Not VCL, A Step In Right Direction?
Would you pay 5 cents for a song?
Users of file-sharing services made roughly 25 billion unauthorized downloads last year, dwarfing the legitimate music industry, and it’s only getting worse.
First it was Voluntary Collective Licensing and now it’s another plan predicting hundreds of millions of dollars to publishing rights holders. Right now labels aren’t making anything off downloads, and they’re stinking rich. One thing is for sure, there’s no need for a statistical theory to back the fact that if the amount of downloads exceed the amount of sales any pricing figure would increase revenue. Something has to change and suing downloader’s isn’t the solution.
An intriguing idea. Seems to me like it would be a double-edged sword for artists. On the one hand, they would be compensated for downloads that they currently aren’t compensated for. On the other hand, contrary to what Pearlman believes, I think this would destroy the market for CDs. Personally, I love the idea of owning the artwork that an artist designed specifically for the music he or she has recorded. I think it’s a huge part of the fun of being a music fan. Others don’t feel that way. So while I and others like me would create some demand for CDs, I think that ultimately it would prove unprofitable for record companies to produce them.
Or should I say “the record company”? Wouldn’t it be weird if the only record company in the universe was Apple Computers? I know that the majors aren’t exactly artistically-minded when you consider that they are just small arms of faceless and multi-faceted global corporations as it is, but, man, the concept just seems dirty to me.
Oh, I just thought of this – if Pearlman proposes that all of the record companies be consolidated into one, the same entity one that is responsible for operating whole internet based system, why the hell would they also produce CDs?? They be competing with their own product. CDs would definitely vanish if this were the case.
Another thing is that the art of making an “album” would slip further into obsolesence. That would suck.
Finally, the most an artist could make from the average-length album would be 50-75 cents. The might not compare unfavorably to a lousy record deal, but if you currently have a good deal, either with a major or indie label, you might lose money. Of course, you wouldn’t be losing money to illegal downloading anymore, but it would still be a hard pill to swallow. You’d have to look at it on a case-by-case basis to see who was benefitting and who wasn’t.
Overall, I think this would be a little better than VCL, but it’s far from ideal.
The average record deal gives artists (based on a $16.98 CD) anywhere from $0.50-2 per CD sold. Shipping, design & packaging take about $2-4 per CD sold. By these figures we can only assume the artists will make about the same money as before, or more if – as you’re guessing and I agree with – as a result of this plan, the CD market was eliminated. Of course, that’s also assuming the shipping and design costs will be allocated to the artist and not dropped into label profits ($5-5.50 for that same CD), which is highly unlikely.
PDF of pricing breakdown
Like I just stated, I completely agree that a CD market couldn’t exist with something like this. Well, at least not how it exists currently. It would probably follow the path of vinyl, sort of a novelty item.
I also detest the idea of one company being the record industry. A monopoly isn’t good for any business.
Of course I disagree with your theories on VCL (emphasis on YOUR theories). Without testing it there’s no definite way to tell how it would turn out. Personally I think it would be better than this system simply because this system doesn’t allow the “free play” or experimentation that is encouraged in VCL. With labels investing less in new artist development there needs to be a way to promote or allow people to discover new artists, VCL does that by default.
So it looks like if you released a relatively long record AND had a lousy record deal, you would make out. But if you wrote an record with 10-12 songs and someone downloaded the whole thing, you’d most likely make far less than you would by selling a cd, especially if you had a good contract. Of course, by eliminating illegal downloading, an artist would not lose out in that sense.
But if you were savvy enough to negotiate a deal that would pay you $2 per album or something close to it, you’d really suffer. You’d have to sell 40 songs on this system to make the same amount.
A question: How would this system prevent illegal downloading from other sources? In other words, as an artist I could lose income because of the cheap price of songs in this system AND still suffer from illegal downloading.
I guess between this and VCL, this one would be better economically and VCL would be better at distributing music, I wouldn’t say that I like either proposal, unfortunately.