The Music Industry and The Pandemic

[A friend asked for my thoughts on this Esquire article about how "Coronavirus Might Kill The Music Industry."]

The problems described in the article were all making life difficult for musicians long before CoVID-19. The pandemic is doing the same thing to the music business as every other industry: choking off cash for an extended period of time, with resulting economic asphyxiation at multiple levels.

Live music was under threat from rising rents and what is referred to as "gentrification" plus a general loss of interest in music from the average person well before the pandemic. The current situation is just putting extra pressure on things, as it is for every struggling business.

Like restaurants, a bunch of venues will go out of business. A bunch of them were on the verge anyhow. Like a forest after a fire, you'll get a few starting to grow back in a few years. It won't be the same, but life never is.

Are we really going to start arguing that streaming services are bad? They're the only growth the music industry has had after decades of economic nose-dive. People aren't going to go back to buying vinyl or CDs or (god forbid) downloads. That's over.

When did the music industry ever "work for everyone?" The "golden age" of the 1970s and early 1980s, where a handful of payola-fueled artists locked down segregated and limited radio stations? It was very much winner-take-all in those days, and independents had no way to get any real exposure or distribution. And there were no other real outlets for media and culture. No internet. No video games. No DVDs (barely VCRs, and movies on tape cost the equivalent of about $250 of today's dollars).

More music is being made now than ever before in human history, and more is available to everyone to listen to.

Economically speaking, it's not a surprise that recorded music has little value anymore. A decade-plus of piracy (late 90s-early 00s) and limp and hostile industry response meant an entire generation grew up with the expectation that music was (or should be) free.

The fact that artists have been complaining about it all for ~20 years doesn't help. If the MAKERS of the music are constantly saying "It sounds like shit, it's not worth paying for, it's a rip-off, and I don't make any money from it anyhow," (refrains for CDs, downloads, AND streaming) what makes anyone think the average person will say "ooh, yeah, I'm going to spend money on THAT!"

In 2020, there's an endless supply of free recorded music. Pick whatever service you want, you can probably find what you want to hear or something close enough for $0.

Thanks to the democratization of recording, recorded music isn't special. People can (and do) make records on their phones or computers now. The number of new recordings has gone up to an astounding number. Granted, most of them are terrible, but few people care about the "quality" of the music.

Music has also become less of a cultural force than it used to be. I don't mean for music fans (like us), I mean for the average person. The 80% of the public that really just doesn't care that much anymore. They used to buy a couple albums a year, maybe, and that was the margin that kept the business going. Now, that money goes to Netflix or Disney+ or video games or phone apps or paying for broadband.

You can see this reflected in most people's homes. They don't have stereos anymore. Not even boomboxes. Maybe they have a "smart speaker" they sometimes use for listening to music. They definitely don't have a CD player or turntable. (Again, not talking about the handful of fans. I'm talking about everyone else, the majority.)

The ocean of music out there means people also don't have to have their tastes challenged or new stuff cycled in and out periodically. FM and AM radio are wastelands, good for polarized talk radio and little else. In your car, you're listening to SiriusXM or your phone. Alexa and Siri play what you expect or ask them to.

If you're exposed to new music, it's likely because the artist made a clever or shocking video, which people watch 30-60 seconds of on social media, either with the sound off or hissing out of their tinny, tiny phone speaker. Or because they did something outrageous and you read about it and wondered what they sounded like.

When you have massive supply of a good and the same (or declining) demand for that good, the price of that good drops.

As for streaming service payouts...really, this again?

Briefly: If artists have bad deals with their labels, it's the artist's problem. Services make deals with the owners of the recording and publishing copyrights. Streaming services already pay so much off the top they can barely survive.

Look at the graveyard of services past and compare them to what you've got now. There's exactly ZERO difference between, say, RDIO and Apple or Spotify. Practically the same interface design, same business model, same features. Marginal differences, more music.

The majority of the public thinks music streaming is too expensive, which is why there's only one semi-independent player left standing at this point (Spotify, who is partially owned by the labels and titans like Tencent.) and the other streaming services are arms of major tech titans who can afford to take losses on music as part of a larger digital media or device ecosystem strategy.

That's right: losses. Nobody is really making lots of money off of streaming services. Even Spotify is aggressively moving into podcasts because those cost so much less for them to provide.

It is a winner-take-all world in streaming, but it's always been that way in the music business. We hoped that streaming would make things slightly better by giving everyone a platform; it ended up making it slightly worse due to the overwhelming flood of music (and industry incentives to promote certain artists over others, and people's inherent laziness in curating their own media universe, which is completely understandable and predictable for non-music fans).

All physical media has taken a big hit -- books, DVDs/Blu-Rays, etc. Again, look at people's houses. No CD player, why should they buy CDs? CDs were a bad deal for most people anyhow, with the average CD being played fewer than 10 times after purchase.

One thing to keep in mind is this: People, fans, listeners seem to have no problem paying for one or more expensive video streaming services -- Netflix, Hulu, Amazon Prime, HBO, Disney. Each of those costs around $10 per month to provide a narrow slice of "content".

Ask the same people to throw down $10 a month for all the music in the world, and they hem and haw and go to YouTube and listen for free, or ask their smart speaker to play something and suffer through ads.

Why? I go back to "music doesn't matter that much anymore".

The live music business has been broken for a long time before this. Classical and jazz ensembles and institutions have had to beg rich people for money for decades. They are museums for the wealthy, and their repertoire and business models reflect and cater to that demographic reality.

The average person just doesn't attend those performances. Maybe for a date, once. And sales are embarrassingly small numbers.

Live pop music also has plenty of problems. It's too late, it's too loud, it's too long, it's too expensive.

Big shows are spectacles, and if you're a major act touring without video walls and dancers, you're probably doing it wrong. P.S. People don't care about backing tracks anymore. The aging rockers can tour their albums to their aging fans, but that is literally a dying art. Younger bands have to focus on
"the show" more than "the music" to attract attention.

Festivals are great if you're someone who likes festivals. Personally, I can't stand them. But like Marvel movies, ultimately the festival's star is the FESTIVAL, not the bands on the bill.

Independent bands in clubs can be thrilling experience, but are most often boring and simply not worth it. Smaller venues have been suffering from rising rents and changing urban values for some time. Again, some of this is simply because most people don't care that much about music.

Put another way, if you ran a restaurant, would you only serve food from 9 - midnight (the sign said 8, but you made people wait around for another hour before your actually opened the kitchen)? Would you make the food so hot that it burned people's mouths unless they took precautions? I could go on, but you get the idea.

Even if you do care about music, is it really fun to stand around at 11:30 on a Wednesday night having your ears blown off by a bunch of amateurs? Sometimes. Maybe.

Personally, I can't stand live-streamed concerts. It's like the worst of both recorded music and live music, with little of the good bits. I can't imagine that anyone is really sitting through an hour of that.

It is also worth noting that nearly every other media vertical is suffering. Cinema/film/movies are taking a big hit for many of the same reasons as music. The future there is shaky indies, mediocre streaming-service series, and soulless Disney/China behemoths, streamed to your phones.

Nobody cares about books, either. If you want to see some scary numbers, read some articles about how many units "best-selling" authors move, and how little money they pull in.

All that said, MUSIC is going to be just fine. Because real artists don't do it for the money, they do it because they WANT to, or because they HAVE to. It is a difficult life choice, as it has always been.

Anyone who chose to go into music for the money, as a business, is also in for a tough time, but I'd argue there is no business that isn't suffering right now, and/or that isn't tough in the 21st century. Maybe banking.

[For context, I've been playing music since I was single-digit years old, was a professional musician for most of the 90s, and helped invent and launch the music subscription business. I'm also old and a little jaded about all this.]

Spotify, Steam, and YouTube: Curation Failure

It is 2018, and the world seems to be moving backwards in terms of speech. Despite, or perhaps because of, a continuing coarsening and dumbing-down of the culture, people seem more likely than ever to take offense at language, media, and even behavior that either would have been unremarkable a few years earlier or seems allowed or uncontroversial in other contexts.

The consequences for saying the wrong thing? Economic exile. You lose your job, and may not be able to get another one. There are countless examples, from Roseanne Barr's recent horrific Twitter eruption to Samantha Bee's vulgarity to your Facebook feed being filled with people demanding that posters or people in videos be identified so their employers can be pressured into firing them.

We seem to want speech (if not thought) to be aligned with a kind of corporate mindset, Get in formation. Say the right things (silence is complicity). Non-compliance is not tolerated. 

It is not surprising then, that media companies are rushing to check themselves before the searchlight and Internet Outrage Cannon is trained on them.

Spotify: Having it both ways

Spotify floated a trial of policies around "hateful content" and "hateful conduct". It quickly walked it back after strong objections and threats of content takedowns from artists.

Spotify had stated they would remove, or at least not promote, music that...

expressly and principally promotes, advocates, or incites hatred or violence against a group or individual based on characteristics, including, race, religion, gender identity, sex, ethnicity, nationality, sexual orientation, veteran status, or disability.

I have to assume Spotify's intent was to have a way to kick things like Nazi punk (an actual genre) or ISIS-core (hopefully not an actual genre) off the platform. But Spotify is a global company, and is trying to keep all the world's music up on its service. It has over 50 million songs in its database, and exercises no editorial control over submitted content. 

And unfortunately for Spotify, there's a lot of music that could fall under their stated policy. Hip-hop -- one of Spotify's most popular genres -- has a number of acts (especially some of the older stuff) who have lyrics that are anti-gay, anti-Semitic, and/or endorse violence against women. There are plenty of rock acts, too. 

Spotify went a step further. They said they'd even block or at least refuse to promote (non-offensive) content from people who had behaved badly -- so-called "hateful conduct". Their test case here was R. Kelly. Presumably they were trying to give themselves a way to pull down content by whoever is currently screwing up so that Spotify could avoid any kind of boycott.

But this policy also quickly becomes difficult to operate with any precision. Is Spotify going to decide what crimes merit banishment? Any crime? Felonies only, or misdemeanors? What about things that are crimes in one country but not another? What about content that was made well before the act did anything objectionable? (a good example here would be Bill Cosby, whose early comedy albums are squeaky-clean and considered landmark comedic works). What about allegations, rather than convictions?

It's worth noting that R. Kelly has never been convicted of any crime. In fact, he was tried and found not guilty, so as far as the government is concerned, he's clean. 

Or what about content where some of the people have done something wrong, but others have not (like producer Dr. Luke and Kesha). Dr. Luke has not been found guilty of anything, with some lawsuits dismissed and others in progress. But apparently that doesn't matter. Even if you personally had a good experience with him and say so, you and anyone associated with you might get into trouble. Do you pull down the records he did with Kesha? Doesn't that hurt her more than him?

There are plenty of artists who have confessed to or endorsed all sorts of bad conduct in interviews. They have boasted about treating women poorly. Frequently abused drugs and alcohol. Driven faster than the speed limit. Driven while intoxicated, and/or killed people in drunk driving accidents. Committed crimes ranging from selling drugs to gun violence to murder. And if you want to include artists who have just been accused of bad behavior, well, that list gets long fast.

Spotify is also trying to have it both ways with their half-step of "well, we won't take the content out of Spotify, but we will refuse to promote it on the homepage or in our editorial playlists". Really, Spotify? So you feel bad about it, but not so bad that people shouldn't be able to get it? That seems like a rather weak approach, calculated for some marketing value only.

Let's be clear: if you think the content is objectionable, either due to what the content promotes or the alleged actions of the creators, why would you make it available at all? By doing so, you are putting money in the creators' pockets, and (at least by the logic of our current era) thereby endorsing this behavior. You are complicit. You are aiding and abetting.

At least Spotify is trying to exercise responsibility for what they offer, albeit in a clumsy and conflicted way.

Steam: Caveat emptor

Steam, the iTunes Music Store of video games, similarly ratcheted up a policy of "no pornography" to include material it had not previously covered, and then apparently, backed off, before creeping back to cover some of it again. Or not. It is hard to tell, and the inconsistency is part of the problem (the blurry guidelines are the other).

In Steam's case, they ran into a bunch of complaints from the LGBTQ gamer community, who claimed the material in question (so-called "visual novels") were important to them, as a safe space to explore their issues, as well as being the genre and medium that catered to them.

Steam's hand-wringing seemed particularly hypocritical in that they targeted sexual content, and yet have zero problems with the casual, extreme, graphic violence that is commonplace among many video games.

Then, Steam threw in the towel. After analyzing the problem, they have simply decided that, rather than curate what is sold in their store, they'd rather just "enable" developers to have the freedom to put out anything, as long as it is not, in Valve's opinion (emphasis added) "illegal or straight up trolling".

Let us ignore the unfortunate use of ambiguous slang for the moment (one wonders if "trolling on the down low" would be OK, or if we have a mutually agreed-upon definition of "trolling" that navigates parody, commentary, and so forth). Let us also ignore Valve's ability to judge whether or not something is "illegal".

The real disappointment here is that the world's biggest game store (and potentially, soon, the biggest software store) doesn't care what it is selling, as long as you are buying. They have abdicated any responsibility for what is in the store, leaving themselves a flimsy back door to dump content when there is a PR incident.

They do not have to spend any time or money looking at their own merchandise. They can dodge blame (just like the gun industry) and say "Hey, we didn't make it, we just sell it. It may or may not reflect our 'values'. Don't buy it if you don't want it."

It seems only a matter of time before this blows up in their faces. But more importantly, it suggests that they feel their massive market dominance as a platform carries with it no responsibility whatsoever. Or perhaps, worse, they feel their influence obliges them to do nothing in the name of "freedom" for creators. So they provide a means for people to monetize hateful, sloppy garbage. Caveat emptor.

Fortunately, the gaming press seems to think Valve is making a bad call here.

YouTube: A monster machine

Steam's situation leads one to reflect that perhaps we should not be offering a megaphone and platform for anyone and everyone. YouTube all but confirms it.

YouTube has been wrestling with issues similar to Steam. YouTube has always taken a view that it is at its best when exercising zero editorial control over what people are posting. So it doesn't. No human being looks at the content being submitted, other than the submitter. There are some rudimentary tests, but not for anything like "values", it's simply to make sure that whatever horrible video being posted doesn't infringe the copyrights of the big media players. There's your "values".

So people go to work, and quickly learn that the best content is the "worst" content. Things that are deliberately shocking, outrageous, and not the kind of thing you would find on any 20th century "network". Due to the nature of internet platforms and our own human nature, we have ended up with "creators" like Logan Paul and Lil Tay. Perhaps Penny Arcade said it best:

They made a kind of monster machine, with every possible lever thrown towards a caustic narcissism, and then they pretend to be fucking surprised when an unbroken stream of monsters emerge.

YouTube has allowed people to blast their most awful "thoughts" and actions worldwide, and have them preserved forever. Great job, gang. You made the world a little or a lot more terrible, and you are making money from it. (And that is to say nothing of the endless stream of copyright violations that also fund YouTube's business).

Perhaps unsurprisingly, there is some pushback. A recent example is that just last week, London police have asked YouTube to take down some music videos, because the police feel they are glorifying or encouraging knife crimes. While there might not be any evidence the videos are contributing to knife crime per se, it is obvious they are amplifying the culture in which it thrives, and that at least some of the crimes have been inspired by, if not predicted by, the communications happening in the videos.

I am a big supporter of freedom in the arts. But it seems hard to defend "art" where the singer says (roughly) "Tom, that's my friend Jimmy in the back and he's going to stab you until you are dead", and then Tom is found dead from stabbing and Jimmy is found holding a bloody knife and says "yeah, I stabbed Tom until he was dead."

That seems more like terrorism, and not all that different from Al Qaeda or ISIS ranting about killing non-believers. (It doesn't help that the music is really uninteresting).

Like Steam, while simulated violence is totally fine for YouTube, anything approaching simulated sex is not. I guess you have to pay for HBO or Cinemax (if you want it fancy and artistic) or just go looking on Tumblr or PornTube (if you want it free and real).

Unlike Steam and Spotify, YouTube has never indicated it would try to police any of its content, and is only reluctantly doing so in the face of legal pressure. And for the first time, YouTube is also facing challenges to the "safe harbor" laws that allow it to ignore the content it hosts.

Minding The Store

Prior to the internet's creation of stores with infinite shelf space, people who sold physical goods had to make choices about what to carry. Every item in the store occupied space that something else could be using. Stores chose based on what would sell or attract people to the store. They also made choices about what kind of institution they wanted to be, and what kind of customers they wanted to have.

Jeff Bezos famously remarked that his biggest mistake was branding early Amazon as "The World's Biggest Bookstore" instead of "The World's BEST Bookstore". He felt the promise of having every book was an expensive distraction, especially when very few books account for the majority of sales. It is the same in every other media vertical.

Perhaps the solution is for the internet's virtual vendors to shoulder some more responsibility and actually choose what goes up. Maybe the world doesn't need every single song, game, or video available in the biggest stores. Niche tastes can look in niche places. It is not difficult to find things on the internet. All that extra junk is not really driving revenue for any of these businesses, and it seems like it just adds risk and gives voice and legitimacy to some questionable ideas.

Us

Of course, all of this willful ignorance and amplification of idiocy for profit says something about the platforms like Spotify, Steam, and YouTube. But it says worse things about us. Because we are the people filling our brains, hearts, and souls with this "content".

The impulse to limit what content or media people can consume has been around for a long time, frequently driven by concerns about the negative influence of the content and/or media on youth. If you can think of a medium, it has likely been accused of corrupting youth: The internet. Video games. Television. Role-playing games like "Dungeons and Dragons". Movies (usually the kind with sex, but occasionally the kind with violence). Radio. Rock music/hip-hop/jazz. Comic books. Novels (I am not kidding). Probably Greek drama and cave paintings.

On the one hand, a whole bunch of research has shown media consumption has, at most, minimal effect on people's behaviors (and there's a lot of uncertainty about whether consuming violent media makes people more violent, or if people with high tendencies towards violence prefer more violent media).

But we also know "you are what you eat", and speak frequently about how media "changed our lives". It is sometimes intended as a joke, sometimes as hyperbole. But still.

Does consumption of media, of art, have no effect at all on us? If it does have no effect, well, sorry, artists. You've been wasting your time. But if it does have an effect, even small and/or temporary, the implications seem obvious.

It would mean the entire production chain -- artists, businesspeople, distributors, etc. -- have a responsibility to think about what they are putting out there, wrap it in warnings, and make sure it is only consumed by those of appropriate age.

It would also mean that we, as individuals and media consumers, have a responsibility to think about what we put in our heads.

Free Trials

The Trials of Free

The digital music business controversy of the moment is centered around free trials. Specifically, some people are expressing outrage over Apple Music's desire to not pay artists (or any content owners) for the 90-day free trials users receive.

That is to say while users may get to play all the music they wish during the first 90 days, Apple doesn't have to pay the artists or composers or labels or publishers anything. Then again, Apple doesn't make any money either. Some artists and composers think this is unfair.

This "don't pay for free trials" has been standard practice in the digital music business for nearly the entire time it's been operational. There may be controversy here, but this is not a new or unique practice, and Apple's not the only one who's doing this. Every subscription service is doing it, and most have been doing it for years.

This issue is getting blown way out of proportion, largely because Apple is somehow involved. I am disappointed but no longer surprised that neither the traditional press nor the digital music/media "press" knew about or included these points in their stories.

Jimmy Iovine, king of Apple Music and current outrage target

My more cynical side thinks this current outrage is a ploy to change these industry-wide deal terms by publicly embarrassing Apple and getting a critical mass of consumers to say "yeah, hey, that doesn't seem fair!" This is unlikely to succeed.

More importantly, the folks agitating for Apple and others to pay during these free trials are misguided, unless their objective is to make all the subscription services fail and shut down. (Which it may be, and that is also unwise, but that is a post for another day).

WTF Is This?

Getting people to sign up and understand subscription services has proven difficult since the industry's inception. The industry has tried a few things: unlimited free :30 clips, limited numbers of complete plays monthly (i.e. free 25 plays per month), guaranteed satisfaction or your money back, and so on.

When they tried :30 clips, users were confused. Who would pay for :30 clips? So they tried limited numbers of complete plays, and users were so worried about using their plays they failed to play anything, and didn't use the services. Users were reluctant to start a billing process knowing how difficult and tricky it could be to get un-billed.

Giving away the service for free is pretty lazy, but it seemed to work better than the other options. Even the beloved Netflix has a 1-month free trial.

Curtailing the free trial would almost certainly cause subscriber acquisition to plummet for all services.

Yes, it is true that with free trials, you do get a ton of "freeloaders" who have no intention of subscribing, and who try to bounce from one free month to another. But you also get users who want to understand the size of the catalog, or hear the sound quality, or test the user interface out.

Free trials are better than nothing. And given the extremely high costs of content the artists, composers, labels, and publishers charge, it is the only way to make customer acquisition work.

Broke Before You Start

Some quick math: Typically services have to pay $8 to the content owners every month, taking it out of a $10 total fee. If the services had to pay for the first free month, it would take them 4 months of billing just to recoup that $8 of customer acquisition cost.

That's not realistic for several reasons. One is that most subscribers don't stay that long (citing the high cost -- the $10 price -- as a key reason for leaving!). Another is that acquisition costs don't consist of just the $8 for a single month of free use. They include advertising, promotion, marketing, and all the other things that go to getting that message in front of customers.

It is also conceptually similar to the practice of "free goods", whereby ye olde record companies would allocate some percentage of the albums shipped to record stores as "free", either to cover against damage in transit (yeah, right) or for the generic "promotion". Everybody in the industry knew the stores sold all of these copies and pocketed the additional revenue (while the artist got nothing).

As per usual, the digital world is still better -- you have perfect accounting, ways to adjust the amount of free plays, and no cut-out bins (and associated shady practices).

Laziness and Responsibility

The digital music business and the various players, past and present (including Rhapsody, Spotify, etc.) are not without fault here, either, however.

There's been scant innovation in the customer acquisition department. The on-boarding and first-run experience for these complex services remains poor, with brand-new users lucky to get a sub-smartphone welcome screen explaining what to do and why.

The services generally understand some users will have a kind of epiphany, see the value of the service, and stay subscribed almost indefinitely...but they have very poor understanding of what causes that for users, and how to accelerate that process or make it happen at all.

The current mindset is basically "hope the user gets it". The most effective way of acquiring users has been hoping your existing users will (continue to) evangelize on your behalf, and explain everything to new users.

My research and experience has shown very little correlation with the length of the free trial and the likelihood of user conversion.

If anything, there's a trial length which negatively correlates with user conversion: make the trial too long and the user loses all urgency to sign up and pay, and in fact finds themselves saying "I hardly used the service at all over the last several months, I guess I don't need to pay for it".

Longer trials don't help. The problem with trials isn't the length, it's the total inattention paid to the user experience during that time. It's as if you walked into a car dealership thinking about buying a car, and they threw a keyring at you, said "bring it back in a month", and turned back to their keyboards and paperwork.

And really, if your experience isn't captivating users within the first hour, if not the first 5 minutes, you're probably doing something wrong. 90 days is forever. Even 30 days is a lot. And this is for a product that costs a mere $10 per month, or $100 per year. If products with much more at stake don't offer those types of terms, why should music have to?

This is something Apple normally understands quite well: their products generally "demo" extremely well, inducing instant want and desire in customers. Apple's insistence on long free trials -- the same thing everyone else has been doing for years, and which obviously produces only mediocre results -- is indicative of the lack of innovation they are bringing to market here.

Start With ONE

I would humbly suggest that rather than asking for 90 days free, the industry collectively work on making the first 5 minutes or hour or even day excellent, compelling, and worth paying for. If one day isn't enough to convince me, do you really think 89 more will help?

A Letter To The Music Business

Dear Music Biz,

It's been a good, close, intimate and mostly wonderful 15 years...but I think we need some time apart.

It's not me. It's you. You've changed.

Digital music business, you used to be the scrappy underdog. They ignored you. Then they laughed at you. Then they fought you. You know what comes next: You win.

But somehow you turned into the rich kid from an 80s teen movie. You might be about to win, but nobody seems to like you. 

The venture capitalists are pissed because you don't make any money, and you keep promising that's going to change. 

The artists think you're robbing them, and your PR response and outreach has ranged from tone-deaf to nonexistent. 

The listeners don't want to pay, or worse, they don't even want to come back for free music after a month. 

Even the labels and publishers don't want you to succeed (don't feel too bad about it, they hate everyone).

Worse, it feels like you've stopped trying. Stopped coming up with new ideas, stopped pushing for something better, stopped thinking. When I look at what you've got on offer, it doesn't really look substantially different from what Rhapsody and iTunes launched nearly 15 years ago. 

How can that be? How can we be stuck with the same lame UI, same ordinary feature set, and no improvements? How can all of these different services feel so similar, and all suffer from terrible flaws?

You can tart yourself up with a slightly different interface and say it's a "revolution", but the only thing you've got going for you now is celebrity endorsements, and that is a fickle, transient, and expensive way to live.

There are just a few kinds of companies left. There are small, largely insignificant players desperately hoping they'll come up with some clever way to offer music for free (for themselves or customers or both) and not have to deal with full-on label licensing. Most of these companies are getting by with tiny staffs and budgets, and have niche audiences to match. Nearly all of them will fail. The best possible outcome is to have someone larger, richer, and/or dumber buy them.

Speaking of, at the other end of the scale there are the titans: Apple, Amazon, Microsoft, and Google/YouTube, and for the time being, Spotify. Their current products are all rather uninspiring. Competent, boring, nothing new. But they'll keep dropping prices until all the little guys are dead, and will roll music into a larger digital media package with video, games, books, and whatever else they can think of to further pull users into their hardware and software ecosystems. They've started on this already.

Finally, there's the "old guard" of companies like Rhapsody, RDIO, Deezer, Slacker, and Pandora (you can probably throw a few more in the mix there). If any of these businesses were really successful, we'd all know about it. The services are indistinguishable, with the same mobile deals, same new releases, same pricing, and forgettable marketing. They're all hoping something is going to change, or that they'll get acquired by someone before the titans crush them.

I look at that world, at how little has changed, and I realize there's nothing to do. Nobody wants to build new features or invest in building a great service. Nobody will admit the current economics are unsustainable, but services are still shuttering or selling for peanuts. It costs a lot to build one of these, and a lot to run it, and you can't make a real business out of it in the current climate.

It's not impossible. You know how to fix this: Innovate.

Stop trying to be the same as every other music service from the last 15 years. Stop thinking it's enough to show up with the same millions of songs and label-mandated featured new releases and top artists/albums/songs.

Help people find something good to listen to. Make their lives easier, not more complicated. Give listeners a reason to come back weekly, if not daily. Stop recommending music to me that I already like and already listen to.

Have a point of view. Show some style or personality. Don't be afraid to be for a particular group of people, even if it means you're less for (or even not for) a different group of people. If you try to be everything to everyone, you become even blander than Wal-Mart.

Be smarter about your pricing. Nobody's ever won a market by berating customers for not appreciating their value. There have to be price points between $10 (too expensive) and free (come on!) that will work. Hire some economists, or at least do some real experiments. 

Maybe "all the world's music" is a dumb idea when people only actually listen to 4-5 million songs. 

Maybe letting aggregators monetize your server space and CDN support (without cutting you in) is not the smartest thing in the world.

Think about your marketing. Stop the lazy and ineffective "x million songs for $y each month", the slow-motion-crowds-cheering-"something about music" montages, and the expensive and ridiculous artist endorsements. You might not even need traditional marketing at all. Google didn't. Facebook never ran a TV commercial. YouTube never made a YouTube video.

Hell, somehow Netflix figured out their whole business, and to be honest, they ain't got nothin' you don't got, right? What's stopping you?

I did all I could to help you out, get you on your feet, and give you a good start. Try not to mess it up too much.

It's your life, music business. What are you going to do with it? Be all bitter that no one appreciates your genius? Stand sullenly in the back with your arms crossed watching the video business and say "Psh. I could do that if I wanted to..."? Keep smokin' weed in your parents' basement until they throw you out? Or are you going to grow up and get real?

Yeah, maybe I'm a little disappointed in you, but I suppose there are worse fates than growing up to be a boring employee of a giant company like Amazon, Apple, Google, or Microsoft. You could end up like Tower Records, for example. Or Guitar Center. Or the book business.

I know, you're going to start telling me about your big dreams. I've heard it before. Even assuming you actually follow through on any of it this time, I can't get excited about any of your plans at the moment.

I recognize that's my problem as much as it is yours. So for our mutual good, I'm taking a break.

I'll check in on you from time to time. I hope we stay in touch. I will always have a special place in my heart for you, and every gig I play will have a seat reserved with your name on it. Your tickets are at "Will Call". And if you get your act together, well, maybe...someday...

No I won't do it again
I don't want to pretend
If it can't be like before
I've got to let it end
I don't want what I was
I had a change of head
But maybe, someday
Yeah maybe, someday

I've got to let it go
And leave it gone
Just walk away
Stop it going on
Get too scared to jump
If I wait too long
But maybe, someday

Yeah
I'll see you smile as you call my name
Start to feel and it feels the same
And I know that maybe someday's come
Maybe someday's come again

So tell me someday's come
Tell me someday's come again 

No I won't do it some more
Doesn't take any sense
If we can't be like it was
I've got to let it rest
I don't want what I did
I had a change of tense
But maybe, someday 

Yeah
I'll see you smile as you call my name
Start to feel and it feels the same
And I know that maybe someday's come
Maybe someday's come 

If I could do it again
Maybe just once more
Think I could make it work
Like I did it before
If I could try it out
If I could just be sure
That maybe someday is the last time
Yeah maybe someday is the end
Or maybe someday is when it all stops
Or maybe someday always comes again

("Maybe Someday" by The Cure, lyrics by Robert Smith)

My last music job

As has been reported, Sony is shutting down its Music Unlimited subscription service and replacing it with Spotify, which launches on the PlayStation 4 today. With Music Unlimited shutting down and the new service live, it is time for me to leave my position at Sony and move on.

This event was the culmination of the last 3 years of my professional life. This was by far the most difficult and challenging job I have ever had in my career, and the most challenging of the many, many music services I have helped build, launch, and operate.

For a variety of reasons, I will not be discussing it in detail. Suffice it to say that it was quite an experience.

These last 3 years were exhausting, but I remain grateful for the opportunity. I traveled to London, Tokyo, Stockholm, and other amazing places. I met some remarkable, wonderful people.

During the last few months in particular, I endured many ups and downs, and learned who my friends really were.

I'd like to believe I have emerged from this gig if not exactly unscathed, at least slightly wiser, seasoned, and confident, with a better understanding about who I am and what I do.

My immediate team deserves special acknowledgement: Rebecca Carpenter, Nick Dedina, Maryann Faricy, Clane Hayward, Danielle Machado, Jon Pruett, and Seth Schulte all did an incredible job with very little.

Also thanks to Al Fuentes, Takashi Hodama, Brian Kurtz, and Sarah Lemarie for program management support -- the other half of what made the business run.

どうもありがとうございます to our colleagues in Tokyo: Yasuhiro Habara, Tohru Kurata, Satoshi Kobayashi, Yuki Hashimoto, and Itsuki Asanuma. Thank you for your hospitality and hard work.

I also extend my heartfelt thanks to my supervisor Mike Aragon, for his unflagging support.

And finally, thanks to my good friend Thomas Muer for bringing me in to Sony.

For the first time in many years, I do not know what I want to do next. I am pretty sure my next job will not be in the digital music business. This isn't the first time I've left a digital music service, (by a long shot) but it may be the last. After more than 15 years, I am ready for a change.

For now, I am taking some time off. I have a few plans. I want to finish some music of my own. Practice guitar. Travel and visit some friends and relatives.  Work out and rehabilitate my shoulder. Read. Catch up on all those TV shows I keep hearing about. Get bored. Perhaps even spend more time writing here.

I will miss seeing my colleagues every day, and I expect I will eventually feel some loss at being out of the digital music game. For now, I'll savor the victories my team had, put my feet up for a bit, and listen to some records.

Tidal: Nothing New

Tidal, the streaming music service Jay Z just bought, has "officially" launched. The overblown video they provided is a good example of some of the problems with today's music business.


Here's a bunch of artists talking about "a new world", "changing the course of history", "last stands" and "human art" and other stuff that sounds really good, if a bit incoherent (like some of the artists themselves, I suppose).

And yet, it says absolutely nothing about what Tidal is, or why their involvement matters, or what they are actually going to do to change things.

So to be clear: Tidal is just like every other digital music subscription service launched since Rhapsody 1.0 hit the world 15 years ago. It's got the same features, apps, limitations, rules, and catalog as Spotify, Rhapsody, RDIO, Deezer, Beats, and everybody else. Their plan for differentiation? Exclusive content and artist partnerships. Just like everyone else.

Tidal does have one difference: instead of $10 per month, you'll pay $20 per month (if you want the special "lossless" audio option)...and Tidal even offers the same $10 per month pricing if you don't need lossless streaming. They even call it "Premium", just like...well, you get the idea.

It leads one to believe the deals and business model behind Tidal are also not substantially different from any of the other music services, which means prospects for long term survival are not good.

Lossless (or HD or high quality) audio is not a new idea (or even a particularly good one) for streaming services.

I'm trying to figure out why that's revolutionary. There's been no disclosure of how Tidal's going to use that extra money to compensate artists. For all you know, it's going right into Jay Z's pocket (or the pockets of the other artists who are "part owners"), or for jet fuel or crazy salaries.

Or for paying fees to the artists standing uncomfortably on this stage listening to Alicia Keys talk.



For all the talk of empowering artists and creativity, apparently that money is not going to pay licensing fees for other artists -- The Haxan Cloak is claiming Tidal's very video is using his music without compensation or permission. The irony...

So we're left with one thing: Tidal is "special" because some artists are part owners. It is then difficult to take any of their previous comments about the "problems" of the digital music business seriously: They're offering the same product, with the same pricing, deals, economics, and features, as everyone else. But suddenly it's OK because they are the ones at the helm.

In the end, this is a commodity with some really expensive marketing wrapped around it:
Tidal is the SmartWater of digital music services.

It's also part of the current vogue of celebrity endorsed/powered/designed/owned services, including the Dre/Trent Reznor Beats (and future Apple service), Neil Young's Pono, and the various crazy things people like Will.I.Am, Lady Gaga, and more have been paid to do by hip companies like HP and Intel. For the next few years at least, celebrities will be able to leverage their star power and rep for advisory positions and paychecks to lend new services legitimacy.

I wish them all the best of luck.

Most People Don't Care About Musician Income

This article summarizes it nicely: Most people don't care about musician's income from streaming services, or elsewhere.

There are a few simple reasons. One is the perception that musicians fall into one of 2 categories:

1. You are a rock star, flying around in a solid-gold Lear jet, making millions, living large, for "not doing that much", working a few hours a day. As Dire Straits said, "That ain't workin', that's the way ya do it. Money for nothin' and your chicks for free."

In this case, you're doing so well already that it shouldn't matter if a few people steal your music, because you're already rich.

2. You suck. Either your act just isn't good enough, or you haven't put in whatever "hard work" is required to build a fan base and "make it". And it's probably the former.

In this scenario, not only do you not "deserve" any money, but your music probably isn't even worth stealing, and you should be thrilled if anyone even listens to it.


In general, regardless of what you do, if you start a conversation with anyone saying "man, my job is so hard and I am so underpaid", you are unlikely to get a response of "you are so right, I agree, your life is so much harder than mine, it is so unfair".

You are far more likely to get a "welcome to the world, son", or a diatribe about how you actually have it far easier than me/teachers/someone else. When was the last time someone told you their job was easy and/or they were paid too much?

It gets worse.

Reading the article, you'll see that only 60% of consumers said they felt music was worth paying for. At all. That should make everyone in the music business extremely worried.

Some of this is the music businesses' own fault: they've spent years allowing many free music services on the internet and elsewhere to provide more than enough free music to satisfy fans. Major artists have given away singles and albums.

Years of mixed messages about the legality of downloads and streaming, companies being "illegal" and then legal, and blogs and websites offering authorized and unauthorized downloads have confused customers while simultaneously setting the expectation that if you want free music, it's out there, and probably legal.

Apple, U2, and Hubris

By most accounts, Apple and U2's release of the new U2 album during Apple's Watch announcement was a disaster.

Now, a few weeks later, we can safely approach the wreckage. Surveying the smoking ruins, one comes away thinking "It didn't have to turn out like this."

Instead of being excited and grateful about a surprise free new album from one of the world's biggest bands, the media and public responded with a sense of outrage.

Instead of thanking Apple and U2, people demanded ways to purge the gift from their collections, and Apple dutifully responded.

10 years ago, Apple and U2 had a similar team up and event, based around the announcement of the U2 iPod. It was sort of weird, but still made sense, and was far more successful.

What happened? What's changed?

10 years is a long time for a person. It's even longer for a pop act or a company. In that 10 year period of time, Apple went from being a scrappy underdog having success in the music business to being the music business. Apple rose to be the best-funded company in the world, and has become the dominant market leader in a number of categories. And Steve Jobs died.

U2 went from being a band with a promising late-career comeback (started with 2000's "All You Can't Leave Behind) to a typical late-period band appealing only to its hardcore followers while mainstream audiences move on.

Perhaps more importantly, the world changed around Apple and U2, and they were both blind to the implications. They've both become out of touch with the world around them.

The result was that Apple and U2 made some obvious, avoidable mistakes.

Mistake: No reason for this collaboration other than promotion.

When Apple and U2 collaborated last time, there was a new U2 album and a special hardware product. That sort of project would have been perfect for an album giveaway, especially back 10 years ago when purchased downloads were less commonplace than they are today.

This time around, there wasn't any clear connection. Apple announced some software upgrades and a watch. There was no U2 edition of the watch, or anything else. It was just bizarre: "here's the exciting product you've been waiting for...oh, also, here's U2 playing live and a free album."

People instinctively understood this was empty spectacle. Apple probably expected the performance and free album giveaway would attract lots of attention (and it did, just not the kind they wanted). U2 probably expected everyone to be grateful or thrilled they were getting a free album, and U2 could claim they shipped 500 million copies, just like Jay-Z went immediately platinum thanks to Samsung.

But there was no obvious connection between the two events, and that made it seem cheap.

Mistake: They didn't ask permission. 

Both Apple and U2 assumed that people would be thrilled with having the new U2 album inserted into their collections. 

People weren't thrilled. People felt violated and creeped out, as if Tim Cook and Bono had broken into people's homes and left a copy of the album on their pillows with a note that said "We are watching you. Enjoy!"

Early on at Rhapsody, it became clear people considered their virtual collections and disk space (PC and mobile) to be their property. People became really angry when that property was tampered with. I find it astounding that Apple, with all their research and "understanding what users want", did not see this coming.

That forcing of the gift not just onto people, but into their library, chafes. It's like coming back to your car and finding flyers under your windshield wipers. Or having people on the street pushing brochures at you. You feel as though your personal space is being violated, and you immediately discount whatever's on offer.

I likened it to how many San Franciscans feel about the SF Examiner, a paper that seems almost maliciously delivered every Sunday, and cannot be stopped, short of legislation.

The easiest solution is also rather simple, and what's known in the industry as an "opt-in": They should have offered the album to people for free, and had users that wanted it to click on a button in order to get it.

They didn't do this. Probably because they wanted the bragging rights of "moving" 500 million albums. Or possibly because they were just tone-deaf, and assumed "of course everyone would want the new U2 record!"

Mistake: Insufficient Messaging

I actually like U2, and was really excited to hear the new album. I am also something of a digital music business expert. I started iTunes and went to the store to look for the album. It wasn't available in the store. I couldn't even find it on the home page of the iTunes store.

It took me about 20 minutes of poking around before I realized that Apple and U2 had literally just "added it to my collection", and on my work machine, that's over 6000 songs. There was no playlist or badging or other indication. It just magically appeared, and then got lost with all my other music.

And if you weren't someone who actually followed Apple's press announcements (but left your iPhone and iTunes at default settings), the album's songs would be mixed in with whatever else you were playing in shuffle mode.

This is a terrible experience, across the board. Why give someone a gift without explicitly handing it to them, wrapped up, with some ceremony? Did Apple and U2 really believe they were so important that all 500 million people would be paying attention to these announcements?

This could have been mitigated with email, in-store messaging, and perhaps some other in-iTunes guidance for how to find and play the new record.

Mistake: Totally Free * 500 million copies = 0

There are plenty of artists and pundits who claim the "music business" has been devaluing music for years.

Here comes Apple and U2 - a company that represents about 2/3 of the music business now, and one of the world's biggest bands. They immediately take a record with clear, tangible value - 5 years of work, from a major artist - and dump 500 million copies on the world. That's like 5-10 times the number of copies Michael Jackson's "Thriller" sold. Should be great, right?

Well, for one thing, they immediately demolished the concept of scarcity. There was nothing to be gained by saying you heard the new U2 record. You literally couldn't get away from it. It's already on your phone. Just like everyone else's. If everyone has something, it is literally commonplace, unexceptional, mundane.

It has been said that what is free has no value. Apple and U2 took a new album by a major artist and made it feel about as valuable as a piece of junk mail. This is devaluing music taken to a new level. If U2 won't charge people for its new album, why will anyone pay for anyone else's record?

Rumor has it U2 was paid about $100 million for the album. At 500 million copies, that's 20 cents a copy. Think about that, all you struggling artists. That's the bar now, lowered by these 2 industry titans. How's Spotify looking now?

I'm not sure what the bigger mistake was: giving it away for free, or giving away 500 million copies.

Mistake: No matter how good the album was, it felt disposable.

All of this completely obscures any reasonable comment one could make about the album. U2 instantly forces people to grade them on a curve: is it good or bad "for a free album"? Is it even a real record? Most of the charts services say no!

Regardless, since this was delivered to people unasked, it feels inconsequential and trivial, perhaps not even worth the time it takes to listen to it once.

The result here is that the only people who will buy this new album are the die-hard fans...and U2 has even alienated some of them, because many people buy their music in digital form. And those people already have a free copy.

Most phones and other devices people buy come with some free intellectual property. Phones often have 10-30 songs by no-name aspiring artists, or credits to download or stream some barely recouped almost-blockbuster movie.

People typically recognize this for what it is - cheap content filler designed to raise the perceived and marketable value of the phone. But nobody cares, because it's unasked for and inessential.

Courtesy of this promotion, Apple and U2 immediately made U2's new work feel just like that.

Hubris

Both the teams behind Apple and U2 were likely convinced they were going to succeed, that these big expenditures were worth it. They never questioned whether or not the rest of the world felt and thought like they did.

Apple is no longer a scrappy, rebellious, cool company. They've grown up, and become a kind of fascist gray monolith. Their recent acquisitions of companies like Beats and fashion designers suggests they are moving in some very different directions. For one thing, they believe they can talk you into wearing a $350 calculator watch because they say it's cool.

U2 is also long past their prime. I am sympathetic. It's hard to have a long career being creative, relevant, and popular. They've done about as well as anyone could. As a fan, I'd love to hear new music from U2 that excites me, since the last record of theirs that I really loved came out in 1997. Still, their last several moves (including relocating for corporate tax purposes) seem really at odds with the image they'd like to project.

I can see how Apple and U2 thought this would work out, as they sat in fancy conference rooms hammering out their spectacular deal. A combination of "aren't we clever and brave", Shelley's Ozymandias, and a genuine desire to do something fun and cool.

Instead, it felt like your out-of-touch grandparents giving you a terrible CD for a birthday present because they heard you're into rock music.

I watched the whole thing live. With the sound off, it looked like a bunch of old white men desperately trying to remain cool.

Music Business Thought of the Day: Look to the Book

Been reading this New Yorker article about Amazon and the discussion around book pricing.

Reminds me a lot of the endless music debates.

Always-wonderful MetaFilter offered me this comment (via user mittens):

"...The insistence on seeing books as a high-margin item is damaging, both to the book business itself, as well as to readers, and literacy generally. Libraries, used bookstores, and thrift shops are full of people who are proving the point that new books are priced too high...and those are just the people who are committed to finding the book at that low price point already, it doesn't include all the readers who could be enticed to buy at a cheap enough point if wide selection and ease of ordering were also guaranteed."

Substitute "music" for books. What's different?

David Byrne Tells Streaming Services To Get Off His Lawn

David Byrne, courtesy of WikiPedia
(which destroyed encyclopedias)

Some days, I feel like I just write the same articles over and over. Sisyphus pushing the rock, defending streaming services. If it's not some random person on the internet, it's Thom Yorke.

Now here comes white-haired David Byrne, shuffling down the sidewalk, yelling about the good old days and the end of the music world.

Byrne was the leader of Talking Heads, one of those moderately successful bands that manages to become influential and is a part of the undisputed "canon of cool" for many musicians. Like with Thom Yorke, it stings a little for me to hear musicians I respect and who influenced me speaking out against my work - work that I have engaged in for their benefit.

Evil?
Byrne asks "Are these services evil?" It's difficult not to respond with something equally churlish and provocative, like "Is David Byrne stupid, or just ignorant?" Probably the latter, as he admits and then demonstrates a lack of detailed knowledge about how the services work.

Still, I am compelled to respond to these uninformed and incorrect assertions.

All Internet services are not the same. Byrne lumps streaming services in with YouTube and Pandora, which is sort of like lumping your bank in with muggers and vending machines. "Well, sure, they're kinda different, but they all take your money, right?"

Byrne asks if streaming services are "simply a legalized version of file-sharing sites such as Napster and Pirate Bay". Nope, at least not in terms of infrastructure and effort. Napster and Pirate Bay don't ingest and host terabytes of music and push it out to CDNs worldwide. They don't provide customer support. I could go on.

The most important distinction is this: YouTube and Pandora don't need or get permission to offer the music they deliver. Streaming services have to get permission from the artist, label, and publisher. And then they pay huge guarantees and submit to a ton of control from the content owners.

It's streaming or nothing. Byrne repeats the assertion that no one will buy CDs or pay for downloads when streaming is available. But there's literally years of research that show that the most avid streamers still buy music, and buy more music, than people who don't stream. Put another way, for every Spotify user who says "I'll never buy a CD again", I'll show you a Rhapsody user who says "I'm buying more music than ever". Streaming increases sales.

But why would you buy when you can stream? Well, maybe you're trying to give the artist you like more money. Maybe you want a copy to keep. People do it.

Monopoly...someday. Byrne asserts that we'll end up with a monopoly, and that will be very bad. Well, it's been 12 years, and we don't have a monopoly. We have a bunch of struggling services, and tons of competition in most of the major music markets. The USA (the biggest music market in the world) alone has at least a half-dozen streaming services. And Apple and Amazon haven't even entered the market...yet.

Griping about payment size. I've gone into this many, many times. It is true that for some artists, the per-stream payment has been low. That has a lot to do with the artist's deal with the labels. I will also again point out the labels are collecting money from services even when users play nothing. Is any of that money going to the artist? If not, the artist should be talking to their label. And I repeat my favorite question: What payment would you suggest for a single stream?

Go browse a store instead. Byrne says you could just go to Bandcamp instead. Yeah, Bandcamp. A place that has none of the content. Where the artist doesn't get paid at all when it's played. Look, I like Bandcamp. I have some of my music available there. But it is not a good substitute for subscription services for the reasons above. It's more like iTunes, but more fair. Amazon is pretty much the same. And most bands on major labels aren't allowed to put their content on Bandcamp.

People only go to these places when they have already decided to buy something. It is a very different experience.

It's totally true that the purchase links in Spotify and other services are lame. They're in there because the record labels make us put them in there, not because we think they're a good idea.

Great Pull Quote!
Byrne being the media old hand that he is, he closes with the usual "everything will collapse into these services and the poor artists will starve". The pull quote and tweeted memed headline is "the internet will suck the creative content out of the whole world until nothing is left."

Provocative! Exciting! Wrong!
In some ways, this is just an updated version of Sousa's "The Menace of Mechanical Music". But let's look at a similar model: video.

Jack Valenti famously said that the VCR was the Hollywood Strangler. And instead, it grew revenues tremendously. Opened new markets. There are lots of people who subscribe to Netflix. They're also still watching broadcast or cable, going to movies, buying and renting movies on DVD and Blu-Ray and as digital files, watching pay-per-view, and watching free internet video as well. New methods of enjoying art bring more consumption of art in more areas. 

If that wasn't true, then Sousa would have been right, and the dawn of recording would have destroyed music such that people like David Byrne and Thom Yorke would never have had careers writing and performing it.

Look at ebooks. People are buying and reading more books than ever.

It's depressing to keep arguing these points. But there is some hope.

Dave Allen (of Gang of Four and Shriekback) has finally come around. His excellent response is well worth a read, and I'll repeat many of his points here. Mr. Allen and I have discussed these issues in the past, and haven't always seen eye to eye. But he brings some welcome perspective. Some of his strong points:

There aren't enough good rebuttals. The Guardian will print things that Yorke and Byrne say because they're both famous musicians, and their tirades will sell papers. It would be nice for a change to see them either allow someone from the industry to respond, or find another famous musician who will say something positive about these services. In the meantime, I'll keep plugging away.

The old system was as bad or worse. As per usual, people start trotting out how many streams a musician has to generate to make minimum wage, and start comparing it to selling t-shirts or CDs. I will again point out that it requires nearly no effort or upfront cost on the part of the musician to provide that stream - that's the work the service is doing: ingesting content, making it available worldwide, writing client software, and more.

Compare that to lugging t-shirts and CDs around, carrying change, and soliciting transactions. That's why you get to keep more money in those scenarios: you're doing more work, you're carrying inventory.

Making a living by selling CDs is as hard or harder. Fine, ignore the previous points. Focus on the actual statistics:

• There were more than 98,000 new albums released in 2009.
• Of those 98,000 albums, about 2% sold more than 5,000 copies.
• About 1% sold more than 10,000 copies.
• As far back as the mid-/late-90s, the average band on a major label with a national promo push would sell about 1,000 albums

And all those new records are competing with Led Zeppelin IV and OK Computer and Speaking In Tongues.

If you think selling CDs is going to make you more money, you're wrong. Statistically, you're not even making minimum wage.

The current internet alternatives to streaming are so much worse. Spotify, Rhapsody, MOG, and other services are paying out 70-80% of their gross income directly to "content owners": record labels, publishers, and yes, artists. iTunes pays 70%. Other internet alternatives like YouTube and 8Tracks pay nothing, and only achieved their current success by either operating illegally (in a "get big, then get licensed and legit" model) or by exploiting a loophole in the DMCA.

Those royalties are cripplingly high. Spotify still isn't profitable. Most of the streaming services are money-losers. Even mighty iTunes just breaks even. These services cannot pay any more than they are already paying...and frankly, shouldn't have to just because artists signed deals with labels which the artist now regrets.

Listeners won't pay more. I've done the customer research many times. The primary reason people don't use these services? Too expensive. And when the free services bloat up with ads, customers turn away and go back to unlicensed services or illegal downloading. Or don't bother playing music at all.

I'll conclude with noting that Messrs. Byrne and Yorke aren't helping the music business, they're hurting it. It's difficult for today's listeners to understand the distinction between legitimate services and piracy, between what pays the artist and what doesn't. And when they attack the services that are doing the right thing, they are sending a message to those listeners that sounds like "you might as well just steal all the music you want, because the artist doesn't get paid anyway." Again, I've done the market research. I've heard it from the music fans

I suppose this constant criticism is a sign of the legitimacy of streaming services, but it sure doesn't feel like a "win".

Life Is Hard
Byrne closes with an appeal that sounds a bit like "won't someone please think of the children???" He notes that life is hard for up-and-coming musicians, and that even talented ones may have to give up if they can't find a way to make a living...and that the future of musical culture thus "looks grim".

OK, three more points and I'm out.

1. It has never been easy to be an up-and-coming musician. It wasn't easy when Byrne was coming up (there are plenty of his peers that never made it big like he did). It wasn't easy when Sousa was coming up, either.

As I noted previously, there were 98,000 albums released in 2009. Recent years have had similar numbers.

That means all those up-and-coming artists have a lot of competition - not only from all the other 199,999 albums released that weren't theirs, but from all the great old records released over the last 50 years, like those by David Byrne and Thom Yorke. It is not an easy job. It never has been. And streaming services aren't making it any worse. If anything, they're offering an easy, low-cost way to make music available worldwide.

2. 98,000 albums. That's a lot of new music, and those numbers keep going up. So even after over a decade of streaming music services, the number of new albums being created continues to rise. If there is some kind of creative apocalypse, it hasn't happened yet. I'd argue we're seeing the opposite - massive growth in content creation.

I also hope Byrne isn't so commerce-minded that he can't see that many artists (as opposed to entertainers) create because they have to, not because it's a good career choice.

3. Look up what "amateur" means. A personal anecdote: I was an aspiring professional musician. I dipped my toe in nearly every part of the music business before Napster came along. It was really hard. And I came to realize that even being talented wasn't enough. You had to be talented and lucky.

That wasn't good enough for me, so I got a day job (making streaming services, it turned out). I still write, perform, and record music. I distribute it worldwide. I don't do it for the money, I do it for the love of music. I am not unique.

I do not consider myself a "great artist", but I am pretty sure most of the folks I do consider great artists create because they love creating first, and because they can get paid second.

It is entirely possible that subscription music is a terrible idea, and one that will become a footnote in history, like the 8-track cassette. But I have a feeling that if it were to vanish, many artists and music lovers would mourn its loss and sing its praises.

That may sound hard to believe, but then who'd have thought David Byrne would be arguing in favor of the past and fighting against the future?

Who killed album sales?

The latest news is that album sales are down.

The usual gripers are blaming subscription services. It's amazing how quickly Rhapsody, Spotify, and the rest have gone from being ignored to being laughed at to being portrayed as ruining the music business. (It's also funny how artists have gone from bemoaning their inability to get on FM radio to bemoaning their inability to get off of internet radio!)

This is especially problematic logic given the relatively paltry numbers of subscribers these services have. It's hard to see how such a small number of users (20 million worldwide) paying $120 a year for a subscription service is devastating the industry. Especially when the data actually shows people who use these services are more likely to buy music, and more of it, than people who don't use these services.

To put that in perspective, in just the USA, around 45 million people bought at least one download in 2011 or 2012. That's compared to 20 million music subscription users worldwide.

Blaming streaming demonstrates a lack of perspective, and a disappointing willingness to point fingers at companies actually trying to improve the business for all particpants - artists, listeners, labels, and publishers.

Here's one problem. There are no record stores anymore. Tower and most of the other big record stores went out of business long before streaming services had taken off (and in Tower's case, before Spotify even existed).

If there are no significant retail outlets for music that are convenient or pleasant for people, they're not going to buy as much stuff. The record business was hurting long before streaming was more than an interesting curio.

So what actually killed album sales?

• Was it the CD format, which some argue encouraged artists to bloat albums with even more filler? Maybe, but this is hardly objective and widespread enough to cause this decline.
• Was it Napster and other file-sharing services, which taught a generation of music fans to steal the songs they want, and forget the rest? 
• Was it the perennial oldster gripe that "music is just no good anymore"? This one is somewhat backed up by industry decisions and data which shows that many post-1990s albums have no long-term catalog value: they do all their sales initially. This trend is not unique to music - many other forms of media (books, movies, apps) follow a similar power law pattern.
• Was it competition from other media and goods? Music fans today can spend their money on DVDs, Blu-Ray, digital video, MMORPGs, Xbox/PS4, apps, smartphones, data plans, and more.
• A more fundamental correction (in the economic market sense). For a long time, the only way to buy music was buying an album. Yeah, there used to be singles, but when big business took over the music industry in the late 70s/early 80s, they started killing that off or converting to absurdly pricey rip-offs like the cassingle or CD single...and even those were hard to find. If you wanted music, you had to buy the whole album, whether you wanted it all or not.
  
  This is like only selling cola in 3-liter bottles. Suddenly someone starts selling it in cans ($1 downloads). Big surprise: not everyone wants 3-liter bottles, and sales of 3-liter bottles drop.
  
  Maybe the music business was historically overselling and overcharging, and the current sales are what economics would "naturally" dictate.

I don't know for sure. I do know it wasn't solely due to subscription services. 

I'd also argue the album isn't dead. There were more albums released in the last few years than ever before! Yeah, fewer are selling big numbers, but just because you or your favorite band isn't doing well (or as well as they used to) doesn't mean the system is broken.

Hi, Fidelity

"Fidelity" means "faithful" and/or "accurate in details". The etymology takes you right to the Latin for "trust" (fides).

Neil Young is still waving Pono around, and I keep hearing people who should know better talk about how "bad" recordings sound today.

There are 3 elements to achieving fidelity in listening:

1. The actual audio to be recorded: the performer/musician/artist/noisemaker
2. The recording system
3. The playback system

The Performer

We can dispense with this pretty quickly. We'll just assume "the music is good". The artist knows what they're doing, and has good instruments, etc.

It is generally true that back when recording was expensive and time-consuming, "the best" musicians got to make records. But you can go back as far as you like, all the way up to the beginning of audio recording, and you'll still find plenty of subjectively terrible artists and work.

Garbage in, garbage out. If what you're starting with is "bad", it's all but impossible to fix. Musicians, get good instruments. Learn how to make them sound good in a room, on their own. Write good songs. Play them well. If you're a listener, choose stuff that comes from talented people, not products of the machine.

The Recording System

Edison Phonograph and cylinders

The very first sound recording devices - the Edison wax cylinder and its eventual replacement, the 78 shellac disc - sound horrible. Even with lots of digital remastering, the "horn" (basically a giant funnel) used to record, and the horn used to reproduce both add resonance, coloring the sound, and the media itself is not great. The entire system adds a lot of noise (as in "undesired signal").

Things got a bit better once electrical recording was developed, using microphones and amplification. However, in the first few years of the technology, electrical recording was considered vastly inferior to the established "warmth" and fidelity of the mechanical system.

From the recording side, things didn't really get acceptable or decent until the 1950s, when there was decent tape and decent recording technology. You can find remastered recordings from the 1950s that sound great...for what they are. You will almost never mistake them for reality.

It takes until the late 1970s for stereo to be standard, and for records to generally start sounding "true" to life, including widespread adoption of real stereophonic recording and playback. But even in that era, many artists focused on making "good recordings" at the expense of just "recording in a room" for a "you are there" fidelity. Classical and jazz are generally exceptions here, but not always - many canonical records from those genres feature tape edits of multiple takes and overdubs.

Since that time, as recording tools have become more powerful, recordings have become hyper-real or stylized. Why stop with documentary photography when you can airbrush, enhance, or digitally create something "better than real", or "perfect"?

The democratization of recording has placed powerful tools in everyone's hands. But those hands are typically far less skilled at actually using said tools, so you end up with lots of records that sound "bad" by most recording standards.

To make good records, learn to use the tools, and use them appropriately. Some of the best-sounding records were made with 2 microphones in a room, and people who knew where to put them relative to the musicians.

In my admittedly limited analysis, there is absolutely zero correlation with how "good" a record sounds (by musician or engineering standards) and how well that record connects with an audience commercially or emotionally. (If anything, there may be some kind of inverse correlation!)

There are a lot of canonical, great records that sound terrible by most audiophile standards.

The Playback System

On the listening side, it's taken a long time for consumer playback equipment to get good. Most cheap record players were and are awful. Most consumer tape players are not properly calibrated (and some can't be). They play at the wrong speed, too. Most listeners had no idea how to maintain them for optimal sound quality and used dull needles and magnetized heads to further destroy their media.

The great thing about CD players - even cheap ones - is all of this went by the wayside. The difference between bad, decent, and great CD players is smaller than most people like to admit.

The problems for most consumer audio playback is the end of the chain: the speakers or headphones. For most people, these are by far the weakest link. Sadly, those white earbuds that have become so popular are part of the problem, and their terrible fit and worse sound quality have helped perpetuate the myth that "MP3s sound bad".

It remains fashionable among musicians and music fans to say "vinyl is better". Well, it isn't. At least, not in terms of fidelity, and not in terms of what most people can afford.

Vinyl is demonstrably not faithful to the original recordings. There's surface noise inherent in the process. The theoretical dynamic range of vinyl is far lower than that of CDs. The available frequency range and accuracy are also narrower than CDs. There are frequently clicks and pops even on "virgin plays" (though quality control has improved somewhat).

And you have to change your recordings to fit the medium: You can't have a lot of bass, and/or a lot of stereo information, without worrying about the needle getting literally kicked out of the groove. Records are fundamentally changed when mastered for vinyl - the high end is dramatically boosted on when the record is made, and then dramatically cut on playback. This is an attempt to reduce the high end noise (at the cost of increasing rumble).

All of that is before you get to the actual record players many people have. Most record player manufacturers used the cheapest possible components to achieve something close to the desired effects above. There actually aren't even standards for tonearm angle, pressure, and other important elements that are fundamental to accurate reproduction. And strictly speaking, any standard "pivoting" tonearm is already terrible. You need a so-called "linear tracking" turntable (popular in the 80s) with an arm that moves in a straight line across the record surface to reproduce accurately.

Records warp. They scratch easily. And on top of all that, because they are physical, mechanical things, the mere act of playing them degrades them.

The Philips compact cassette doesn't inspire the same devotion as vinyl, but was also pretty bad. High noise (even with Dolby, which most people didn't understand), limited frequency response, and lots of tape alignment issues. And playing it also destroys it over time.

The high fidelity audio world is populated by people who can be best described as "nuts". For people who value "truth", they cling to pseudo-science and voodoo. They spend $1,000 on special electrical cords to connect their gear to their home power. They buy oxygen-free speaker cable that "protects the signal from light" by insulating it with fluid or rubber or magic. Gaze into the mouth of madness.

I'm not saying that expensive stereos don't sound good. But I am saying they don't automatically sound good. And that you don't have to spend a lot of money on your reproduction equipment to have a good experience.

If you really want to improve your fidelity, here are the things I'd recommend, in order:

• Get better speakers and/or headphones. You're probably listening to whatever you bought around college. Generally, the headphones that came with your phone or MP3 player are junk. For $100 you can get something decent. It makes a huge difference.
• Fix your listening environment. If you listen on speakers, where you listen matters a lot. Put your speakers at an appropriate height. Not too low, not too high relative to where your ears will be when you're listening. You want to be sitting in the "sweet spot" between the speakers. You want a room with a minimum of acoustically reflective surfaces. If you clap your hands and hear reverb or echoes, your music isn't going to sound right. If you're like most people, you stuck your speakers wherever they fit in your weird-shaped room.
• Pay attention. When you listen to a record, don't do anything else. Close your eyes. Or look at the cover. Get into the music. Just like how you might concentrate on the taste of a good meal. Listen carefully. Don't let the music be background, and it will immediately sound better.
• Get better music. Stop listening to music made on computers out of shards of other digital recordings (or at least go find some of the ones making deep, huge, beautiful works). Go find some 256 or 320 kbps MP3s (or CDs) of well-recorded, great music.

Rhymes With "Oh No"

The Pono player, as seen on David Letterman

All of this is a pretty long way of saying Pono is going to fail.

This bums me out, because I like Neil Young's music.

This is also unfortunate because its mere existence and continued discussion will further entrench the twin bad ideas that "regular old MP3s/digital sounds bad" and that the "fidelity" issue for consumers hasn't been "solved" yet. It has. By MP3s. Which (at 256 or 320 kbps, with a decent encoder) sound amazing compared to vinyl and tape.

Science disagrees with Pono's fundamental premise. Even if Pono wasn't wrong here, the record companies are unlikely to release all of their catalog in this format (or any new format), making it similar to quadraphonic stereo, HDCD, SACD, DVD Audio, and various other "hi-def" audio formats that also failed due to a vicious circle/negative feedback loop of "no content, no users, no demand".

But more importantly, most people don't care that much about fidelity to begin with. Those that do are pretty skeptical of digital audio (even though they're wrong to be).

The average music consumer wants and expects all of the music they want to be available wherever they are, whenever they want it. They care far more about convenience than "quality" (and that is largely the short-sighted music business' fault), and they care about price above all.

If you are reading this, you almost certainly are not the "average music consumer". But ask yourself this: When was the last time you took an hour, sat down, and really listened to something?

"Fidelity" means being faithful - go be faithful to your music. Treat it right. Maybe get some new headphones, too. I work at Sony, I can get you a deal.

"Coincidence that Pono rhymes with 'oh no'" 

- JP Lester