You say you want a Revolution

Last month Steve Jobs called for music companies to open up their music catalogs and allow DRM-less sales. I was at first heartened by his thoughts, but after reading the music companies’ responses (google it if you like, I’m not linking directly) it occurred to me that there was something more going on than just the protection of copyrights. I was finally realizing why the RIAA has been so relentless in its hunt for alleged pirates, going so far as to file suit against 12-year-old kids. The record companies are trying to squeeze every last cent out of the music that they own, because they know their days are numbered. The digital revolution that’s occurring in music will eventually destroy the recording industry, as it now exists.

While searching for new music to fill a new mp3 player, I branched out from my usual favorites and started looking for new artists. As I searched for recommendations, I found that each new artist had just a few really good songs, generally two or three per album. Not seeing any sense in paying full price for an album with only a few songs I liked, I simply paid for the tracks that I liked and ignored the rest. The only time I found myself buying an album in it’s entirety was when the artist had released several albums with two to three tracks per album that I liked, then they subsequently released a “Best of Album”. I would frequently pay the price of the “Best of” album because it was cheaper than buying all of the individual tracks off of the prior albums.

Record companies make albums much the same way Oscar Meyer makes hot dogs, taking a couple of quality cuts, and mixing them with a bunch of filler. That is, they produce albums, which contain one or two really good songs and 7 to 10 filler tracks. They then rake in the dough having sold an hour-long record with only 10 minutes of listenable music. With downloadable music, though, consumers can get around the filler, and go straight for the quality cuts. The record companies have paid for all this filler though, so they take measures to compel shoppers into paying for lower quality songs. Some of the albums available from downloadable music retailers can only be sold as an entire album. These “Album Only” tracks usually have just one song anyone would want to buy, so the record companies license it as all or nothing. They recognize they won’t make any money off of the sales of the one song, so they protect their profits by not allowing consumers to buy just the hot track. It’s marketing like this that makes it clear that the music industry knows its days are numbered. As downloadable music becomes the norm in the marketplace, the hot dog days of the recording industry will disappear.

With rare exceptions, most people aren’t going to pay full-price for an entire album when they only want one song. As people reject the all or nothing approach to the selling of certain albums, the record companies will no longer be able to profit from inferior recordings. They will have to either adapt or perish.

DRM is a last ditch an effort by the recording industry to prevent the inevitable changes in the marketplace. DRM only effects consumers who download music from online music stores. As such, it is specifically targeting those people who purchase music by the song and not by the album. If you buy a CD from a brick and mortar store, the content is completely unprotected, and the recording industry doesn’t care. They got you to pay for the filler, and that’s really all they were after. By making it inconvenient to transfer downloaded music among various media players, DRM is in essence manipulating the marketplace. To legally transfer your music to more devices than the DRM allows, you either have to pay for additional downloads of the song, or go out and pay for an actual CD. Ultimately, I expect these efforts to fail, and the changes in the music industry will proceed on their present course, only slightly hindered by the DRM movement.

If the record companies choose to adapt, they will need to recognize that people have already begun to change the way they think about buying music. Instead of thinking about music in terms of records or albums, we are making music purchasing decisions based largely on the merits of individual songs. Because people are no longer stuck paying for filler songs, the rest of the money that would have gone to pay for a complete album can now be used to by quality music from other artists. The growing popularity of independent artists is a testament to the paradigm shift that’s occurring.

I am going to make a bold prediction here: I expect the record companies will find it unprofitable to fund an artist recording an entire album, only to be able to sell a few of the tracks. As a result, I think we will gradually see the decline of the full-length album. What I think we will see in its place is record companies signing more artists to smaller contracts based on the recording of single songs rather than complete albums. If this happens, everyone wins, because it creates more variety, and allows the best songs to rise to the top.

Then again, I could be wrong.