The sky is falling, no one is watching / tornadoes twisting where nobody is listening

A tweet from David McLaugh­lin found me think­ing, silent­ly reflect­ing I sup­pose (and that’s most­ly what this post is — an attempt to put those down), about the very (at least to me) inter­est­ing place the music indus­try has found itself in as we head – already – into the sec­ond month of the sec­ond year of the sec­ond decade of the sec­ond millennium.

I retweet­ed David’s Forbes link as it’s a pret­ty fas­ci­nat­ing read that hand­i­ly sum­maris­es the [rene­gade] rise of the-soon-to-be-house­hold-name, Daniel Ek from geek to own­er and vision­ary behind one of the most impor­tant musi­cal deliv­ery plat­forms on the plan­et right now, Spotify.

Essen­tial­ly it’s a sto­ry which has been repeat­ed hun­dreds of times over the cen­turies: man/woman, often odd, dri­ven or a lon­er, has a wacky idea comes from way out on the fringes, from a place where all the cor­po­rate or estab­lish­ment R&D bucks in the world can’t or won’t reach. He or she runs with the idea and it finds both its time and its audi­ence and changes the world.

Think Guten­berg (and I’d refer you to this piece in The NZ Lis­ten­er (not online yet) and by exten­sion the book, which I’ve yet to read but will, although I hav­ing a nig­gling feel­ing it may annoy rather than illu­mi­nate in places), Hen­ry Ford, The Wright Broth­ers and you get the idea. Bill Gates was one, despite the fact he ‘bor­rowed’ much of the frame­work need­ed to achieve his grand vision. Jobs too of course, but I think that both dig­i­tal enter­tain­ment and the hand­held com­put­ing device, despite the fact that he too bor­rowed much of the con­cep­tu­al frame­work, will be his endur­ing lega­cy, rather than the com­put­er I’m writ­ing this on now.

So we have Spo­ti­fy and it arrives, bril­liant­ly, at a time when we have the tech­ni­cal deliv­ery mech­a­nisms and – final­ly – the arrival of a mind­set root­ed clos­er to com­mon sense on the part major con­tent owners.

Spo­ti­fy offers cheap (read ‘free’ in most of the world) access via 21st Cen­tu­ry tech­nol­o­gy (read fast unlim­it­ed – apart from NZ but I guess it will get there even­tu­al­ly – inter­net) access to almost every­thing musi­cal. And it will grow from there.

It’s a radio sta­tion and one that the user/s pro­grammes. Wel­come to the even­tu­al death of com­mer­cial radio as we now know it. Yep, peo­ple still lis­ten to radio, and in some num­bers, and radio folks will tell you of grow­ing audi­ences and more, but this tech­nol­o­gy – along with the oth­er arriv­ing vari­ants on the theme – have drawn the line in the sand. Tai­lored audio will even­tu­al­ly dom­i­nate pri­vate lis­ten­ing, fac­to­ries, retail and just about every­where else where we cur­rent­ly lis­ten to things from a radio broad­cast. And algo­rithms will ensure that we get what we want and the tai­lored broad­cast will evolve as our tastes and desires evolve.

It’s a tun­ing knob, XFM, pod­casts and niche radio all rolled into one. It has only just begun. It may take a while but that’s where it will end up. And, most­ly, major con­tent hold­ers and cor­po­ra­tions will con­trol it — the RIAA’s dom­i­nant voic­es already own 18+ % of Spo­ti­fy, thus the noise — jus­ti­fi­able — about dou­ble dip­ping by com­pa­nies who already pay their acts a fair­ly low­ly amount under con­trac­tu­al terms which are often less than generous.

But, man, did these same con­tent hold­ers fight it tooth and nail. Five years back record com­pa­nies were hol­ler­ing in hor­ror at any­thing close to the world they now live in — and are now doing rather well in.

Remem­ber Peter Jenner’s words, back in 2006:

.…. I think in two or three years blan­ket licens­es will be with us in most countries.

It was Jen­ner, for­mer man­ag­er back in the dis­tant past of Pink Floyd (ear­ly days), Ian Dury, and The Clash (it was he who tried to save the band from them­selves and their errant destruc­tive but inspired orig­i­nal and suc­ces­sor man­ag­er, Bernie Rhodes with­out suc­cess) who both tout­ed sub­scrip­tion and was heav­i­ly shot down by the estab­lish­ment for doing exact­ly that.

And yet he was (most­ly) right, although it took a year or two more than he pre­dict­ed in that inter­view. 1

Half a decade on we have found our­selves in the obvi­ous place where all-you-can-eat audio comes from both a free mod­el (sup­port­ed by ads on your desk­top) and a sub­scrip­tion mod­el (on mobile devices).

And that’s not all. As shown in this (incom­plete) data from Techdirt’s Mike Mas­nick, the enter­tain­ment indus­tries are doing, despite the end­less howls of col­lapse, pret­ty darn tidi­ly. The news in there is noth­ing new of course. I was blog­ging some­thing sim­i­lar a cou­ple of years back — income was ris­ing and we had been scammed by half-truths, par­tial stats and more to pro­duce a pic­ture that was most­ly smoke.

If you looked beyond IFPI, MPAA and RIAA media then the stuff you’ll see below was there for the curi­ous to find.

Emerg­ing from the shock of Nap­ster, from the col­lapse of CD sales to the arrival of iTunes and the war the music con­tent indus­tries fought against the mod­ern world, and lost, came an indus­try that some­how had been blud­geoned so many times that they even­tu­al­ly were forced to adapt.

The indus­try had been dying from the death of a thou­sand cuts: not only dig­i­tal pira­cy (which was and is a far less­er vil­lain than you are sup­posed to think it is, but I won’t go into that here), but the rise of the track as the pri­ma­ry unit of music, alter­na­tive demands on dis­pos­able income, reces­sion, relent­less most­ly self-induced bad press, awful A&R, accoun­tan­cy trump­ing cre­ativ­i­ty and so on.

Some­where, slow­ly and with some inspired new blood most­ly dri­ven by the indie sec­tor which has both boomed and is soon to dom­i­nate, as the big­ger indies evolve into the new majors 2 the death of a thou­sand cuts has become the life of a thou­sand cuts.

Wit­ness YouTube. We all do — all the time.

Once you get past the first few pages and the fact that it reads like an extend­ed ver­sion of the open­ing scene of The Empire Strikes Back, the Megaupload/ Kim Dot­com indict­ment refers sev­er­al times to the copy­ing of files from YouTube to fill up the MegaVideo site. If you read through to page 30 you get this detail:

In approx­i­mate­ly April 2006, mem­bers of the Mega Con­spir­a­cy copied videos direct­ly from to make them avail­able on

The irony in this — which seems to have escaped the Feds — is that almost every­thing con­tain­ing third par­ty copy­right­ed mate­r­i­al on YouTube in April 2006 was deemed by the own­ers to be pirat­ed. It was­n’t until the Via­com case in 2007 and the con­tent ID sys­tem intro­duced that year fol­lowed by pro­gres­sive licens­ing through to 2009 that the songs and music were legit­imised on the Google site. That aside, I guess scrap­ing copy­right mate­r­i­al tech­ni­cal­ly host­ed ille­gal­ly is still tak­ing copy­right mate­r­i­al — it’s almost like steal­ing from a fence.

That ques­tion aside, and it’s noth­ing more than an aside to this, the point is that the things you now watch on YouTube are more or less legit now and the indus­tries found a way to mon­e­tise that ‘pira­cy’ (read the Via­com link above — it’s no more or less vir­u­lent, wide-rang­ing and some­what irra­tional than the MegaU­pload indict­ment) and extract cents from every play.

And extract cents from count­less oth­er sources — video, sync, games, stream­ing, soft­ware, toys, per­for­mance and so much more — to slow­ly rebuild the col­laps­ing walls of the house that Ahmet, Gef­fen, Black­well, Gordy, Davis and so many oth­ers built in the 1960s, 70s and 80s.

And so it sur­vives, albeit rad­i­cal­ly changed — the days of the mas­sive super­star acts are draw­ing to a close despite Adele (the excep­tion that proves the rule — even Lana Del Rey’s num­ber two US chart entry fig­ure is, for all the fuss, way less than an album would have achieved if it had entered in the 20s a decade or so back), as is the dom­i­nance the sur­viv­ing trio of majors.

Which brings us to Megau­pload and it’s alleged share of the inter­net. Giv­en that, real­ly, its offences seem to be lit­tle dif­fer­ent in scope to the rogue YouTube, as doc­u­ment­ed in that Via­com indict­ment, one won­ders why the ‘man’ is so keen to stomp so vis­i­bly and bru­tal­ly on the founder and face of the site.

The indict­ment seems to be both ridicu­lous and absurd­ly unsup­port­able in much of its con­tent and any court out­come, even just the extra­di­tion case, is like­ly to take years to play out as con­vinc­ing­ly explained by Rick Shera here.

Clear­ly, Kim does­n’t have a mas­sive US cor­po­ra­tion as a par­ent as YouTube did by 2007, and he has rubbed all the Mega­Corps severe­ly up the wrong way in so many doc­u­ment­ed ways. Boy, has he pissed them off. He’s the rogue geek that nev­er came in from the cold and could­n’t believe his luck when all that cash began arriv­ing. He’s not that clever, obvi­ous­ly. If he had been, he would’ve tak­en the oppor­tu­ni­ty to ensure that he was for­ev­er safe and loaded. It was do-able.

How­ev­er, for all that I can’t quite work out exact­ly why no real attempt has been or is vis­i­bly being made, to mon­e­tise the fact the site clear­ly makes lots of mon­ey by attract­ing mil­lions of peo­ple who like both music and film. Indeed, it’s long been doc­u­ment­ed that the peo­ple most like­ly to steal music are the same peo­ple most like­ly to buy music. They are fans. It is sim­ple com­mon sense.

So, if an algo­rithm can be con­struct­ed to iden­ti­fy and reward for con­tent watched on YouTube, why is doing some­thing sim­i­lar not being done for the cyberlockers?

Or do they still want to hang on for the off-chance that it real­ly will some­how return to 1998 and all will be fine.

I’m still not sure they quite get it, Mr. Jenner.

Show 2 footnotes

  1. He can be found in quite a few oth­er places espous­ing the same view – he was very noisy that year.
  2. Wit­ness the his­to­ry of Uni­ver­sal Music: formed as a US arm of the UK Dec­ca label in the ear­ly 1930s, it was an out­sider led by Jack Kapp. Kapp then lit­er­al­ly stole it from the UK par­ent in 1943 using the US gov­ern­men­t’s strip­ping of US based UK com­pa­nies under the con­di­tion­al Lend Lease deal­ings. Much of Dec­ca­’s ear­ly cat­a­logue con­sist­ed of tracks they had no rights to, and sim­ply released. By the 1980s it was in bed with the mafia. In the 1990s it was bought by Sea­grams, a Cana­di­an com­pa­ny who had made their for­tune by boot­leg­ging into the US in the 20s and 30s. And Nap­ster are pirates?

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I ain’t seen a sign of my heroes / And I’m still div­ing down for pearls — The Opin­ion­at­ed Diner
August 6, 2012 at 7:09 am

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