The Top 13 Things We’ve Discovered In the Digital New World

Hey, we couldn’t resist – hope you enjoyed the Columbus Day weekend.

Here are the top lessons the music industry has ‘discovered’ in the early days of this ‘digital new world’.

(1) It’s really, really hard to sell music to fans online.  

Whether the iTunes Store or Rdio, getting fans to allocate even modest amounts of their income to music is an extremely difficult challenge.  Competing with free has proven a hard game indeed.

(2) But it’s not as hard to engage fans, as long as they’re not paying.

In fact, they love music more than ever!  Welcome to the Digital

  • Save
 New World riddle.

(3) DRM is an awful idea, at least for downloads.  

Other platforms like YouTube, subscription services, and streaming radio are still fair game.

(4) Sound quality doesn’t matter.

At least to most fans.  That would explain why few have complaints with MP3s, though Jimmy Iovine and T. Bone Burnett have serious problems with the fidelity freefall.

(5) An official release date means very little.

Almost everything is leaked in advance, and even half-baked copies find their way online long before a scheduled drop.

(6) Licensing content is a great way to squander an investment.

VCs are largely out of this game, though others are still slogging through horrific licensing processes and nosebleed costs (ie, Spotify).  Or, running the red light and dealing with the consequences (ie, Grooveshark).

(7) Email addresses are more important than Facebook, Twitter and MySpace connections.

Or, at least that’s what pros like Ian Rogers are saying.  Sounds a bit counterintuitive, but according to what rulebook?

(8) If you’re hot right now, just wait 5 minutes.

Attention spans are shorter than ever, and fan relationships with bands can be fickle and short-lived.

(9) Direct-to-fan distribution is a seriously double-edged sword.

Sure, you can create powerful direct-to-fan relationships, but so can millions of other bands.  Welcome to the horrific content glut that results from digital democracy.

(10) There’s an app for that.

Good luck selling ringtones or OTA downloads on a mobile device.  But those that understand app culture have done well, including Tapulous, Smule, and T-Pain.

(11) 360-degree deals can really kill your musical mojo.

We’re just starting to see some of the problems associated with these label land grabs.  Smart artists like Arcade Fire and Metric are rolling their own multi-national deals, though sometimes the 360-degree paycheck is worth the handcuffs.

(12) Digital disruption is not just for record labels.  

Nearly every other sector – including publishing and touring – are also trudging through tough transitions.

(13) The music is still the most important thing.

Artists over-dialed into their Twitter followings and play counts are often missing the most important part of the equation.

 

Written by publisher Paul Resnikoff while listening to Mozart, AZ, Xzibit, A Tribe Called Quest, Sepultura, Verdi, Rick Ross, and some Taiko drumming. 

15 Responses

  1. Smart Alec

    May I add a 14th ?

    The major WRECKARD companies are FINALLY reaping what they’ve sowed.

    ~ Since the beginning of time, they’ve constantly and consistingly screwed artists out of their just due royalties …. though that’s no secret, I just thought I’d throw in my 1 1/2 cents.

    Anyone care to add a 15th discovery ? 🙂

  2. alden

    Let’s see, number 15? okay

    how about consumers really don’t care at all about paying for content – no guilt, no nothing. they’re the ones really screwing artists!

  3. JacksonL

    #16

    the bundle is history. unless we figure out a way to get it back.

  4. dhazan

    The false “Myth of Merch” panacea…..the fan who won’t pay $10 for the CD is unlikely to drop $25 on the t-shirt

  5. feldscott

    Direct-to-Fan supports a lot of the positive aspects of today’s technology and audience. While it democratizes the overall process, you still need to understand and activate direct-to-fan practices in order to be successful today. The content glut isn’t the problem; the lack of a trusted filter/gatekeeper is. In lieu of anything better, and with less time in the average person’s day, they tend to rely on popularity (on YouTube, Twitter, etc.) instead of investing the time to find quality. Back in the old daze, radio could do that, your local record store could do that, but who has time to go to the record store? And there’s no time to play music on the radio ‘cuz it gets in the way of the commercials.

    No amount of Tweeting makes your music sound any better, and 2 million views on YouTube doesn’t translate to cash in your pocket. But if we’re only capable of listening to the low hanging musical fruit, then whose fault is that?

    Direct-to-fan allows you the opportunity to develop the relationship with the fans you have. It also leads to discovering new fans in a trusted, reliable way. Sure you’re in competition with a lot of other people, but you’re limiting (indirect) intermediaries, and gaining an audience of engaged, passionate fans. And it’s working. Sorry if it’s not the silver bullet, but quality takes time. Musicians (with quality music!) who engage in direct-to-fan best practices will see solid, consistent growth.

    –Scott

    Scott Feldman
    Director of Marketing – Nimbit
    scott@nimbit.com

  6. @DECA3 (Twitter)

    DÉCA3
    Bienvenue dans le monde numérique… Aargh!

  7. DMarcus

    “(11) 360-degree deals can really kill your musical mojo. We’re just starting to see some of the problems associated with these label land grabs.”

    Can you be more specific on this one? What are the problems associated with these so-called land grabs?

    • presnikoff

      @DMarcus

      Major labels will argue that a consolidated, 360-degree deal offers scale and broader coordination between various assets. And, there’s merit to that argument in theory, and in practice I’d say for the right artist and situation.

      But the flip side has been apparent from the beginning – also theoretically – though I’d argue that we’re already seeing some real-world issues. Not sure if you caught that clip with Lupe Fiasco, who described a situation in which Atlantic held back promotional muscle and resources because he had not signed to a 360? In fairness, this is just one side of the argument and there’s more due diligence I could do here. But labels are pushing to maximize the full package these days – and Lupe’s allegations of de-prioritization fit into that business mentality. (Lupe vid here).

      Another issue has always been the problem of placing too many eggs into one basket. If there is a major problem or disagreement with the label in a recording agreement, artists can find their recordings held hostage, creatively railroaded, etc. But in a broader, 360-degree arrangement, that freeze can affect the broader asset pie.

      At the Future Of Music Coalition’s Policy Summit earlier this month, another issue came up. Edward Pierson (Esq. Attorney, Inside Passage Music) pointed to different term lengths for various assets that fall under a 360-degree arrangement – recordings, publishing, merchandising, etc. That makes it very complicated for an artist to move on past a 360-degree deal, and subsequently strike independent deals involving controlled copyrights or even licensing control over merchandising, for example.

      The last point I’d say is coming from artists that are putting together their own 360-degree arrangements – with themselves as the hub of the wheel – not the majors. I’d point to Arcade Fire and Metric as prime examples. Perhaps these are most positive arguments against a more risky major label tie-up.

      pr.

  8. @LatiumArtists (Twitter)

    Latium Entertainment
    Artists over-dialed into their Twitter followings and play counts are often missing the most important part of the equation.
    The music is still the most important thing.
    thanks digitalmusicnews.com …. that says it all

  9. Andrei Maforin

    Paul,

    Pretty cool that you were listening to Mozart while writing the article! I didn’t know we had any surviving recordings of him playing…

    • presnikoff

      why yes, there’s a digitally remastered copy of a piano concerto performance from 1782 floating around the office…

  10. @RikSpr (Twitter)

    Rik Spruijt
    ‘It’s really hard to sell music to fans online, but it’s not as hard to engage fans, as long as they’re not paying’