Sundtempest

Reporting, analysis, and opinions on the latest trends and developments in the music industry.

Posts Tagged ‘New artist models’

The Pirate Bay Goes Legit

In what is quite possibly one of the most unexpected twists one could imagine in the music industry, file-sharing haven The Pirate Bay has been acquired - legitimately! - by a Swedish software company, Global Gaming Factory. GGF offered the equivalent of nearly $8 million for the website and have stated that they plan to turn it into a legal enterprise.

Though the move comes as a shock to TPB’s community (and much of the Internet), the transaction involved no coercion. It turns out that the folks at TPB do believe, more or less, that GGF’s goals are in line with their own.

The obvious challenge is how one can take a website devoted to flagrantly violating copyright law and somehow make it legal, without turning away the entire community. GGF has stated that they will begin to charge users for content, but they will also (somehow) pay users for sharing said content. Advertising revenue and “offering services to telecom operators” will also play a part.

Do you think the new, GGF-owned Pirate Bay will survive?

(Editor’s Note: Preparing for a wedding and moving into a new apartment are more time-consuming than I expected. Still looking for guest writers to help in times like this - just shoot me an email!)

Swedish Software Firm Buys Filesharing Site Pirate Bay [wsj.com]

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Is “Free” Overrated as a Business Model?

James Ledbetter of the Washington Post penned a great rebuttal argument that takes some of the air out of the argument that all businesses should give away some key part of their products. The piece is designed mainly as a counter to Chris Anderson, editor of Wired, who has aggressively promoted the idea that virtually any kind of business, but especially ones operating in the digital realm, can and should give away key components of their products or services.

Ledbetter points out that this model makes no sense in many industries;

“Just about any activity that merits the title “business” has a cost of producing its goods or services. Take the oil-and-gas business. It costs a huge amount of money to extract petroleum from the ground (more now than it used to in many places), as well as refining the stuff, storing it, shipping it and so on. Those costs may or may not justify the price of a barrel of oil or a gallon of gas, but neither do they justify a price of zero. It’s exceedingly difficult to envision a way in which the oil industry could recoup its expenses without charging for its product…”

He also names a number of businesses operating online that have failed or are failing, despite their model of giving away services for free. I can name plenty myself - to name just two popular sites, Twitter and YouTube.

My favorite point that Ledbetter makes is that many Internet-based businesses think that if they give away lots of stuff for free - say, music for example - they can make up the difference (and more) with advertising. However, the problem is that the value perceived by advertisers in any given ad space is entirely dependent on the target market, and, for the majority of businesses, it is far preferable to advertise to a small group with a higher response rate than to a dispersed group.

Here’s a practical example. It would be possible for me to buy a billboard outside of 30th Street Station in Philadelphia and advertise my sample library products. This would be exorbitantly expensive, and it is highly unlikely I would get more than a handful of conversions as a result, despite the massive expense. On the other hand, $300 gets me ad space on Northern Sounds, a web forum devoted entirely to discussion about sample libraries. Which would I want to spend my money on?

Ledbetter’s point is well-taken. Musician industry veterans know that giving out hundreds of copies of a CD at a convention will likely result in absolutely no return on investment, because your target audience is too broad. Internet companies would be ill-advised to simply gain as many ‘customers’ as possible by giving out free products with no consideration for how this may dilute their advertising prospects.

Call It Free, But It Will Cost You [Washington Post]

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Free Music Archive is Now in Beta, 5,000 Tracks Available

Nine times out of ten, any website that springs up claiming to offer free music is either (1) laden with ads, focused on major label and popular music, and streaming-only or (2) illegal. As great as it is to have a myriad of places where I can go to listen to or purchase “My Life Would Suck Without You” (unfortunately, that’s a real song title) I tend to get more excited about repositories of truly free music that hasn’t already saturated the market. That’s why I’ve always loved OverClocked ReMix, for example, a video game music arrangement website that hosts over 1,500 free MP3s.

So, if you’re anything like me, you’ll probably be very interested in the Free Music Archive, which is pretty much exactly what it sounds like: a repository of freely-downloadable, independent music licensed under Creative Commons:

“The Free Music Archive is a platform for collaboration between WFMU and a group of fellow curators, including KEXP, dublab, KOOP, ISSUE Project Room, and CASH Music. The site combines the curatorial approach that these organizations have played for the last few decades, with the community generated approach of many current online music sites.”

Users can browse the archive by genre and access information about each artist, album and track with a single click. The music can either be downloaded or streamed right from the website without the need to create any sort of account (yet). As of now, artists may participate on an invitation-basis only, perhaps as a method of quality control. Despite this limitation, the Free Music Archive boasts over 5,000 tracks already. Thanks to the archive’s wide breadth of artists and its easy-to-use, uncluttered interface, free music aficionados will probably be busy for a long time.

This is FMA Beta! [freemusicarchive.org]

(tip courtesy of Bradley Burr- thanks Brad!)

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Choruss: The Worst Idea Ever

If you’ve been following this blog, you already know that Warner Music Group has made some pretty bad moves for the last few years, even morseo than the other major record labels. However, their newest venture, “Choruss” (dreamt up by consultant Jim Griffin) has to take the cake for the worst yet.

The basic plan is that major labels would “ask” (read: force) universities to pay them a fee, and in return, the labels promise not to sue the universities for copyright infringement. In theory, students can then keep on downloading, guilt-free, and labels get paid.  
In actuality, such a scheme would be highly detrimental to artists, songwriters, and publishers.

Intellectual property lawyer Bennett Lincoff explains why: “Under Choruss’s programme, songwriters and music publishers will not have an enforceable right to receive royalties through Choruss for student file-sharing of recordings that contain their songs … if Choruss relies on covenants not to sue and thereby avoids the obligation to clear mechanical rights, songwriters and music publishers will end up with nothing, or next to nothing from student file-sharing of their songs.”

In other words, rather than create proper licenses for the music within the Choruss program, the people behind the scheme instead want to bypass that and instead simply promise not to sue students and universities. That’s all well and good (for the labels) but artists, songwriters, and publishers essentially depend on proper licenses to earn money from their work under U.S. law. Labels would have a stream of revenue from universities and no legal responsibility to pay that back out to anybody else.

How does this affect non-major artists and songwriters? Students will no doubt assume they simply have the right to download whatever they want - not just major label music - and will continue to do so without fear or guilt. Except, of course, there’s no possible way non-majors could have any hope of compensation from such a program.

Lastly, is this really teaching the right lesson to students? To them, they’re just getting a free pass to download lots of music. I doubt universities will thoroughly explain the legal framework of Choruss, and even if they do, I doubt most students would understand. We’d be telling people that music now has no value and that they can just pirate all they want. I don’t think that’s the message the music industry should be sending.

Choruss’s Covenant: The Promised Land (Maybe) For Record Labels; A Lesser Destination For Everyone Else [ip-watch]

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