Illegal Downloading…The Decline of the Music Business or The New Music Business Model?

There has been so much talk and debate about the cause and effect of illegal music downloads and the decline of the music business. I find it interesting that most people in upper management of music businesses are adamant that illegal downloading has caused the music industry to crash. The music moguls see no way out of this issue, no matter how hard they try. They are fighting a battle they can’t win by going after lower income subjects suing them for hundreds of thousands of dollars. If the four major record labels (EMI, Sony-BMG, Warner, Universal) really dissect and realize why this happened, they would have been much more prepared for this “crisis” instead pointing fingers at the people who are downloading music without paying for it.

Blame can be pointed to the individuals that download music (movies and software too) to a certain extent. In this information age, most people know that songwriting is an art, recording an album costs a lot of money, and that most artists have very little income. But the way CD prices have increased and everything else for that matter, who can blame people for downloading music for free when they have to spend their money on necessities in order to survive.

Is there a solution to prevent people from illegal downloading music? Probably not, but there are things that music labels can do to convert illegal music downloader’s to music purchasers. There are individuals that solely download music without ever buying a CD, and these are the individuals that are lost to the music business, they will never convert them to be music buyers. I admit that I have illegally downloaded music for two main reasons that I will share with you here. But let me just make this point to you- I love CD’s! I would rather have CD’s in my collection than digital music files. I will pay my hard earned money to get my hands on them, if they are worth it.

Is illegal downloading the sole reason for the downfall or a result of the past practices and unrealistic expectations?

Lets take a look at the last question I have presented. No, I don’t believe that illegal downloading is the sole reason for the fall of the music empire. Remember that CD’s were a new format in the 1980’s, and were very expensive. CD players were hundreds of dollars, some over $1000, and CDs were close to $100, that is for one album, or 10-15 songs. Then the 1990’s hit and CD’s became very affordable. ($9.99-$11.99) Not only that, food and gas (remember $1.00/gallon) were affordable, and the job market was booming, so people could afford to buy CD’s. Also, when CD’s became the replacement for cassette tapes and records, music buyers replaced their music collection. Buying new copies of the Beatles, Rolling Stones, Pink Floyd, etc, etc. So now these record labels are making fantastic sales, and expected to continue making the same money and more year after year.

Here is the #1 reason why I have illegally downloaded music: Re-releases and Extra Tracks These record labels and bands continue to release music that I have purchased before. They release it with new collectors edition packaging, with extra previously non-released tracks, videos, re-mastered edition, 5.1 stereo edition, mono edition, etc. You understand what I’m getting at.

Let’s take the classic band, The Doors. I had purchased the CD’s of the Doors while in high school. A total of six CD’s at $10.99, and in high school and not having a consistent income, that’s a lot of money. Then in 1999, they released a re-mastered box set of the albums with a bonus disc of live tracks and unreleased demos. So I spent $80 on the box set because I wanted the best sound of one of my favorite bands and of course the disc with the extra un-released songs. Then in 2008 The Doors released a box set of the albums again, with more extra unreleased songs in 5.1 stereo. Along with that, it is included with music videos. So you know what, instead of buying the albums again, I downloaded what I didn’t have. I was not and will not repurchase an album I bought twice before. I’m sure I’m not the only music lover that has felt taken advantage of by record labels by re-releasing albums and bands that allow it to happen.

This past week, a band finally got it right: The Rolling Stones! They re-released their classic album “Exile On Main St.” (The second re-mastered edition), but this time, with 10 extra never before released out-takes. But their fans can purchase the CD of the unreleased tracks separately without having to re-purchase the entire album.

Another part of this reason is when bands release CD and digital albums and the digital release has extra tracks.

I have been waiting for five years for the new Massive Attack CD. I pre-ordered it, and love it. Then I saw that there was a deluxe digital edition with six extra tracks only available when the album was purchased whole. I already paid $14 for the CD and I’m not going to pay another $10 just for six songs. So I illegally downloaded the six songs.

Can there be a solution for this? Of course! Why can’t there be a coupon inside the CD for a free download of the six extra tracks? Why only available for the digital album? Do record labels really expect music fans to pay twice for an album with extra tracks? It sure does look like it.

Reason #2: CD’s are priced too high and many buyers do not want to take a gamble: Have you walked into a Borders or Barnes and Noble’s lately? CD’s are $18.99. Remember Tower Records a few years back? CD’s were selling for $18.99 as well. Just too much money for most people in this day and age. Walk into a Target and Wal-Mart their CD’s are priced much better. But the selection is not that great. Again when these record labels were bringing in loads of cash, they were signing many bands and releasing CD’s that had one to two hit songs. Music fans were buying up CD’s only to find that they spent $10-12 for one song. This has happened to me as I’m sure has happened to you. It is still happening today hence that is why most top 40 bands have higher sales in download singles than CD’s.

Record labels need to lower the CD prices $10-12. If digital albums can cost $10 or lower, then CD’s can cost $10-12. This would entice the music fan to buy more and take a chance on CD’s, as they are more affordable. If you are ever in Los Angeles, take a trip to Amoeba Records and you’ll see that music lovers are shopping and filling in their baskets with CD’s that are priced very low.

That’s’ why I download to hear the album first because I don’t like to take a gamble on music that’s considered “good” these days. I downloaded Kanye West’s album, “Graduation” after hearing all the hype about it, heard it, and thought it was crap. Same with Phoenix’s Grammy winning album, “Wolfgang Amadeus Phoenix”, I downloaded it, heard it, was bored by the second song, and haven’t listened to it since. I have deleted both albums from my iPod and iTunes. On the flip side, I downloaded the new album from Jonsi, entitled “Go.” Wow, I loved it! And knowing that this would be an album that I would listen to again and again, I went out to buy the CD.

Record labels should start streaming full-length albums on their artist’s websites. Let the fans hear the album prior to make their decision to buy the album or not. Give away a non-album track to entice fans to buy an entire album. I think these records labels don’t give us music lovers and fans the benefit of doubt. In this era, most consumers want to feel that they got a great deal for what it is they have purchased. This is an extreme measure, but when Radiohead released their last album, “In Rainbows,” they gave their fans the option to pay whatever they felt like to download the album. They also had the option to purchase a limited edition collector’s CD box set, with six extra tracks, not available for download. What happened? Radiohead made over $2,000,000 with that selling model! Now Radiohead is a huge successful band and can take a gamble doing something like that, and probably screwed up the old business model even more, especially for true indie bands. But labels and bands should have learned from that. Customers want to be in control of their money, and feel that they are getting the better end of the deal.

Another reason why people illegal download is in full force is that many artists (and yes ones that are on major labels) are all for it. Artist like Dave Grohl, Kid Rock, and Radiohead have stated they don’t mind if their music is free. They are still selling out shows and making their money from touring and merchandise. Even indie bands like Fugazi have been giving their music away for free for years. These artists know that TRUE music fans and lovers will pay for music and support their favorite artist and bands! That is why they aren’t afraid to give their music away for free. They believe in their true fans that they worked hard to get! They believe in their music!

Now, there are going to be the people that are just fans of music and not care that they are stealing and never change. These are the same people that would ask you to burn them a copy of a CD or copy it to a cassette tape for them so they wouldn’t have to buy it, these people don’t realize that artists need to get paid as well as the record labels that invested in them. Besides, fans of music usually like one or two songs off an album, listen to the song for a couple of weeks until the new “hit song” comes along that they hear on MTV Reality shows. These are the people that probably will never stop illegally downloading music and there will be nothing anyone can do about it.

Lets also put one thing to rest and out in the open. Most of the people that are illegal downloading music are not poor, or to be more politically correct, not lower class. Most lower income families cannot afford the Internet, or if they can, the bandwidth couldn’t handle the download. Most of the illegal music downloader’s are college kids who are very tech savvy and would rather spend their money on college activities, or have spent most of their money on tuition and books. Remember Napster, the first major music file-sharing site, started in a dorm room. Did you know that books for basic college courses could cost up to $500!!!! No wonder why they have no more money for music….

The bottom line is that, unfortunately, illegal downloading will not stop, no matter how hard these labels try. Suing music downloader’s for millions of dollars when they only make $30,000 per year isn’t going to stop anyone. In my opinion it will only increase illegal downloading, as people will want to “stick it to the man.” These major Record labels need to stop fighting with people and connect with music fans to see what they want what people are willing to pay for. The economic boost the record labels felt in the 1990’s are gone, and probably never be same. If they want to see a change, they will need to change their business model and find new ways to build their artists fan base and not expect quick returns of investments from bands they sign. They will also have to embrace and learn about the new technology that is going to effect music and the business of it. It’s time to remember the phrase, “if you can’t beat ‘em, join ‘em.”

Now if you excuse me, I need to delete Keane’s “Night Train” off of my iPod and iTunes, then head off to Target to buy the Rolling Stones “Exile On Main Street” extras CD.

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