Hard News by Russell Brown

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Hard News: The Public Good

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  • Stephen Judd,

    Ben: I started being aware of a live music scene, even in piddly Hamilton, in the late 80s, and for me about 1991 was a high water mark. After the benefit cuts and tertiary student funding changes musicians were being hassled to work , the drinking audience declined, and students had less spare time. Now perhaps the taxpayer should not have been funding a bunch of beer-drinking, freeloading noisemakers, but anyway I reckon there was a sharp discontinuity there.

    Perhaps a change of fashion towards DJ-based dance gigs was the reason instead.

    OK, it's not even a theory, it's a hunch.

    Wellington • Since Nov 2006 • 3122 posts Report Reply

  • Simon Holloway,

    As someone who works in the "music industry" I have been very interested to see the level of interest in this topic. On reading that ruinous bit of PR from RIANZ last week I initially emailed the following to the NZHerald reporters-

    "I wonder when someone might start looking into the possible link between the decline in revenue in the recording industry and the increase in that of internet service providers over the last decade. Consumers are still paying for music, it's just that intead of paying traditional music retail outlets they have been paying their ISP. The record industry's problem is that this wasn't acted on soon enough. A possible solution could have been micro payments levied from ISP traffic or licence fees similar to those employed by APRA, the collection society for music publishing income that collects and pays royalties based on radio, TV and public performance of music in NZ. If RIANZ had taken steps to alert government to this problem and the possible required regulation earlier they could have had the opportunity to be a world leader in offering a possible solution to loss of revenue due to file sharing. Instead, this present rear guard action, while commendable in intent, is probably of limited value in turning around the decline in revenue. Increased enforcement of DRM and chastising the customer are bad PR for RIANZ; what they should be doing for their members and represented artists is lobbying government to look into where the money has gone, steps that could be taken to correct the problem and possible retrospective reparation- such as agreements the big media companies in the US have recently come to with MySpace, YouTube and the like. [As a footnote- unfortunately, once the tap's been turned on you're going to have a hard job telling people they're going to have to go down to their local shop to buy their water- but hold on, that did happen in the 90's didn't it? The lack of marketing and brand innovation in the music industry is also a contributing factor in this issue, but that's another story.]"

    Also of note is that the lack of revenue from sales of overseas artists reduces the amount the local major labels can spend on NZ acts. You can have a top 10 album in NZ with about 300 sales in a week these days. That is not an exaggeration. You don't need to worry about how much the record co is or isn't making per unit at those sorts of sales levels- any way you look at it, it's uneconomic.

    Auckland • Since Apr 2007 • 6 posts Report Reply

  • Ben Austin,

    How would this levy actually work? If it was a flat levy on all subscribers then that would have never worked, given that a lot of people don't actually ever download stuff (I know I don't. No, seriously!) and would not want to pay purely on principle.

    A micropayment or traffic based system is also problematic, if I've understood you correctly. I think perhaps you may be over-estimating the sophistication of our ISP's or their back office systems if you think it could be easily created or monitored.

    London • Since Nov 2006 • 1027 posts Report Reply

  • Russell Brown,

    A micropayment or traffic based system is also problematic, if I've understood you correctly. I think perhaps you may be over-estimating the sophistication of our ISP's or their back office systems if you think it could be easily created or monitored.

    Lots of people have looked at this kind of idea. One of the problems is that if you paid out on the flow of content, the porn industry would pocket a whole lot of the money.

    The idea that you find a way to monetise without destroying the internet dynamic is really appealing, but it's pretty hard to to do.

    Auckland • Since Nov 2006 • 22850 posts Report Reply

  • Simon Holloway,

    Granted it would probably have been a bit more hard work than 10 years sitting around doing nothing about it.

    I think if you tried to rebuild the performance right body models worldwide from scratch now you'd probably scratch your head and go no, too hard, as well.

    The level a levy would have to be at to recoup the lost revenue would be practically invisible to end users.

    If p2p traded files were trackable a micro payment system would be possible. If songs were freely available with no DRM pretty soon the majority of content would be orignating from the producers, not ripped and uploaded from consumers, and *ideally* would be identifiable as such.

    APRA doesn't know when/where every song that's been played has been played but their system works pretty well it seems to me and is probably, aside from live, where most (writing) musicians actually see a revenue stream. You would think the recording industry worldwide would have looked into some sort of equivalent for recorded music revenue.

    Subscription models look unlikely to work because of the demographic they're selling to- it's not Sky for fat dads on the couch is it?

    Auckland • Since Apr 2007 • 6 posts Report Reply

  • Simon Grigg,

    You can have a top 10 album in NZ with about 300 sales in a week these days.

    somebody in the US last week was boasting that they'd hyped a track to number 59 in the NZ "rock" chart last week. I commented that all that meant was that someone had walked past the Cd in Real Groovy.

    f it was a flat levy on all subscribers then that would have never worked, given that a lot of people don't actually ever download stuff (I know I don't. No, seriously!) and would not want to pay purely on principle.

    yes, but as that April Fools thing did point out in its own way, legitimizing & monetising the P2P services with a levy is the a possible way forward (which terrifies the majors), or the eMusic model which is so very simple. Instead they persevere with iTunes, which is,despite its pre-eminence, not working for the companies...it's very little more than a pretty holding operation as physical sales (as Simon so rightly points out with his NZ figure..and thats on a good week) go over the precipice.....p2p downloads grew 47% last year in the US alone to some 5 billion tracks!

    Already Soulseek has a voluntary subscription, if you pay $5 via Paypal you get priority queuing. What the uptake on that is I don't know. A $2 levy per month might seem like Universal's worst nightmare but its a step up from $0.

    If the rumoured Amazon purchase of eMusic goes ahead then we have a very interesting new ballgame, combining as it does the physical and the digital on a global scale.

    Just another klong... • Since Nov 2006 • 3284 posts Report Reply

  • Rob Stowell,

    I'd totally support a p2p levy, but a flat rate on the net ain't going to happen. I don't download music and micro or not, the idea that I'd have to pay for those who do is infuriating. Tethering the entire www to such a reginme is both impractical and unjust. But yeah, Simon- the April fools may turn out to the people who who aren't thinking this laterally. It looked more like a sound business structure than most anything I've seen.

    Whakaraupo • Since Nov 2006 • 2120 posts Report Reply

  • Jake Pollock,

    <quote>With a taste in music history - tell me Einsteins - where do I go to buy a copy of Thomas Edison reciting "Mary had a little Lamb", pre 1914 - hell - pre 1900 recordings of all sorts, obscure comedy tracks we used to have on 78's, long broken/<quote>

    Archive.org has a lot of that sort of stuff.

    Raumati South • Since Nov 2006 • 489 posts Report Reply

  • Ben Austin,

    P2P levies are an interesting concept, but given the culture of secrecy and the like which has grown up around them I'd doubt a levy regime would capture much of the traffic. Plus there is the fact that much of the world (lets say non western) trades film/music cheaply and without care of the copyright holder. I dont' see this stopping, as they will never prioritise such enforcement while they have more serious things to worry about. And so if they still have their free and easy regime then it will flow back into the western markets.

    London • Since Nov 2006 • 1027 posts Report Reply

  • Simon Grigg,

    Simon- the April fools may turn out to the people who who aren't thinking this laterally. It looked more like a sound business structure than most anything I've seen.

    which I think was Bob Lefsetz's point and its one he makes in non April 1 posts quite often. He tends to ramble on a lot in his emails (and sometimes you get three a day) but amongst the rambles there is much truth and sense.

    The Canute-ism of the recording industry is incredible sometimes.

    Just another klong... • Since Nov 2006 • 3284 posts Report Reply

  • Simon Grigg,

    Or, I should say, the record industry (meaning the majors)...the recording industry in my experience is quite the opposite...hungry for ideas, technology and change

    Just another klong... • Since Nov 2006 • 3284 posts Report Reply

  • Simon Holloway,

    Tethering the entire www to such a reginme is both impractical and unjust.

    I remember reading an article in a local internet mag a few years back detailing exactly how to download the latest (insert NZ artist name) album "for free" complete with links to the p2p software and a step by step of how to download- written as a feature on NZ music! I thought at the time, would it be acceptable to write an article detailing how to break and enter your local Dick Smith after hours and pick up that appliance you wanted as a fun alternative to the normal retailing experience?

    There are lots of utilities and services that we collectively make contributions to so that we have the option of using them - terrestrial TV is probably an apt example to cite here.

    Auckland • Since Apr 2007 • 6 posts Report Reply

  • Ben Austin,

    How do we collectively make contributions to terrestrial tv? Do you mean the now abandoned licensing fee or stateowned BCL/TVNZ/NZonAir?

    I remember the first time I ever got binned by the licence people. I was watching TV at my Harbour Tce flat in Dunedin with my flatmates and a middle aged guy knocked on the door and asked me if we had a TV, which he could clearly see from his position. One minute later I was signed up to the regime and received a backdated invoice in the post a week later. I was a little stunned by the whole process to be honest.

    London • Since Nov 2006 • 1027 posts Report Reply

  • Russell Brown,

    __Simon- the April fools may turn out to the people who who aren't thinking this laterally. It looked more like a sound business structure than most anything I've seen.__

    which I think was Bob Lefsetz's point and its one he makes in non April 1 posts quite often. He tends to ramble on a lot in his emails (and sometimes you get three a day) but amongst the rambles there is much truth and sense.

    As a radical idea, it's a step off the cliff - who knows if you'll fly? The main problem I can see is conversion. The experience is that the moment you make a free content service paid you lose at least 90% of your audience.

    What's to stop the Limewire audience decamping to free services? Maybe that wouldn't happen here (and Leftsetz' point about universities taking bulk licences to cover their assess is insightful) but it's not guaranteed.

    Maybe some emusic-style halfway house where your fee gets you x number of downloads (you can upload as much as you want), but can be topped up, would be more palatable.

    Advertising income shouldn't be discounted either, if it can be accomodated. It has the massive benefit of getting people paid without (usually) breaking the fundamental dynamic of the network.

    But that also has its problems: in the case of TV, it's hard to see how a distribution model provides the kind of advertising revenue that pays for news operations and top-flight dramas.

    Something is going to come out of leftfield and nail this, though. It's just a matter of when.

    Auckland • Since Nov 2006 • 22850 posts Report Reply

  • Simon Holloway,

    As far as I am aware it is possible for ISPs to see what percentage of traffic is p2p based on traffic via certain standard application ports, and, to my knowledge this has something to do with how they work out their TOC management (they limit bandwidth allocated to those specific ports). So, maybe it would be possible to levy p2p traffic via ISP- you'd be talking about 10c/month or whatever per user- the revenues would still be huge given the volume.

    Ben is right, it's hard to see why a subscription model would work on p2p software. The revenue collection has to be invisible to the consumer much in the same way publishing income is collected for artists via the performing right societies. I'm sure bars/venues pass on the APRA levy to consumers as a cost of good sold but I've never heard anyone complaining about that.

    Part of the problem here is that the recording industry has gone about dealing with this problem in possibly the most arse-about-face way they could have conceived of. In reality the problem has very little to do with their customers doing anything wrong- they're problably consuming more music than they ever have before.

    Auckland • Since Apr 2007 • 6 posts Report Reply

  • Nobody Important,

    I remember the first time I ever got binned by the licence people.

    Yes, that Govt department were quite an outfit. When a new flatmate moved in she stupidly (but dutifully, she was quite the sheep) went to the Post Office and filled out a change of address form. Back in those days the form consisted of several copies, one of which went to TV Liscencing. They checked the address she was moving to and saw that no liscence fee had been paid for our address. So they sent her an invoice, based on the premise that everyone had a TV until they proved otherwise.

    It took some effort on my part to convince her to write in and say we didn't have a TV, because we did, and she thought everyone should pay their taxes. Obviously I didn't agree which was why I gave a false name and address when I bought the TV, since retaillers would also dutifully notify TV Liscencing of who had bought a TV.

    Soon after moving in she began making her own dinners and eating them in her own room, where she had no TV. Perhaps she thought that would protect her when NZ's version of The Stasi kicked down our front door, burst into our living room, and discovered our 21" Thorn TV.

    expat • Since Mar 2007 • 319 posts Report Reply

  • Simon Holloway,

    How do we collectively make contributions to terrestrial tv

    As far as I am aware it's now done direct from the tax pool- I guess I should have said state owned terrestrial TV, although NZOnAir funds programmes shown on other stations too.

    Auckland • Since Apr 2007 • 6 posts Report Reply

  • Stephen Judd,

    Something is going to come out of leftfield and nail this, though. It's just a matter of when.

    That's a statement of faith and nothing more, Russell. At least if by that you mean some new development is going to rescue the big players from the prospect of decreasing profit.

    I don't buy the idea that the music industry is stupid when its main strategy is to try to make it illegal to bypass them. Very large companies with very bright lawyers and very bright technical folks have seen the writing on the wall, and decided that getting their business model enshrined in law is the bet approach to protecting their investment.

    If from the outside we think that's an impractical and likely unsuccessful approach, well fine. The conclusion we ought to draw from this is that the music industry itself knows it is screwed and sees no relief. And it will not be un-screwed by wishful thinking.

    There will be a new regime in ten or twenty years. The most successful businesses in that regime may share a lineage with the most successful ones now, because existing business know-how and capital will provide a headstart. But that's it.

    That deflating sound is the entertainment industry investment in decades of intellectual property losing its value. Their franchise is ruined. It will not come back.

    Wellington • Since Nov 2006 • 3122 posts Report Reply

  • Simon Grigg,

    Part of the problem here is that the recording industry has gone about dealing with this problem in possibly the most arse-about-face way they could have conceived of. In reality the problem has very little to do with their customers doing anything wrong- they're problably consuming more music than they ever have before.

    which is absolutely evident from the vitriol on the Herald site, much of it perhaps unreasonable, as in real terms the album is cheaper than ever (based on the RBNZ calculator the $12 1981 album should cost $42 in 2006).

    But these people have absolutely alienated their customer base and complaining how poor the artists, whom these consumers have supported are, just aggravates the problem.

    And it tends to avoid another key issue...whether the Radio / RIANZ / NZOA funding model creates artists without sustainable careers by promoting, via the broadcasters, acts whose only asset is a few radio friendly songs, without a real fan base. The regularity of the failure of second albums is perhaps an indicator to that.

    Just another klong... • Since Nov 2006 • 3284 posts Report Reply

  • Ben Austin,

    Good point about the ports. However I don't really know why the ports that are usually used for such p2p traffic are chosen. Is there a clear technical reason, or is it convenience, tradition, or what? Perhaps if monitoring or taxing started up on the current common ports, others would soon be used? I really don't know enough about this to keep talking, without treading ever more closely to having a "the Internet is made up of Tubes" moment.

    Like Stephen said - the franchise is ruined. But what does this mean? Does it mean that the record industry pushing albums/tracks out through their distributors (be that itunes, or a truck) is over? Does it mean that the paid for music mass market is over? Maybe it can mean a bit of a) and a bit of b) depending on who you are and where you live?

    London • Since Nov 2006 • 1027 posts Report Reply

  • Simon Holloway,

    very large companies with very bright lawyers and very bright technical folks have seen the writing on the wall, and decided that getting their business model enshrined in law is the bet approach to protecting their investment.

    Why then the about face on DRM by EMI yesterday?

    And why is the body (RIANZ) that represented EMI to the select committee last week in NZ lobbying for more DRM?

    Looks more like a headless chicken to me.

    Auckland • Since Apr 2007 • 6 posts Report Reply

  • Nobody Important,

    Looks more like a headless chicken to me.

    So whatever happened to The Headless Chickens? Can C4 do a Where Are They Now? show? (God knows MTV won't)

    Everytime I see Fiona MacDonald on TV with that perky false smile I wince ...

    expat • Since Mar 2007 • 319 posts Report Reply

  • podgirl,

    Campbell Smith: A further development to be taken account of is the newly-created market for podcasts of work. Copyright owners or licensed providers now make podcasts available for purchase and obtain a return. The wide time shifting provision in the Bill will interfere with the normal exploitation of copyright owners and thus be in conflict with both the Berne Convention and TRIPs Agreement.

    Thanks Russell - for rubbishing this comment. There is no fee for listening to podcasts or for subscribing to NZ Music podcasts on networks such as The Voicebooth. Many independent NZ artists and labels submit music with the understanding it is for podcast, and appreciate the feedback & interest - often from overseas music fans. Hopefully, for artists, that translates into gigs, sales, collaborations - the whole networking thing works its magic etc. I'd hardly call this "exploitation" of copyright owners. Artist details, weblinks etc are all acknowledged.

    wellington • Since Apr 2007 • 4 posts Report Reply

  • podgirl,

    Music month is always time for a good stir-up - issues need airing - hope they're listening.

    wellington • Since Apr 2007 • 4 posts Report Reply

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