There’s Another Huge Middleman. And He’s Standing Between You and Apple

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Last week, we stumbled upon something interesting: a direct iTunes uploading interface.

In other words, a tool for directly porting music into the iTunes Store, without paying an intermediary.  Actually, ‘iTunes Connect’ has been sitting there for a while, though keeping quite the low profile.

But there’s a gigantic catch.  This is a very tricky process to self-manage, and even an Apple executive advised letting someone like Tunecore handle the details.  We kept asking around, and another expert (with no vested interests) outlined a hassle-filled process, and lots of extra costs for obtaining things like UPC codes.  So, the takeaway was obvious: pay the $50 and focus back on your music.

Then, something interesting happened.  A number of readers felt that the process was actually not as difficult as we had reported – and is getting a bit easier.  These sounded like expert-level users, though this roll-your-own group was enjoying the direct connection, more detailed financial reports, and other perks.

But what if iTunes Connect was incredibly easy-to-use for everyone?  As in, what if Apple dedicated a week to create the most incredible direct-uploading tool imaginable, one that looked like other Apple software products?  “We’ve made it easier than ever for artists and authors to directly place their work onto the iTunes Store,” Steve Jobs would tell fanboys at the next presentation.  “And best of all, iTunes Connect is free for anyone to use, and it’s available right now.”  Insert audience applause here.

Almost overnight, intermediaries like Tunecore, CD Baby, and ReverbNation would be treading water – and possibly staring at their own extinction.  And, Apple would gain a direct relationship with the uploading artist, polish an artist-friendly image, and generate even more hardware sales.  And, ditch the middleman, something that fits neatly into the Apple control-oriented outlook.

But wait, wouldn’t these companies just shift towards other DIY artist services – like analytics, distribution to other stores, email marketing, and merchandising?  Actually, this is where most of these companies are struggling to gain traction, based on lots of conversations we’ve had with entrepreneurs and employees.

It turns out that artists are mostly disinterested in paying for less essential tools and services.  That makes sense given the typically tiny budgets and small DIY earnings defining the Long Tail.  Sure, iTunes distribution counts as an essential, but do you need a complicated analytics solution?  This is a major problem for the DIY services sector.

Well, here’s another major problem.  These middlemen are experts in managing every aspect of iTunes distribution, reporting, and renumeration.  And, they’re making money off of that.  But they’re also occupying a very thin sliver between the artist and Apple.

And it could go away tomorrow.

Paul Resnikoff, Publisher.