RIAA and Labels Still Not Getting It


There’s been a number of recent articles about music lately. Much of it has been around the issue of how to grow the digital download business. Apple‘s Steve Jobs even weighed in suggesting that the labels need to seriously consider dropping the prohibitive DRM technology from the music.

Of course he was speaking to a group that has turned a deaf ear to everyone but their own bean counters. In fact, things are so bizarre over at the RIAA that their response to the Jobs letter was to completely misread it, intentially or otherwise. Today the RIAA lauded Apple for their willingness to license Apple’s DRM technology to others as a major breakthrough. The problem with this is that the letter said, essentially, the exact opposite! Jobs stated that Apple has decided that opening up FairPlay (the name of their DRM technology) would solve nothing and that DRM should be dropped entirely. In another article an RIAA rep pointed out that it’s estimated that over 1 billion songs are traded each month even with all the so-called success in suing individuals over the practice. To counter that the rep pointed out that iTunes has “only” managed to sell over 2 billion songs since its inception.

Left out of all of these articles is common sense, as always. Every major technology pundit I know of has reminded the RIAA that suing individuals would come at a price in terms of stubbornness to continue on. The articles also continue to count every download as lost revenue. As I’ve pointed out many times, our parents taught us long ago that you don’t count money as yours unless it’s in your pocket. There’s no way to know how many of the downloads would turn into legitimate sales if no other avenue were available. The RIAA counts it as 100% which is completely ridiculous. I went through a period where I download a bunch of music back in the Napster days. I used it to audition music to decide if I wanted to own the CD (I’m not a fan of MP3’s as a final media form and believe in the concept of paying for the music). I downloaded quite a number of songs I never purchased. They just weren’t good enough past the initial interest. I’d download them, listen to them over a few days and then delete them.

Understand that I’m now 42 years old. My days of buying a lot of music in bulk are behind me. I just don’t care about music like I did when I was 20. I own literally a few thousand CD’s but my CD buying has dropped significantly. My friends say the same thing and they’re not downloading music to keep either. However, the CD’s I have bought recently were mostly as a result of auditioning MP3’s first. Without that outlet I probably would have passed on buying those discs entirely. I also suspect that this is yet another parameter that the RIAA doesn’t consider or doesn’t mention—that as the baby boomers age, they’re buying less music. This is bound to have an impact on the bottom line. CD sales are down 23% since 2000. I’d be willing to bet that a graph showing the aging of the main buyer in 2000 isn’t far off from that same line.

The final thing that isn’t mentioned is profit. iTunes has sold 2 billion songs and the labels make far more on those singles than they ever did selling CD’s (percentage-wise per song). However, this isn’t shared with us. Instead they want you to have the other numbers in your head even though it’s not an apples-to-apples comparison.

I’m still waiting to join the (new) digital revolution. I’ve bought a couple of songs but then stopped. When I can download DRM-free full CD-quality songs I’m very likely to start spending more money again. I don’t see that happening anytime soon though. There are many CD’s that come out that I think about buying and without the ability to audition the songs properly (10 second segments don’t cut it people) there’s no way I’m going to make that investment on a reliable basis. However, when I can pay $1 for a song the way I described above, then it becomes an impulse buy and I’m interested again. Paying $1 for a crippled piece of junk has no allure for me. Sorry.

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