The undertaker is measuring the Big Four record labels for a wooden overcoat
TuneCore
is playing a dangerous game. They are a music publishing service operating at minimal costs, and they have contracts with iTunes and Rhapsody allowing artists to sell their music on two of the most powerful music sellers.
Prior to the creation of TuneCore
, this was the domain of the record labels - essentially meaning the Big Four: Universal, Sony BMG, EMI and Warner. The Big Four occupy a uniquely powerful position - known in economic terms as an oligopoly - where the entire global market is made up of just 4 companies. Over 75% of all music sold worldwide comes from these four - and they work together to hold a life-and-death grip over artists and the industry.
How did this situation come about? Essentially, until early 1980s, there were more record labels, and they controlled 4 vital stages in the sale of recorded media - promotion, distribution, manufacturing, and indirectly, the recording studios. The recording studios were largely controlled by the sheer cost of recording. Independent artists were unable to fund recording sessions, and it require the financial might of the record labels to invest up front.
In the 1980s with the advent of cheap electronics, new formats and new equipment became available, and the cost of getting your recording done fell. The record labels controlled this by simply tightening their grip on the other 3 assets they still had, and merging until they became the Big Four.
In the late 90s, the next asset started falling away. Production was no longer the domain of the Big Four - cheap recordable CDs and music in digital format meant cheap or free reproduction and transportation of music. Power to the people, and the beginning of mass copyright infringement. The Big Four tightening their grip still further on the last two assets, and banded to together to form the RIAA, and the ‘War on Piracy’.
Now, in 2006, production has fallen from their grasp, and the 3rd asset, distribution, is disappearing. The power of iTunes and the like is rising, and the power of the once mighty record store is falling, further aided by giant corporations who are untouchable by the Big Four and the RIAA - Walmart, Tesco, and Amazon will will do nothing but smirk at their demise.
But it’s not over yet. The RIAA members will fight to hold onto this asset. Don’t be surprised if Tunecore disappear suddenly - ask Gemesis and Apollo Diamond founders if they sleep safe in their beds, attempting to manufacture flawless, guilt-free, artificial diamonds under the noses of the DeBeers cartel, controllers of the world diamond trade - an international cartel based on an over-hyped and overpriced product, much like recorded music. And ask the victims of the RIAA random legal threats - people without computers, the mentally ill, and the desperately poor, sued for thousands or millions in an attempt the scare the entire world away from the great leveler of the personal computer.
And it’s not all dirty tricks. The final weapon in the Record Industry’s arsenal is the most powerful. Promotion. A barrage of media and a network of retail outlets combine behind every release, mega-hyping the compliant artists and drowning out the ones that refuse, or are refused, a place in the big party. This final ability holds more power over their target ‘consumers’ than their family, friends, government education or even hormones. They (we!) follow the latest fad like a religion, buying overpriced, undervalue trash, screaming like dervishes at our music gods, and toeing the party line all the way to $30,000,000,000 per year in the hands of the Big Four.
So why will it end? The first three assets slipped away like smoke despite everything in the power of that $30billion/year industry. The time will come when the artists will find they have an option. They can sell record their music themselves on cheap equipment, or hire independent studios. They can distribute their music directly to their fans over the internet or via contracts with small print shops. Fans get their music without them needing to manufacture more than a few bytes. And in the future, promotion will open up to them too. Advertising companies may decide to cut out the middle man. Online communities like myspace are opening up new possibilities. The all conquering TV may even begin the serve the artist. And then the record labels will rue the day they served their shareholders over their artists and customers. Mark my words - it won’t be long.
(via Future Feeder) (If you like this article, digg it)
UPDATE: Thanks to Mike for pointing out it should be an oligopoly, I have made the correction. It’s been a few years since A level economics!
And thank you Digg for all your kind (and a few unkind!) comments. To answer a couple of questions…
“$100 says druid is connected to TuneCore
in some way.”
I’ll take that, I could use the cash. I’m never heard of them until one hour before the post when I found them on future feeder (linked from the bottom of the post)
“How else did the TuneCore
people come and post comments so damn quickly after this was posted?”
Like every other online business these days they have technorati, google and digg searches they check every 30 mins. They look after their community. It makes sense. Online sync/backup site Plaxo have replied directly to posts on my blog 3 or 4 times now, and I love it.
“Did he use the CSS from Torrentspy and just change it red???.”
The theme was created by an artist called TechWench and can be downloaded here: http://www.techwench.com/wp/C17/ (This is also linked at the bottom of the post)
“The RIAA was formed in 1952.”
OK you caught me on that one, I didn’t research it. The RIAA became visible to me in the last 5 years. Thank you for the correction!
Posted by akaDruid on 16 Feb 2006 at 01:02 pm
Posted in , (Visited 43041 times) Digg this story
Read twice, publish once.
Using
That would be an oligopoly, not oligarchy, speaking in “economic” terms of course. Great post non the less.
Using
FIGHT FOR OUR FREEDOM TO PRODUCE!
Using
This principle has a name known as “The Long Tail.” Chris Anderson, editor in cheif of Wired magazine, is in the process of writing a book on the topic. You can read the article here
http://www.wired.com/wired/archive/12.10/tail.html
Using
If you take a service like http://www.pandora.com, which present me with artists that I might like, incorporate it in iTunes like sites, add the fact that MP3 through P2P serves as Advertisement too, than you are probably correct.
The avid fans will pay, not just for music but Original stuff (like discs, direct email with the artist). Others just listen for free.
Using
For a long while the record companies have justified the almost negligable income that most recording artists get from the sale of CDs and the like by claiming that the bands get their “cut” from higher concert fees bolstered by the success of the related albums. Makes it clear that most performers would be no worse off giving their albums away free on the Internet and cutting out the recording copanies completely.
Using
Interesting article, but let’s not confuse distribution with promotion. The fact that people can buy tunecore music at itunes doesn’t automatically motivate them to do so. Promotion will be more important than you suggest - it’s not just something that enables big labels to drown out new talent. It’s something that is essential for any sales to take place.
Using
[...] In other news, http://blog.thedruid.co.uk/2006/02/16/the-undertaker-is-measuring-the-the-big-four-record-labels-for-a-wooden-overcoat/is allowing musicians to bypass record companies and go straight to iTunes & Rhapsody. This is incredible. [...]
Using
[...] In other news, TuneCore is a new service allowing musicians to bypass record companies and go straight to iTunes & Rhapsody. This is incredible. [...]
Using
Wow, well done. The RIAA’s dying days. My concern with this whole is the fact that people are, by and large, stupid. A billion songs (almost) have sold on itunes… As an example, I know that I’m 109 on those. If we maintain that ratio… Well, you see what I’m getting at. I hope that people stop putting up with the RIAA, and realize their choices. Well done with the analysis, and congrats on the digg.
Using
This week I heard a talk by Daniel Levitin outlining a proposal to have the major search engines buy up the record companies. My notes on the talk are here: http://www.appliedmiscellany.com/blog/archives/14
Using
Inside my head, that article is read in the voice of the narrator from Transformers: The Movie.
Using
What’s the difference between Tunecore and Magnatune?
Using
“What’s the difference between Tunecore and Magnatune?”
As I understand, Magnatune is a record label (albeit with a great reputation for artist freedom and consumer choice) whereas Tunecore is not a record label, just a means of publishing your songs on iTunes etc.
Using
I would love to see the RIAA die. Most any thing good is in the local clubs
Using
This whole process reminds me of the birth of punk in 1976. There was a 5 year explosion of bands, white label private pressings, tiny independent music labels and shake up of the industry. It took them 5 years to regain control.
Shouldn’t that be Pigopoly? And the social system that allows them to manipulate government and hence society for their own ends is therefore a pigopolarchy.
Using
Thanks for the thoughtful analysis, Druid, and for the kind words on Digg.
I can’t predict the future, but I hope TuneCore will show the industry that it’s possible to offer a fair deal for a desired service and still survive and thrive. If we can do that, we’ve done more for the individual musician and the industry than a dozen courtrooms ever could.
Thanks, and drop me a line if y’all have any questions.
–Peter
peter@tunecore.com
Using
[...] Tunecore lets anyone distribute their music through iTunes or Rhapsody. Here’s a primer on how this is relevant to the record industry (via digg) and the obligatory long tail link. [...]
Using
[...] RIAA might be approaching the end of its life. Thank God. In the 1980s with the advent of cheap electronics, new formats and new equipment became available, and the cost of getting your recording done fell. The record labels controlled this by simply tightening their grip on the other 3 assets they still had, and merging until they became the Big Four. [...]
Using
Reminds me a lil bit of a Frank Zappa Rant.. A good follow up might be to look into the systemic effects of the underlying dynamics.. and there shifts.. on culture.. What’s it mean to joe audiance person… The answer probably lies in “Foucault Meets Joseph Campbell” Well that’s my 2 cents anyway
Using
It is fun to see the internets at work. I am looking forward to the day when promotion is powered by music fans. Where is the software/service that would allow anyone to write music reviews and get a referral fee? Weedshare looks promising. Any others out there?
It’s all part of the computer revolution Bay-bee! Power to the peeps.
Using
[...] read more | digg story [...]
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Using
[...] better read on their service here. [...]
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[...] The epic death march of the music industry has entered the final valley. Here’s why hip startup Tunecore is the sign of the end for the RIAA members.read more | digg story [...]
Using
I use Tunecore and I love it for the most part. I have a few complaints but for the most part it is a great service
Using