Most of the debate over digital music business models is about the record companies and their digital successors, but what about the musicians? David Lowery of Cracker argues that for them, things are much worse: at least some pre-digital musicians actually got paid.
Things are worse. This was not really what I was expecting. I’d be very happy to be proved wrong. I mean it’s hard for me to sing the praises of the major labels. I’ve been in legal disputes with two of the three remaining major labels. But sadly I think I’m right. And the reason is quite unexpected. It’s seems the Bad Old Major Record Labels “accidentally” shared too much revenue and capital through their system of advances. Also the labels ”accidentally” assumed most of the risk. This is contrasted with the new digital distribution system where some of the biggest players assume almost no risk and share zero capital.
I don’t agree with everything he writes, but that bit there makes sense to me – and it’s being replicated in ebooks. What looks like empowerment can also be evisceration: the Apples and Amazons of the world aren’t getting rid of middlemen, but becoming them by getting writers to do all the work (editing, promotion, etc) that traditional publishers do. They still get a cut, but they don’t have to risk any of their money.
In the last few years it’s become apparent the music business, which was once dominated by six large and powerful music conglomerates, MTV, Clear Channel and a handful of other companies, is now dominated by a smaller set of larger even more powerful tech conglomerates. And their hold on the business seems to be getting stronger.
There’s a wider angle to this too, which I’m sure I’ll come back to in a proper post: the way in which the new titans are organised in such a way that they can destroy their foreign rivals without paying foreign taxes. By routing ebook sales and music downloads through Luxembourg and putting UK earnings through Irish subsidiaries – something that, as public companies, they arguably have to do; their responsibility is to maximise their share prices, not to be good corporate citizens – the new bosses get yet another advantage: not only are they largely free from the need to invest in content creation, but they’re freed from some of the main costs of doing business too.
Taking no risk and paying nothing to the content creators is built into the collective psyche of the Tech industry. They do not value content. They only see THEIR services as valuable. They are the Masters of the Universe. They bring all that is good. Content magically appears on their blessed networks.
As I say, I don’t agree with everything he says, but it’s hard to argue against that one.