Losing Control and Liking It

Following the jump is my editorial in this week's CMA.EDU, a biweekly roundup of digital music news I co-edit with David Ross of Music Row for the CMA Future Markets Task Force. It describes two visions of the music business laid out by twin keynote speakers at last week's Leadership Music Digital Summit in Nashville. No surprise that I'm more inclined to be with Terry McBride, whose mantra was "give up control" of recorded music. He urges artists to create other events and products and relationships that can be monetized, including CD and download sales, but don't sweat it when people want to share your music. Then today I saw this piece by Peter Gabriel about how he changed his mind after resisting the sharing/no control paradigm for years. I admit it's easy for me to embrace the DRM-free, sharing-is-good philosophy, as I'm not a working musician or a songwriter. It's got to be hard to charge down this path of uncertainty when it seems like everyone from music supervisors to Debbie in her dormroom wants your music from nothing. But more and more artists are relenting to what may be the inevitable.

We saw quite a few CMA.EDU readers mingling at last week’s third annual Leadership Music Digital Summit. Event chairs Ted Cohen, Lori Badgett, Fletcher Foster and Fred Knobloch proved once again that the LMDS is Music City’s premiere annual forum for fresh ideas in the fast-changing entertainment media world.
Our highlight was the spicy contrast between the morning and afternoon keynoters, Nettwerk Music Group CEO Terry McBride, who urged the end of digital rights management (DRM), and RIAA CEO Mitch Bainwol, who said you can’t make a market function if there are no rules in the stores. Our own David Ross summarized McBride’s message in Music Row:

McBride noted the industry is currently trying to change behavior through legislation and litigation, naming the RIAA as an example. “History shows that won’t work,” he said. “We must move to monetize the behavior of the consumer, not try to change it. Using the tool of fear will not change the habits of the millennium generation. What we are doing is forcing P2P activity underground and pushing kids into trading songs using Instant Messenger where we are unable to collect data.”

CME.EDU today links to several dispatches from Paul Resnikoff of Digital Music News, who reported Bainwol’s message thusly:

"DRM serves all sorts of pro-consumer purposes," Bainwol asserted. Addressing the continued interoperability mess, Bainwol noted that "cross-licensing DRM is the way to solve the issue," a not-so-subtle jab at Apple and its closed, FairPlay protection system. But despite the ardent support for DRM, Bainwol left the door open on other possibilities. "If it supercharges the sales of music, then we'll learn," Bainwol said, while pointing to a "prudent, rational judgment on how to proceed on DRM” over the next few months.

Two visions. One future. Who do you agree with?

Comments

[George]

I interpretted McBride's comments as far broader than simply removing DRM. People like Jon Simsom and Mitch Bainwol are trying to tax their main source of publicity: Radio (including internet and satellite) and TV. This whole move towards increasing or creating revenue through performance royalties is the most short-sighted idea I've ever seen. Labels want to be able to call stations and tell them to increase spins on a song, while at the same time increasing the royalty. Something's gotta give. As Kurt Hansen has pointed out in his blog, there IS a value in airplay. Airplay is its own compensation. The finance people at the labels have forgotten that. Free airplay has created the golden goose. You can see the difference in sales between those who get free airplay vs. those who don't. So why tax radio and TV for publicizing artists and music? Especially internet and satellite, where the playlists are far wider.

One comment Terry made was about how MTV once played music videos. The reason they and CMT don't any more is they discovered they can make more music by creating programming they own, rather than airing free videos. At some point, radio stations will make the same discovery. When it happens, record labels will have even more trouble getting their music played. Adding a performance royalty will simply seal the fate. Plus it will open the door for artists who are willing to forego the royalty, or new labels owned by radio companies. There was a time when media companies like CBS, RCA, and MCA owned record labels. That time may come again.