A few days ago this article made the rounds: music execs are stressed over free streaming (e.g. online radios, pandora), and streaming in general (e.g. the for-pay spotify, rdio, mog etc). They fear that this freeness or cheapness will generate even less profit for them. But isn’t this normal?
Funny thing is, until last year they put the blame for their failing business to piracy. Now, they blame streaming. But the truth lies elsewhere, a truth they’d prefer hidden.
The real headache for the big music business is not just piracy, streaming, lack of talent/innovation, or even the financial crisis. Yes, these factors had their toll, no doubt, but they are not the only catalysts for the decrease in revenue. The “problem” is also the fast emergence of the independent scene.
Independent musicians were around since forever, but the Internet, and the cheaper hardware & software in this past decade, brought them into the limelight, little by little. Now it’s possible to find thousands of legally free promo mp3s from these indie artists, get accustomed to their eclectic sound, and eventually get to a state of mind where you never want to have anything to do with the mainstream music ever again. Also, these decreased revenue numbers we get from RIAA are from a few labels only, while customers have moved over to true indie labels instead (e.g. even SubPop is not exactly indie anymore, being owned by Warner Bros, and being part of RIAA), and they often buy or freely download music from artists that are label-less.
To showcase how the indie scene took paying customers away from RIAA, let’s have a look at the Rolling Stone magazine’s reviews over the years. Magazines have their interest in reporting about music acts that people care about, so they’re a good benchmark in this research. Rolling Stone has posted online their music reviews from 1967 to date. The first album reviews for an indie band was just in the ’90s, for Nirvana, Soundgarden, and Pavement. They were pretty much the only indie bands that were reviewed on a timely basis, and the first two eventually went major anyway. The second true indie band reviewed later was Yo La Tengo, in 1998. The next ones were Shins and Neco Case in 2001. Interpol and Death Cab for Cutie in 2002. Cat Power and The Postal Service in 2003. Basically, acts from mostly Matador, or Subpop, and only far and between.
From that point on though numbers of indie reviews were going up every year, and around 2009, about 40% of all the reviews on Rolling Stone was for indie bands. Fast forward in early 2010, and that number is at around 60%. Fast forward at the end of 2010, and the beginning of 2011, and that number is close to 80%. It seems that the indie bands are taking over major-signed artists in the press at a logarithmic speed, and the curve of this surge feels more natural than just a pre-calculated editorial policy shift. Not to mention the explosion of indie mp3 blogs in the recent years too.
Sure, news gossiping is still about major pop stars, but that’s because nobody cares, or should care, about the personal lives of indie bands. Album review articles on the other hand, are targeted directly to serious consumers, people whose purchases are supposed to show up in these RIAA revenue spreadsheets. But they won’t, not anymore. The press is now directing new consumers towards indie acts — after the previous generation of consumers forced the press itself towards indie.
As for Arcade Fire winning “album of the year” at the Grammy’s, a first for an indie band? That was just the cherry on top of the cake.
Music does not die. The music industry does not die. It just has moved shift from the majors, to the indies. New, more broad spreadsheets are required to measure the success or failure of the music industry. Unfortunately, RIAA is using the same old methods to measure its revenue, presents it as the only truth, and speaks via its lobbyists to the Government still with authority — while it should have none anymore. The result from this head-on collision will be more terrible laws, trying to save an industry that should not exist anymore. Major record labels are not needed anymore. Recording and mixing is cheap nowadays, and advertisement can just be offloaded to third party PR companies.
These music execs who now complain are in the wrong business. Nothing would have saved them. There is not money to be made anymore in the same fashion they were working in the past. Some people say that if majors had embraced the Napster model things would have worked for them, but that’s not true. Big companies need lots of money to sustain themselves, and cheap products can’t sustain that lifestyle. Instead, full scale-back was needed, and for those companies this didn’t make sense, they should have dissolve, or sell, no later than 2008. The ones who remain, throw ash in our eyes with this “streaming is hurting us” bullshit, while from the other side they try to kill their true competition, the indie scene and Creative Commons.
You see, they’ve lost control. In the past, they would dictate to consumers to whom to listen to, by creating stars, and paying TV and radios to play their songs every hour. Without having a contract with them, you could never make it in the business. Now, they’ve lost that control. People are finding new bands on Pandora, music blogs, or Bandcamp, often downloading bedroom-made music for free. You can’t beat free. Plus, technology has helped putting an end to the read-only culture the majors nurtured in the last century.
The point is, indie is here to stay. Lady Gaga is the last major pop star of the old world.