Along with the books for which they are known, the public library system has lots of music on CDs. (Presumably they acquired them legally).
I get to check out the CDs that the library owns, and play them, without paying the library, the artist, the recording label company, or anyone else.
OK, certainly there are differences. I can listen to one particular physical CD that the library lent to me, but no one else can do so until I return it. If the library wants to be able to supply several people with the same CD concurrently, the library must purchase or otherwise legally acquire more copies of the CD in question.
Still, it does poke a hole in the idea that the wrongness of Napster comes from people having access to tunes without the artist or recording industry getting paid for it.
The digital world, and the ability to copy and transfer files, changes some of our conventional notions of possession. Suddenly I can give you something I have and yet I still have it too. This has ramifications for artists (and software authors and so forth), and for the rest of us, since if the artists and whatnot stop making what they make because they aren’t getting paid, we don’t get any new music or software or etc.
On the other hand, the prices we once paid to buy a piece of plastic that had to be manufactured out of materials in order for us to hear sound seem inappropriate now that it is clear that we don’t need anything physical, we just want the bloody bits and bytes which don’t cost the recording industry anything to manufacture.
I have said it before and I will say it again: the existing players in the recording industry, should they decide that they wish to survive, had better set up web sites and start selling their repertoire online for download. And if they don’t, they will be replaced by others who are able to scrape up the initial cash to record and promote the artists.
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*Originally posted by pldennison *
Again, most corporations operate at a tiny profit margin,e ven the giants. In the most recent quarter Warner Music Group saw EBITDA of $87 million on revenue of $895 million. That’s down 11% from the prior year quarter, BTW. That’s 9% for that division, and that’s one of the better companies.
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That’s not a tiny profit margin. Grocery chains used to have a profit margin of 1-2% (maybe still do; I just haven’t kept up). Now that’s tiny. And yet there are still an abundance of places to buy groceries.
The point about the expensive recording studios is well taken, since that’s the part that the record companies provide that actually adds value.
As far as advertising and promotion are concerned, exactly how does that benefit me, the consumer? The radio stations would still find music to fill the airwaves with, absent such efforts; it might not be the same music as results from all that advertising and promotion, but that might be a good thing, you never know.
‘Distribution’ - in a Web-based age, this shouldn’t cost much anymore. The ‘distribution’ costs are all about the companies’ defending their interests. Again, why should I pay for this? (I’m starting to feel like Manny in The Moon Is a Harsh Mistress when the reporters ask him whether Luna shouldn’t be taxed to pay for space travel, police protection, and armed forces.)
Artwork and packaging - there’s at least an argument here, but sorry, but I was there for the golden age of all that stuff (Sticky Fingers, School’s Out), and it’s gone forever. Nowadays, kids carry the CDs around in a big CD wallet, and the jewel cases with their artwork, such as it is, are on a shelf at home, gathering dust. So I don’t see a particularly large market to whom this represents significant value added.
And the musicians - if you could put forward a case that most musicians actually benefit from the lock the recording companies currently have on the industry, then you’d actually have something. But bands make their serious money, not from recording (many actually wind up in debt to the record companies for the privilege of having them record their albums, I understand - but you’d know more about this than I would) but from touring. How would that be affected if the record companies fell apart? Nada. There would still be radio stations playing songs, so there would still be hits, and there would still be bands touring, playing those hits, making money through their concerts, selling tickets and t-shirts.
So I should pay for the recording studios. Fine. But much of this other stuff is questionable, and some of it, you’re asking me to pay for stuff that benefits only them.
That’s not a tiny profit margin. Grocery chains used to have a profit margin of 1-2% (maybe still do; I just haven’t kept up). Now that’s tiny. And yet there are still an abundance of places to buy groceries.
The point about the expensive recording studios is well taken, since that’s the part that the record companies provide that actually adds value.
As far as advertising and promotion are concerned, exactly how does that benefit me, the consumer? The radio stations would still find music to fill the airwaves with, absent such efforts; it might not be the same music as results from all that advertising and promotion, but that might be a good thing, you never know.
‘Distribution’ - in a Web-based age, this shouldn’t cost much anymore. The ‘distribution’ costs are all about the companies’ defending their interests. Again, why should I pay for this? (I’m starting to feel like Manny in The Moon Is a Harsh Mistress when the reporters ask him whether Luna shouldn’t be taxed to pay for space travel, police protection, and armed forces.)
Artwork and packaging - there’s at least an argument here, but sorry, but I was there for the golden age of all that stuff (Sticky Fingers, School’s Out), and it’s gone forever. Nowadays, kids carry the CDs around in a big CD wallet, and the jewel cases with their artwork, such as it is, are on a shelf at home, gathering dust. So I don’t see a particularly large market to whom this represents significant value added.
And the musicians - if you could put forward a case that most musicians actually benefit from the lock the recording companies currently have on the industry, then you’d actually have something. But bands make their serious money, not from recording (many actually wind up in debt to the record companies for the privilege of having them record their albums, I understand - but you’d know more about this than I would) but from touring. How would that be affected if the record companies fell apart? Nada. There would still be radio stations playing songs, so there would still be hits, and there would still be bands touring, playing those hits, making money through their concerts, selling tickets and t-shirts.
So I should pay for the recording studios. Fine. But much of this other stuff is questionable, and some of it, you’re asking me to pay for stuff that benefits only them.
Well, I did say that that was one of the best, being part of giant AOL Time Warner. That’s why there has been and continues to be consolidation in the record industry–any given label is likely to be unprofitable enough or marginally profitable enough that they can easily be snapped up by one of the media giants.
The comparison to grocery stores is, while taken in the spirit in which it is offered, not precisely valid. Grocery stores operate on a much smaller scale than record companies, and their products are perishable. CDs are not. A comparison to food wholesalers might be more apt, but even then, we’re dealing with a product which spoils on the shelf eventually, as opposed to food.
It doesn’t matter if it benefits you or not–the record company isn’t about to just write off that cost. They’re going to try to recover it. Just like the movie studios, soft drink manufacturers, the auto makers, the sneaker producers . . . you pay for advertising/promotion costs with nearly every product you buy. Why should music be any different? Why do people seem to have this idea that music should be treated differently just because it’s so fun to listen to?
I disagree, to an extent. I, too, would like to be able to download any album I want to buy, but that isn’t the case right now; and, until there is some way for rightsholders to protect their legitimate copyright interests, it won’t be. So for now, you have to get the product from point A to point B, and that costs money. It’s a huge part of any product – why do you think you have to pay S&H charges for mail-order products, or delivery costs for furniture? If it wasn’t for distrubution costs, and the costs of maintaining a physical inventory, Amazon.com would be in the black and Pets.com would still be in business.
I hate to sound like a broken flat black vinyl analog-encoded music recording, but you pay these same costs with every product you buy, and I see no compelling reason why music should be any different.
I agree that the record companies could probably reduce the packaging, but – once again – they can’t eliminate it completely (they at least have to identify the artist, title and track names, along with catalog numbers, copyright info, etc.). That has to be put somewhere. And they have to recoup that cost. Sure, everyone could adopt the simplest possible packaging, but producers have to have some way to distinguish one CD from another in the marketplace. Obviously, the days of elaborate Roger Dean album covers are gone, but if two CDs look exactly alike on the rock, why would you, while browsing, stop to look at either one of them?
Plus, there are other considerations tied in with the packaging, such as:
Retail display. Remember what it took to get rid of the longboxes? Retailers liked being able to display two rows of longboxes side-by-side in an existing bay for vinyl. When the companies all went to jewel cases, retailers had to retrofit their displays to accommodate. Guess who paid for that? Making major industry-wide changes to packaging would only make CDs more expensive in the short term, at least to consumers.
Security. There was a bit of a hew and cry when the industry switched to jewel cases because they would be easier to steal. I don’t know what kind of numbers are available on industry losses due to shrink, but the fact remains that any change in packaging is going to have to account for possible theft.
I have no idea how many CDs Opal buys.
You’d think so, wouldn’t you? But it isn’t true. Just as the label fronts the money for the album, the label fronts the money for the tour. At just about every level, that’s label money being spent. At the smallest levels, the label rents the band a van, they drive it themselves, and they get a per diem for hotels (maybe) and food. Maybe some local promotion is undertaken in each city–morning show appearances, a meet-and-greet at a record store, etc. At the larger levels, there are enormously expensive logistics, insurance, and travel costs, all paid for by the label.
The bands make their money through publishing (if they’re the songwriters) and merchandising (t-shirts, stickers, whatever) until they make it big enough that their upfront/touring/promotion costs are recouped and their per-unit sales start to add up. Whatever the case, though, I’m not about defending industry practices, or making the labels the victims and the bands the villains, or whatever. I’m just pointing out that bringing a recording to market is an expensive proposition. This pernicious legend that the record companies clear $15.00 in profit from every $17.99 CD does nothing to increase understanding on any side of this debate.
I don’t feel that it differs significantly from any other product I buy.
