the dotmatrix project

photo by (michelle)

He can.

Obviously, we’re not going to go to the, uh, you know, superstars and say, “We want a percentage of your…” They’d be like (makes a dumbfounded face)

It must suck to watch your industry fall apart at the seems. Hell, I experienced it in 2001 working in Silicon Alley. Too bad for the music biz that their problem isn’t as simple as the net bubble burst with overzealous investors saturating an immature market.

That’s a correction at worst, not a complete redefinition of industry.

Is the 360 deal the silver bullet? I doubt it. It reads as a way to stop the bleeding, not the necessary organ transplant of the business model. One Golden Goose (record sales) dies, so Flom and company pilfer the remaining geese — that’s robbing Peter to pay Paul, not changing the foundational approach of what it means to be a music label in 2008.

They’re not getting to the heart of the matter.

The music industry’s problem is that too many people can make, find, enjoy, experience and share music without ever needing to step foot in their marketplace. They can sign bands to 360 deals until the cows come home, but the fact of the matter is that we’ve moved away from a world of massive record sales and sold-out stadium shows to a world where free music online leads to well attended, yet cozy venues and small festivals.

We are living a more personalized, fun and affordable music experience.

Of course there will always be superstars, relatively speaking, and they’ll demand a higher price point across the board, but marketing teams won’t be the genesis of their popularity moving forward. The web enables decentralized power through the aggregate of individuals — whether the individuals are musicians or fans — so our “chock full of choice” world is now aligning along the edges, not within the artificial heart of where the music industry dictates.

The 360 deal is a short-term play for industry executives to keep making coin, not a long-term solution to evolve their business.

Labels need to do more with less because the ratio of revenue delivering superstars to nominally successful acts is becoming a smaller integer as each day passes. Indie labels without aspirations of world dominance can swing that transition because they’ve been working smart, sleek and forward-thinking all along.

How does a major label — with all of its bloated, corporate structure — compete in this dynamic environment?

They don’t.

(via KOAR)

I’d rather pull out my eardrums with tweezers that listen to most 50 Cent tracks, but you gotta give him credit for staring technology in the face and not blinking. I guess he has an advantage over Doug Morris and the rest of his ilk in that he’s previously dealt with raining bullets.

Dodging the damage of MP3 downloads must be cake by comparison.

Check out this exchange from an interview by Pål Nordseth at a club in Oslo, Norway:

[...] “How are G-Unit Records doing in these times of file-sharing?

“Not so good.” he responded. “The advances in technology impacts everyone, and we all must adapt. Most of all hip-hop, a style of music dependent upon a youthful audience. This market consists of individuals embracing innovations faster than the fans of classical and jazz music.”

“What is important for the music industry to understand is that this really doesn’t hurt the artists.”

Thats quite a statement. Organizations like the RIAA are always talking about how the artists get hurt by file-sharing but 50 Cent clearly doesn’t agree. In fact, he appears to appreciate the value of a good fan, whether he buys or file-shares his music, as he explains:

“A young fan may be just as devout and dedicated no matter if he bought it or stole it.”

Indeed. It’s been said time and time again - get the music out there by any which way, fill the gigs and capitalize on the merchandising and ends will meet. 50 Cent agrees:

“The concerts are crowded and the industry must understand that they have to manage all the 360 degrees around an artist. They, (the industry), have to maximize their income from concerts and merchandise. It is the only way they can get their marketing money back.”

He finishes up: “The main problem is that the artists are not getting as much help developing as before file-sharing. They are now learning to peddle ringtones, not records” he said.

“They don’t understand the value of a perfect piece of art.” [...]

50 Cent is using marketing terminology like “360 degrees” to describe the value proposition surrounding an artist and the major labels can’t come up with anything better than suing their customers and boycotting iTunes.

Amazing.

UPDATE: Cayocosta, over at RecProAudio, has a different take on 50’s revelation:

Apparently not realizing that piracy-catalyzed 360 deals are actually recouped directly out of the artist’s pocket, he went on to offer the following when addressing the issue of lost recorded-music sales revenue, “The concerts are crowded and the industry must understand that they have to manage all the 360 degrees around an artist. They, (the industry), have to maximize their income from concerts and merchandise. It is the only way they can get their marketing money back.”

Further expounding on the negative effects of piracy, he offered, “The main problem is that the artists are not getting as much help developing as before file-sharing. They are now learning to peddle ringtones, not records. They don’t understand the value of a perfect piece of art.”

I could be off here, but 50 Cent’s perspective sounds steeped in the shoes of an artist / label executive, not in naivety.

With most major deals, all money put up by the label must be recouped prior to an artist getting a dime of profit from any revenue stream managed by the label. With fans that download music for free, it seems to me that 50 Cent is looking at the silver lining of the situation and chalking it up to a marketing expenditure — similar to producing music videos in the golden age of MTV.

Maybe instead of suing people for spreading the goodness of an act, labels should focus on the remaining opportunities to maximize their profits and stop trying to force their will on both a market and open technology? 360 deals don’t represent an ultimate answer, but neither does suing their fan base.