Tuesday, January 20, 2009

File under: I can't believe we're still talking about this

Here's an article about some discussions at this year's MIDEM.

Music industry urged to embrace the Internet

Some quotes:

"In 2008, some 95 percent of the music downloaded from the Internet, or more than 40 billion files, was illegal, leaving the overall music market down around 7 percent on 2007... Consumers will only move to legal sites from illegal ones if the proposition is better and easier to use, critics say."

Music labels still don't get it. They had an army of techies and venture capital who wanted to make music over the Internet work 8 years ago. The labels squandered this opportunity, and are still digging in their heels.

The labels failed to learn what the shareware industry learned early on: it's better to make money from 3% of a huge market then 100% from a microscopic market. Labels are losing 95% of the money and customers that they could have reached. They still reject new technologies and business models, preferring to protect their special markets business and what I call "stupid VC" money. Huge advances are much more attractive to execs who will retire in a few years than investing in the future of the business. Meanwhile, the leaks around the edges remain a flood.

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