Interview: Greg Kot of Ripped: How the Wired Generation Revolutionized Music (Part 1) - hypebot

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Old Record Guy

"By 1999 the music industry was the biggest revenue-earning entertainment industry in North America. So why change? Why embrace the Futureworld when the profits are rolling in, quarterly profit statements are fat, and stockholders are happy? The businessmen running these companies saw change as riskier than maintaining the status quo (and their jobs). They were wrong."

As much as I agree that we got it wrong, it really pisses me off that every tool who writes an article or a book makes it sound like the smart move was to embrace Napster etc when we (the majors) sat down with them in 1999.

Folks, here's the real deal: the offers new media companies were making to labels SUCKED. They went something along the lines of "Hey, we want users to have access to your entire catalog of recorded masters, plus live and bootleg shit that the artists haven't approved. People will be able to share as many copies as they like, and we can't track it, so we will charge them a flat fee, let's say 10 bucks a month. After costs, we'll keep half, and you'll get like 15% of the other half, let's call it $1.50 a month. Here's the contract - oh, and can you make it snappy and sign it? Once you do our market cap will be in the billions, and you don't get any equity. Whoopie!" There was NO FEAR - the economics SUCKED! You want to know what fear is? Try getting screamed at by Donnie Ienner in a room full of people, that's fear.

NODODY would sign that deal in 1999, even if we knew file sharing was going to fuck everything up. Certainly our artist and publisher agreements prohibited doing so -it was a struggle to get many artists to agree to lower their catalog CD prices to a midline tier to help sales, forget about convincing them to Napster royalties. Retailers really hated the idea too for obvious reasons.

We made a lot more money than $1.50 on just one CD sale. Nobody anticipated that a decade later, governments would be unable or unwilling to enforce copyright. The industry was sitting on 50 years of success and challenges, and everyone figured things would change, and we'd adapt. But no one was going to shitcan the entire music economy just because "some computer assholes invented a website" ( a quote I remember clearly from those days).

OK, so that's all past history, and the new frontier is all about direct to consumer, commerce via engagement. Sharing is the new consumption model, ignore it at your peril.

As someone who spent their entire career working "niche" artists at majors, I can tell you this guy is dead wrong about "only bland celebrities having a chance". I sat in a thousand marketing meetings when just as much discussion time was given to really niche type acts as there was to Mandy Moore etc. Acts with mainstream appeal get all the media attention, true, and they sell the most records. But that never stopped any label I worked for signing niche acts and trying to find a place for them, to various degrees of success.

Books about digital music all make the same, or most of the same, points:

1) The music business didn't see the huge opportunity of the web because of their bloated, cigar smoking arrogance and FEAR
2) No one in a leadership position at a major knew anything about digital
3) CDs all had 2 good songs, the rest were "filler"
4) The artists were all on board with Napster etc but the labels killed it against their wishes

The truth is simpler. Are the majors arrogant fuckers? Unquestionably. Were the deals we were being offered at all reasonable, based on any established value of recorded music? No. Were there highly qualified and experienced digital people working at the majors very closely with senior management to develop strategy? Yes. Were they tasked with prioritizing deals that providing margins similar to those earned via physical product? Yes. Did they torpedo deals and jerk around a lot of people with great blue sky ideas that would bring the price of music down dramatically? Yes. Did artists think their albums were 2 great songs and the rest crap? HELL NO. Did artists want to be paid even less than the paltry sums the label shelled out if by some miracle they ever recouped? NO. Did most of the companies we met with seem like they had no real business model, they just wanted a license to prop up their value for an IPO? Yes. Are 99% of those companies long out of business? Yes. Whose fault is it - the labels, or the companies themselves? Both.

With respect to Mr. Kot, I doubt he ever sat in a single label pitch meeting or ever tried to negotiate a licensing deal. If he did, he'd have noticeable scar tissue to show for it (although not much else), and he wouldn't be regurgitating the same tired, revisionist babble that pleases the crowd so much. If we have balanced dialogue about what really happened during those years, we might actually see a way forward into a new era, instead of wading around ankle deep in the same tired birdbath of insights.

Dan Cransforth

Let me guess. You didn't read his book. Rather you sized him up as another Chris Anderson wanna-be and went to town. Thanks for the static. I'll bet you even have some legit points somewhere in the vitriol, but who would trust you?

Old Record Guy

Fair enough, I've only read excerpts and this interview and his website, not the entire book. But his preamble here could have been cut and pasted from every article written about digital music in the past decade. I'd rather trust what I saw with my own eyes.

Jay

I disagree. I found ORG's insights to be particularly interesting. Rarely will you read anything from his point of view on the net; the overwhelming majority of music industry articles seem to be mostly from the Tech point of view nowadays.

Ten years has felt more like an eternity ago in terms of how much the industry has changed. To understand where we are now, its imperative to understand where we've come from.

Pooleside

ORG-

I totally respect your point of view, but can you say that by the 90's radio was playing anything other than sure bets?

And can you say that there was another path to success, other than via radio?

While I believe that some in the industry saw the writing on the wall and made moves to embrace the potential of the net, I'm very happy to see that monolith fall. It'll be good for business, too, in the long run.

Liv Pooleside

http://www.somewhereoutwest.com

Old Record Guy

Pooleside;

US Radio and major label music in general didn't start to suck badly until after 2000, or the time when the boy band/Britney thing started. Alternative Radio still took chances in the 90's, although certainly less in 1999 than in 1991. In the 90's, working for majors, I personally worked:

Marianne Faithfull
Philip Glass
Arthur Russell
James
Michelle Shocked
Quicksand
David Baerwald
Soundgarden (Badmotorfinger and Superunknown)
Sheryl Crow (for the first 8 months after Tuesday Night Music Club was released, before it hit)
Swervedriver
Xymox
PJ Harvey
Tricky

Just to name a few. My foggy middle aged brain forgets the names of so many other great artists, but the point should be clear: these were all very talented acts, uncompromising in their art, and all of them were priority work records. All of these artists got "pushed" - in many cases, the marketing started in the grassroots, and in some it never went beyond that. So when I hear twaddle from book writers and columnists who never worked a day in their life at a record label, saying the industry only cared about pop tripe, that nobody gave a shit about credible artists, it pisses me off, because I KNOW it isn't true. I know a lot of people who really loved music and gave their hearts and sweat to these acts. I didn't craft or sign their shitty deals but I still feel badly that so many artists got fucked. But I also saw a lot of acts who had a great time and loved their labels too.

The monolith is falling, but I can tell you, the majority of people running the majors these days care a lot less about music and artists than their predecessors. The labels of today are rampant with MBA weasels who are devoid of soul or creativity and think music is a commodity like coffee beans or pork bellies. Artists don't need labels anymore, but most still need a lot of help in areas not related to creativity, no matter how you define DIY. That's where the opportunity lies.

Pooleside

Who ARE those people? Oh, wait, that Marianne Faithful, didn't she used to date Mick Jagger?

I can assure you that they never played on my radio at any time during the 90's.

I'm not blaming those of you who worked for those accounts- my hat's off to anyone who fought/fights that battle.

No, it's the machinery that only works well for multi-million sellers that I despise. It was a remarkable chunk of history, those golden years of mass-media. I hope we're moving beyond it now.

Old Record Guy

You must not have listened to alternative or college radio that much in the 90's, as almost all of these artists got airplay (albeit some way more than others) on those formats. Where did you live anyway? Ever hear of Live 105, or Krock, or WBCN or WLIR?

NDick

"They went something along the lines of "Hey, we want users to have access to your entire catalog of recorded masters, plus live and bootleg shit that the artists haven't approved. People will be able to share as many copies as they like, and we can't track it, so we will charge them a flat fee, let's say 10 bucks a month. After costs, we'll keep half, and you'll get like 15% of the other half, let's call it $1.50 a month. Here's the contract - oh, and can you make it snappy and sign it? Once you do our market cap will be in the billions, and you don't get any equity. Whoopie!" There was NO FEAR - the economics SUCKED!"

Funny! I thought you were describing a major label offering an artist a recording contract!

A.S.

What I don't understand is why didn't one of the big labels try to build an in-house equivalent to Napster or iTunes.

Old Record Guy

They did. Sony and Universal joined to create Pressplay as a reaction to Napster. It was a failure but eventually and ironically it morphed into the legal version of Napster. I worked on the project and it is a hair-raising tale indeed.

Digital Music Guy

ORG - You make some valid points, but come on. I've worked in digital music since 1999 and I don't remember the kinds of deals you talked about. The music business had many opportunities to embrace change. 10 years later, DRM is gone, and pricing is reasonable. All thanks to Apple.

I remember it more like this:

Us: "How much do you want to list your digital albums for on tower.com?"
Them: "$17.99"
Us: "But you sell the SAME PHYSICAL CD at tower.com for $10.99"
Them: "So? Digital is $17.99. And digital singles for $3.99"


John the Drummer

I remember alternative radio prior to Clear Channel eating up everything locally. Old Record guy is right....there was a better time prior to 2000 or so.....

Jean Renard

I worked the Hatch hearings and the fact is the RIAA dropped the ball and the majors as well when the majors had leverage before dsl was common, there was a nanosecond of hope in getting protection for IP. The technology existed and government was willing to set new guidelines, we were all told to go home, everything was under control.

Add to that the changing of the laws for ownership of stations, money for nothing and the picture we face now was born. The majors are out of the music business and into the pop product promotion business. The industry was not all about art, but some of it was, now it is about product whether it is t shirts, tickets, cds, mp3's or perfume it does not matter. To be fair the industry was changing even then and Frank Zappa had it right in his you tube video about the music business http://www.youtube.com/watch?v=KZazEM8cgt0

Bottom line, if people need music, art, journalism or anything for that matter, there will be some economic model to make it happen, if it does not, then just like after the Roman empire faded away, the dark ages will arrive, I hope it does not take as long for the renaissance to occur.

Peter

Same tired birdbath of hinedsight is what the old record guy probably means.

Peter

'Dark ages' of the recording industry but not of music and the important values that are born from it.

Even the buggy without the horse took on necessary changes to support the speeds combustion engines would produce. We'll get through this "retooling" of vehicle parts used to transport information smoother, safer and faster to a public willing to pay for it. Of course, it's easy to say goodbye or good riddance to the old model of music recording and icon marketing when CEO's, CFO's, labels and A&R so depend on it to feed their families and pay their Bentley and Mercedes off in time to buy their kid's that important education at Princeton, Yale or whatever...

But, like with all 'good things'.... Families will adjust out of necessity and a whole culture of greed and imbalance will fall by the wayside.

The cell divides. The question is, where does a creative musician find their niche among the first divisions of the industry divide? As recording artist? Performing artist? Mix artist? Mastering artist? Or engineering specialist?

As a producer, you might be called upon to wear many hats including, but not limited to the industrial aspects of PR, sales/marketing and the often necessary politics that go with the exploitation of new stuff.

Here's where the cell has to divide again. Managing the artist.

Forget all that. Hey, when the art form is important enough, there's nothing to keep the artist from the public. I have to agree with Jean here with a slight caveat. Instead of the dark ages, we're experiencing a gigantic black hole. Suddenly and late into the night, someone stole the horses!

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