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The music industry is in freefall, but a new breed of digital music could be its saviour. Will the latest anti-piracy measures work, or is the old rockstar model broken beyond repair?

[ Words Thomas Shambler Illustration Paul Jackson @ Tank.Axe.Love ]

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Spotify3 US$0.17 iTunes2 US$0.65

CD1 US$0.20

LABEL ROYALTIES

T

he music industry is in trouble. There’s no other way to say it. Thanks in part to a spate of illegal file sharing sites and a generation of Bieberbopping music-lovers who think free tunes are a basic right (a bit like breathing or peeing with the door wide open), the music industry is putting its efforts into catching pirates, prosecuting sharers and setting up new, legitimate means of making money. And not for the first time… Back in the 80s, the music industry poured its energies into the ‘Home Taping is Killing Music’ campaign. Kill music it most certainly did not, but it did give rise to Napster, an easy way to share tunes and an even greater threat to music’s health. Ten years and a few court appearances later, and Napster is no more, at least not in the fun, free and illegal sense, anyway. But its spirit lives on, in the hundreds and thousands of free tracks, torrents and albums being sent and shared over the interwebs. The Recording Industry Association of America (RIAA) doesn’t like this, naturally, and has taken to aggressively prosecuting file sharers in court. File sharers like Jammie Thomas, who was slapped with a US$1.5million copyright infringement case last November. The crime? Jammie was convicted of sharing 24 songs (a staggering US$62,000 per tune). Or Ann Muir, a 58-year-old grandmother from Scotland who has just been handed a three-year probation sentence for sharing karaoke tracks. But this controversial tactic, of making examples out of regular torrent-users, clearly isn’t working. A report commissioned by the music industry has said illegal file sharing will cost billions by 2015. That’s US$340billion, to be exact, along with over 1.2million jobs lost in Europe alone. Faced with these big numbers, and no decline in the number of sites or tune sharers, the music industry has thrown its weight behind a new breed of sound store. It wants to transform the way we get hold of our songs,

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1. Based on ten-track CD sold at US$9.99 2. Based on US$0.99/track 3. Per song streamed

and if it works, the future of music is going to be a world away from the High Street model much of the industry still clings to. Digital music looks to be the way forward, but will it work? And how are we going to get it? Downloads come of age After a troubled youth with DRM and pricing issues, digital music downloads have grown up. The emergence of better-than-CD quality 24-bit downloads is a new reason to buy to keep, and the cost of downloading has been driven down with iTunes variable pricing and Amazon’s US$0.69 tracks. Edward Bagnall, Marketing and Communications Manger for digital download service Music Master, welcomes the lowpriced competition and claims price isn’t the only issue. “The biggest selling point for digital music has to be the convenience. You can just about get wireless in most places now, which gives you the ability to log onto Music Master and download from our catalogue.” Bagnall believes that online services are the future; certainly they offer the sort of convenience vinyl users have sordid dreams about. And the Music Industry has taken note, “There is a huge issue of illegal downloads across the globe and labels are looking to support as many legal solutions as possible, whether its Apple’s iCloud or a local download website like Music Master.” Hybrid download services, such as Nokia’s ill-fated Comes With Music service, gave you as many tracks as you like for the price of your handset – but you could only play those songs through the mobile. But the Finnish firm recently announced it was going to shut down in most markets, citing the need for, “a DRM-free music service”. Bagnall agrees: “Most people I know have music on several devices, ranging from the iPod to laptop to storage devices and even tablets. By having DRM-free music, it gives them the flexibility to listen to music on any of those devices.”

Research: David McCandless www.informationisbeautiful.net

But there remains a question over whether the digital-savvy consumer who is used to getting music for free is bothered about ownership. For them, streaming services have a fresh, free sheen that buying in the traditional way lacks. Stream of plenty Streaming sites like Spotify let subscribers access millions of tracks, for free (via funding from adverts) or a monthly fee. It’s pushed streaming to the forefront of music consumption. That’s where Qriocity comes in. According to Sony Music’s Craig Pereira, Director of Marketing and Digital Business Development in the Middle East, Qriocity “will enable all of Sony’s internet connected devices to stream music, movies and games for a monthly fee.” In short, it wants to, “do for the streaming model what iTunes did for downloads”. Lofty ideals, indeed. But Craig is optimistic, streaming services, “give you the chance to be exposed to a whole world of music at half the price of a single CD.” But the amount it and similar services actually earn for artists is shrouded in mystery, with most bands content to rely on CD or digital download sales. A blog post by Robert Fipp, guitarist with prog rockers King Crimson, revleaed that two of the band’s tracks on Spotify were streamed a total of 618 times. Island Records received a royalty cheque for US$2.60, making each play worth roughly 0.004 cents. The major labels are doing slightly better from the bargain. Sony, Universal Music, Warner Music and EMI own 19 per cent of shares in Spotify and earn money from subscriptions and advertising revenue as well as streaming royalties. Rob Wells, Senior Vice-President, of Universal Digital, recently revealed that Spotify earnings were the label’s fourth most profitable source of digital income.

“spotify has killed band income. Our annual accounts made depressing reading”

The first copyright infringement campaign came along more than 20 years ago


/future of music

CD1 US$0.10 iTunes2 US$0.09 Spotify3 US$0.004

ARTIST ROYALTIES

need to know get your music fix Download Physical From stores sales US$0.69 Principal advocates

per track

Amazon, Beatport, iTunes, Music Master

But Dia H, lead singer of local band Juliana Down sees another advantage to streaming services: it’s cheaper. “The simple fact is that it costs more to manufacture, distribute and retail a CD than it does to upload a series of binary numbers”. The third way But what if there was a way to get the best of both – owning your tracks and streaming them from the cloud to whatever iDevice, smartphone, PC or tablet you may be using at the time. Enter the big boys – Amazon and Google. Both are huge players in the content and ownership game, and both have just started their own streaming services. Amazon’s Cloud Player gives you a taste of streaming, providing 5GB of online space to start with and letting would-be users upload tracks and albums. Need more space? Then you can buy another album through the Amazon MP3 store and it’ll bump up your ‘Cloud Drive’ storage to 20GB. Buy more tracks and you’ll have them uploaded for free – giving you unlimited space for songs, just as long as you keep Amazon on the books. The world’s biggest search giant has too, gotten into the music act. It announced Music Beta last month, a digital locker system that will upload your personal music collection to its servers, letting you listen to your library from any smartphone, tablet or computer hooked up to the net. Whether this will drag streamers and illegal downloaders back to legitimate downloads is another matter. It’s just as easy to upload a pirated track as one from a CD or digital download service, and the benefits – being able to stream it at a moments notice — are the same. Let’s get physical Some music lovers still crave a physical object. The advantage a CD holds over digital downloading is simple; there’s no DRM woes, no need to back up your tunes and it’s easy to share your music. Radiohead famously let fans choose their

price for the digital download of In Rainbows but they also sold a limited-edition box with a hardback book and bonus CD for US$65 at the same time. A more recent attempt to lure fans with a physical product was Lady Gaga’s Super-Delux Fame Monster Pack which cost US$100 and featured a lock of her hair as well as a puzzle, paper doll collection and note. But attractively packaged box sets are good for high-profile artists who command a frothing fan base desperate for a lock of hair. Smaller acts, with fewer committed fans, will see lower royalties and smaller advances as record companies look to reduce risk. On one hand, this could mean that artists will have to focus on producing all-killer, no-filler material, but there’s also a chance that it’s going to make instant-hit music the only economical viable material for the major labels to back. Is the death of the album nigh? Mike Priest, Community Manager at music booking firm The Fridge, thinks not. “Bands with big followings have other ways to carve out a living, and gigs are a great way to do that.” Dia H agrees, “there is a new emphasis on live music again, because it’s a great income stream for bands (at least bands with decent name recognition) so it is forcing bands to put on great live shows.” At the end of the day, “it’s about creating music that makes people want to follow you. The days of industry taste-makers is gone, big labels are no longer the only gate-keepers to the music industry.” Stuff says… Our money is on a future based around easyaccess, low-cost digital music provided by steaming services and digital downloads. The likes of Spotify and Qriosity give you the most convenient and least painful way of paying for music for those who have little prior experience. Downloads will continue to be a safe bet, helped by digital lockers like Amazon Cloud Player and Music Beta by Google. And while physical purchases will always have a place, they’ll become niche. We expect to see a different kind of music industry emerging, in which artists are far more dependent on their own self-promotion.

How it works You purchase individual tracks or whole albums that are then downloaded to your hard drive. Some have a sliding price scale with higher quality files costing more to download. Pros You own all your tracks and can play them whenever and wherever you like with no extra charges or ads. Cons It can be hard to try before you buy and it’s a more expensive way of listening to music than streaming.

Principal advocates

Amazon, HMV, Virgin Megastore How it works You walk into a shop or visit an online store and buy a CD or vinyl copy of the record you want. You know, like they used to do in the olden days. No instant streaming, no delivery direct to your computer. Pros Leaves you with a record collection that won’t disappear if your hard drive crashes. Cons More expensive and less convenient than downloading just the tracks you want.

Streaming Digital Free with services ads locker or pay Principal advocates

per month

Spotify, Qriosity, We7

US$price varies

Principal advocates

up to 5gb free, pay to upgrade

Music Beta by Google, Amazon Cloud Player

How it works Sign up for an account and you get access to a huge library of tracks to stream. Stick with a free account and you have to put up with ads. Otherwise, pay a monthly fee to make them disappear.

How it works You buy tracks just as you would from a download store which then get saved online. You can upload previously bought tunes, and then have the service stream your songs to any device connected to the net.

Pros Free access to large music libraries if you can stomach ads. Ad-free streaming with subscriptions includes access via your mobile.

Pros You own the digital tracks and get streaming services for free. Also works with your current library

Cons Cancel your subscription and you’ve got no music to show for it.

Cons Limited space. If your digital locker is full, you’ll have to upgrade the amount of online storage or buy more music from select stores.

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Future of Music - Stuff Magazine  

The music industry is in freefall, but a new breed of digital music could be its saviour. Will the latest anti-piracy measures work, or is t...