement potentially deprives the owner of revenue. That is all. Even worse is using the term 'piracy'. How can you compare piracy on the high seas (with its associated murder and pillage) with copright infringement? The record industry wishes us to think in these terms and you, the BBC, regularly assist in this Orwellian redefinition.
Dave, England
Why are tapes which cost more to make cheaper to buy than CDs?
Martin Imber, England
"..there are many more costs involved than merely manufacturing a piece of plastic. " Is he referring to Britney Spears?
Ollie Woodall, UK
I never download music from the internet. I buy 4 or 5 CDs a week on average, usually sale items or old back catalogue stuff for about £5. This is reasonable. What is not reasonable is having to pay £15 for new releases or even more sometimes for old stuff (eg Beatles, Pink Floyd). This is a joke, over £15 for a forty year old album. No wonder people "steal".
Michael Lancaster, England
I agree with him, as long as the music is available. I have shared, on Kazaa, some records that were issued in the mid 1970s, by a company that ceased trading within a year. I would not have done so if the tracks had been made available by some "legal" means.
Roger, UK
source:http://news.bbc.co.uk/2/hi/entertainment/3079908.stm
Can anyone stop the dominance of ITunes?
Tom Dunmore is Editor-in-Chief of Stuff magazine. The views expressed are his own.**
Amazon’s music download service has finally arrived in the UK. That’s great news for music fans, who will benefit from lower prices and greater choice - but it’s not going to save the music industry from the dominance of iTunes.
After all, Amazon’s download service has been running for a year in America, but it’s still way behind iTunes. In fact, even if you add all of Amazon’s CD sales into the mix, iTunes is still bigger.
Here in the UK, iTunes has well over 50 percent of the music download market (some put the figure as high as 80 percent). And that’s despite Amazon’s biggest online rival Play.com selling MP3 music at knockdown prices for the past six months. Why? Because neither Play.com nor Amazon can match Apple’s integration of iTunes software and iPod hardware.
More importantly for the music industry, despite all the new rivals in the download market, there’s nowhere near enough music being sold to make up for the slump in CD sales.
The last figures published by the BPI, the UK’s music industry body, showed that total year-on-year album sales were down 5.5 percent. Digital sales were up, but not enough: 7.5million less CDs were sold in the first nine months of 2008 compared with the same period in 2007. Download album sales were up less than 3.5m.
And that was before the economic downturn really began to bite. To compound the music industry’s woes, the UK high street’s biggest music retailer, Woolworths, has gone into administration – along with its music distribution arm Entertainment UK. Supermarkets are having to source their CDs direct from record companies, and megastore operator Zavvi has been forced to cancel all orders through its website.
It’s not all bad news for consumers: the treacherous market conditions have forced the music industry to do away with the Digital Rights Management (DRM), which limited how music could be played and made most download music incompatible with the massively popular iPod. The end of DRM means that Amazon, and Play.com can offer their entire catalogues in ultra-compatible MP3 format – unlike iTunes, which still sells some songs with DRM.
Amazon’s entry to the download market will help push down prices, too – much has been made of Amazon’s £3-per-album introductory offer. But while price is important, it’s by no means the killer issue online – after all, the easy availability (and overwhelming popularity) of free music illegally downloaded from peer-to-peer services makes ‘bargain’ £3 albums a pretty tricky sell.
The key to Apple’s success has been convenience and ease of use: you can buy music in the same software you use to listen to music – or even buy it directly from your iPod. Until Amazon can produce something quicker and simpler than iTunes, it’s destined to be a bit-part player in the download music market.
source:http://blogs.reuters.com/great-debate-uk/2008/12/04/can-anyone-stop-the-dominance-of-itunes/
Amazon’s music download service has finally arrived in the UK. That’s great news for music fans, who will benefit from lower prices and greater choice - but it’s not going to save the music industry from the dominance of iTunes.
After all, Amazon’s download service has been running for a year in America, but it’s still way behind iTunes. In fact, even if you add all of Amazon’s CD sales into the mix, iTunes is still bigger.
Here in the UK, iTunes has well over 50 percent of the music download market (some put the figure as high as 80 percent). And that’s despite Amazon’s biggest online rival Play.com selling MP3 music at knockdown prices for the past six months. Why? Because neither Play.com nor Amazon can match Apple’s integration of iTunes software and iPod hardware.
More importantly for the music industry, despite all the new rivals in the download market, there’s nowhere near enough music being sold to make up for the slump in CD sales.
The last figures published by the BPI, the UK’s music industry body, showed that total year-on-year album sales were down 5.5 percent. Digital sales were up, but not enough: 7.5million less CDs were sold in the first nine months of 2008 compared with the same period in 2007. Download album sales were up less than 3.5m.
And that was before the economic downturn really began to bite. To compound the music industry’s woes, the UK high street’s biggest music retailer, Woolworths, has gone into administration – along with its music distribution arm Entertainment UK. Supermarkets are having to source their CDs direct from record companies, and megastore operator Zavvi has been forced to cancel all orders through its website.
It’s not all bad news for consumers: the treacherous market conditions have forced the music industry to do away with the Digital Rights Management (DRM), which limited how music could be played and made most download music incompatible with the massively popular iPod. The end of DRM means that Amazon, and Play.com can offer their entire catalogues in ultra-compatible MP3 format – unlike iTunes, which still sells some songs with DRM.
Amazon’s entry to the download market will help push down prices, too – much has been made of Amazon’s £3-per-album introductory offer. But while price is important, it’s by no means the killer issue online – after all, the easy availability (and overwhelming popularity) of free music illegally downloaded from peer-to-peer services makes ‘bargain’ £3 albums a pretty tricky sell.
The key to Apple’s success has been convenience and ease of use: you can buy music in the same software you use to listen to music – or even buy it directly from your iPod. Until Amazon can produce something quicker and simpler than iTunes, it’s destined to be a bit-part player in the download music market.
source:http://blogs.reuters.com/great-debate-uk/2008/12/04/can-anyone-stop-the-dominance-of-itunes/
Rock Band Going Country, Guitar Hero Going Electronica?
The seemingly-immune gaming industry is now managing recessionary pressures, though ironically, the growing ranks of the unemployed have more idle time than ever. But despite the softer backdrop, development on titles like Rock Band are rolling on. And, that means more artists and genres, including some unexpected new directions.
Just recently, Rock Band creators MTV Games and Harmonix* released a country five-pack, one that includes songs from Brad Paisley, Brooks & Dunn, Dixie Chicks, and others. The pack, called "Going Country," is available December 16th for the Xbox 360, and December 18th for the PS3. Gamers can purchase individual tracks as desired.
Separately, MTV Games reported to-date paid downloads of 28 million since the launch of the Rock Band Music Store in November of 2007.
What else? Rumors now surround the potential release of a DJ-based variant of Guitar Hero. The speculation comes courtesy of DJ Tiesto, who allegedly posted news of an upcoming "DJ Hero" title, though both Tiesto and Activision subsequently attempted to disavow the post.
*We mistakenly attributed Rock Band to Activision in the initial post. Activision is behind Guitar Hero.
source:http://digitalmusicnews.com/stories/121008rock/view
Just recently, Rock Band creators MTV Games and Harmonix* released a country five-pack, one that includes songs from Brad Paisley, Brooks & Dunn, Dixie Chicks, and others. The pack, called "Going Country," is available December 16th for the Xbox 360, and December 18th for the PS3. Gamers can purchase individual tracks as desired.
Separately, MTV Games reported to-date paid downloads of 28 million since the launch of the Rock Band Music Store in November of 2007.
What else? Rumors now surround the potential release of a DJ-based variant of Guitar Hero. The speculation comes courtesy of DJ Tiesto, who allegedly posted news of an upcoming "DJ Hero" title, though both Tiesto and Activision subsequently attempted to disavow the post.
*We mistakenly attributed Rock Band to Activision in the initial post. Activision is behind Guitar Hero.
source:http://digitalmusicnews.com/stories/121008rock/view
YouTube Hits 100 Million Users In October...
Wall Street may have tanked in October, but YouTube was busy reaching new heights. According to a recent study released by comScore, the video giant attracted 100 million users in the United States alone during the period. The swelling crowd viewed roughly 5.4 billion videos, nearly 40 percent of the broader 13.5 billion measured across the web. MySpace grabbed a distant second with 520 million views.
Other ranking destinations are well-established in music. Yahoo properties, including Yahoo Music, ranked third with 363.4 million; Viacom Digital properties, including MTV, grabbed fourth with 305.3 million.
Across YouTube and a raft of video competitors, music videos remain a massive draw - uploaded legitimately or otherwise. In fact, the all-time, most-played video on YouTube is Avril Lavigne's "Girlfriend" (109.8 million views) and the most-viewed channel is produced by Universal Music Group (2.9 billion views on roughly 9,000 videos). Still, monetization revenues remain modest, at least for now.
source:http://digitalmusicnews.com/stories/121008youtube
Other ranking destinations are well-established in music. Yahoo properties, including Yahoo Music, ranked third with 363.4 million; Viacom Digital properties, including MTV, grabbed fourth with 305.3 million.
Across YouTube and a raft of video competitors, music videos remain a massive draw - uploaded legitimately or otherwise. In fact, the all-time, most-played video on YouTube is Avril Lavigne's "Girlfriend" (109.8 million views) and the most-viewed channel is produced by Universal Music Group (2.9 billion views on roughly 9,000 videos). Still, monetization revenues remain modest, at least for now.
source:http://digitalmusicnews.com/stories/121008youtube
Fresh Data Reveals Broader November Sales Decline...
Consumers in the United States lowered spending by nearly 6 percent in November, according to a fresh estimate surfacing Wednesday. MasterCard tracking unit SpendingPulse pointed to a 5.5 percent drop to $295.3 billion during the month, based on credit card purchases and estimated cash and check payments. The figure excludes automobiles, a seriously-distressed sector of the economy.
The decrease is understandable, especially given the high level of economic uncertainty that consumers face. But online, spending levels appear slightly ahead of year-ago tallies, at least according to data recently released by comScore. Either way, consumers are undoubtedly exercising more caution this holiday season, and making more selective purchases. Exactly how that plays out for the recording and broader music industries remains unclear, though November CD sales are expected to be markedly down.
Story by news analyst Alexandra Osorio.
source:http://digitalmusicnews.com/stories/120908november/view
The decrease is understandable, especially given the high level of economic uncertainty that consumers face. But online, spending levels appear slightly ahead of year-ago tallies, at least according to data recently released by comScore. Either way, consumers are undoubtedly exercising more caution this holiday season, and making more selective purchases. Exactly how that plays out for the recording and broader music industries remains unclear, though November CD sales are expected to be markedly down.
Story by news analyst Alexandra Osorio.
source:http://digitalmusicnews.com/stories/120908november/view
Sony Music Faces Fines Following Privacy Breach...
Sony Music Entertainment now faces penalties reaching $1 million, based on privacy breaches related to online registrations. In a federal court action triggered by the US government, Sony Music is accused of improperly allowing registrations from fans under the age of 13. Under provisions of the Children's Online Privacy Protection Act (COPPA), monitored by the Federal Trade Commission (FTC), sites are required to receive parental permission prior to allowing registrations from children.
An unnamed executive shared details of the fine with Reuters on Wednesday, and an official announcement appears imminent. As part of the settlement, Sony Music will also revamp its registration process, and implement a monitoring process to better comply with the statute. The suit, filed with the US District Court in Manhattan, also lists a number of other privacy violations, including a failure to disclose how collected information is being used.
Story by news analyst Alexandra Osorio.
source:http://digitalmusicnews.com/stories/120908coppa/view
An unnamed executive shared details of the fine with Reuters on Wednesday, and an official announcement appears imminent. As part of the settlement, Sony Music will also revamp its registration process, and implement a monitoring process to better comply with the statute. The suit, filed with the US District Court in Manhattan, also lists a number of other privacy violations, including a failure to disclose how collected information is being used.
Story by news analyst Alexandra Osorio.
source:http://digitalmusicnews.com/stories/120908coppa/view
Meanwhile, in Turkey: EMI, Warner Music Start Collaborating...
EMI Music and Warner Music Group are now expanding a distribution and marketing alliance into Turkey, according to details announced Wednesday. The labels have been trading responsibilities in Southeast Asia, India, and the Middle East, part of an ongoing collaboration designed to lower collective overhead.
The recent expansion calls for EMI to handle physical and digital distribution for Warner throughout Turkey. EMI has been managing physical distribution throughout India and the Middle East, though responsibilities will now expand to include digital distribution within those regions as well. "These markets have exciting growth potential, especially in digital," said Adrian Cheesley, president of International at EMI Music. "We are delighted to be extending our successful relationship with Warner Music to include digital rights to their fantastic artist roster and catalog and to cover Turkey as well."
Currently, Warner Music Group handles physical distribution for EMI in Southeast Asia and other Asian countries, specifically Hong Kong, Indonesia, Malaysia, Singapore, Korea and Thailand.
source:http://digitalmusicnews.com/stories/121008emi
The recent expansion calls for EMI to handle physical and digital distribution for Warner throughout Turkey. EMI has been managing physical distribution throughout India and the Middle East, though responsibilities will now expand to include digital distribution within those regions as well. "These markets have exciting growth potential, especially in digital," said Adrian Cheesley, president of International at EMI Music. "We are delighted to be extending our successful relationship with Warner Music to include digital rights to their fantastic artist roster and catalog and to cover Turkey as well."
Currently, Warner Music Group handles physical distribution for EMI in Southeast Asia and other Asian countries, specifically Hong Kong, Indonesia, Malaysia, Singapore, Korea and Thailand.
source:http://digitalmusicnews.com/stories/121008emi
MySpace Music Goes Live; All Majors On Board
MySpace Music is now opening its eyes to the world, the beginning of an aggressive experiment by labels, artists, and the social network. The early-morning launch includes participation from all four majors, including EMI Music, an eleventh-hour partner. As expected, those majors will carry an equity stake in a joint venture structure, and receive payout percentages on related advertising and purchases.
The independent collection is far less complete, at least at launch. The Orchard is among the early participants, though discussions with other groups remain ongoing. For example, Orchard rival IODA is not part of the initial appearance, and independent label consortium Merlin is also absent. "We are actively working with the indies," MySpace senior vice president of Product Strategy Steve Pearman told Digital Music News on Monday. "From a systems perspective, an artist is an artist is an artist."
But independents are not expected to become equity stakeholders in the joint venture. According to Orchard chief Greg Scholl, the group is receiving a share of advertising revenue but is not a partner, a structure that will most likely extend to other independent groups. That is a major sore spot for Merlin chief executive Charles Caldas, who blasted MySpace on Wednesday and warned of "a situation that is both unhealthy and dangerous."
In a discussion with Digital Music News, Scholl seemed less focused on a broader equity position, and more interested in negotiating a share of a liquidation event. "It's easy to say we want equity too, but I'm more interested in when does equity matter," Scholl explained. "Instead of focusing on equity, let's focus on what happens if there's a dividend, a sale, or an IPO."
The Orchard content is now being positioned, though the entire catalog of 1.3 million songs will take some time to load. "The rollout will happen over time," Scholl explained. "Everything is uploaded and in the queue, but there is a large volume of content." Additionally, major-owned, independent-focused units ADA (Warner Music Group), RED (Sony Music), Fontana (Universal Music Group) and Caroline (EMI Music) are also launch partners.
On the publishing side, MySpace also pointed to commitments from major publishing groups, including Warner/Chappell Music, Sony/ATV Music Publishing, Universal Music Publishing Group, and EMI Music Publishing.
In terms of structure, MySpace Music revolves around on-demand access to a library of millions of songs. In a demonstration earlier this week, MySpace executives revealed a service that allows users to create endless playlists, share those playlists, and explore a multi-million-strong catalog. Outside of on-demand access, MySpace is tapping AmazonMP3 to deliver paid downloads, as expected.
Those elements matched the live experience this morning, though the launch process was described as iterative. Other aspects, including merchandising, ticketing, and related assets, will be included at a later date.
As expected, McDonald's, State Farm Insurance, Toyota, and Sony Pictures are sponsoring the initial splash. Additionally, MySpace has tapped Jamster to deliver artist ringtones.
The independent collection is far less complete, at least at launch. The Orchard is among the early participants, though discussions with other groups remain ongoing. For example, Orchard rival IODA is not part of the initial appearance, and independent label consortium Merlin is also absent. "We are actively working with the indies," MySpace senior vice president of Product Strategy Steve Pearman told Digital Music News on Monday. "From a systems perspective, an artist is an artist is an artist."
But independents are not expected to become equity stakeholders in the joint venture. According to Orchard chief Greg Scholl, the group is receiving a share of advertising revenue but is not a partner, a structure that will most likely extend to other independent groups. That is a major sore spot for Merlin chief executive Charles Caldas, who blasted MySpace on Wednesday and warned of "a situation that is both unhealthy and dangerous."
In a discussion with Digital Music News, Scholl seemed less focused on a broader equity position, and more interested in negotiating a share of a liquidation event. "It's easy to say we want equity too, but I'm more interested in when does equity matter," Scholl explained. "Instead of focusing on equity, let's focus on what happens if there's a dividend, a sale, or an IPO."
The Orchard content is now being positioned, though the entire catalog of 1.3 million songs will take some time to load. "The rollout will happen over time," Scholl explained. "Everything is uploaded and in the queue, but there is a large volume of content." Additionally, major-owned, independent-focused units ADA (Warner Music Group), RED (Sony Music), Fontana (Universal Music Group) and Caroline (EMI Music) are also launch partners.
On the publishing side, MySpace also pointed to commitments from major publishing groups, including Warner/Chappell Music, Sony/ATV Music Publishing, Universal Music Publishing Group, and EMI Music Publishing.
In terms of structure, MySpace Music revolves around on-demand access to a library of millions of songs. In a demonstration earlier this week, MySpace executives revealed a service that allows users to create endless playlists, share those playlists, and explore a multi-million-strong catalog. Outside of on-demand access, MySpace is tapping AmazonMP3 to deliver paid downloads, as expected.
Those elements matched the live experience this morning, though the launch process was described as iterative. Other aspects, including merchandising, ticketing, and related assets, will be included at a later date.
As expected, McDonald's, State Farm Insurance, Toyota, and Sony Pictures are sponsoring the initial splash. Additionally, MySpace has tapped Jamster to deliver artist ringtones.
Design-Thinking's Role In Business Model Innovation
Thanks to Twitter I've connected with several new and interesting people in the innovation space during the past couple of weeks. One of them is Ralf Beuker who has written a good blog entry on design-thinking that should strike a chord with many in our community. What is design-thinking? Is it a process? A mind-set? A profession?
Accordingly, our view on ‘Design Thinking’ is not so much related to a profession itself, but rather a question of mindset. In this sense ‘Design Thinking’ is rather an attitude than exclusive to a profession....As a matter of fact ‘Design Thinkers’ will develop similar frameworks that approach a problem or issue from different angles and free themselves to stick to traditional definitions and models. Again it’s not about ‘right’ or ‘wrong’, but rather about yes/and!
Ralf Beuker at Vol. 2: The Design Management Weblog
The BIF Takeaway
There is definitive value in the designer's approach to solving problems which can be applied to all components of business. And I think there are two reasons for this: First, designers have a mindset that welcomes opposing models. And second, the designer’s process puts the customer at the center of the value proposition.
Roger Martin, Dean of the Rotman School at the University of Toronto, argues that economic value creation will only be found if organizations shift from "an obsession with reliability" to a "welcoming environment for validity." In searching for creative solutions to problems, designers tend to embrace complexity, tolerate uncertainty and manage tension. This is exactly the mindset required when an organization wants to tackle value generation outside its current operating model.
So the question facing all leaders is how to keep current business models reliably producing while at the same time, experimenting with new and valid ways to deliver value?
When it comes to R&D, many companies are quite skilled at designing experiments to test out possible combinations of features and functions to deliver the next great product or service. But those same companies have no similar sets of processes when it comes to designing the next great business model. And that’s a problem.
Here at the Business Innovation Factory (BIF), we believe the CEO of tomorrow will have to change their business model several times over the course of a career and consequently, must establish an ongoing process to explore new business models (even models that might threaten the current one). What’s needed is a ‘safe haven’ for experimentation - an R&D lab for new business models. By relying on an iterative approach to validation, BIF is building a platform to explore and experiment with new business models much in the same way new products and technologies are tested today.
Imagine a time when an established company can have a sense of how a collection of possible future business models is faring within any given series of experiments and where risk is measured and shaped by valid experimentation processes and protocols. That should be the outcome of any good R&D effort.
Accordingly, our view on ‘Design Thinking’ is not so much related to a profession itself, but rather a question of mindset. In this sense ‘Design Thinking’ is rather an attitude than exclusive to a profession....As a matter of fact ‘Design Thinkers’ will develop similar frameworks that approach a problem or issue from different angles and free themselves to stick to traditional definitions and models. Again it’s not about ‘right’ or ‘wrong’, but rather about yes/and!
Ralf Beuker at Vol. 2: The Design Management Weblog
The BIF Takeaway
There is definitive value in the designer's approach to solving problems which can be applied to all components of business. And I think there are two reasons for this: First, designers have a mindset that welcomes opposing models. And second, the designer’s process puts the customer at the center of the value proposition.
Roger Martin, Dean of the Rotman School at the University of Toronto, argues that economic value creation will only be found if organizations shift from "an obsession with reliability" to a "welcoming environment for validity." In searching for creative solutions to problems, designers tend to embrace complexity, tolerate uncertainty and manage tension. This is exactly the mindset required when an organization wants to tackle value generation outside its current operating model.
So the question facing all leaders is how to keep current business models reliably producing while at the same time, experimenting with new and valid ways to deliver value?
When it comes to R&D, many companies are quite skilled at designing experiments to test out possible combinations of features and functions to deliver the next great product or service. But those same companies have no similar sets of processes when it comes to designing the next great business model. And that’s a problem.
Here at the Business Innovation Factory (BIF), we believe the CEO of tomorrow will have to change their business model several times over the course of a career and consequently, must establish an ongoing process to explore new business models (even models that might threaten the current one). What’s needed is a ‘safe haven’ for experimentation - an R&D lab for new business models. By relying on an iterative approach to validation, BIF is building a platform to explore and experiment with new business models much in the same way new products and technologies are tested today.
Imagine a time when an established company can have a sense of how a collection of possible future business models is faring within any given series of experiments and where risk is measured and shaped by valid experimentation processes and protocols. That should be the outcome of any good R&D effort.
Innovation in business models
Innovation in Business Models
I've spent most of my life thinking that value was generally created by technical innovation--a view I suspect is shared by many of my engineering brethren. Over the past year I've had the distinct pleasure of studying at the Stanford GSB and my perspective on this has started to change. As usual, Tim beat me to the punch, but for me it is better late than never. One of the things that has caught my attention are the similarities between engineering and business.
I'm not talking about "financial engineering" here, but plain old business model and revenue model. I'm impressed by how many companies have come to dominate their space simply by reworking the way they make money. Doing this usually requires a fair amount of systems engineering to ensure that the company and its partners are set-up to make money in this new way. Accordingly, model innovation is particularly effective when attacking an existing industry because the incumbents often cannot match the change because doing so would require massive organizational changes. Here are some examples that come to mind.
Southwest: Low-cost airlines have gotten their fair share of coverage in this space before. Southwest is the grand-daddy of them all, having started in 1971. Southwest pioneered the change from the hub-and-spoke model, which made sense in a highly regulated environment, to a point-to-point model which highly utilizes the expensive aircraft. Its not that the incumbents didn't understand how Southwest was doing it, its just that for a number of reasons, from their inflexible labor policies to their addiction to long-haul revenue, they couldn't match the Southwest model. As a result, Southwest has been able to generate more profits over the last 30 years than all of its incumbent competitors combined.
Vanguard: Vanguard shook up the mutual fund industry by introducing the index fund in 1975. Since then it has grown into a powerhouse, ranked fourth worldwide in assets under management, by focussing on this model which offers average performance at very low prices. Key to making this work is the largely self-service distribution model. While most mutual fund companies offer index funds now, the incumbents at the time could not react quickly enough to prevent Vanguard from becoming a force. This was largely because they sold their product through brokers who were used to sharing in the high fees the old funds charged.
Google: I'm sure that everyone in this space knows the story of Google, but it is worth noting that beyond PageRank and all the technical prowess, it was the AdWords model which made them profitable. Without this they would probably have just been another Inktomi. With it they were able to make money by selling to advertisers that the big incumbents, such as Yahoo!, weren't servicing.
W.R. Hambrect: Google is of course the perfect segue to this nascent player in investment banking, which it used for its IPO. Bankers presently take something like 7% off the top of every IPO, bond issuance, and other financial deal done. Veteran banker Bill Hambrect (this is the second investment bank he founded) realized that this could be made more efficient while at the same time removing many of the conflicts of interest inherent in the process. The incumbents I've spoken to are largely in denial that his approach will work. Ultimately time will tell, but I think he is on to something.
I'm sure that there is room for more model innovation in the future. My favorite targets: hedge funds and managed healthcare. Both are fat and sitting on piles of money just waiting to be liberated by someone with a better idea. So if you've got an entrepreneurial itch, but don't have a technical insight you want to pursue, give some thought to what it would take to re-work an existing model to capture more value for yourself and for customers.
source:http://radar.oreilly.com/archives/2007/03/innovation-in-b.html
I've spent most of my life thinking that value was generally created by technical innovation--a view I suspect is shared by many of my engineering brethren. Over the past year I've had the distinct pleasure of studying at the Stanford GSB and my perspective on this has started to change. As usual, Tim beat me to the punch, but for me it is better late than never. One of the things that has caught my attention are the similarities between engineering and business.
I'm not talking about "financial engineering" here, but plain old business model and revenue model. I'm impressed by how many companies have come to dominate their space simply by reworking the way they make money. Doing this usually requires a fair amount of systems engineering to ensure that the company and its partners are set-up to make money in this new way. Accordingly, model innovation is particularly effective when attacking an existing industry because the incumbents often cannot match the change because doing so would require massive organizational changes. Here are some examples that come to mind.
Southwest: Low-cost airlines have gotten their fair share of coverage in this space before. Southwest is the grand-daddy of them all, having started in 1971. Southwest pioneered the change from the hub-and-spoke model, which made sense in a highly regulated environment, to a point-to-point model which highly utilizes the expensive aircraft. Its not that the incumbents didn't understand how Southwest was doing it, its just that for a number of reasons, from their inflexible labor policies to their addiction to long-haul revenue, they couldn't match the Southwest model. As a result, Southwest has been able to generate more profits over the last 30 years than all of its incumbent competitors combined.
Vanguard: Vanguard shook up the mutual fund industry by introducing the index fund in 1975. Since then it has grown into a powerhouse, ranked fourth worldwide in assets under management, by focussing on this model which offers average performance at very low prices. Key to making this work is the largely self-service distribution model. While most mutual fund companies offer index funds now, the incumbents at the time could not react quickly enough to prevent Vanguard from becoming a force. This was largely because they sold their product through brokers who were used to sharing in the high fees the old funds charged.
Google: I'm sure that everyone in this space knows the story of Google, but it is worth noting that beyond PageRank and all the technical prowess, it was the AdWords model which made them profitable. Without this they would probably have just been another Inktomi. With it they were able to make money by selling to advertisers that the big incumbents, such as Yahoo!, weren't servicing.
W.R. Hambrect: Google is of course the perfect segue to this nascent player in investment banking, which it used for its IPO. Bankers presently take something like 7% off the top of every IPO, bond issuance, and other financial deal done. Veteran banker Bill Hambrect (this is the second investment bank he founded) realized that this could be made more efficient while at the same time removing many of the conflicts of interest inherent in the process. The incumbents I've spoken to are largely in denial that his approach will work. Ultimately time will tell, but I think he is on to something.
I'm sure that there is room for more model innovation in the future. My favorite targets: hedge funds and managed healthcare. Both are fat and sitting on piles of money just waiting to be liberated by someone with a better idea. So if you've got an entrepreneurial itch, but don't have a technical insight you want to pursue, give some thought to what it would take to re-work an existing model to capture more value for yourself and for customers.
source:http://radar.oreilly.com/archives/2007/03/innovation-in-b.html
Business Models
Business model
From Wikipedia, the free encyclopedia
Jump to: navigation, search
A business model is a framework for creating economic, social, and/or other forms of value. The term business model is thus used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, offerings, strategies, infrastructure, organizational structures, trading practices, and operational processes and policies.
In the most basic sense, a business model is the method of doing business by which a company can sustain itself -- that is, generate revenue. The business model spells-out how a company makes money by specifying where it is positioned in the value chain.
Contents [hide]
1 Conceptualization
2 Evolution
2.1 Examples over the years
3 Do Business Models Matter?
4 Related Concepts
5 See also
6 References
7 External Links
[edit] Conceptualization
Conceptualizations of business models try to formalize informal descriptions into building blocks and their relationships[1]. While many different conceptualizations exist[2][3][4][5][6][7][8][9], Osterwalder proposed[10] a synthesis of different conceptualizations into a single reference model based on the similarities of a large range of models, and constitutes a business model design template which allows enterprises to describe their business model:
Business model design template: Nine building blocks and their relationships, Osterwalder 2004[10]Infrastructure
Core capabilities: The capabilities and competencies necessary to execute a company's business model.
Partner network: The business alliances which complement other aspects of the business model.
Value configuration: The rationale which makes a business mutually beneficial for a business and its customers.
Offering
Value proposition: The products and services a business offers. Quoting Osterwalder (2004), a value proposition "is an overall view of .. products and services that together represent value for a specific customer segment. It describes the way a firm differentiates itself from its competitors and is the reason why customers buy from a certain firm and not from another."
Customers
Target customer: The target audience for a business' products and services.
Distribution channel: The means by which a company delivers products and services to customers. This includes the company's marketing and distribution strategy.
Customer relationship: The links a company establishes between itself and its different customer segments. The process of managing customer relationships is referred to as customer relationship management.
Finances
Cost structure: The monetary consequences of the means employed in the business model. A company's DOC.
Revenue: The way a company makes money through a variety of revenue flows. A company's income.
[edit] Evolution
A brief history of the development of business models might run as follows. The oldest and most basic business model is the shopkeeper model. This involves setting up a store in a location where potential customers are likely to be and displaying a product or service.
Over the years, business models have become much more sophisticated. The bait and hook business model (also referred to as the "razor and blades business model" or the "tied products business model") was introduced in the early 20th century. This involves offering a basic product at a very low cost, often at a loss (the "bait"), then charging compensatory recurring amounts for refills or associated products or services (the "hook"). Examples include: razor (bait) and blades (hook); cell phones (bait) and air time (hook); computer printers (bait) and ink cartridge refills (hook); and cameras (bait) and prints (hook). An interesting variant of this model is a software developer that gives away its word processor reader for free but charges several hundred dollars for its word processor writer.
In the 1950s, new business models came from McDonald's Restaurants and Toyota. In the 1960s, the innovators were Wal-Mart and Hypermarkets. The 1970s saw new business models from FedEx and Toys R Us; the 1980s from Blockbuster, Home Depot, Intel, and Dell Computer; the 1990s from Southwest Airlines, Netflix, eBay, Amazon.com, and Starbucks. Poorly thought out business models were a problem with many dot-coms.
Today, the type of business models might depend on how technology is used. For example, entrepreneurs on the internet have also created entirely new models that depend entirely on existing or emergent technology. Using technology, businesses can reach a large number of customers with minimal costs.
[edit] Examples over the years
Subscription business model
Razor and blades business model (bait and hook)
Pyramid scheme business model
Multi-level marketing business model
Network effects business model
Monopolistic business model
Cutting out the middleman model
Auction business model
Online auction business model
Bricks and clicks business model
Loyalty business models
Collective business models
Industrialization of services business model
Servitization of products business model
Low-cost carrier business model
Online content business model
Freemium business model
Premium business model
Direct sales model
Professional open-source model
Various distribution business models
[edit] Do Business Models Matter?
Malone et al.[11] at MIT find that some business models, as defined by them, indeed performed better than others in a dataset consisting of the largest U.S. firms, in the period 1998 through 2002, while they did not prove whether or not the existence of a business model mattered or not.
Perhaps the most overlooked dimension in developing a business model especially for a new product/service/business is the dimension of time, more specifically the timing of investments/expenses or cash flow out versus the receipt of revenues/accounts receivables or cash flow in. The principle issues are: 1) Essentially how much of the product or service has to be built before customers can make some level of either actual purchase decision and/or purchase commitment? 2) How much investment/expense is required to secure these revenues/commitments from customers? and 3 )How much risk is there in achieving net positive cash flow, given the required upfront investment and the future time to capture revenues/receivables cash inflow, within an acceptable timeframe, if ever?
These business model issues often make or break new ventures. Business models that are optimized to reduce the upfront investment, that accelerate the revenue/receivables cash inflow, that obtain cogent and reliable customer feedback often and earlier, and that take other measures to reduce the investment risk all have a higher probability of business success.
For example, in the entertainment industry, does one have to produce a movie for $100 million plus before any box office revenues can be derived, or can the business model be evolved by licensing certain established characters/signing leading movie stars for secondary licensing rights for fast-food chain promotional-tie-ins, movie merchandise licenses, etc. can generate pre-release cash inflow through licensing fees? Or a different entertainment business model might be to create and promote a "Weirdest Video" website platform for users to contribute the content and then based on site traffic, sell advertising for revenues. Here, the upfront investment for creating and promoting the site could be a fraction of the investment to produce a movie and the chances that it would be more popular than a movie may be much higher, as it can be tweaked as it is developed while a movie is an all or nothing production.
It comes down to a nitty gritty question: Can we make to order or do we have to create a new mousetrap and then wait to see if the world will come to it, or somewhere in-between?
[edit] Related Concepts
The process of business model design is part of business strategy. The implementation of a company's business model into organizational structures (e.g. organigrams, workflows, human resources) and systems (e.g. information technology architecture, production lines) is part of a company's business operations. It is important to understand that business modeling commonly refers to business process design at the operational level, whereas business models and business model design refer to defining the business logic of a company at the strategic level.
[edit] See also
Competitive advantage
Core competency
Business model design
Business process modeling
Business plan
Business reference model
Business rule
Growth Platforms
Market forms
Marketing
Marketing plan
Monopoly
Strategic management
Strategic planning
Strategy dynamics
Value migration
[edit] References
^ Not to be confused with the term business architecture that structures the accountability over business activities
^ The Role of the Business Model in captualue from Innovation: Evidence from XEROX Corporation’s Technology Spinoff Companies., H. Chesbrough and R. S. Rosenbloom , Boston, Massachusetts, Harvard Business School, 2000.
^ Leading the revolution., G. Hamel, Boston, Harvard Business School Press, 2000.
^ Changing Business Models: Surveying the Landscape, J. Linder and S. Cantrell, Accenture Institute for Strategic Change, 2000.
^ Developing Business Models for eBusiness., O. Peterovic and C. Kittl et al., International Conference on Electronic Commerce 2001, 2001.
^ Place to space: Migrating to eBusiness Models., P. Weill and M. R. Vitale, Boston,Harvard Business School Press, 2001.
^ Value-based Requirements Engineering - Exploring Innovative e-Commerce Ideas, J. Gordijn, Amsterdam, Vrije Universiteit, 2002.
^ Internet Business Models and Strategies, A. Afuah and C. Tucci, Boston, McGraw Hill, 2003.
^ Focus Theme Articles: Business Models for Content Delivery: An Empirical Analysis of the Newspaper and Magazine Industry, Marc Fetscherin and Gerhard Knolmayer, International Journal on Media Management, Volume 6, Issue 1 & 2 September 2004 , pages 4 - 11, September 2004.
^ a b The Business Model Ontology - A Proposition In A Design Science Approach, Thesis by Alexander Osterwalder, 2004
^ Do Some Business Models Perform Better than Others?, Malone et al., May 2006
source: http://en.wikipedia.org/wiki/Business_model
From Wikipedia, the free encyclopedia
Jump to: navigation, search
A business model is a framework for creating economic, social, and/or other forms of value. The term business model is thus used for a broad range of informal and formal descriptions to represent core aspects of a business, including purpose, offerings, strategies, infrastructure, organizational structures, trading practices, and operational processes and policies.
In the most basic sense, a business model is the method of doing business by which a company can sustain itself -- that is, generate revenue. The business model spells-out how a company makes money by specifying where it is positioned in the value chain.
Contents [hide]
1 Conceptualization
2 Evolution
2.1 Examples over the years
3 Do Business Models Matter?
4 Related Concepts
5 See also
6 References
7 External Links
[edit] Conceptualization
Conceptualizations of business models try to formalize informal descriptions into building blocks and their relationships[1]. While many different conceptualizations exist[2][3][4][5][6][7][8][9], Osterwalder proposed[10] a synthesis of different conceptualizations into a single reference model based on the similarities of a large range of models, and constitutes a business model design template which allows enterprises to describe their business model:
Business model design template: Nine building blocks and their relationships, Osterwalder 2004[10]Infrastructure
Core capabilities: The capabilities and competencies necessary to execute a company's business model.
Partner network: The business alliances which complement other aspects of the business model.
Value configuration: The rationale which makes a business mutually beneficial for a business and its customers.
Offering
Value proposition: The products and services a business offers. Quoting Osterwalder (2004), a value proposition "is an overall view of .. products and services that together represent value for a specific customer segment. It describes the way a firm differentiates itself from its competitors and is the reason why customers buy from a certain firm and not from another."
Customers
Target customer: The target audience for a business' products and services.
Distribution channel: The means by which a company delivers products and services to customers. This includes the company's marketing and distribution strategy.
Customer relationship: The links a company establishes between itself and its different customer segments. The process of managing customer relationships is referred to as customer relationship management.
Finances
Cost structure: The monetary consequences of the means employed in the business model. A company's DOC.
Revenue: The way a company makes money through a variety of revenue flows. A company's income.
[edit] Evolution
A brief history of the development of business models might run as follows. The oldest and most basic business model is the shopkeeper model. This involves setting up a store in a location where potential customers are likely to be and displaying a product or service.
Over the years, business models have become much more sophisticated. The bait and hook business model (also referred to as the "razor and blades business model" or the "tied products business model") was introduced in the early 20th century. This involves offering a basic product at a very low cost, often at a loss (the "bait"), then charging compensatory recurring amounts for refills or associated products or services (the "hook"). Examples include: razor (bait) and blades (hook); cell phones (bait) and air time (hook); computer printers (bait) and ink cartridge refills (hook); and cameras (bait) and prints (hook). An interesting variant of this model is a software developer that gives away its word processor reader for free but charges several hundred dollars for its word processor writer.
In the 1950s, new business models came from McDonald's Restaurants and Toyota. In the 1960s, the innovators were Wal-Mart and Hypermarkets. The 1970s saw new business models from FedEx and Toys R Us; the 1980s from Blockbuster, Home Depot, Intel, and Dell Computer; the 1990s from Southwest Airlines, Netflix, eBay, Amazon.com, and Starbucks. Poorly thought out business models were a problem with many dot-coms.
Today, the type of business models might depend on how technology is used. For example, entrepreneurs on the internet have also created entirely new models that depend entirely on existing or emergent technology. Using technology, businesses can reach a large number of customers with minimal costs.
[edit] Examples over the years
Subscription business model
Razor and blades business model (bait and hook)
Pyramid scheme business model
Multi-level marketing business model
Network effects business model
Monopolistic business model
Cutting out the middleman model
Auction business model
Online auction business model
Bricks and clicks business model
Loyalty business models
Collective business models
Industrialization of services business model
Servitization of products business model
Low-cost carrier business model
Online content business model
Freemium business model
Premium business model
Direct sales model
Professional open-source model
Various distribution business models
[edit] Do Business Models Matter?
Malone et al.[11] at MIT find that some business models, as defined by them, indeed performed better than others in a dataset consisting of the largest U.S. firms, in the period 1998 through 2002, while they did not prove whether or not the existence of a business model mattered or not.
Perhaps the most overlooked dimension in developing a business model especially for a new product/service/business is the dimension of time, more specifically the timing of investments/expenses or cash flow out versus the receipt of revenues/accounts receivables or cash flow in. The principle issues are: 1) Essentially how much of the product or service has to be built before customers can make some level of either actual purchase decision and/or purchase commitment? 2) How much investment/expense is required to secure these revenues/commitments from customers? and 3 )How much risk is there in achieving net positive cash flow, given the required upfront investment and the future time to capture revenues/receivables cash inflow, within an acceptable timeframe, if ever?
These business model issues often make or break new ventures. Business models that are optimized to reduce the upfront investment, that accelerate the revenue/receivables cash inflow, that obtain cogent and reliable customer feedback often and earlier, and that take other measures to reduce the investment risk all have a higher probability of business success.
For example, in the entertainment industry, does one have to produce a movie for $100 million plus before any box office revenues can be derived, or can the business model be evolved by licensing certain established characters/signing leading movie stars for secondary licensing rights for fast-food chain promotional-tie-ins, movie merchandise licenses, etc. can generate pre-release cash inflow through licensing fees? Or a different entertainment business model might be to create and promote a "Weirdest Video" website platform for users to contribute the content and then based on site traffic, sell advertising for revenues. Here, the upfront investment for creating and promoting the site could be a fraction of the investment to produce a movie and the chances that it would be more popular than a movie may be much higher, as it can be tweaked as it is developed while a movie is an all or nothing production.
It comes down to a nitty gritty question: Can we make to order or do we have to create a new mousetrap and then wait to see if the world will come to it, or somewhere in-between?
[edit] Related Concepts
The process of business model design is part of business strategy. The implementation of a company's business model into organizational structures (e.g. organigrams, workflows, human resources) and systems (e.g. information technology architecture, production lines) is part of a company's business operations. It is important to understand that business modeling commonly refers to business process design at the operational level, whereas business models and business model design refer to defining the business logic of a company at the strategic level.
[edit] See also
Competitive advantage
Core competency
Business model design
Business process modeling
Business plan
Business reference model
Business rule
Growth Platforms
Market forms
Marketing
Marketing plan
Monopoly
Strategic management
Strategic planning
Strategy dynamics
Value migration
[edit] References
^ Not to be confused with the term business architecture that structures the accountability over business activities
^ The Role of the Business Model in captualue from Innovation: Evidence from XEROX Corporation’s Technology Spinoff Companies., H. Chesbrough and R. S. Rosenbloom , Boston, Massachusetts, Harvard Business School, 2000.
^ Leading the revolution., G. Hamel, Boston, Harvard Business School Press, 2000.
^ Changing Business Models: Surveying the Landscape, J. Linder and S. Cantrell, Accenture Institute for Strategic Change, 2000.
^ Developing Business Models for eBusiness., O. Peterovic and C. Kittl et al., International Conference on Electronic Commerce 2001, 2001.
^ Place to space: Migrating to eBusiness Models., P. Weill and M. R. Vitale, Boston,Harvard Business School Press, 2001.
^ Value-based Requirements Engineering - Exploring Innovative e-Commerce Ideas, J. Gordijn, Amsterdam, Vrije Universiteit, 2002.
^ Internet Business Models and Strategies, A. Afuah and C. Tucci, Boston, McGraw Hill, 2003.
^ Focus Theme Articles: Business Models for Content Delivery: An Empirical Analysis of the Newspaper and Magazine Industry, Marc Fetscherin and Gerhard Knolmayer, International Journal on Media Management, Volume 6, Issue 1 & 2 September 2004 , pages 4 - 11, September 2004.
^ a b The Business Model Ontology - A Proposition In A Design Science Approach, Thesis by Alexander Osterwalder, 2004
^ Do Some Business Models Perform Better than Others?, Malone et al., May 2006
source: http://en.wikipedia.org/wiki/Business_model
zondag 7 december 2008
Wireles turns iPod into a phone
Again Apple is doing something interesting and new.
Wireles turns iPod into a phone
A freeware application for the iPod Touch can turn the music player into a virtual mobile phone.
Truphone uses wi-fi technology in an iPod Touch to allow users to make calls to other iPod Touch owners and Google Talk's messaging service users.
The software is a spin-off from technology Truphone developed for smartphones and iPhones.
The developers plan to have the ability to make calls to and from landlines in place very soon.
Truphone is the latest firm to offer voice over internet protocol (VoIP), alongside Unlicensed Mobile Access and proprietary protocols such as Skype.
Geraldine Wilson - Truphone's CEO - said the firm had ambitions to become a global internet player.
"There are a slew of new features we're rolling out for the iPod Touch that will let users call landlines, Skype users or send instant messages. We're talking weeks, not months, before these go live."
Although Truphone technology can, in theory, work on any mobile device, the firm is concentrating on devices that have an application store.
"We've decided to focus on devices that are wi-fi enabled and have an apps-store. For the consumer, there has to be an easy way of downloading an application."
"Our focus on the consumer side - at least in the short term - is finding devices that fit that category," said Ms Wilson.
Wi-fi go bye bye
The only catch is that for a wi-fi connection to work, users need to be within range of a wi-fi network.
Truphone founder - James Tagg - said that the technology also worked on other mobile devices, albeit in a slightly different way.
"If you were using Truphone on a Blackberry, it will use cellular technology to log into the Truphone's website."
"From here you can make an international call, call a user on VoIP, or send an instant message."
"Because the first leg of the call - from the user to our server - is charged at local rate, you're talking a bill of pennies, rather than pounds, to call, say the United States."
The company said Google's Android operating system would be the next platform for which it will develop the Truphone applications.
Wireles turns iPod into a phone
A freeware application for the iPod Touch can turn the music player into a virtual mobile phone.
Truphone uses wi-fi technology in an iPod Touch to allow users to make calls to other iPod Touch owners and Google Talk's messaging service users.
The software is a spin-off from technology Truphone developed for smartphones and iPhones.
The developers plan to have the ability to make calls to and from landlines in place very soon.
Truphone is the latest firm to offer voice over internet protocol (VoIP), alongside Unlicensed Mobile Access and proprietary protocols such as Skype.
Geraldine Wilson - Truphone's CEO - said the firm had ambitions to become a global internet player.
"There are a slew of new features we're rolling out for the iPod Touch that will let users call landlines, Skype users or send instant messages. We're talking weeks, not months, before these go live."
Although Truphone technology can, in theory, work on any mobile device, the firm is concentrating on devices that have an application store.
"We've decided to focus on devices that are wi-fi enabled and have an apps-store. For the consumer, there has to be an easy way of downloading an application."
"Our focus on the consumer side - at least in the short term - is finding devices that fit that category," said Ms Wilson.
Wi-fi go bye bye
The only catch is that for a wi-fi connection to work, users need to be within range of a wi-fi network.
Truphone founder - James Tagg - said that the technology also worked on other mobile devices, albeit in a slightly different way.
"If you were using Truphone on a Blackberry, it will use cellular technology to log into the Truphone's website."
"From here you can make an international call, call a user on VoIP, or send an instant message."
"Because the first leg of the call - from the user to our server - is charged at local rate, you're talking a bill of pennies, rather than pounds, to call, say the United States."
The company said Google's Android operating system would be the next platform for which it will develop the Truphone applications.
New marketing strategy online
A band from Chicago has been together and working for 11 years but the succes isn't growing as it should be so they have made up an interesting marketing campaign for their new albums pre-sale.
From site: http://www.reuters.com/article/technologyNews/idUSTRE4B607520081207?feedType=RSS&feedName=technologyNews
Chicago band uses digital savvy to promote album
By Antony Bruno
DENVER (Billboard) - Progressive jam band Umphrey's McGee is capturing the attention of the music industry with the pre-order campaign for its upcoming album.
Such strategies are nothing new, and many offer an incentive to buyers -- a free download of the first single or access to early ticket sales for concerts. But Umphrey's McGee has gone to far greater lengths for its January 20 release "Mantis," which the Chicago-based band hopes will bring it mainstream success after 11 years building a nationwide base of loyal supporters.
The group has a variety of content that it's making available to anyone ordering the album now, including digital singles, rare live performances, behind-the-scenes video footage and photos. But in an innovative twist, the band is not releasing it all at once. Instead it's releasing tiers of content based on how many pre-orders are sold. Each time the number of pre-orders reaches a certain threshold, a new tier of content is released. (There are nine tiers in all.) The idea is to engage diehard fans as evangelists who will convince their friends and family to pre-order "Mantis" so the next tier of content can become available.
So far, it's worked. According to band manager, Vincent Iwinski, Umphrey's McGee has sold more than 2,400 pre-orders since it launched in late October, including a $50 deluxe package that contains a bonus DVD and vinyl copy. That may not seem like a lot to mainstream acts, but it's twice the number of pre-orders that the band logged for its last album, 2006's "Safety in Numbers," according to Iwinski.
Already, Umphrey's McGee has released six of the nine content tiers and had to raise the sales requirement for the remaining tiers to avoid running out of content too soon.
"We're realizing that doing things the way we've done the last few years is not going to keep people's attention," Iwinski says. "What's important to us in this day and age is to give people a reason to buy one copy of the album in return for all this free stuff."
The campaign could serve as a template for how emerging and established acts alike can kick-start interest in a new release. But it's not as if this idea came out of nowhere. For more than a decade, Umphrey's McGee has built its fan base through the strategic use of free content and fan engagement.
The band, which plays some 120 shows annually, sells out 4,000-capacity venues by charging a core group of eight to 15 fans in each market with the task of giving away free CDs. It then lets attendees freely tape shows; and it sells the sound board mixes for $15 per CD after the concert or $10 for a digital download available 72 hours after each gig. It sells upwards of 300 CDs per show and to date has moved 750,000-plus tracks online. It also has a podcast series that releases two 75-minute recordings of live material every month to more than 20,000 subscribers.
The demand that this has created among fans is such that the band began holding onto certain content rather than making it available immediately. Select shows were not available for taping or post-event purchase. Umphrey's McGee also stopped performing some of its songs, particularly those to be included on "Mantis." This content, combined with tracks from early out-of-print releases and 11 years of rarely seen photos and videos, is driving the demand for the presale.
"Because we're a band that has always recorded everything, taken photos of everything, used video as much as possible and doing that for such a long time, we have a lot of stuff," Iwinski says.
What's more, Umphrey's McGee isn't frontloading all of this content into the presale. The CD will contain an electronic key that will give anyone buying it -- presale or otherwise -- access to a site where even more material will be released monthly for a year after the arrival of "Mantis."
The combined strategy has gotten the attention of several digital music experts, including Gartner analyst Mike McGuire, who cites the initiative as the perfect way to implement a pre-order campaign. While far better-known acts like Radiohead and Nine Inch Nails have raised the bar for generating interest in upcoming releases, Umphrey's McGee has become an unlikely role model for a music industry still struggling with the conversion to digital distribution amid rampant piracy.
Reuters/Billboard
From site: http://www.reuters.com/article/technologyNews/idUSTRE4B607520081207?feedType=RSS&feedName=technologyNews
Chicago band uses digital savvy to promote album
By Antony Bruno
DENVER (Billboard) - Progressive jam band Umphrey's McGee is capturing the attention of the music industry with the pre-order campaign for its upcoming album.
Such strategies are nothing new, and many offer an incentive to buyers -- a free download of the first single or access to early ticket sales for concerts. But Umphrey's McGee has gone to far greater lengths for its January 20 release "Mantis," which the Chicago-based band hopes will bring it mainstream success after 11 years building a nationwide base of loyal supporters.
The group has a variety of content that it's making available to anyone ordering the album now, including digital singles, rare live performances, behind-the-scenes video footage and photos. But in an innovative twist, the band is not releasing it all at once. Instead it's releasing tiers of content based on how many pre-orders are sold. Each time the number of pre-orders reaches a certain threshold, a new tier of content is released. (There are nine tiers in all.) The idea is to engage diehard fans as evangelists who will convince their friends and family to pre-order "Mantis" so the next tier of content can become available.
So far, it's worked. According to band manager, Vincent Iwinski, Umphrey's McGee has sold more than 2,400 pre-orders since it launched in late October, including a $50 deluxe package that contains a bonus DVD and vinyl copy. That may not seem like a lot to mainstream acts, but it's twice the number of pre-orders that the band logged for its last album, 2006's "Safety in Numbers," according to Iwinski.
Already, Umphrey's McGee has released six of the nine content tiers and had to raise the sales requirement for the remaining tiers to avoid running out of content too soon.
"We're realizing that doing things the way we've done the last few years is not going to keep people's attention," Iwinski says. "What's important to us in this day and age is to give people a reason to buy one copy of the album in return for all this free stuff."
The campaign could serve as a template for how emerging and established acts alike can kick-start interest in a new release. But it's not as if this idea came out of nowhere. For more than a decade, Umphrey's McGee has built its fan base through the strategic use of free content and fan engagement.
The band, which plays some 120 shows annually, sells out 4,000-capacity venues by charging a core group of eight to 15 fans in each market with the task of giving away free CDs. It then lets attendees freely tape shows; and it sells the sound board mixes for $15 per CD after the concert or $10 for a digital download available 72 hours after each gig. It sells upwards of 300 CDs per show and to date has moved 750,000-plus tracks online. It also has a podcast series that releases two 75-minute recordings of live material every month to more than 20,000 subscribers.
The demand that this has created among fans is such that the band began holding onto certain content rather than making it available immediately. Select shows were not available for taping or post-event purchase. Umphrey's McGee also stopped performing some of its songs, particularly those to be included on "Mantis." This content, combined with tracks from early out-of-print releases and 11 years of rarely seen photos and videos, is driving the demand for the presale.
"Because we're a band that has always recorded everything, taken photos of everything, used video as much as possible and doing that for such a long time, we have a lot of stuff," Iwinski says.
What's more, Umphrey's McGee isn't frontloading all of this content into the presale. The CD will contain an electronic key that will give anyone buying it -- presale or otherwise -- access to a site where even more material will be released monthly for a year after the arrival of "Mantis."
The combined strategy has gotten the attention of several digital music experts, including Gartner analyst Mike McGuire, who cites the initiative as the perfect way to implement a pre-order campaign. While far better-known acts like Radiohead and Nine Inch Nails have raised the bar for generating interest in upcoming releases, Umphrey's McGee has become an unlikely role model for a music industry still struggling with the conversion to digital distribution amid rampant piracy.
Reuters/Billboard
Five easy steps to plug online music leaks
Antonio Bruno gives advices how to act when your album leaks online before release.
From site: http://www.reuters.com/article/technologyNews/idUSTRE4B60CW20081207?feedType=RSS&feedName=technologyNews
Five easy steps to plug online music leaks
By Antony Bruno
DENVER (Billboard) - When an album leaks online before it arrives in stores, it can be a real punch in the gut.
Recent new releases from rock bands Guns N' Roses, Metallica and AC/DC all found their way onto peer-to-peer (P2P) file-sharing networks before they reached the stores, proving that even the most closely guarded projects are vulnerable.
But it's not the end of the world. After angrily beating your head against the wall, there are several measures you can implement to mitigate the damage. Here are five recommendations not intended for artists or managers who deliberately leak their own material.
1. FIND THE SOURCE
Leaks infuriate managers and artists, because they usually occur after an album has been delivered to the label. The culprit is often someone in the production chain who's gone rogue or a talent rep trusting the wrong person with an advance copy. So the label needs to take every step possible to determine where the leak occurred and take action against who is responsible. "You can't unring the bell," says Mike McGuire, an analyst at research firm Gartner Inc. "But if it is an internal leak, then somebody needs to be punished."
2. STOP THE BLEEDING
Once the leak has sprung, it's almost impossible to stop it from spreading. But targeting the top online sources of leaked material can pay dividends by at least stemming the flow long enough for the release to be distributed through legitimate channels. Make sure you've updated the audio fingerprinting of partners who use them to filter out unwanted content. Contact the MP3 bloggers with whom you have relationships. And send takedown notices or cease-and-desist letters when necessary. "The strategy is one of containment," says Eric Garland, CEO of consulting firm BigChampagne. "Chase everybody everywhere with your legal eagles and have the Internet scrubbed clean. It's got to be a coordinated, rapid response."
3. COMMUNICATE WITH FANS
In cases where the leaked album is not the final version, artists and labels should get the word out to fans that what's available online is not the finished product. The goal is to convince them to wait for the final, official version by promising better sound quality or other bonuses. Be specific about how the official version of the album will be different from what's been leaked and provide a firm date for the authorized release. "Make sure you're clear on when it is going to be done and give people that," Gartner's McGuire says. "Managing the PR is about setting expectations."
4. RUSH THE RELEASE
Skip all the marketing plans and just get the album into stores or make it available through authorized channels as soon as possible. This serves two purposes: it responds to the increased demand that a leaked album creates for the final product and takes advantage of the one positive aspect of a leak -- marketing. Many industry observers say that P2P is today's radio, and the buzz that a leaked track creates can often supplant the best-laid marketing plans -- as long as the feedback is positive, of course.
"We live in a word-of-mouth world, and the unfettered Internet is a platform for evaluation, promotion and marketing," BigChampagne's Garland says. "It is hard for me to think of an instance where a marketing plan is more important than the immediate need to get out there with a legitimate offering." For added measure, package the authorized release with such exclusive, previously unreleased material as a new track or other bonus content to help differentiate it from the leaked version.
5. PRE-EMPTIVE MEASURES
One of the best ways to insulate yourself from an Internet leak is by taking action well in advance. Letting fans pre-order the album is one good solution, since it locks in sales before any potential leak. Another is building buzz by posting streaming-only singles when appropriate or taking advantage of programs like iTunes' Complete My Album feature to sell songs from an album before its release. "Establishing a transaction and an implicit social contract is one of the ways you remove incentive to find leaked material," McGuire says.
Reuters/Billboard
From site: http://www.reuters.com/article/technologyNews/idUSTRE4B60CW20081207?feedType=RSS&feedName=technologyNews
Five easy steps to plug online music leaks
By Antony Bruno
DENVER (Billboard) - When an album leaks online before it arrives in stores, it can be a real punch in the gut.
Recent new releases from rock bands Guns N' Roses, Metallica and AC/DC all found their way onto peer-to-peer (P2P) file-sharing networks before they reached the stores, proving that even the most closely guarded projects are vulnerable.
But it's not the end of the world. After angrily beating your head against the wall, there are several measures you can implement to mitigate the damage. Here are five recommendations not intended for artists or managers who deliberately leak their own material.
1. FIND THE SOURCE
Leaks infuriate managers and artists, because they usually occur after an album has been delivered to the label. The culprit is often someone in the production chain who's gone rogue or a talent rep trusting the wrong person with an advance copy. So the label needs to take every step possible to determine where the leak occurred and take action against who is responsible. "You can't unring the bell," says Mike McGuire, an analyst at research firm Gartner Inc. "But if it is an internal leak, then somebody needs to be punished."
2. STOP THE BLEEDING
Once the leak has sprung, it's almost impossible to stop it from spreading. But targeting the top online sources of leaked material can pay dividends by at least stemming the flow long enough for the release to be distributed through legitimate channels. Make sure you've updated the audio fingerprinting of partners who use them to filter out unwanted content. Contact the MP3 bloggers with whom you have relationships. And send takedown notices or cease-and-desist letters when necessary. "The strategy is one of containment," says Eric Garland, CEO of consulting firm BigChampagne. "Chase everybody everywhere with your legal eagles and have the Internet scrubbed clean. It's got to be a coordinated, rapid response."
3. COMMUNICATE WITH FANS
In cases where the leaked album is not the final version, artists and labels should get the word out to fans that what's available online is not the finished product. The goal is to convince them to wait for the final, official version by promising better sound quality or other bonuses. Be specific about how the official version of the album will be different from what's been leaked and provide a firm date for the authorized release. "Make sure you're clear on when it is going to be done and give people that," Gartner's McGuire says. "Managing the PR is about setting expectations."
4. RUSH THE RELEASE
Skip all the marketing plans and just get the album into stores or make it available through authorized channels as soon as possible. This serves two purposes: it responds to the increased demand that a leaked album creates for the final product and takes advantage of the one positive aspect of a leak -- marketing. Many industry observers say that P2P is today's radio, and the buzz that a leaked track creates can often supplant the best-laid marketing plans -- as long as the feedback is positive, of course.
"We live in a word-of-mouth world, and the unfettered Internet is a platform for evaluation, promotion and marketing," BigChampagne's Garland says. "It is hard for me to think of an instance where a marketing plan is more important than the immediate need to get out there with a legitimate offering." For added measure, package the authorized release with such exclusive, previously unreleased material as a new track or other bonus content to help differentiate it from the leaked version.
5. PRE-EMPTIVE MEASURES
One of the best ways to insulate yourself from an Internet leak is by taking action well in advance. Letting fans pre-order the album is one good solution, since it locks in sales before any potential leak. Another is building buzz by posting streaming-only singles when appropriate or taking advantage of programs like iTunes' Complete My Album feature to sell songs from an album before its release. "Establishing a transaction and an implicit social contract is one of the ways you remove incentive to find leaked material," McGuire says.
Reuters/Billboard
dinsdag 2 december 2008
Web 2.0 start ups running out of money
It seems that social networks popularity is reaching it's peak and the biggest ones are taking advantage of it.
From site: http://www.billboard.biz/bbbiz/content_display/industry/e3i2b831046707ffd254f48e456ce9b2a09
Start-ups Knock On MySpace's Door
December 02, 2008 - Digital and Mobile
Reuters
MySpace, the online social network owned by News Corp, sees opportunities to buy start-ups for a fraction of what they would have cost six months ago as the economic slump slices millions of dollars off their price tags.
MySpace Co-founder and Chief Executive Chris DeWolfe said companies worth between $200 million and $300 million just six months ago are now running out of money and willing to sell themselves for less than one-tenth of that value.
Many Web 2.0 start-ups -- so-called because they develop interactive websites and applications -- have begun knocking on his door recently, looking to sell themselves, DeWolfe told the Reuters Media Summit via video conference on Monday (Dec. 1).
"At the lower levels the money dries up, everyone's looking for some kind of exit and the valuations we're seeing out there are definitely a small, small fraction of what they were even five or six months ago," he said, adding that he expects these companies to become even cheaper in the next few months.
DeWolfe said acquisitions are central to MySpace's growth strategy, which includes expanding its presence in international markets, building its music offering and developing applications for mobile phones.
MySpace, which media mogul Rupert Murdoch bought for $580 million in 2005, looks at start-ups in each of these areas when deciding to buy, build or partner with another company.
"Certainly we're interested in expanding in key markets internationally and there may be some opportunities on the music side at some point, but right now we don't have any particular companies directly in our sights," the MySpace CEO said.
DeWolfe said MySpace also was not interested in Twitter, the micro-blogging site which gained mainstream popularity after President-elect Barack Obama's campaign used it to communicate with supporters.
"We're not actively interested in Twitter," DeWolfe said in response to a question about whether MySpace wanted to buy it. MySpace's rival Facebook earlier held talks to buy Twitter, according to media reports.
Twitter is a "great service" but MySpace provides a similar service and would rather focus on acquisitions related to its core growth areas, he added.
Venture capital investment in start-ups fell 7% in the third quarter compared to the second quarter. The National Venture Capital Association expects investment to dip further in coming quarters as pension funds and institutional investors distribute fewer dollars among venture capital firms.
From site: http://www.billboard.biz/bbbiz/content_display/industry/e3i2b831046707ffd254f48e456ce9b2a09
Start-ups Knock On MySpace's Door
December 02, 2008 - Digital and Mobile
Reuters
MySpace, the online social network owned by News Corp, sees opportunities to buy start-ups for a fraction of what they would have cost six months ago as the economic slump slices millions of dollars off their price tags.
MySpace Co-founder and Chief Executive Chris DeWolfe said companies worth between $200 million and $300 million just six months ago are now running out of money and willing to sell themselves for less than one-tenth of that value.
Many Web 2.0 start-ups -- so-called because they develop interactive websites and applications -- have begun knocking on his door recently, looking to sell themselves, DeWolfe told the Reuters Media Summit via video conference on Monday (Dec. 1).
"At the lower levels the money dries up, everyone's looking for some kind of exit and the valuations we're seeing out there are definitely a small, small fraction of what they were even five or six months ago," he said, adding that he expects these companies to become even cheaper in the next few months.
DeWolfe said acquisitions are central to MySpace's growth strategy, which includes expanding its presence in international markets, building its music offering and developing applications for mobile phones.
MySpace, which media mogul Rupert Murdoch bought for $580 million in 2005, looks at start-ups in each of these areas when deciding to buy, build or partner with another company.
"Certainly we're interested in expanding in key markets internationally and there may be some opportunities on the music side at some point, but right now we don't have any particular companies directly in our sights," the MySpace CEO said.
DeWolfe said MySpace also was not interested in Twitter, the micro-blogging site which gained mainstream popularity after President-elect Barack Obama's campaign used it to communicate with supporters.
"We're not actively interested in Twitter," DeWolfe said in response to a question about whether MySpace wanted to buy it. MySpace's rival Facebook earlier held talks to buy Twitter, according to media reports.
Twitter is a "great service" but MySpace provides a similar service and would rather focus on acquisitions related to its core growth areas, he added.
Venture capital investment in start-ups fell 7% in the third quarter compared to the second quarter. The National Venture Capital Association expects investment to dip further in coming quarters as pension funds and institutional investors distribute fewer dollars among venture capital firms.
Concert industry has some new big deals
While record industry is suffering the concert business is still alive and kicking maybe even harder than ever and big deals are made.
From site: http://www.billboard.biz/bbbiz/content_display/industry/e3i262fde538e88806857c572b169e3588f
Live Nation, Blockbuster Ink Ticket Deal
December 02, 2008 - Touring
By Ray Waddell, Nashville
Live Nation has signed a three-year deal with Blockbuster whereby the latter will be the exclusive physical retail ticket outlet for Live Nation Ticketing, Live Nation's new in-house ticketing company, beginning with the start of the 2009 concert season.
Under the agreement, Live Nation will sell its retail tickets exclusively through approximately 500 Blockbuster company-owned stores in "strategically chosen" markets across the country aligned with Live Nation's concert venue platform footprint. Live Nation says it sells some eight percent of tickets to its concerts - about one million tickets annually - through retail outlets.
Tickets will still be available at venue box offices; the deal with Blockbuster essentially replaces Ticketmaster retail outlets for Live Nation venues when Live Nation's deal with Ticketmaster expires at the end of this year.
The selected Blockbuster stores will offer exclusive blocks of tickets available during the first four hours of ticket sales, as well as general ticketing as long as supplies last. Blockbuster will be responsible for managing and operating all aspects of the ticket transactional experience.
Under the agreement, Blockbuster and Live Nation are committing promotional support, marketing assets and customer data bases to drive awareness of the new ticketing relationship. Additionally, Blockbuster and Live Nation expect to offer exclusive concert products and promotions to Blockbuster customers.
From site: http://www.billboard.biz/bbbiz/content_display/industry/e3i262fde538e88806857c572b169e3588f
Live Nation, Blockbuster Ink Ticket Deal
December 02, 2008 - Touring
By Ray Waddell, Nashville
Live Nation has signed a three-year deal with Blockbuster whereby the latter will be the exclusive physical retail ticket outlet for Live Nation Ticketing, Live Nation's new in-house ticketing company, beginning with the start of the 2009 concert season.
Under the agreement, Live Nation will sell its retail tickets exclusively through approximately 500 Blockbuster company-owned stores in "strategically chosen" markets across the country aligned with Live Nation's concert venue platform footprint. Live Nation says it sells some eight percent of tickets to its concerts - about one million tickets annually - through retail outlets.
Tickets will still be available at venue box offices; the deal with Blockbuster essentially replaces Ticketmaster retail outlets for Live Nation venues when Live Nation's deal with Ticketmaster expires at the end of this year.
The selected Blockbuster stores will offer exclusive blocks of tickets available during the first four hours of ticket sales, as well as general ticketing as long as supplies last. Blockbuster will be responsible for managing and operating all aspects of the ticket transactional experience.
Under the agreement, Blockbuster and Live Nation are committing promotional support, marketing assets and customer data bases to drive awareness of the new ticketing relationship. Additionally, Blockbuster and Live Nation expect to offer exclusive concert products and promotions to Blockbuster customers.
maandag 1 december 2008
Apple does it first again
Again something new in Apple family
From site:
http://musicindustrynewswire.com/2008/11/25/min802_181726.php
Ministry of Sound and iZotope release first album-themed music creation app for iPhone and iPod touch
Tue, 25 Nov 2008 18:17:26 -0800 PST
by Jesse JJ Jame
London, UK — Ministry of Sound and iZotope today announced that, in a groundbreaking collaboration for iPhone and iPod touch, fans can now buy the iDrum: Ministry of Sound Anthems album from the iTunes Store and also purchase a companion application from the Apple App Store that lets them create original music. “This is a truly unique experience where some of the best known dance music sounds of the last two decades are now available to be recreated on iPhone at the touch of a button.” said Van Uong, licensing account manager at Ministry of Sound.
“With the combination of iDrum’s simple Multi-Touch user interface and Ministry of Sound’s incredible sample content, you can create your own club anthems right in the palm of your hand,” said Nick Dika, content manager at iZotope.
iDrum: Ministry of Sound Anthems lets iPhone and iPod touch owners recreate their favorite club tracks of yesterday and today. This special edition of iDrum is the perfect companion to Ministry of Sound’s newest album representing clubbing history, “Anthems II.” Starting with professionally produced iDrum kits that emulate the greatest anthems in clubbing history, users can customize the included beats any way they like or mix and match over 300 original samples to make their own epic tracks. iDrum’s simple interface lets even novice users build beats layer by layer by tapping the touch screen or create music with simple shapes and color combinations that let anyone visualize the rhythm.
Features:
* Includes professionally produced samples and beats from Ministry of Sound over 300 original classic and old school dance samples and 20 unique kits with dozens of pre-made patterns
* Customize patterns to create your own unique beats
* Take control of the rhythm of every drum sound and sample
* Tap the screen to play and record your own musical patterns
A collaboration between Ministry of Sound and iZotope, this special edition of iDrum is the perfect companion to Ministry of Sound’s newest album representing clubbing history, “Anthems II,” now available on the iTunes Store. The follow up to last year’s over half million selling album, “Anthems II” includes three discs filled with the best club classics of all time.
iDrum: Ministry of Sound Anthems is available for $5.99 USD from Apple’s App Store on iPhone and iPod touch.
About Ministry of Sound (www.ministryofsound.com)
Headquartered in London, Ministry of Sound is a global dance music and digital lifestyle entertainment brand delivering content, music and lifestyle products both offline and through multiple digital channels. Since first opening its doors as a London nightclub in 1991, Ministry of Sound has become a truly international brand with offices and clubs worldwide. Ministry of Sound is also the world’s largest independent record company.
About iZotope, Inc. (www.izotope.com)
iZotope is a research-driven audio signal processing company based in Boston, Massachusetts. Its hardware products, software products, and audio technology are used by millions of people in over 50 countries, from hobbyist musicians to GRAMMY Award winners. iZotope focuses on developing innovative audio technology for professional and consumer applications. This core technology is presented to customers in its award-winning product line and through its extensive licensing program.
Technorati Tags: iDrum Ministry of Sound Anthems, iZotope
SPHERE: Related Content — CLICK HERE to See What Else is Out There!
--------------------------------------------------------------------------------
About The Author / Editor:
JJ Jame is a percussionist and theramin player, formerly a member of the Redondo Beach based BoyRacer.com™ electronica band, and a long-time electronic music fan, formerly an editor for the defunct EMcult™ website.
» Learn More About Jesse JJ Jame
This material is Copr. © 2008 Music Industry Newswire™ and Neotrope® - Terms of Use
From site:
http://musicindustrynewswire.com/2008/11/25/min802_181726.php
Ministry of Sound and iZotope release first album-themed music creation app for iPhone and iPod touch
Tue, 25 Nov 2008 18:17:26 -0800 PST
by Jesse JJ Jame
London, UK — Ministry of Sound and iZotope today announced that, in a groundbreaking collaboration for iPhone and iPod touch, fans can now buy the iDrum: Ministry of Sound Anthems album from the iTunes Store and also purchase a companion application from the Apple App Store that lets them create original music. “This is a truly unique experience where some of the best known dance music sounds of the last two decades are now available to be recreated on iPhone at the touch of a button.” said Van Uong, licensing account manager at Ministry of Sound.
“With the combination of iDrum’s simple Multi-Touch user interface and Ministry of Sound’s incredible sample content, you can create your own club anthems right in the palm of your hand,” said Nick Dika, content manager at iZotope.
iDrum: Ministry of Sound Anthems lets iPhone and iPod touch owners recreate their favorite club tracks of yesterday and today. This special edition of iDrum is the perfect companion to Ministry of Sound’s newest album representing clubbing history, “Anthems II.” Starting with professionally produced iDrum kits that emulate the greatest anthems in clubbing history, users can customize the included beats any way they like or mix and match over 300 original samples to make their own epic tracks. iDrum’s simple interface lets even novice users build beats layer by layer by tapping the touch screen or create music with simple shapes and color combinations that let anyone visualize the rhythm.
Features:
* Includes professionally produced samples and beats from Ministry of Sound over 300 original classic and old school dance samples and 20 unique kits with dozens of pre-made patterns
* Customize patterns to create your own unique beats
* Take control of the rhythm of every drum sound and sample
* Tap the screen to play and record your own musical patterns
A collaboration between Ministry of Sound and iZotope, this special edition of iDrum is the perfect companion to Ministry of Sound’s newest album representing clubbing history, “Anthems II,” now available on the iTunes Store. The follow up to last year’s over half million selling album, “Anthems II” includes three discs filled with the best club classics of all time.
iDrum: Ministry of Sound Anthems is available for $5.99 USD from Apple’s App Store on iPhone and iPod touch.
About Ministry of Sound (www.ministryofsound.com)
Headquartered in London, Ministry of Sound is a global dance music and digital lifestyle entertainment brand delivering content, music and lifestyle products both offline and through multiple digital channels. Since first opening its doors as a London nightclub in 1991, Ministry of Sound has become a truly international brand with offices and clubs worldwide. Ministry of Sound is also the world’s largest independent record company.
About iZotope, Inc. (www.izotope.com)
iZotope is a research-driven audio signal processing company based in Boston, Massachusetts. Its hardware products, software products, and audio technology are used by millions of people in over 50 countries, from hobbyist musicians to GRAMMY Award winners. iZotope focuses on developing innovative audio technology for professional and consumer applications. This core technology is presented to customers in its award-winning product line and through its extensive licensing program.
Technorati Tags: iDrum Ministry of Sound Anthems, iZotope
SPHERE: Related Content — CLICK HERE to See What Else is Out There!
--------------------------------------------------------------------------------
About The Author / Editor:
JJ Jame is a percussionist and theramin player, formerly a member of the Redondo Beach based BoyRacer.com™ electronica band, and a long-time electronic music fan, formerly an editor for the defunct EMcult™ website.
» Learn More About Jesse JJ Jame
This material is Copr. © 2008 Music Industry Newswire™ and Neotrope® - Terms of Use
Digital media project
The Digital Media Project aims to resolve emerging and outstanding problems revealed by recent social and technological change. A simple shift of format – the transition from hard-copy objects like vinyl records to digitized bits of information like MP3s – has prompted an upheaval of business models, legal principles, and social practices associated with the use, distribution, and control of media. This upheaval has created a void in the digital media world, a void that policymakers, industry representatives, and consumers are scrambling to fill with new laws and technological solutions.The goal of the Digital Media Project is not to advance a simple agenda but instead to help educate stakeholders – government officials, the media, artists, businesspeople, and the public at large – about the choices and values that can guide law and technology to maximize the potential of digital media for the years ahead.In its fourth year of investigating how the transition from analog to digital can occur in such a way as to get the benefit of this transfer with as little constraint as possible, the Digital Media Project is focusing on key areas:
Patent law: the tension between the benefits derived from encouraging scientists to produce more research by protecting creators’ work, and the drawbacks that a complicated, expensive patent law system can cause such as increasing barriers, higher cost, and commercialization of science.
Scholarly context: How can the benefits of digital media be used in education and how are businesses, laws and technology preventing academics and educators from reaching this potential?
Digital Media Exchange: Building on Professor Fisher’s exploration of alternative compensation systems – most explicitly set forth in his book, Promises to Keep – the DME is a web-based, open source platform that enables the distribution and licensing of digital content.
Digital Media in Asia, which looks at the evolving interplay of law, technology and business issues as they relate to the creation and dissemination of content in Asia.
New tools such as recommendation engines, playlists, blogs and podcasting.
The regulatory context of television in its rollover from analog to digital.
Digital Media in the EU, which looks at the evolving interplay of law, technology and business issues as they relate to the creation and dissemination of content in the EU.The Center also collaborates with Gartner on a number of research projects. Examples of recently released reports include an analysis of business models in the Digital Media space, extensions of its widely-noted 100-page review of Apple’s iTunes music service, and an update of our White Paper on Copyright and Digital Media, with new international dimensions. Prof. Terry Fisher, Prof. Jonathan Zittrain, and John Palfrey submitted a brief to the United States Supreme Court in the Grokster case that was cited in a concurring opinion, with the help of more than a dozen students. Berkman also continued work related to an amicus brief in Capitol Records v. Alaujan in US Federal District Court, part of an ongoing litigation between the recording industry and alleged digital file-sharers.
http://cyber.law.harvard.edu/media/
Patent law: the tension between the benefits derived from encouraging scientists to produce more research by protecting creators’ work, and the drawbacks that a complicated, expensive patent law system can cause such as increasing barriers, higher cost, and commercialization of science.
Scholarly context: How can the benefits of digital media be used in education and how are businesses, laws and technology preventing academics and educators from reaching this potential?
Digital Media Exchange: Building on Professor Fisher’s exploration of alternative compensation systems – most explicitly set forth in his book, Promises to Keep – the DME is a web-based, open source platform that enables the distribution and licensing of digital content.
Digital Media in Asia, which looks at the evolving interplay of law, technology and business issues as they relate to the creation and dissemination of content in Asia.
New tools such as recommendation engines, playlists, blogs and podcasting.
The regulatory context of television in its rollover from analog to digital.
Digital Media in the EU, which looks at the evolving interplay of law, technology and business issues as they relate to the creation and dissemination of content in the EU.The Center also collaborates with Gartner on a number of research projects. Examples of recently released reports include an analysis of business models in the Digital Media space, extensions of its widely-noted 100-page review of Apple’s iTunes music service, and an update of our White Paper on Copyright and Digital Media, with new international dimensions. Prof. Terry Fisher, Prof. Jonathan Zittrain, and John Palfrey submitted a brief to the United States Supreme Court in the Grokster case that was cited in a concurring opinion, with the help of more than a dozen students. Berkman also continued work related to an amicus brief in Capitol Records v. Alaujan in US Federal District Court, part of an ongoing litigation between the recording industry and alleged digital file-sharers.
http://cyber.law.harvard.edu/media/
Where will music be coming from?
Where Music Will Be Coming From
Technology is changing music. But then again, it always has. The invention of the piano 300 years ago centered Western music on the keyboard. Electricity's arrival in the late 19th century enabled the duplication of performances and, later, the amplification of instruments. With digitization, the pace of upheaval has further accelerated. Digital file-sharing technologies -- Napster and its offspring -- are now undermining the established economics of music. And everything we know about digital technologies suggests that Napster is only the beginning.There is no music made today that has not been shaped by the fact of recording and duplication. In fact, the ability to copy music has been deeply disruptive ever since the invention of the gramophone. When John D. Smoot, an engineer for the European company Odeon, carted primitive recording equipment to the Indonesian archipelago in 1904 to record the gamelan orchestras, local musicians were perplexed. Why copy a performance? The popular local tunes that circulated in their villages had a half-life of a few weeks. Why would anyone want to listen to a stale rendition of an obsolete piece when it was so easy to get fresh music?As phonographs spread throughout the world, they had a surprising effect: folk tunes, which had always been malleable, changing with each performer and in each performance, were transformed by the advent of recording into fixed songs that could be endlessly and exactly repeated. Music became shorter, more melodic and more precise.Early equipment could make recordings that contained no more than four and a half minutes, so musicians truncated old works to fit and created new music abbreviated to adapt to the phonograph. Because the first sound recordings were of unamplified music, recording emphasized the loud sounds of singers and de-emphasized quiet instrumentals. The musicologist Timothy Day notes that once pianists began recording they tried, for the first time, to ''distinguish carefully between every quaver and semiquaver -- eighth note and sixteenth note -- throughout the piece.'' Musicians played the way technology listened. When the legendary recordist Frederick Gaisberg arrived in Calcutta in 1902, only two decades after the phonograph was invented, he found that Indian musicians were already learning to imitate recorded music and lamented that there was ''no traditional music left to record.''As the technologies of reproduction bloomed in the last century, consumerism boomed. What consumers consumed -- whether in the form of a book, a CD or a can of Coke -- were exact copies. The ability to make copies in mind-boggling quantities, ceaselessly and perfectly, was the chief ingredient of mass culture. Music rapidly adapted to the culture of the copy. Reproductions were made exact, while copies were multiplied vigorously. Music lived in its constant reproduction.The grand upset that music is now experiencing -- the transformation that Napster signaled -- is the shift from analog copies to digital copies. The industrial age was driven by analog copies; analog copies are perfect and cheap. The information age is driven by digital copies; digital copies are perfect, fluid and free.Free is hard to ignore. It propels duplication at a scale that would previously have been unbelievable. In only 10 months, 71million copies of the music-sharing software Morpheus were downloaded. Of course, it's not just music that is being copied freely. It is text, pictures, movies, entire Web sites. In this new online world, anything that can be copied will be copied, free.But the moment something becomes free and ubiquitous, its position in the economic equation is suddenly inverted. When nighttime electrical lighting was new, it was the poor who burned common candles. When electricity became easily accessible and practically free, candles at dinner became a sign of luxury.In this new supersaturated online universe of infinite free digital duplication, the axis of value has flipped. In the industrial age, copies often were more valuable than the original. (Who wanted the ''original'' prototype refrigerator that the one in your kitchen was based on?) Most people wanted a perfect working clone. The more common the clone, the more desirable, since it would then come with a brand name respected by others and a network of service and repair outlets.But now, in a brave new world of abundant and free copies, the order has inverted. Copies are so ubiquitous, so cheap (free, in fact) that the only things truly valuable are those which cannot be copied.What kinds of things can't be copied? Well, for instance: trust, immediacy, personalization. There is no way to download these qualities from existing copies or to install them from a friend's CD. So while you can score a copy free of charge, if you want something authenticated, or immediately, or personalized, you'll have to pay.In the domain of the plentifully free, music will do the only thing it can do: charge for things that can't be copied easily. A friend of a friend may eventually pass on to you the concert recording of a band you like, but if you pay, the band itself will e-mail it to you seconds after the performance. Sure, you can find a copy of that hit dance track, but if you want the mix approved by the legendary D.J., then you'll want to pay for it. Anyone can grab a free copy of Beethoven's Ninth, but if you want it customized for the audio parameters of your room or car, you'll pay for it. You may have downloaded that Cuban-Chinese rock band from the Morpheus site without paying, but the only way to get all that cool meta-information about each track, which lets you search for chords and lyrics, is to establish a relationship with the band by paying.The quality least plentiful in a world of rampant free copies is attention. Each year more than 30,000 new music titles are released (or rereleased) into a very cluttered head space of new movies, new TV shows, new books, new games, new Web sites. No matter what your musical appetite, there are not enough hours in a lifetime to listen to but a tiny fraction of the global supply. People will pay simply to have someone edit the music and recommend and present selected material to them in an easy and fun manner. That is why producers, labels and the related ecology of reviewers, catalogers and guides will continue to make a living: they counter our natural lack of attention for the 10 million albums we can expect to see in another 50 years. In the end, an awful lot of music will be sold in the territory of the free because it will be easier to buy music you really like than to find it for free.Free is overrated as a destiny. It is only the second phase of the three stages of copydom. The first phase -- perfection -- is experienced in both analog and digital. Perfect duplication made the modern world and modern music.The second stage is freeness. Costless duplication made Napster possible and a music revolution thinkable.Yet it is in the third level of digital copy-ness that the real revolution lies. This third power is liquidity, and it will take music beyond Napster.Digital copies are not only perfect and free, they are also fluid. Once music is digitized it becomes a liquid that can be morphed and migrated and flexed and linked. You can filter it, bend it, archive it, rearrange it, remix it, mess with it. And you can do this to music that you write, or music that you listen to, or music that you borrow.At first glance it seems audiences were drawn to online music because of the power of the free, but in reality the rush to online music came from digitized sound's ever-expanding power of liquidity. Once music could swirl around one's life unencumbered, the millions of people who downloaded peer-to-peer file-sharing software suddenly and simultaneously imagined a thousand ways to conjure with music's liquidity. It wasn't only that it was free; it was all the things you could do with it.Once music is digitized, new behaviors emerge. With liquid music you have the power to reorder the sequence of tunes on an album, or among albums. To surgically morph a sound until it is suitable for a new use. To precisely extract from someone else's music a sample of notes to use oneself. To X-ray the guts of music and outline its structure, and then alter it. To substitute new lyrics. To rearrange a piece so that its parts yield a different voice. To re-engineer a piece so that it sounds better on a car woofer. To meld and marry music together into hybrid breeds. To shorten a piece, or to draw it out so that it takes twice as long to play.With digitization, music went from being a noun, to a verb, once again.If this third power of the digital copy were to play out in full, the world would be full of people messing around with sound and music much as they dabble in taking snapshots and shaping Web pages. The typical skepticism toward a scenario of ubiquitous creation and recreation of music is that it is always easier to read than to write, to listen than to play, to see than to make. That is true. Yet 10 years ago, anyone claiming that ordinary people would flock to expensive computers to take time from watching TV in order to create three billion or more Web pages -- well, that person would have been laughed out of the room as idealistic, utopian. People just aren't that creative or willing to take time to create, went the argument. Yet, against all odds, three billion Web pages exist. The growth of the Web is probably the largest creative spell that civilization has witnessed. Music could experience a similarly exuberant, irrational flowering of the amateur spirit.Part of the reason people have been inspired to create text, graphics and action in the digital realm has been the arrival of new tools. Fans of music are already shuffling playlists, remixing tracks, sampling sounds, laying music with automatic drums and other instruments. They are already making music in the way that a camera makes an image -- by starting with what is there and adding a unique view to it. Just as the introduction of the Brownie camera changed photography from an expert's art to a ubiquitous public expression, with the right tools in hand it is not a very long hop from now to a time when everyone makes music in a small, amateur way.Much of the friction about Napster is cast as a question about the future of music. But no matter what happens, the world of the future will have lots of music, listened to by lots of people. The question is not about the future of music but about the future of musicians. The role of the professional musician is in flux. But again, it has always been so.The rules for making a living making music have been remade over and over, from the first drumbeat. Until the 20th century, musicians in Western societies were generally held in contempt, their status approximating that of a vagabond. Even the most successful musicians were mistrusted.Recording technology redeemed the professional musician. The machinery of recording and duplication steadily elevated the role of musicians during this century until many of them now have reached celebrity status and riches. This was a status only a handful of musicians could have dreamed of a few hundred years ago. Mozart never had it so good.The arrival of perfect, free and liquid copies of music means that new economic models of making music will be forced upon musicians. Will the model of the future be to give away copies in order to sell out a performance? Or to rapidly issue new work from the studio faster than it can spread online? Or to release music in such wonderful packaging that it is cheaper to buy it than to copy it? The probable answer: all of the above and more.If there is any lesson that should be taken from the online world, it is that options multiply. I am willing to bet that within the next 10 years a young band will come along that will be primarily and generously supported by a commercial sponsor. The band will write and play whatever music it feels like, but it will grant first option to the sponsor to use the sponsor's materials in commercials. The sponsor gets cool, hip music, and the band gets its stuff heard by millions, and anything the company doesn't use is the company's to pass out, free of charge.Creating music is hard work. Creating music that is widely appreciated and constantly in demand is harder still. It may seem ludicrous to suggest to a working musician that in this new online world, music is becoming a commodity that is traded, cocreated and coproduced by a networked audience. How can an unskilled population create something that will be appreciated by many?The partial answer is that most of us won't. It will still be a rare person who can write and play music that everyone swoons over. Those hit musicians will have their own economics. But most music, like most photography, needn't appeal to everyone. Most photographs taken in the world are taken by amateurs, and the images are of interest only to themselves or their families. Music does not have to be widely popular to be desired.The future of music is unknown. But whatever it is, it will be swayed, as usual, by technology. Carver Mead, a computer-chip pioneer, advises us to ''listen to the technology'' to see where it is headed. If we listen to the technology of music, we might hear these possibilities:* Songs are cheap; what's expensive are the indexable, searchable, official lyrics.* On auction sites, music lovers buy and sell active playlists, which arrange hundreds of songs in creative sequences. The lists are templates that reorder songs on your own disc.* You subscribe to a private record label whose agents troll the bars, filtering out the garbage, and send you the best underground music based on your own preferences.* The most popular band in the world produces only very good ''jingles,'' just as some of the best directors today produce only very good commercials.* The catalog of all musical titles makes more money than any of the record companies.* A generator box breeds background music tailored to your personal tastes; the music is supplied by third-party companies that buy the original songs from the artists.* Because you like to remix dance tunes, you buy the versions of songs that are remix-ready in all 24 tracks.* You'll pay your favorite band to stream you its concert as it is playing it, even though you could wait and copy it at no cost later.* The varieties of musical styles explode. They increase faster than we can name them, so a musical Dewey Decimal System is applied to each work to aid in categorizing it.* For a small fee, the producers of your favorite musician will tweak her performance to exquisitely match the acoustics of your living room.* So many amateur remixed versions of a hit tune are circulating on the Net that it's worth $5 to you to buy an authenticated official version.* For bands that tour, giving away their music becomes a form of cheap advertising. The more free copies that are passed around, the more tickets they sell.* Musicians with the highest status are those who have a 24-hour Net channel devoted to streaming only their music.* Royalty-free stock music (like stock photography), available for any use, takes off with the invention of a great music search engine, which makes it possible to find music ''similar to this music'' in mood, tempo and sound.* The best-selling item for most musicians is the ''whole package deal,'' which contains video clips, liner notes, segregated musical tracks, reviews, ads and artwork -- all stored on a well-designed artifact in limited editions.* Despite the fact that with some effort you can freely download the song you think you want in a format you think will work for your system, most people choose to go to a reliable retailer online and use the retailer's wonderful search tools and expert testimonials to purchase what they want because it is simply easier and a better experience all around.In the end, the future of music is simple: more choices. As the possibilities of music expand, so do our own.
http://www.kk.org/writings/music.php
Technology is changing music. But then again, it always has. The invention of the piano 300 years ago centered Western music on the keyboard. Electricity's arrival in the late 19th century enabled the duplication of performances and, later, the amplification of instruments. With digitization, the pace of upheaval has further accelerated. Digital file-sharing technologies -- Napster and its offspring -- are now undermining the established economics of music. And everything we know about digital technologies suggests that Napster is only the beginning.There is no music made today that has not been shaped by the fact of recording and duplication. In fact, the ability to copy music has been deeply disruptive ever since the invention of the gramophone. When John D. Smoot, an engineer for the European company Odeon, carted primitive recording equipment to the Indonesian archipelago in 1904 to record the gamelan orchestras, local musicians were perplexed. Why copy a performance? The popular local tunes that circulated in their villages had a half-life of a few weeks. Why would anyone want to listen to a stale rendition of an obsolete piece when it was so easy to get fresh music?As phonographs spread throughout the world, they had a surprising effect: folk tunes, which had always been malleable, changing with each performer and in each performance, were transformed by the advent of recording into fixed songs that could be endlessly and exactly repeated. Music became shorter, more melodic and more precise.Early equipment could make recordings that contained no more than four and a half minutes, so musicians truncated old works to fit and created new music abbreviated to adapt to the phonograph. Because the first sound recordings were of unamplified music, recording emphasized the loud sounds of singers and de-emphasized quiet instrumentals. The musicologist Timothy Day notes that once pianists began recording they tried, for the first time, to ''distinguish carefully between every quaver and semiquaver -- eighth note and sixteenth note -- throughout the piece.'' Musicians played the way technology listened. When the legendary recordist Frederick Gaisberg arrived in Calcutta in 1902, only two decades after the phonograph was invented, he found that Indian musicians were already learning to imitate recorded music and lamented that there was ''no traditional music left to record.''As the technologies of reproduction bloomed in the last century, consumerism boomed. What consumers consumed -- whether in the form of a book, a CD or a can of Coke -- were exact copies. The ability to make copies in mind-boggling quantities, ceaselessly and perfectly, was the chief ingredient of mass culture. Music rapidly adapted to the culture of the copy. Reproductions were made exact, while copies were multiplied vigorously. Music lived in its constant reproduction.The grand upset that music is now experiencing -- the transformation that Napster signaled -- is the shift from analog copies to digital copies. The industrial age was driven by analog copies; analog copies are perfect and cheap. The information age is driven by digital copies; digital copies are perfect, fluid and free.Free is hard to ignore. It propels duplication at a scale that would previously have been unbelievable. In only 10 months, 71million copies of the music-sharing software Morpheus were downloaded. Of course, it's not just music that is being copied freely. It is text, pictures, movies, entire Web sites. In this new online world, anything that can be copied will be copied, free.But the moment something becomes free and ubiquitous, its position in the economic equation is suddenly inverted. When nighttime electrical lighting was new, it was the poor who burned common candles. When electricity became easily accessible and practically free, candles at dinner became a sign of luxury.In this new supersaturated online universe of infinite free digital duplication, the axis of value has flipped. In the industrial age, copies often were more valuable than the original. (Who wanted the ''original'' prototype refrigerator that the one in your kitchen was based on?) Most people wanted a perfect working clone. The more common the clone, the more desirable, since it would then come with a brand name respected by others and a network of service and repair outlets.But now, in a brave new world of abundant and free copies, the order has inverted. Copies are so ubiquitous, so cheap (free, in fact) that the only things truly valuable are those which cannot be copied.What kinds of things can't be copied? Well, for instance: trust, immediacy, personalization. There is no way to download these qualities from existing copies or to install them from a friend's CD. So while you can score a copy free of charge, if you want something authenticated, or immediately, or personalized, you'll have to pay.In the domain of the plentifully free, music will do the only thing it can do: charge for things that can't be copied easily. A friend of a friend may eventually pass on to you the concert recording of a band you like, but if you pay, the band itself will e-mail it to you seconds after the performance. Sure, you can find a copy of that hit dance track, but if you want the mix approved by the legendary D.J., then you'll want to pay for it. Anyone can grab a free copy of Beethoven's Ninth, but if you want it customized for the audio parameters of your room or car, you'll pay for it. You may have downloaded that Cuban-Chinese rock band from the Morpheus site without paying, but the only way to get all that cool meta-information about each track, which lets you search for chords and lyrics, is to establish a relationship with the band by paying.The quality least plentiful in a world of rampant free copies is attention. Each year more than 30,000 new music titles are released (or rereleased) into a very cluttered head space of new movies, new TV shows, new books, new games, new Web sites. No matter what your musical appetite, there are not enough hours in a lifetime to listen to but a tiny fraction of the global supply. People will pay simply to have someone edit the music and recommend and present selected material to them in an easy and fun manner. That is why producers, labels and the related ecology of reviewers, catalogers and guides will continue to make a living: they counter our natural lack of attention for the 10 million albums we can expect to see in another 50 years. In the end, an awful lot of music will be sold in the territory of the free because it will be easier to buy music you really like than to find it for free.Free is overrated as a destiny. It is only the second phase of the three stages of copydom. The first phase -- perfection -- is experienced in both analog and digital. Perfect duplication made the modern world and modern music.The second stage is freeness. Costless duplication made Napster possible and a music revolution thinkable.Yet it is in the third level of digital copy-ness that the real revolution lies. This third power is liquidity, and it will take music beyond Napster.Digital copies are not only perfect and free, they are also fluid. Once music is digitized it becomes a liquid that can be morphed and migrated and flexed and linked. You can filter it, bend it, archive it, rearrange it, remix it, mess with it. And you can do this to music that you write, or music that you listen to, or music that you borrow.At first glance it seems audiences were drawn to online music because of the power of the free, but in reality the rush to online music came from digitized sound's ever-expanding power of liquidity. Once music could swirl around one's life unencumbered, the millions of people who downloaded peer-to-peer file-sharing software suddenly and simultaneously imagined a thousand ways to conjure with music's liquidity. It wasn't only that it was free; it was all the things you could do with it.Once music is digitized, new behaviors emerge. With liquid music you have the power to reorder the sequence of tunes on an album, or among albums. To surgically morph a sound until it is suitable for a new use. To precisely extract from someone else's music a sample of notes to use oneself. To X-ray the guts of music and outline its structure, and then alter it. To substitute new lyrics. To rearrange a piece so that its parts yield a different voice. To re-engineer a piece so that it sounds better on a car woofer. To meld and marry music together into hybrid breeds. To shorten a piece, or to draw it out so that it takes twice as long to play.With digitization, music went from being a noun, to a verb, once again.If this third power of the digital copy were to play out in full, the world would be full of people messing around with sound and music much as they dabble in taking snapshots and shaping Web pages. The typical skepticism toward a scenario of ubiquitous creation and recreation of music is that it is always easier to read than to write, to listen than to play, to see than to make. That is true. Yet 10 years ago, anyone claiming that ordinary people would flock to expensive computers to take time from watching TV in order to create three billion or more Web pages -- well, that person would have been laughed out of the room as idealistic, utopian. People just aren't that creative or willing to take time to create, went the argument. Yet, against all odds, three billion Web pages exist. The growth of the Web is probably the largest creative spell that civilization has witnessed. Music could experience a similarly exuberant, irrational flowering of the amateur spirit.Part of the reason people have been inspired to create text, graphics and action in the digital realm has been the arrival of new tools. Fans of music are already shuffling playlists, remixing tracks, sampling sounds, laying music with automatic drums and other instruments. They are already making music in the way that a camera makes an image -- by starting with what is there and adding a unique view to it. Just as the introduction of the Brownie camera changed photography from an expert's art to a ubiquitous public expression, with the right tools in hand it is not a very long hop from now to a time when everyone makes music in a small, amateur way.Much of the friction about Napster is cast as a question about the future of music. But no matter what happens, the world of the future will have lots of music, listened to by lots of people. The question is not about the future of music but about the future of musicians. The role of the professional musician is in flux. But again, it has always been so.The rules for making a living making music have been remade over and over, from the first drumbeat. Until the 20th century, musicians in Western societies were generally held in contempt, their status approximating that of a vagabond. Even the most successful musicians were mistrusted.Recording technology redeemed the professional musician. The machinery of recording and duplication steadily elevated the role of musicians during this century until many of them now have reached celebrity status and riches. This was a status only a handful of musicians could have dreamed of a few hundred years ago. Mozart never had it so good.The arrival of perfect, free and liquid copies of music means that new economic models of making music will be forced upon musicians. Will the model of the future be to give away copies in order to sell out a performance? Or to rapidly issue new work from the studio faster than it can spread online? Or to release music in such wonderful packaging that it is cheaper to buy it than to copy it? The probable answer: all of the above and more.If there is any lesson that should be taken from the online world, it is that options multiply. I am willing to bet that within the next 10 years a young band will come along that will be primarily and generously supported by a commercial sponsor. The band will write and play whatever music it feels like, but it will grant first option to the sponsor to use the sponsor's materials in commercials. The sponsor gets cool, hip music, and the band gets its stuff heard by millions, and anything the company doesn't use is the company's to pass out, free of charge.Creating music is hard work. Creating music that is widely appreciated and constantly in demand is harder still. It may seem ludicrous to suggest to a working musician that in this new online world, music is becoming a commodity that is traded, cocreated and coproduced by a networked audience. How can an unskilled population create something that will be appreciated by many?The partial answer is that most of us won't. It will still be a rare person who can write and play music that everyone swoons over. Those hit musicians will have their own economics. But most music, like most photography, needn't appeal to everyone. Most photographs taken in the world are taken by amateurs, and the images are of interest only to themselves or their families. Music does not have to be widely popular to be desired.The future of music is unknown. But whatever it is, it will be swayed, as usual, by technology. Carver Mead, a computer-chip pioneer, advises us to ''listen to the technology'' to see where it is headed. If we listen to the technology of music, we might hear these possibilities:* Songs are cheap; what's expensive are the indexable, searchable, official lyrics.* On auction sites, music lovers buy and sell active playlists, which arrange hundreds of songs in creative sequences. The lists are templates that reorder songs on your own disc.* You subscribe to a private record label whose agents troll the bars, filtering out the garbage, and send you the best underground music based on your own preferences.* The most popular band in the world produces only very good ''jingles,'' just as some of the best directors today produce only very good commercials.* The catalog of all musical titles makes more money than any of the record companies.* A generator box breeds background music tailored to your personal tastes; the music is supplied by third-party companies that buy the original songs from the artists.* Because you like to remix dance tunes, you buy the versions of songs that are remix-ready in all 24 tracks.* You'll pay your favorite band to stream you its concert as it is playing it, even though you could wait and copy it at no cost later.* The varieties of musical styles explode. They increase faster than we can name them, so a musical Dewey Decimal System is applied to each work to aid in categorizing it.* For a small fee, the producers of your favorite musician will tweak her performance to exquisitely match the acoustics of your living room.* So many amateur remixed versions of a hit tune are circulating on the Net that it's worth $5 to you to buy an authenticated official version.* For bands that tour, giving away their music becomes a form of cheap advertising. The more free copies that are passed around, the more tickets they sell.* Musicians with the highest status are those who have a 24-hour Net channel devoted to streaming only their music.* Royalty-free stock music (like stock photography), available for any use, takes off with the invention of a great music search engine, which makes it possible to find music ''similar to this music'' in mood, tempo and sound.* The best-selling item for most musicians is the ''whole package deal,'' which contains video clips, liner notes, segregated musical tracks, reviews, ads and artwork -- all stored on a well-designed artifact in limited editions.* Despite the fact that with some effort you can freely download the song you think you want in a format you think will work for your system, most people choose to go to a reliable retailer online and use the retailer's wonderful search tools and expert testimonials to purchase what they want because it is simply easier and a better experience all around.In the end, the future of music is simple: more choices. As the possibilities of music expand, so do our own.
http://www.kk.org/writings/music.php
music industry died?
Former president, MCA Records
I think that this is an incredibly vital time in the music industry where the chips are just being reassigned. It's going to just be a different layout.
I think musically, this may end up being an incredibly vital time because of the fact that people are making music for themselves. They're not making it to get a record deal. I mean, I think there was a point where maybe three, four years ago where even on a grassroots level, everything was aiming towards getting a major record deal.
I now talk to many musicians out there who have no interest in a major record label deal. What they have an interest in is trying to make their music. They do want to get paid, they want to find out a way that they can actually make a career of it, but they're much more hands-on. They're much more willing to understand the process themselves of what's involved in doing it and to find out a way of doing it where they're not as dependent on other people.
Now, do I think record companies are going to go away? No, I don't. I think a great value is added by a great record company -- or at least the people at a record [company], because record companies are not entities, it's the people in them. And, you know, what is a record company supposed to do? They're supposed to recognize exceptional talent, they're supposed to help develop that talent -- whether it be their imaging, whether it be introducing them to people who can help them in a recording process or a songwriting process, or in any of the aspects that sort of gets their music ready to be out there and be presented. They're supposed to have relationships to help them market themselves in terms of touring or presentation.
They're supposed to, in many ways, provide a certain amount of financial capital to at least get the ball started and rolling. And it doesn't have to be a lot of capital. In some cases it is, but many examples would have been very modest expenditures.
And then they're supposed to have an expertise of knowing where in the marketplace that particular art that this musician is creating might resonate and be able to target that market to see if it does resonate. And thus then spread it from there and try to pull it into the greater marketplace and the greater population.
Those are skill sets. Those skill sets are still going to be needed. The question is can the artist do some of that, more of that, themselves? Will it be a manager who does more of that themselves? Will there be independent companies that will be doing more of that that used to be done by the majors? Or will the majors adapt and create different types of companies that are staffed differently to provide different services that are more attuned? I think the answer is a little bit of all the above, but it'll be very different.
Manager, Velvet Revolver
My opinion is record labels will become sort of -- I mean they are to some extent venture capitalists, in the way that they invest in a piece of talent. But they only have the rights to derive income from the record sales.
I believe that the future's going to be if a record company invests in breaking in artists -- which a record company does spend time, energy, effort, [in] marketing, promotion, distribution, sales, and numerous other ways to help break an artist -- they're going to want a piece of the publishing, the merchandising, the touring. I mean some of that has started on some level, and that's how it used to be years ago. But I think record companies are going to go that way again.
Or die.
Or die, yeah. I mean I don't think they're going to die in the relative future, and the relative future is the next five or 10 years. Again, it's really complicated, and it's way beyond the scope of what I can say at this moment, but brick and mortar retail sells 99 or 98 percent of all records sold. It's really hard to, quote "overnight" have the people that sell 99 percent of your product go out of business. That doesn't happen overnight. But it happens over time with the Internet, and the sophistication, the technology growing. You know, that's how it works.
Editor-in-Chief, Hits Magazine
[C]an you imagine a world where everybody [has high-speed Internet access]? And you could put up an ad in the newspaper tomorrow that the new Eminem single is available at nine o'clock tonight. Wherever you are in the world, the way you hook up, you can have that song. Can you imagine how many records you would sell? Or how many whatever it is you're going to call it's you're going to sell? How many songs you're going to sell?
But see you're starting about a real revolution. What you're talking about is the idea that the record companies owned by Bertelsmann and water companies in France are no longer marketing and distribution companies because that's probably going to be Apple. What they really are, what you would ask them to be is artist development companies?
There, bingo.
Who would prepare the music to hand it over to Steve Jobs.
Or hand it into the system of distribution. They've always done that. They handed it to Tower Records for the last 30 years, right? But all of a sudden when the digital revolution came, they thought that they could control distribution also. They really thought people were going to buy their music from sony.com. They thought they were going to care about labels, that they would buy Sony music because the Sony site was cool.
Well, the public doesn't care about labels, they care about songs. They either like it or they don't like it. And if they like it they want to buy it at the most easy, accessible instant gratification way, and they can't. They want to buy what they want, and they can't. You hear a great song by the Beatles, and you want to buy that song. You can't buy that song. You have to buy the whole album. And you can't get it quickly, because it's not accessible.
You've got to drive to the store and go to Tower Records and see some kid with 47 piercings on his face and ask him if he has the new Barry Manilow album. And the kid's going to look at you like you're from Mars or something, OK? The system is broken.
But if you could do it and just push a button and get Barry Manilow in your house, or whoever you want, whether it's cool or uncool, whether it's classical or rock or theater music or whatever music -- if you could do that without anybody judging you, and by getting instant gratification, then the system will work again.
But nobody's trying to really fix the system because they're all trying to wring out that corporate profit. Wring it out, squeeze a little bit of profit now instead of really fixing the system.
To fix the system it has to be a revolution, and things have to really change. Well, the guys at the top are trying to make quarterly profits. And Thomas Lee and partners, who just bought Time Warner, they don't want to hear about eating two years of losses to fix the system. "Well what can we do? How many more secretaries can we fire? How many more local promotion guys can we fire? How many more sales guys can we fire, so that we can make a little bit of profit, so that we can turn this thing in three to five, and make money for our investor?" They're not trying to fix the system, they're just trying to wring out the last morsels from the system.
At some point the system's going to change, we all know that. Is it five years? Is it 10 years? Is it 20 years? It's going to change. People are going to get what they want. …
Chairman and CEO, Artemis Records
There's been some experiments of packaging a DVD and a t-shirt and a CD together that have gone pretty well. I think that the thing you're going to see a lot of in the next six to 12 months is a hybrid CD-DVD. Because although DVDs also can be downloaded and copied, it's harder to do so. And on the other hand the technology is there to include a DVD and a CD onto one disc. That the cost of producing visual material has gone down with digital camcorders and digital editing. So I think that's going to be a common product. You're going to see more and more audio/visual products. You know, audio/visual albums.
I think that the one most logical connectivity, which would be between the concert business and the record business, is culturally a very hard connection to make. That's going to take more years, because the touring business has been a completely separate business, with agents and managers involved in that who are not record company people. It's just a different culture and to connect those two businesses is easy on paper but hard in practice.
Reporter, Los Angeles Times
There's a couple of different ways that things could go. On the one hand, there is an upside for the record companies, which is that right now they're spending whatever it is that they're spending to make the video, to make the album, to promote the single at radio stations and so forth. And if they can hold the line and kind of keep CD sales roughly what they are, and they can get some kind of new influx of people through Apple and other services on the Internet, then essentially they've got two income streams from the same recording. Right? They've only spent the money once to make that album and to start promoting it. And now you've got some number of people that are still buying CDs in stores. And now you've got maybe an additional number of people who might not have bought the CD, but who are going to give you money for at least some of that album.
There's a school of thought that says, "This is going to be great, because if we can just hold on to where we are with CDs and gradually build up the digital sales, then we'll have two incomes onto the same report, or off the same expenses.
Yeah, it's also possible that people will be able to say, "Well, if you like this single, then you should buy more of them." But what the Internet allows you to do is sample those things and make up your own mind before you really do. And I'm not so sure that it's always been that easy to do that with CDs. In the last couple of years stores have become better about having listening stations and making it possible for you to try things out before you buy them. And I think that's been a positive thing for the consumers.
So, sure, their hope is that if they can get you to buy one, that you'll want to buy the others. And there are people who admit to downloading music on the Internet who say that they buy more music than they used to because their world has been opened to so much more music. They've been able to try things they never really knew existed. And then they've liked it, and they've bought the album.
But, by the same token, you know there are people out there who just don't buy albums anymore.
http://www.pbs.org/wgbh/pages/frontline/shows/music/inside/future.html
I think that this is an incredibly vital time in the music industry where the chips are just being reassigned. It's going to just be a different layout.
I think musically, this may end up being an incredibly vital time because of the fact that people are making music for themselves. They're not making it to get a record deal. I mean, I think there was a point where maybe three, four years ago where even on a grassroots level, everything was aiming towards getting a major record deal.
I now talk to many musicians out there who have no interest in a major record label deal. What they have an interest in is trying to make their music. They do want to get paid, they want to find out a way that they can actually make a career of it, but they're much more hands-on. They're much more willing to understand the process themselves of what's involved in doing it and to find out a way of doing it where they're not as dependent on other people.
Now, do I think record companies are going to go away? No, I don't. I think a great value is added by a great record company -- or at least the people at a record [company], because record companies are not entities, it's the people in them. And, you know, what is a record company supposed to do? They're supposed to recognize exceptional talent, they're supposed to help develop that talent -- whether it be their imaging, whether it be introducing them to people who can help them in a recording process or a songwriting process, or in any of the aspects that sort of gets their music ready to be out there and be presented. They're supposed to have relationships to help them market themselves in terms of touring or presentation.
They're supposed to, in many ways, provide a certain amount of financial capital to at least get the ball started and rolling. And it doesn't have to be a lot of capital. In some cases it is, but many examples would have been very modest expenditures.
And then they're supposed to have an expertise of knowing where in the marketplace that particular art that this musician is creating might resonate and be able to target that market to see if it does resonate. And thus then spread it from there and try to pull it into the greater marketplace and the greater population.
Those are skill sets. Those skill sets are still going to be needed. The question is can the artist do some of that, more of that, themselves? Will it be a manager who does more of that themselves? Will there be independent companies that will be doing more of that that used to be done by the majors? Or will the majors adapt and create different types of companies that are staffed differently to provide different services that are more attuned? I think the answer is a little bit of all the above, but it'll be very different.
Manager, Velvet Revolver
My opinion is record labels will become sort of -- I mean they are to some extent venture capitalists, in the way that they invest in a piece of talent. But they only have the rights to derive income from the record sales.
I believe that the future's going to be if a record company invests in breaking in artists -- which a record company does spend time, energy, effort, [in] marketing, promotion, distribution, sales, and numerous other ways to help break an artist -- they're going to want a piece of the publishing, the merchandising, the touring. I mean some of that has started on some level, and that's how it used to be years ago. But I think record companies are going to go that way again.
Or die.
Or die, yeah. I mean I don't think they're going to die in the relative future, and the relative future is the next five or 10 years. Again, it's really complicated, and it's way beyond the scope of what I can say at this moment, but brick and mortar retail sells 99 or 98 percent of all records sold. It's really hard to, quote "overnight" have the people that sell 99 percent of your product go out of business. That doesn't happen overnight. But it happens over time with the Internet, and the sophistication, the technology growing. You know, that's how it works.
Editor-in-Chief, Hits Magazine
[C]an you imagine a world where everybody [has high-speed Internet access]? And you could put up an ad in the newspaper tomorrow that the new Eminem single is available at nine o'clock tonight. Wherever you are in the world, the way you hook up, you can have that song. Can you imagine how many records you would sell? Or how many whatever it is you're going to call it's you're going to sell? How many songs you're going to sell?
But see you're starting about a real revolution. What you're talking about is the idea that the record companies owned by Bertelsmann and water companies in France are no longer marketing and distribution companies because that's probably going to be Apple. What they really are, what you would ask them to be is artist development companies?
There, bingo.
Who would prepare the music to hand it over to Steve Jobs.
Or hand it into the system of distribution. They've always done that. They handed it to Tower Records for the last 30 years, right? But all of a sudden when the digital revolution came, they thought that they could control distribution also. They really thought people were going to buy their music from sony.com. They thought they were going to care about labels, that they would buy Sony music because the Sony site was cool.
Well, the public doesn't care about labels, they care about songs. They either like it or they don't like it. And if they like it they want to buy it at the most easy, accessible instant gratification way, and they can't. They want to buy what they want, and they can't. You hear a great song by the Beatles, and you want to buy that song. You can't buy that song. You have to buy the whole album. And you can't get it quickly, because it's not accessible.
You've got to drive to the store and go to Tower Records and see some kid with 47 piercings on his face and ask him if he has the new Barry Manilow album. And the kid's going to look at you like you're from Mars or something, OK? The system is broken.
But if you could do it and just push a button and get Barry Manilow in your house, or whoever you want, whether it's cool or uncool, whether it's classical or rock or theater music or whatever music -- if you could do that without anybody judging you, and by getting instant gratification, then the system will work again.
But nobody's trying to really fix the system because they're all trying to wring out that corporate profit. Wring it out, squeeze a little bit of profit now instead of really fixing the system.
To fix the system it has to be a revolution, and things have to really change. Well, the guys at the top are trying to make quarterly profits. And Thomas Lee and partners, who just bought Time Warner, they don't want to hear about eating two years of losses to fix the system. "Well what can we do? How many more secretaries can we fire? How many more local promotion guys can we fire? How many more sales guys can we fire, so that we can make a little bit of profit, so that we can turn this thing in three to five, and make money for our investor?" They're not trying to fix the system, they're just trying to wring out the last morsels from the system.
At some point the system's going to change, we all know that. Is it five years? Is it 10 years? Is it 20 years? It's going to change. People are going to get what they want. …
Chairman and CEO, Artemis Records
There's been some experiments of packaging a DVD and a t-shirt and a CD together that have gone pretty well. I think that the thing you're going to see a lot of in the next six to 12 months is a hybrid CD-DVD. Because although DVDs also can be downloaded and copied, it's harder to do so. And on the other hand the technology is there to include a DVD and a CD onto one disc. That the cost of producing visual material has gone down with digital camcorders and digital editing. So I think that's going to be a common product. You're going to see more and more audio/visual products. You know, audio/visual albums.
I think that the one most logical connectivity, which would be between the concert business and the record business, is culturally a very hard connection to make. That's going to take more years, because the touring business has been a completely separate business, with agents and managers involved in that who are not record company people. It's just a different culture and to connect those two businesses is easy on paper but hard in practice.
Reporter, Los Angeles Times
There's a couple of different ways that things could go. On the one hand, there is an upside for the record companies, which is that right now they're spending whatever it is that they're spending to make the video, to make the album, to promote the single at radio stations and so forth. And if they can hold the line and kind of keep CD sales roughly what they are, and they can get some kind of new influx of people through Apple and other services on the Internet, then essentially they've got two income streams from the same recording. Right? They've only spent the money once to make that album and to start promoting it. And now you've got some number of people that are still buying CDs in stores. And now you've got maybe an additional number of people who might not have bought the CD, but who are going to give you money for at least some of that album.
There's a school of thought that says, "This is going to be great, because if we can just hold on to where we are with CDs and gradually build up the digital sales, then we'll have two incomes onto the same report, or off the same expenses.
Yeah, it's also possible that people will be able to say, "Well, if you like this single, then you should buy more of them." But what the Internet allows you to do is sample those things and make up your own mind before you really do. And I'm not so sure that it's always been that easy to do that with CDs. In the last couple of years stores have become better about having listening stations and making it possible for you to try things out before you buy them. And I think that's been a positive thing for the consumers.
So, sure, their hope is that if they can get you to buy one, that you'll want to buy the others. And there are people who admit to downloading music on the Internet who say that they buy more music than they used to because their world has been opened to so much more music. They've been able to try things they never really knew existed. And then they've liked it, and they've bought the album.
But, by the same token, you know there are people out there who just don't buy albums anymore.
http://www.pbs.org/wgbh/pages/frontline/shows/music/inside/future.html
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