You Mean Wall Street Just Realized The Recording Industry Was In Trouble?
from the why-you-don't-trust-wall-street-analysts dept
You didn't have to be particularly insightful to realize a while back that the traditional recording industry was in trouble if it kept traveling down the self-destructive path of suing music fans and shutting down unique and innovative distribution tools. However, it appears that the folks on Wall Street are just starting to figure it out. Apparently, the recent defections of Madonna, Radiohead and other big name acts has Wall Street analysts finally suggesting that the recording industry's future isn't very bright, and thus downgrading the labels' prospects. The thing is, they should have realized that long ago. The big name act defections are simply the end result of a long chain of strategic blunders, despite any number of people presenting more reasonable plans forward. Again, this is focused solely on the record labels, not the overall music industry -- which is thriving. In fact, the record labels have had every opportunity to embrace these new tools and be a big part of online promotions -- but they chose not to. One would hope that with even Wall St. analysts telling them their strategy is wrong the record labels might wake up to the opportunity they've thrown away, but the labels themselves (with the possible exception of EMI -- which was recently taken over by private equity folks who seem to realize what's going on) have given no indication of any significant change in strategy.Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
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Filed Under: downgrades, recording industry, wall street
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Doris Day
Sherm
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grammar change
I completely and totally agree with you (it's really hard not to) and you are a truly fantastic writer. I just wanted to point out that the sentence where you mention Madonna and Radiohead would sound much better if you removed "they're using".
It's just a suggestion.
Sincerely,
James
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GREED
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Now that the business analysts as a group realize the error the next dominoes to fall will be the majority of the recording companies (there will be some die-hard believers) followed by the industry groups themselves. The last group to see the light will be politicians. The industry groups are not going to be eager to send their paid lobbyists back to Congress to say "Oh, by the way, what we have been telling you for the last decade is 100% wrong."
But eventually the industry is going to realize that things like the DCMA is straightjacketing them and they will return to the politicians requesting repeal of the DCMA and passage of other laws based on their new, flawed business model.
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Corporate greed
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The end of monopoly
The success of outfits like AoMP3 has shown - clearly that people are willing to pay for good-quality, easy-to-use DRM free content - they're just not willing to pay the $1/song that the RIAA insists is not enough to keep them in the style to which they have become accustomed.
The world has changed, and they are looking back to the '70s and '80s and wondering things are not the way they were...
It's not Art - it ceased to be when the masters were handed over - it's just data.
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Nice Synopsis
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Re: Nice Synopsis
Given what they have done, it's close enough. The issue isn't really the RIAA anyway, it's the 5/6 major labels that control the operation and activities in pursuit of their own vested interests. Lets face it, the minor labels have little if any say in the matter.
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Re: Nice Synopsis
No, they signed a deal with ATO Records solely for distribution. They are not signed to the record label, binding themselves to the label and giving the label control over their music. Two very different things...
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Re: Re: Nice Synopsis
ATO Records has a history though of letting artists do what they want anyway as far as creative control. ATO was built by an artist who believes in complete creative control going to the artists.
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Re: Re: Re: Nice Synopsis
No, there's nothing wrong with bands using labels to help them in specific areas... the problem is when they sign their life away to the labels.
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"Even" is the key word concerning the previous comment The thing is, they should have realized that long ago. It's amazingly rare how infrequently business workers understand business strategy, at least as a group. There are many, many highly intelligent people on Wall Street, but rarely do trends reflect this.
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Re: comment
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Once upon a time...
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Radiohead song on radio
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Good to see the music industry get what they deser
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Music Industry
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Re: Music Industry
Actually, as we've discussed and pointed out repeatedly, that's just not true. It is true that a *smart* record label could help, but we've seen all kinds of "no name" artists use the tools the internet provides to make themselves popular without a record label at all. So the idea that a small band needs a record label is false, plain and simple.
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actually
They can do it the old fashioned way. Touring, building a following, music reviews, etc.
They can also embrace technology. Start a web site, build a blog, a pod cast, do video casting, and build an online community that can bring in more than just album sales. Word of mouth is very powerful these days.
Major label economics only benefited the major labels as well as the few bands who actually made it big, and only because they had the clout to renegotiate their next contract.
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Music Industry
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get with the change
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