Middlemen

They've been around for a long time now.  They're around in almost every market segment, taking their slice of transactions.  Lawyers are the middlemen between to parties in a legal dispute.  Grocery stores are the middlemen between farms and consumers.  Up until now, record labels have been the middlemen between musical artists and their fans.

Bringing two people together to do business has always been a hard thing to do.  Direct contact between buyer and seller is almost always the best, but sometimes its just really hard to connect.  Enter the middleman (or middlewoman).  New middlemen are popping up all over the internet.  Social networking sites are the middlemen between people trying to connect.  Sites like Digg and Technorati are the middlemen between Bloggers and readers. Google is now the middleman between just about everything (content) and everyone (searchers).

Which brings be back to the record labels.  It used to be if you wanted to make music and get it into the hands of your fans, you pretty much had to go through a record label.  What did the record label really do for you though?  For the most part, they did some advertising, and they got your Vinyl / 8-track / Tape / CD from you to record stores, and then into the hands of your fans.  

With the costs of producing music plummeting, and the ability to do your own advertising and distribution, where's the value from the record labels anymore?

Death of a Record Label

I predict that within 50 years, maybe less, the record labels will look nothing like they do today.  Oh they'll probably manage to hang around, but instead of the media titans they are today, they will be relegated to online bit bucket hosting and credit card processing.  That's really the only thing that's a little bit hard to do still.  The real power will be in the internet's new middlemen.  Google, iTunes, Amazon, these are the places where fans go to look for music these days.  What music fan goes to Universal's website to look for new music?  Bands in the future will simply check the 'music host' option from their local internet service provider, register with iTunes, and then do some advertising and play shows.

Will this mean the end of music superstars?  Probably not.  I think it just means that hype will die down, and only the bands with true talent will last long enough to get their music into enough fans hands to be called superstars.

Will there be more bad music out there?  Probably.  However social networks, peer ratings and the collective audience will quickly sort the good from the bad and allow you to find good music that you like.  Sites like Last.fm are doing this now.

So there's my prediction.  I'll check back in 50 years and see how I did.

Music vs. Motion :: Rent vs. Own

(reprinted from my other blog - Nov 2006)

Much has been said on the different models for the various online music stores. Here is my personal take.

Music and video are two very different mediums. Music occupies one sense: sound. Perhaps you could say it occupies touch also if you turn the music up loud enough, but sound is the primary sense. Video occupies two senses: sight and sound. As a result, there are certain activities where you can listen to music, or watch video at the same time, activities that occupy different senses.

Lets take music first. Since it occupies only one sense, sound, we are free to use our other senses for other activities. We can look at things. We can move around. We can't really listen to music and talk on the phone however, those activities overlap senses.

Video is more complex. It occupies two senses, sight and sound. We can't really look around too much, or we miss the video. Moving around is also awkward since we must split our attention between the video and not bumping into things. Running on a treadmil is ok, since we're not really in danger of running into things.

If we look at the activities when one listens to music, we find that in the majority of them, the music is secondary in nature. Riding a bicycle, or driving an automobile; music is there, but it is a background activity. Our primary focus is on a different task. Video on the other hand is usually the primary task. We sit down to watch television, we go to a theater to watch movies. We generally don't do much else while watching the video. Perhaps we eat or drink, but these are momentary, fleeting activities, and still secondary in nature. Exercise might be one of the few activities that could be considered primary while watching video might be secondary.

The frequency of consumption of these two media types takes different forms. Most music, with the exception of classical, tends to be fairly short. Even classical compositions rarely reach the length of a television show or movie. These smaller chunks are more easily consumed, and on a more frequent basis. We can listen to the same song three to five times a week, and not think much of it. Most of us probably enjoy it. However we probably will not watch the same movie that often, much less a television episode, or even a music video.

Since the associated activities, and consumption frequency of these two media types are so different, might our ownership and sales models also be different? Consider the successful iTunes Music Store. Their model for media sales is ownership. We pay Apple a one time fixed cost, and the media is given to us and we own it. (Well we own a license to use the media, but it's a very long term license) We can listen to a song as many times as we want, and we never have to give Apple another cent. Now consider other online media stores. Napster, Rhapsody, and others heavily favor a subscription model. We pay them a monthly fee, and can listen to as much music as we want each month. If we stop paying, we can no longer listen to any of their music.

Now for me.

I like owning music. It takes a lot for me to add a new song or new artist to my library. I listen to my music a lot. At home playing games, on my bicycle, in my car, at work, etc. I probably loop through my music library once ever week and a half or so. The songs that are in my main playlist however I really like, and I want to have them come up in rotation every few days.

Video is another matter. I perhaps own 20-30 movies on DVD. The last time I watched one of them was 2 months ago (Star Trek II: The Wrath of Kahn). I watch a fair amount of television. I got really into Farscape and Angel, and bought a few seasons of them on DVD. I watched each episode once and haven't played them again. I'm currently recording the new episodes of Battlestar Galactica. Since I'm not usually at home in front of my television Friday nights at 10pm, I record the episodes on TiVo, and watch them when I get time. Then I delete them. I enjoy the story, but I don't think I'll ever be really dying to go back and watch them again. Before I got a TiVo, I did buy a few episodes of Battlestar Galactica off iTunes. Again I watched them once and haven't looked at them since.

I want to buy music. I want to rent video. They are different media, offer different experiences, last different lengths of time, and occupy different parts of my senses. Why should we think they should be treated the same?