Former Record Label Exec Ethan Kaplan: Duh, Of Course More File Sharing Leads To More Sales
from the your-product-isn't-diamonds-mined-from-a-secret-mythical-land dept
We recently posted an interesting study talking about how greater file sharing of leaked albums had a specific (if small) causal impact that resulted in higher sales. I thought it was an interesting area of research, though one where a lot more work needs to be done. Following that, however, there was an interesting exchange on Twitter, mainly by former Warner Music exec Ethan Kaplan, who didn't seem to think the concept was controversial at all -- and instead that it was obvious. As he stated:Let me simplify this answer: YES IT LEADS TO MORE SALES. DEMAND = DEMAND W/ $$$$$$ IF PRODUCT GOOD.He then expanded on that idea (edited slightly to de-Twitterize):
Simplified further: MUSIC BUSINESS (RECORDED): your product isn't diamonds mined from a secret mythical land.You can see the complete exchange on Storify (embedded below) as per Ethan's command. Ethan, as always, is a perceptive observer (and never afraid to share his opinions) of one of the key reasons why the recording (not music) industry has had so much difficulty over the past few years. The industry was focused on something that they pretended was scarce when it was not -- misunderstanding the supply curve. Add to that, the fact that they misunderstood how file sharing represented pent up demand, and they astoundingly got both sides of the supply-demand curve wrong. It's hard to build a successful business when you do that.
And beyond broadband/napster/whatever, what hurt you the most is PEOPLE FIGURED THAT OUT. Cynicism caught up with you.
Of course, all of this makes me wonder how Ethan lasted in his role at Warner for as long as he did. It must feel good to be free... Though, I stand by my assertion from 2008, that if Warner had put Ethan in charge, that company would be doing a lot better today.
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Filed Under: ethan kaplan, file sharing, leak
Companies: warner music
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Re: I don't get it
How exactly do his character flaws affect his smart ideas?
Or are you saying that his smart ideas are why he left the label?
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Meh.
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Re: Meh.
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Re: Meh.
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Yes, by necessity.
You don't gain the largest marketshare by being excellent. You gain it by being the least offensive you can be. Any product for the masses has that as the primary design goal, from fast food to movies.
This is why the death of the major movie/recording houses would be a wonderful thing for our culture: it would reduce the influence of the vanilla, bland, mass-media stuff and increase the influence of truly creative works that certain wouldn't appeal to anywhere near everybody.
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I liked this line from Ethan's blog:
Poor guy, maybe he just sick and tired of trying to force the company to innovate.
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Wait...
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It's not that simple
Of course, any buzz sells concert tickets, T-shirts, fan club memberships, etc., so it's all good for the band. But typically the label only makes money on CD/download sales, so as much as "piracy" reduces CD sales it hurts their only revenue stream, while for the bands, selling fewer CDs but selling more concert tickets is a great tradeoff. Leads to interesting discussions.
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Re: It's not that simple
Genuinely curious: examples?
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There's lots of evidence that piracy of already popular albums hurts sales; there are plenty of sales charts where you can see sales ramping up, then the album appears on file sharing networks, and sales drop dramatically.
We can tell he's lying because his hypothetical album was already on file sharing networks before it even hit the stores.
Laird, the sales didn't drop dramatically because of file sharing, since as I noted above, it was already being shared before the first purchase. The sales dropped dramatically because the album sucked.
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Re: It's not that simple
I like this method, because I can't tell you how many times I ended up buying an entire album after hearing one or two singles, and believing the rest was just as good when it turned out the rest of the album was terrible.
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Re: It's not that simple
--Albums were priced way too high
--They'd sell albums on the strength of one track but the album as a whole would inevitably suck
--People realize just how awful major label music has become
--Nobody listens to the radio nor watches MTV anymore
--The aggressive tactics employed by major labels, the RIAA and others, going after consumers, internet users, bars and clubs, etc., thus causing people to boycott their products
--How many more times can major labels sell material from the middle of the 20th century, anyway?
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I have lost faith in humanity.
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Re: It's not that simple
I'm with Colin on this one. Please give us some citations of this "lots of evidence" you speak of.
I've been waiting quite awhile for some solidly verifiable data on this.
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Can you show/do a study showing the correlation of filesharing and loss of sales that is not biased and produced by a independant part (and please, don't come with ones - sponsored by RIAA - whose methodology and figures have been debunked as faulty in face of evidence)?
Most torrent trackers and cyberlockers keep statistics on how many time the file was downloaded (though sometimes it's not public), can you correlate the number of downloads with the decrease in number of sales, potential market saturation, and number of people buying individual tracks instead of the whole album?
If not, your point seems to be guesswork of a uninformed person and therefore moot.
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as for having Ethan in charge would have meant that Warner would be doing better now, that was never going to happen. it would have meant that some clueless 70+ year old prick who was in charge would have had to admit they were doing things wrong!
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One question
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music biz
- the music biz is not a business, it's a group of friends, family members and same sex preference/religion etc. who, let's face it, know nothing about business and less about music.
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