Industry information that you can actually use
February 2004
RIAA Lawsuits: Some Say They're "Working," Are They Right? (FEATURE STORY)
UNI Locks Up mp3 Artists and Throws Away the Key
NY University Tosses Major Music Venue Out On Its Ass
Janet's Boobs and Michael's Blues
JANET'S BOOBS AND MICHAEL'S BLUES
It's happened. We've finally hit the bottom of what I thought to be a bottomless pit of stupidity. We are suffering one of the worst economic upheavals since the Great Depression, but somehow we are going to find the money for what? Did I hear CNN right? We are going to spend hundreds of thousands-maybe millions-of tax dollars to find out if Justin Timberlake deliberately exposed Janet Jackson's breast on TV?
This is right up there with investigating a politician for infidelity. And just a quick reality check: our government is currently planning to spend over three times the amount of money investigating Breast-gate than that which they've currently spent on the poor intelligence data that has cost the lives of 1000s in the Middle East.
All in favor, please touch yourself in public.
As for brother Michael, my prediction is that he will walk and walk big. There is less evidence against him than there has been in many other recent celebrity prosecutions-- and those defendants walked. In all likelihood, Jackson will end up in jail for contempt of court before anything else. He keeps confusing his court appearances with his live concert appearances. This month, Superior Court Judge Rodney S. Melville chastised the "King of Pop" for entering the court arena 21 minutes late for his arraignment. "Mr. Jackson…I want to advise you I will not put up with that. It's an insult to the court," Melville said.
Of course, from Jackson's point of view, he was early. After all, 21 minutes late is "anxious" in Music Business Time.
THE JACKSON GAME
The upside for us rubber-necking spectators is this new Michael Jackson game on www.zooass.com, entitled "Escape from Neverland." This is a must-see. You use a hand-held rocket launcher to stop escaping children It's soooo wrong, but I could not stop playing it. I had to imagine Michael at home-wherever that is these days- playing it along with me. Note: turn the sound up for this one.
ARTIST SHOW-SPACE CLOSED DOWN BY NY UNIVERSITY
It's shaping up to be a dark month in New York music history. New York's Bottom Line, one of the only clubs in Greenwich Village one could see name-brand quality music in an intimate setting has been boarded up-ironically by their landlord, New York University. The irony is that most of the Bottom Line's bar crowd was composed of NYU students.
The venue on Bleecker Street was famous for caring more about music than door-receipts and gave many stars their first big break. These include: Jackson Browne, Janis Ian, George Benson, Rita Coolidge, Don McLean, Nicolette Larson, Dire Straits, Tower Of Power, Hall and Oates, Carly Simon, James Taylor, Todd Rundgren, Bruce Springsteen, Melissa Manchester, James Newton Howard, Phoebe Snow, Joni Mitchell,
…and about a thousand others.
Even though several big artists and Sirius Satellite Radio tried to pledge money to pay off the $185,000 in back rent owed by the club, in the end the University claimed it needed the space for more classrooms.
I, for one, will miss this club (where I played many times) very much.
MP3s CATALOG SWALLOWED UP BY UNI - ARTISTS LEFT OUT TO DRY
It is often the messenger who is beheaded for an accurate prediction that many find too uncomfortable to bear.
Recently, I took a lashing for implying that a certain popular online indie CD-distributor, one who offers iTunes access, could be unfairly seducing their clients into giving up rights and ignoring the obvious loopholes in their contracts. Their claim: they would release any artist from their Digital Distribution deal with 30 days notice-- no questions asked. Even though the contract is not really clear on that exact point, many people signed up solely on the trusted word of the company's CEO.
This cry will sound painfully familiar to those who have been following the recent developments in the MP3 story. Background: former MP3.com owner, Michael Robertson is now powerless to stop his parent company, Vivendi, who bought him out, from reneging on a promise he made to the over 100,000 subscribers on MP3.com. One of my key points is that verbal guarantees are only as good as the person offering them and are rendered worthless if, one day, he or she decides to sell the company.
This expert from a more expansive article, summarizes it nicely:
"When in November, mega tech portal CNET acquired the MP3.com domain name, Vivendi had already indicated that it was no longer interested in hosting the 1.5 million song archive. Despite a spirited campaign by MP3.com founder Michael Robertson, who sold MP3.com to VU in 2001, and an offer to host the collection by Archive.org founder Brewster Kahle, Vivendi shut off public access to the music in December."
The lesson, never sign a contract simply because you think the CEO is cool. The odds are better than average that he will not be in charge forever.
The exact status of the MP3.com catalog has not been determined, and will probably be tied up in many touts of litigation. But, to be sure, many artists who trusted the intentions of Robertson are now sorry they didn't read the fine print and trust the old adage: verbal agreements aren't worth the paper they're printed on.
Please see http://www.theregister.co.uk/content/6/34829.html for more information on this topic.
RIAA LAW SUITS: POINT OR PUNT? MARKET RESEARCH REPORTS SAY IT'S WORKING BUT CAN YOU TRUST THEM? - feature
The RIAA's suits against almost everyone and their 12-year-old daughter have taken a new turn. Are they making a point or are their legal actions a desperate punt to grasp at a dying business model? Market research firms are saying "yes" to lawsuits, but is their data tainted by agendas or flawed methods?
Barred from pressuring ISPs into giving up personal information about illegal file sharers, the RIAA is using an old legal strategy called a " John Doe filing" to go after these same people. In this from of suite the RIAA does not need a name, but merely an IP number-- that's the numerical footprint that your computer leaves as it moves through cyberspace.
RIAA chief Carry Sherman wanted to make it clear that he's no longer against file-sharing, just "illegal" file-sharing. "It's iTunes and the new Napster and others versus Kazaa, Imesh and Grokster…it's whether or not digital music will be enjoyed in a fashion that supports the creative process or one that robs it of its future."
OKAY, BUT IS IT WORKING?
Many marketing research firms have sprung into action and have published reports that attempt to answer the big question: is the RIAA legal campaign working? Meaning, is it pushing people towards legitimate downloading venues? Many reports say "yes," and adding that file-sharing is down, but many journalists are saying "no" because, they claim, the RIAA is alienating record buyers, which ultimately hurts sales. Both reports cannot be simultaneously true. So, here are a few facts that might reveal an Achilles heel in these oversimplified and polarized conclusions.
1) There is still probably a lot of confusion on the part of the public about what is "free," what is promotional, and what is "for a fee." This gray area might contribute to continued piracy and could create a disruptive market as well as make any firm conclusions about whether or not lawsuits are "effective," impossible.
2) One survey suggests that the RIAA's message is a good first step in creating awareness. There is little doubt that people are NOW beginning to understand that intellectual property is just as sacred as real property-whether or not this means that they will continue to break the law is another story. (This chart is available on my site at http://www.mosesavalon.com/riaa.htm)
Consider this: Although jaywalking is illegal, most people do it anyway. However, if the city suddenly began to enforce the jaywalking law, we'd probably stop jaywalking. Academic, but, if cops DIDN'T give tickets for jaywalking, would you have MORE respect for the law? Would you feel like following other laws that you routinely break? I doubt it. The argument that the RIAA lawsuits are NOT working because they alienate record buyers follows this same blunt logic. And the RIAA won't earn popularity points if they back off, either. So lawsuits are a win-win from their viewpoint.
3) As of this newsletter, many people still can't access the iTunes and Napster Web sites because they are designed exclusively for high-level Mac and Windows 2000 platforms. And, believe it or not, there are still many millions of us who still use Windows 98 and older Mac OSes. So, according to a large cross-section of the record-buying public, the legal file-sharing technology is momentarily inaccessible. This might still be pushing people towards illegally file-sharing.
4) Finally, not one study I've read so far has made a case that people are downloading MORE music since the lawsuits.
BEWARE OF THE EXPERTS
Although journalists also have a transparent agenda--attracting readers with doom and gloom stories of record industry Armageddon--it's important to be cautionary of official-sounding market research "results" on this subject. Almost every firm investigating this phenomenon has done so with the aid of an on-line survey. In other words, people go to a site to answer questions about their downloading and buying habits. Is it any wonder, then, that the results they get are skewed in favor of computer users? Of course you're going to have a high statistic like "one in four Americans have downloaded music," when four out of four people surveyed have computers?
Consider the conclusion of several firms that used computers to gather data:
--20% of all Americans have downloaded music.
--Almost 50% of males under 24 have downloaded music.
--Downloading has dropped since the RIAA's legal assault.
These follow the statistics of the average computer-user in America.
So, let's be real: do you think market research firms are interested in attracting indie artist as clients? No, they want corporations with large marketing budgets. In this case, the RIAA. And to get clients like this they need to show sympathy towards the needs of the RIAA.
One firm published some very intriguing results.
--People will pay about 50% less (or about $5) for downloaded albums over CDs.
--Even at a far lower price (almost half off) consumers would rather have CDs than downloads.
-- People still prefer discs to data.
Record execs must be doing the pee-pee dance over these conclusions.
HOW IS THIS RELEVANT TO ARTISTS?
Bearing in mind that these results are slanted in favor of computer-users, these are VERY encouraging results for those selling their own music on CDs, independently. The fear among many of my indie clients is that they will have massive overstock, now that many people can buy music easily through Digital Downloads. But the above suggests that there is still time to sell CDs at a decent profit and that the celestial jukebox, although a significant step closer, is still lingering just outside the status of " major threat" to traditional retail.
In the mean time, we can expect market research firms, who are very interested in acquiring RIAA business, will continue to interpret their data in the way that gets them the most attention. Likewise we can expect journalists, who feel the need to rebel against the machine and "serve the public" to say how the RIAA is bullying the market into non-existence. My guess is that we still have about another two years till we can begin to use CDs as roof shingles.
For some really great interviews on Digital media go to Phil Leigh (Senior Analyst, Inside Digital Media) at www.insidedigitalmedia.com. Phil's site has great PowerPoint presentations and interviews on the future of digital music.
(On my site this month is a chart taken from a market research survey done by a top firm. It shows people's attitudes toward file-sharing have changed since the RIAA lawsuits. You can see the actual chart at http://www.mosesavalon.com/riaa.htm
Guitars, Guitars, many more Guitars, and a digital workstation or two. If you missed it, just go to any large music store and spin around several times. Same thing!
Mo out.
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