The shit storm continues
If you have the stomach - here's more about how major labels are screwed. This time from the Economist:
The music industry | From major to minor | Economist.com: "
And a few of my fav highlights from the article:
IN 2006 EMI, the world's fourth-biggest recorded-music company, invited some teenagers into its headquarters in London to talk to its top managers about their listening habits. At the end of the session the EMI bosses thanked them for their comments and told them to help themselves to a big pile of CDs sitting on a table. But none of the teens took any of the CDs, even though they were free. “That was the moment we realised the game was completely up,” says a person who was there.
Ok - so it took almost 10 years for labels to actually SEE people rejecting CDs. Fair enough - I guess.
So - the question we all have is - NOW WHAT?
From the article:
They (labels) now want to move beyond Apple's iTunes and its paid-for downloads. The direction of most of their recent digital deals, such as with Imeem, a social network that offers advertising-supported streamed music, is to offer music free at the point of delivery to consumers.
Perhaps the most important experiment of all is a deal Universal struck in December with Nokia, the biggest mobile-phone maker, to supply its music for new handsets that will go on sale later this year. These “Comes With Music” phones will allow customers to download all the music they want to their phones and PCs and keep it—even if they change handsets when their year's subscription ends. Instead of charging consumers directly, Universal will take a cut of the price of each phone. The other majors are expected to strike similar deals.
“‘Comes with Music' is a recognition that music has to be given away for free, or close to free, on the internet,” says Mr Mulligan.
Paid-for download services will continue and ad-supported music will become more widespread, but subsidised services where people do not pay directly for music will become by far the most popular, he says.
For the recorded-music industry this is a leap into the unknown. Universal and its fellow majors may never earn anything like as much from partnership with device-makers as they did from physical formats. Some among their number, indeed, may not survive.
In other words - people won't buy music - they'll buy things that have music in it.