If Only the Tech Industry Understood the Music Industry They Want to ‘Replace’…

Another day, another muppet claiming to have replaced the music industry. This time it’s Vikram Kumar, CEO of Mega, the new cloud storage dreamt up by the self-proclaimed artist rights champion, Kim Dotcom (currently fighting extradition to the US where he faces charges on copyright infringement, racketeering and money laundering).  Talking to Billboard, Kumar announced that yet-to-be-launched MegaBox and MegaVideo will provide a platform for “content creators to go straight to people and bypass the traditional distribution chain”.

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“We’re really interested in content creators going direct to people,” he continues. “This is quite distinct from the recording industry or the film industry, which tend to represent the distributors. Those people are still very much using outdated business models […] When content owners start looking at the internet as an important way to make money, then we’ll see this conflict [between Hollywood and Silicon Valley] reduce quite a bit.”

First of all, as Billboard is largely geared towards people working in the music industry, readers may ponder if services such as YouTube, SoundCloud and Bandcamp have completely bypassed Kumar.  There’s hardly a shortage of avenues artists can take to get straight to their fans – some of them even allow the artist to control how their music is used, make money off it and develop a stronger connection with those fans.

Secondly, these music industry workers might wonder what Kumar thinks they’re doing all day.  Sean Parker and Shawn Fanning didn’t come up with a way of replacing the music industry with Napster – more like a way to replace the trucks (it’s debatable if they replaced the record stores, as it didn’t include a way for fans to pay artists for their “content”).

It didn’t even replace distribution companies.  The vast majority of indie labels have never handled their own distribution.  Sure, what distributors do has somewhat changed, but even self-releasing artists use digital distributors, such as Record Union, to place their music on a wide range of digital music outlets.  And, to make sure they’re properly accounted to when it’s streamed on services such as Spotify and Deezer.  Perhaps Kumar should have a look at An In-Depth Look At How Distributors Work.

Kumar argues “the very nature of copyright was based on controlling the creation of copies […] The internet allows for the creation of digital copies at almost no cost.  These are the legacy business models of physical distribution, which haven’t adapted to digital internet distribution.”

Here Kumar also ignores the use of copyright in performance and synch licensing.  In Kumar’s world it appears radio stations only had to pay for a CD in order to broadcast it over and over again for free, and advertising agencies used whatever music they liked for free in their ads.  These companies have never made multiple physical copies, but they’ve made multiple use of the one copy supplied to them – and paid for those uses.

Copyright without control, without the ability to say no, creates a race to the bottom as far as being able to monetise “content” – it lines the pockets of the distributors (YouTube, The Pirate Bay et. al.) but not those who created it.

Kumar reminds me of “internet intellectual” Clay Shirky, who said: “Publishing is going away. Because the word ‘publishing’ means a cadre of professionals who are taking on the incredible difficulty and complexity and expense of making something public.  That’s not a job anymore.  That’s a button.  There’s a button that says ‘publish’, and when you press it, it’s done.”

Anyone who has pressed that “publish” button only to see their work drown in the white noise of the millions of other people pressing that button at the same time, could see the value of an experienced publisher.

Maybe that’s why Eric Schmidt, the executive chairman of Google, signed a deal with Random House  – the largest general-interest trade book publisher in the world – to publish his upcoming book, The New Digital Age (hardcover $26.95 in the US, Kindle version £12.99 on Amazon UK).  The authors who sued his company for scanning their books without permission may ask why he didn’t just make it available via Google for free – perhaps with some Google AdSense ads next to it.

 

It’s clear, even to Schmidt, that “the new digital age” has not made publishers obsolete.

50 Responses

  1. Visitor
    Visitor

    “Kumar announced that yet-to-be-launched MegaBox and MegaVideo will provide a platform for “content creators to go straight to people and bypass the traditional distribution chain”.”
    I already bypass that chain and reach people on iTunes.
    That’s as straight as can be — unless you own the internet.
    And even Mr. Dotcom isn’t quite there yet.

    Reply
  2. Visitor
    Visitor

    “Eric Schmidt, the executive chairman of Google, signed a deal with Random House – the largest general-interest trade book publisher in the world – to publish his upcoming book, The New Digital Age (hardcover $26.95 in the US, Kindle version £12.99 on Amazon UK). The authors who sued his company for scanning their books without permission may ask why he didn’t just make it available via Google for free – perhaps with some Google AdSense ads next to it”
    Do you think Google will link to pirated versions within the usual 24 hours after release?
    And will they place the pirate links on top of the search page?

    Reply
    • Chris
      Chris

      Do as I say not as I do. Google probably has the best anti-piracy software it can afford for its top execs but then again what makes them so different than a politician. Let them eat cake huh Eric~! How funny its always the non- creaters who make all the demands for themselves….

      Reply
  3. Ron
    Ron

    Are you conciously trying to be this obtuse? You’re like the Sean Hannity of this site.

    Reply
    • Helienne
      Helienne

      Though I don’t press the “publish” button on Digital Music News, you do know that even if I did it wouldn’t make me a publisher, right? At the other publication I write for, the Guardian, whoever subs (that’s subedits) my piece presses the button that launches it. That, however, does not make that sub the publisher of my piece – the Guardian is.

      Reply
      • Visitor
        Visitor

        Case in point. The Guardian is not exactly a success story of the traditional publishing business model.

        Reply
        • Helienne
          Helienne

          Quality journalism costs money – online advertising hasn’t been able to cover it, no matter how hard the Guardian has tried. That’s why it’s losing money. As they say, you pay peanuts you (eventually) get monkeys.

          Reply
          • Visitor
            Visitor

            Which follows in the pattern this is exactly what those “Internet intellectuals” were predicting over a decade ago; traditional publishing is in fact, dying.

  4. Visitor
    Visitor

    The tech industry may not understand the music industry, but the music industry has continously proven they don’t understand the tech industry. Looks like we are at a standstill.

    Reply
        • Uhhh.
          Uhhh.

          The tech industry’s major purpose is to invent new things that go forth and replace and harm other industries. That’s what technology fundamentally does.
          It’s called disruptive innovation girl. The more your business causes, the cooler you are in Silicon Valley.

          Reply
    • steveh
      steveh

      ” The music industry never turned theft into a business model.”

      “And the music industry is not claiming to have replaced the tech industry”

      Right on guys! Two really spot on statements!

      The bottom line is:- why do all big-tech organisations want music? They all seem to want in. They all want to co-opt what we (the music creators) have and what we create.

      Reply
      • Visitor
        Visitor

        The music industry is NOTORIOUS for turning theft into a business model.
        Charging customers $18.99 for a piece of plastic that may have 1 decent song on it.
        Lack of transparency for digital sales.
        Using samples without permission.
        Conning artists into signing away their masters.
        Charging manufacturing costs as recording costs.
        The list goes on and on and on.

        The tech companies want in on the music biz because the music biz has FAILED to provide a solution that satisfies the consumer!
        The music business is a cruel and shallow money trench, a long plastic hallway where thieves and pimps run free, and good men die like dogs. There’s also a negative side.

        Reply
        • Helienne
          Helienne

          When was the last time you paid $18.99 for a CD? A decade ago? Counting inflation the average price of a CD has gone down by around 42%. I don’t know about you, but meanwhile my rent has gone up by around 75% and my public transport ticket by 50%.

          Reply
          • Central Scrutinizer
            Central Scrutinizer

            It was a decade ago but that doesn’t negate the statement.
            The music industry WAS nororious for shady and illegal practices and I haven’t seen anything new from the music industry to change that opinion.

          • if you only knew
            if you only knew

            …and guess what? COPYRIGHTs and CONTRACTS give the creator legal remedies to correct any ‘shady’ dealings of the past.
            Funny… the vast majority of todays’ really successful artists are… LEGACY artists…
            To the ‘Tech’ industry: “Stay the Fuk out of the music industry” PLEASE.
            If you want to be a part of it, FIRST YOU NEED TO UNDERSTAND it.
            You [tech] pretend that music is worthless, yet you’re all tripping over each others’ heels to be a part of it.

          • steveh
            steveh

            “You [tech] pretend that music is worthless, yet you’re all tripping over each others’ heels to be a part of it.”
            Exactly!

          • Central Scrutinizer
            Central Scrutinizer

            You seem to be implying that I am a tech business sympathizer.
            That is wrong.
            I am merely pointing out that the music industry has a long history of illegal and unethical business tactics.
            and the legal remedies you mention, I am sure that is comforting to the musicians who have to sue to get an accounting, many of them “LEGACY artists…” who are fotrtunate enough to have enough money to bring a lawsuit to recover the revenue that the music industry accountants have hidden away.

            Welcome to the machine indeed.

          • steveh
            steveh

            no-one is denying the malpractices of the music industry and its whole dark side.
            The point is that artsists and music creators are resoundingly NOT calling on people like Kim fucking Dotcom to ride in as a knight in shining armour to “save” the thing.
            No way! This is a complete nightmare.
            Why don’t they just leave us alone – to be able to sell our records in peace?

        • Visitor
          Visitor

          “The music industry is NOTORIOUS for turning theft into a business model.
          Charging customers $18.99 for a piece of plastic that may have 1 decent song on it.”
          Sorry, but now you’re losing it…
          Could you please explain how selling legitimate products in legitimate stores to willing customers equals theft?
          Try to be as specific as you can.
          (And please credit the honorably Dr. Thompson for his wonderful writing, thank you.)

          Reply
        • Yves Villeneuve
          Yves Villeneuve

          I guess if you are dumb enough to buy a CD with only one good song on it you deserve the Dumb Award. Last I checked, iTunes offers a-la-carte downloads with 90 seconds previews. I only buy albums and if most of the previews pass my ear test 2 days in a row I add it to my buy list.

          Reply
          • Visitor
            Visitor

            Ah the chorus man wants to share his insights!
            Last I checked, iTunes was only ten years old. Obviously I’m referring to the 90’s when I reference CD prices being ridiculously high. How did you preview songs before iTunes Yves?
            So let’s see. Record label pays to get radio play for a single. Said single is heard millions of times and consumers want to own it. Consumer goes to retail store, buys album with single on it for anywhere between $10 and $20. Consumer is disappointed that the rest of the album isn’t as good as said single. 🙁

          • Visitor
            Visitor

            “How did you preview songs before iTunes Yves?”
            I’m not Yves, but I assume he pre-listened in his local record store like everybody else.

          • Yves Villeneuve
            Yves Villeneuve

            I bought music of reputable bands. I rarely ventured into new bands unless they had two or more hits on the radio… Take for instance Men At Work.
            If the song was released as a single for radio, chances are it was released as a single on vinyl or CD. No need to buy the album in this case, unless you are prepared to take a risk. You can also lessen your risks by watching the weekly album charts.
            Maybe my instincts are just better than yours, which is why I didn’t feel burned often. Keep in mind, you may not have liked the rest of the album, but someone might have.

        • Joda
          Joda

          The tech industry wants in because they need something to sell that they can’t create themselves. Preferably something that makes them cool. Music is the most easily accessed piece of content for that. Unfortunately for the entire bay area, and silicon beach, they will still never be cool. That’s all there is to it.
          Before you say I’m anti tech just know that I make millions from tech. I am just stating the facts as I see them.
          Keep doing what you are doing Paul. You are right WAY more than you are wrong.

          Reply
  5. RC
    RC

    Helienne, I do believe you’ve nailed it.
    @Vistor, the Hunter S. Thompson quote goes like this:
    “The TV business is uglier than most things. It is normally perceived as some kind of cruel and shallow money trench through the heart of the journalism industry, a long plastic hallway where thieves and pimps run free and good men die like dogs, for no good reason.
    Which is more or less true. For the most part, they are dirty little animals with huge brains and no pulse.”

    Reply
    • Visitor
      Visitor

      “Hunter S Thompson: in his own words

      A selection of the best-remembered quotes from the master of the one-liner

      “The music business is a cruel and shallow money trench, a long plastic hallway where thieves and pimps run free, and good men die like dogs. There’s also a negative side.””

      Source: The Guardian.
      http://www.guardian.co.uk/books/2005/feb/21/huntersthompson
      Not true of course, but funny…

      Reply
      • Myles na Gopaleen
        Myles na Gopaleen

        Sometimes it is hard to find truth in metaphor.
        RC has the actual text and quote correct. guardian’s source is incorrect. Someone was kind enough to track down the exact book that the quote is taken from and post the info online. sorry, I lost the link and too lazy to do another search.
        Anyway, many people have changed, paraphrased and added to the quote.
        Changed TV to music biz etc.
        “There’s also a negative side” was added some time later.
        Hunter S. also has a quote about the veracity of information on the internet, but I’ve forgotten that also. Where are my google glasses when I need them?

        Reply
  6. jon b
    jon b

    He is no different than Wayne LaPierre advocating for his chance to make money at others’ expense.

    Reply
  7. FarePlay
    FarePlay

    Sometimes I wonder if the tech side has anything new to say.
    Okay, sometimes we’re in the same boat. And sometimes the discussion feels like gun control. Sane people agreeing there’s a problem, but the inmates are running the rehab center.
    On a positive note, we can expect gun sales to plummet, now that those AK47s are in no danger of disappearing.
    We can all agree that tech views content as a speedbump to empire building, yet forget, never knew, don’t want to admit, that without content who would give a flying F about the internet.
    I’m particularly fond of the &18.99 cd line, which is only heightened one someone adds buying a CD for one song and the rest is garbage.
    Herein lies part of the problem with music being perceived as valueless. So you download the doors’ light my fire and miss, Last Whiskey bar, 20th Century Fox and The End.
    One week later, you’re bored stiff by Light My Fire and done with the doors. Until their next hit, which there weren’t a lot of.
    If bands were smart or I was back managing bands again, and had a band that played sheds and made serious money, I’d give my latest CD away to every ticketholder, build it into the ticket price. Like Prince did, that Prince, he’s one smart dude.
    This guy from Mega, sounds like he has no clue.
    Bands need to go outside the digital world to build a following, otherwise they’re just a line on a screen or an image that fades when you shut down your computer.
    Yeah, you could call me a “physical” copy dinosaur. Long live Vinyl.

    Reply
  8. Big Swifty
    Big Swifty

    The only function of the Kumar interview is to create some media attention for mega.
    It is filled with provacative mis-information to create controversy.
    end of story

    Reply
  9. Evan Wish
    Evan Wish

    Kumar argues “the very nature of copyright was based on controlling the creation of copies […] Nope,
    “the very nature of copyright was based on creator controlling the creation.”

    Reply
    • Visitor
      Visitor

      I’m not sure whining is the right way to create sympathy for the tech industry.
      Why don’t you guys come up with some new cool and original stuff that doesn’t abuse people?

      Reply
      • Visitor
        Visitor

        I’m not sure whining is the right way to create sympathy for the tech industry.
        So true. It sure hasn’t worked very well for the music industry.

        Reply

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