There has been a lot of talk lately about Minister Sean Sherlock’s attempt to sneak (yes, sneak) in legislation in Ireland that is remarkably similar in intent to the recent SOPA and PIPA acts which died on their feet in America. The music industry seems absolutely intent on blaming all their woes on piracy and illegal downloading of music and have been clamouring for the government to do something. After initial attempts to bully ISP’s failed they appear to have gone to the one person capable to automatically signing something they feel can help them out. And so far all the signs indicate that this little bit of legislation is poorly thought out, poorly written and completely reactive.
First up, lets take a look at some of the major claims of the music industry and then lets dismantle those claims and expose them for being the bogus, hyperbolic excuse making that they really are :
In this article on the Irish Times website, we see mention that EMI Ireland’s profits have halved in 2011 “and it attributed this fall mainly to piracy.” In this article over at thejournal.ie you have Willie Kavanagh of EMI claiming “The Irish music business has dropped from €146million five years ago, to under €70 million in 2011.”
Now, that’s about 76 million euro wiped out in a five year span…which is an aggressive and pretty much unprecedented growth of the illegal activity that is piracy. So…is the implication that piracy cost the Irish music industry such an amount total bullshit? Absolutely. Unfortunately for Willie Kavanagh in a previous job it was pretty much my duty to figure out what made customers spend less money or more money, what market changes drove certain habits and how you engage customers to the point of increasing their consumption. Being currently unemployed it seems that EMI don’t have anyone currently doing this for them…so on the off chance the Willie see’s this…hit me up, for the right price i can help you out.
Now then, lets get down to the nitty gritty and look at all the things that have affected EMI’s and the Irish Music Industries bottom line that they won’t actually admit to…because that would mean taking some responsibility for allowing what you do to change dramatically before your eyes and doing nothing about it.
1) The Rise of the Digital Format and a delayed reaction from the music industry – back in the day you bought music in a physical format. This went on for about 60 years or so…before that you either saw music live or listened to it on the radio. These days you simply buy a bundle of information which can be interpreted by a program and reproduced as sound. What’s more, there are countless online services that will stream the music for you, you don’t even need to buy it. You can go on Youtube or Grooveshark or Pandora and just listen. Due to the combo of hi-tech mobile phones with internet access, decent wifi coverage and reasonable pricing from telecoms providers you could effectively stream music on the move. No need for the files to fill up space on your phone that could be occupied by hilarious pictures of cats. None of this happened quickly either…it slowly morphed over a 10 to 15 year period largely in sync with the expansion of the internet and the growing prevalence of information technology.
I’m not sure why…and can only postulate a mildly derogatory theory that it’s because the guys who run the music industry are old, set in there ways and too full of coke and money to change now…it never occurred to these guys to actually sell the music in digital format themselves. It’s not like in the early 90′s you went into a Sony Music shop, or a Geffen Store…you went to HMV or Virgin or whatever and paid the money and got your C.D. They had been farming out sales for a while, so why change the tactic now?
So they sat back, allowed the concept of the online music store to grow and grow but never once thought to actually cash in. It’s clear they didn’t want to control things like marketing, exposure, price points, splits of profits or anything else…because now they don’t when music is sold in it’s digital format. Who does? Well…I-Tunes mostly. As the industry leader the rest just kind of follow their example. And I-Tunes was only really set up as a way to get people to buy I-pods. Napster (remember that?) went down in June 2000 due to legal moves by the likes of Dr Dre, Metallica and Madonna. I-Tunes went live in January 2001. That’s what happens when someone quickly spots that something that is happening illegally could make some money legally. Oddly enough no one in the music industry itself seems to have been the one to make this connection. It was a company that makes hardware.
So what can we surmise from all this? Due to losing control over the way that their music was sold (seriously, go to any major label site and you can’t actually buy the music…the ship you off to some 3rd party online retailer) they also lost a chunk of change as they went from being a provider of something that shops with retail units needed to live, to relying on other people to move their product so they could live.
- Times have changed…just a little.
2) If you live in Ireland, you don’t have to buy music in Ireland anymore – Another nugget that Willie K seems insistent on ignoring is the fact that a massive amount of retail sales have shifted from the high street to the information super highway. I can walk into HMV and buy an album, or i can buy the same album from Amazon for less money. One of these will count as a money made in the Irish Music Sector (that 146 million) and the other won’t. The labels will get a cut, but a large portion is removed as the sale is recorded in the books of a different country’s economy.
There have been a multitude (dare i say deluge?) of stories in the media about assorted shops closing, massive retail chains with clout on the verge of bankruptcy and an endless train of people going up North to buy their goods. Pretty much every business in Ireland is willing to point out that the new international market of the internet and the closer physical market of Northern Ireland is having an impact on it’s bottom line. Once again, not the music industry. I can assume that by not mentioning it they don’t feel it is a factor, if it’s not a factor then it means they don’t think it is affecting them. Well, it is…because it is affecting everyone.
3) They Can’t Provide a Service or Product People Want – Now this is the real kicker and it’s a tough one to face up to, so i am not surprised they are skirting the issue with a nonchalant whistle. The constant claim is that CD sales are dropping (but they never mention that a huge percentage of this drop is being replaced by digital sales via legal avenues – 25% last year to be precise) so you would expect the sales of something like vinyl ( a more expensive format that costs a lot more to appreciate ) would be pretty abysmal. Well, actually, since about 2009 vinyl sales have been in rude health, so what gives? How come people are not just pirating the material and inflicting the same damage they are inflicting on CD sales?
Because, lets face it, vinyl is a unique product. Last year the Radiohead album “King of Limbs” pretty much accounted for half of all vinyl sales of albums in the UK on it’s own. From this we can draw that if you give people a product they want and that means something to them…they will buy it.
If you don’t you are left in their current situation, where the money they make from a digital sale is far less than the money they used to make from a CD sale.
4) They Have Devalued Their Own Product – Over the course of 60 years pop music changed. People who write about and love pop music will tell you it hasn’t but you could argue they lack a certain sense of distance from a product they use to give themselves credibility. Some things about Pop music are the same (the endless change in trends and styles, the cosmetic driven image game and the nonstop pilfering of underground sounds and styles to keep itself “fresh”) and some are very different…the main difference between the sheer volume of identikit crap that major labels will release. They chase a Number 1 spot, and when that number one spot is achieved they will then groom other artists to have a similar sound and also get to number one. Are we really allowing ourselves to be surprised that the 16 year old girls who love JLS might not actually care enough to buy the CD when One Direction also have an album coming out next week?
In the never ending run towards turning the unique into a commodity and the talentless into a hit they have basically rendered each iteration of the winning formula to be exactly the same as the last one…and it is not inspiring people to buy music. On the other hand Adele, the biggest selling artist of last year (yes, she sold more units that a certain blonde lady from America who insists on aping all the came before her in the name of “originality”) was signed to an Indie label, XL Recordings. Who also signed Tyler The Creator. And little known acts like The Prodigy back in the day. In short…XL have been showing them for a while that formula is great but a unique artists with their own qualities and strength who appears to be born of the times does just as well. Which brings us too….
5) People Are Happy to Give Away Music (Or Sell It Themselves for Cheap) – Right now there is practically no reason to buy music. If you want music you can find it for free. The proliferation of home recording equipment and programs like Ableton and other DAW’s mean there is an army of people out there making music (Soundcloud now has 10 million users) and lots of them are willing to give tracks away for free and some of them are willing to give all their music away for free. Odd Future built a massive fanbase by giving away apparently endless collections of tracks on their tumblr page, The Weeknd caught massive hype and mainstream attention by giving away free albums and countless others seem to be adopting the model of either giving away tunes and just trying to make some money on the gig front or by selling their own music via services such as Bandcamp.
Now, while this aspect is not a massive factor it is still an important one…the proliferation of information, social media and other such things mean that people are no longer being exposed to music almost solely through the mainstream media. A friend can find a track, but it on Facebook, Tumblr and Twitter and before you know it that track has 2 million plays on Youtube. So why would people do this? Why not send demo’s to majors and see if you get signed? Well, a large part of that is the well known fact that actual sales of music don’t do much for an artists bottom line, there is a strong suspicion that by allowing others to invest in your art you lose a degree of control and that by generating hype for yourself you give yourself a firmer footing from which to deal with a label anyway. Some pretty sound thinking really.
6) They Never Learn From Their Mistakes – As previously pointed out, the Napster Saga made illegal downloading of music an issue…eleven freaking years ago. So they have been trying to find a solution to this problem for over a decade while a whole new problem appeared without them spotting it. Streaming. Streaming is a different beast because the claim is that artists make money each time a song is played. Well…an artists makes roughly three tenths on a cent each time someone streams one of their songs ( according to this article on Rolling Stone). The majority of the money generate from Youtube is due to ads…and labels and Youtube have recently joined forces to throw as many ads at you as they can before you get to see the video you want to see. It’s a basic interruption to the reason people use Youtube (instant access) and another misguided attempt to generate more cash from their artists work…but as you can see from the artist payment not to actually generate cash for the artist themselves. Meanwhile places like Grooveshark don’t seem to be respecting copyright all that much but given the industries track record it should be another 7 to 8 years before they try and actually do something about it.
Now, obviously i am not privy to the data that EMI Ireland has, but all the above are very valid changes to the market and are going to have had an impact on companies bottom lines (Note that i didn’t even point out the RECESSION that has been affecting all businesses for the last number of years…but Willie seems to think that EMI Ireland’s bottom line would have been recession proof). As such, i think we have effectively established that the implication that piracy is the sole reason for the decline of a) sales and b) profits for the music industry to be completely false and more than a little misleading. I know a lot of it will have been quite obvious…but the simple fact is that very few people out there seem to be pointing this stuff out with regard to Sean Sherlock’s plans.
Don’t get me wrong, if someone rang me and told me that a multi-million euro industry had lost half it’s worth due to illegal activities that could be curtailed i would instantly seek to do something too. But the simple fact is that this hasn’t happened, so if this is the type of honey that Kavanagh and his ilk have been pouring in Sherlock’s ear then i wonder if an emotional reaction to the trumped up charges and dangers of piracy have led to the legislation he is trying to bring in…if this is the case then Sherlock needs to start looking at the actual facts of the matter and major labels such as EMI need to start being more honest about how they are losing their footing in a changing consumer market.
That’s it for now…but in Part 2 I’ll be looking at the wording of his legislation and the possible impact that it could have for people like me who keep little blogs to pass the time and on the Irish economy as a whole.
