Comprehensive guide to a flat rate model for music
Author, speaker and Media Futurist Gerd Leonard has a pretty comprehensive round-up of flat-rate models for music in preparation for his session at Midemnet 2009.
It includes Google in China, Orange, TDC, Nokia, Sony-Ericsson, T-Mobile, Netcom, STIM, and possibly Warner Music Group.
He also links back to his excellent post and presentation on The Future Revenues for Content Creators: Attention Revenues Up, Copy Revenues Down.
Both posts are essential reading!
Zavvi go pop
The Daily Mail writes:
“Zavvi, formerly the Virgin Megastore chain, called in administrators Ernst & Young after it was crippled by the collapse of Woolworths’ Entertainment UK wholesale division.”
Read the full article here.
It won’t stop there…..more to follow. Literally.
Warner cuts of its own nose, then shoots both feet…
So Warner Music has ordered Youtube to pull all of it’s videos from Youtube in a dispute over royalties, stating:
“We simply cannot accept terms that fail to appropriately and fairly compensate recording artists, songwriters, labels and publishers for the value they provide.” (via Brand Republic)
Ignore, for the moment, the fact that by pulling all their videos, they’ve almost invited Google to pull all their search results (Sometimes it’s a real shame the company claims to ‘do no evil’)
Ironically just four hours later Universal Music was featured on Cnet as making ‘tens of millions of dollars from Youtube’, according to Executive VP, Rio Caraeff:
“(YouTube) is not like radio, where it’s just promotional,” said Caraeff, who heads up Universal’s digital group. “It’s a revenue stream, a commercial business. It’s growing tremendously. It’s up almost 80 percent for us year-over-year in the U.S. in terms of our revenue from this category.”
“Certainly, in the last year the rise of free to consumer ad-supported video has become a very significant part of our business coming from a variety of areas,” Caraeff said. “YouTube is driving a very large quantity of that… We have a great relationship with YouTube, and the future for us will be more than with YouTube than we’re doing today.
“We’re working with them on a variety of new concepts and new businesses to take the groundwork we’ve done in the last year and half and do a lot more with it,” he added. “I wouldn’t expect to see us just do business with YouTube like we used to do.”
The estimate from a ‘music industry source’ is almost $100 million from music streaming across the web.
And then Stan Schroeder eloquently sums up on Mashable why a rumoured Hulu-type video portal for Sony BMG, EMI, Universal Musica Group and Warner would be a monumental wast of time and effort.
The drum beat you hear is that of consumers who want to be able to enjoy, spread, love, talk about, share, promote, remember, and most of all, buy into the event and joy of music, hitting their heads repeatedly on their keyboards, laptops, MP3 players and Smartphones.
Major labels sign up to charge students for music in tuition fees
Tuition fees for U.S. universities could include a small music-royalty free in a model proposed by digital music strategist on behalf of the Warner Music Group (via Wired)
ISPs would collect the micropayments, which would then be given out to copyright holders by an independant non-profit organisation called Choruss. Only Universal is yet to sign up from the four major labels, and the offer is being shopped around U.S universities including Cornell, Columbia and the University of Chicago.
Here’s the interesting bit in the words of Wired:
In return for a university paying fees to Choruss, its students would be able to continue downloading as they have been — bit torrent, Limewire and so on — without fear of legal reprisal. Unlike previous plans that require the use of onerous digital rights management, this one would allow students to download music in the unprotected formats they prefer, using the hardware, software and networks of their choice.
Could this be the long-awaited innovation in the face of extinction? It’s an interesting proposition, and one which presumably accepts DRM-free files will be shared, traded, uploaded etc. And will probably end up in the hands on non-students, who won’t have ever paid any fees?
If so, I’ll be stunned.
I await the first time it launches, and the discovery within a week of some kind of tracking or limitation. If it does turn out to be true, it does prove that anyone can change if they’re heading for a big enough disaster. Repent, ye industry sinners.
(There’s also the small flaw of those students and families complaining that fees intended to pay for an education are now being diverted to an entertainment industry, and the rush of film and media companies to include their own fees.
Plus complaints by those who don’t intend to download any music and resent paying for others.
Plus the eternal question of why on earth music labels deserve to take any of the money in the first place – because in this model, they don’t actually do anything?
Look again:
1. Universities charge students.
2. ISPs collect payment.
3. Organisation collects electronic data and distributes it to copyright holders (Surely the musicians and artists who created the work).
Exactly where in this 3 step plan do we have a need for record companies? Give the non-profit organisation the ability to enforce copyright if a musician wants to, and that’s the music labels gone.
Analysts say mobile music ‘must be free’
A report by analysts Screen Digest (Found via PaidContent:UK) claims that mobile music sales will reach 3.2 billion Euros by 2012.
But the report also claims full music tracks will only make half of that figure, with ringtones and other items contributing half. And the author of the report, Christine Binns goes on to say:
“Paying for music is progressively becoming a niche activity as the value of recorded music is already in steep, possibly terminal, decline. Bundled music attempts to tackle this problem head-on, providing a way for every player in the value chain to benefit. Even offering music for ‘free’ at point of delivery is not going to be enough to ensure uptake of the service – the customer experience and handset design have to be right if mobile music services are to become lasting propositions.”
Mobile music subscriptions are predicted to hit £721 million in 2012, almost double the £408 million predicted for full individual tracks. And the report goes on to say that it’s almost impossible to compete with iTunes.
See here for the full report: Mobile music: It’s got to be free.
Now might be a good time for the music industry to start panicking. Not only do you have to give away your music for nothing – but even that might not force people to listen!
We believe
1. Music will always continue, but the parasitical 20th Century music industry is dead.
2. Music does not rely on technology or distribution. It simply requires people. It did not begin with vinyl, the CD, the electric guitar or the synthesizer.
3. If piracy is able to damage your ivory castles, you should seek to understand it and learn from it. Piracy is the most effective distribution.
4. You will never win the war on privacy, because the pirates have a belief, and you are protecting a business.
5. People will only pay for what they want to pay for. Get used to it.
6. Artists and fanatics run the show – if you are in neither camp you’re fucked.
7. DRM’s only function is to limit the spread of music and to irritate the very people you should be pleasing – your audience.
8. I’ve paid for the tape, the vinyl, the CD and the MP3 – if I ever pay again, I’ll pay for the rights to the content in whatever format is appropriate for the rest of my lifetime, not for something limited to one format.
9. Let’s face it..artists can make more money if middle-men are not involved
10. Look – we all know you’re pissed about you’re expense bill no longer being approved but please stop taking it out on the rest of us
11. The people of the world want to share what they love. If you stand in the way there is only one outcome. Rebellion
12. People embrace what they create. We all want to take part. It’s no longer your industry, its ours. Sure that hurts…
13. Just become a concert promoter. Live music will never end. Rip-off, insular and selfish business models already have. Sorry
14. People will pay for what they want to. If you create something of value to people, people will pay for it
15. People will not longer automatically pay for something that YOU think is valuable
16. Resistance is futile. However powerful your connections are, the people of the world will find a way around it
17. Every time you sue, you nail an even heavier nail in your OWN coffin. Think about it…
18. The people of the world love music as much as they always have – not less – its just they have seen behind the curtain now
19. Artists love fans and will get paid by them for products and services the fans adore. Get out the way and let it happen
20. Copyright is a byproduct of the business model for content creation and distribution. It’s not the reason for content creation
21. The case studies of artists making more money from not using your regime will never stop – only increase. Listen up
22. It makes no difference how connected you are to the government. Artists and fans out-number you and always will
23. All the time you spend wining about protecting music you could spend working out ways to help the new world mature
24. If you really wanna get rich, concentrate on facilitating fanatical advocacy. There is no ceiling of value to that
25. People can only truly be of financial benefit to you if they are free. Confined humans have no long-term monetary benefit